Quotes from President Bush’s speech today:

“A federal bailout of lenders would only encourage a recurrence of the problem. It’s not the government’s job to bail out speculators, or those who made the decision to buy a home they knew they could never afford.”

“In the coming days, the FHA will launch a new program called FHA-Secure. This program will allow American homeowners who have got good credit history but cannot afford their current payments to refinance into FHA-insured mortgages. This means that many families who are struggling now will be able to refinance their loans, meet their monthly payments and keep their homes.”

Just how do those deserving homeowners differ from “speculators” who bought a home “they knew they never could afford?” And why is this not “a federal bailout of lenders?” The president did not say.

What it will mean is that the federal government will decide which overleveraged homeowners deserve to keep their homes, and which lenders will have bad mortgages repaid in full.

The issues are not easy ones, and I do not have my own solution. But don’t be surprised if, in a year or two, we learn that lobbyists swarmed all over “FHA-Secure” and that a good part of the money went to those with good political connections.