It’s true that there are different ways to try to address this debt overhang and restore demand, some of which don’t depend on housing-specific policies. For example, liberal blogger Matt Yglesias recently wrote that he’s not enthusiastic about “targeted debt relief” because it raises “fairness, moral hazard, and time-consistency problems”—that is, all the things that make the politics of housing hideous—“that can be avoided with broader based stimulative ideas.” Instead, Yglesias is a persistent proponent of suddenly fashionable NGDP targeting, an approach to monetary policy that aims for real growth but will tolerate higher inflation, which serves as untargeted debt relief.
While that sort of approach isn’t targeted to distressed homeowners or mortgage debt, it’s responsive to the ways in which the housing crisis is weighing down the U.S. economy. That’s not something that can be said, at this point, of the plans (or non-plans) offered by the GOP contenders. Good catch by the AP, and let’s see more of this over the course of the campaign.