Hardest hit

$17 million is a lot of money. But it's a drop in the bucket if you're trying to pay down a debt of $13 billion.

This is the folly of Nevada's "hardest-hit fund," the federal program administered by the Nevada Affordable Housing Assistance Corp. The $1.5 billion program was launched in 2010 as a sop to the five states that had suffered the steepest housing market collapses. It enabled politicians such as Nevada Sen. Harry Reid, who was seeking re-election at the time, to proclaim they had done something to help folks who were hurting. Nevada's share of the loot ended up totaling $194 million.

The problem: Today Nevada's homeowners are $13 billion underwater. That is, their homes are worth $13 billion less than what they owe. And through the third quarter of this year, the hardest-hit fund had paid out just $17 million.

"Here's $200 million, and they can't even give away $20 million by June," Victor Joecks, communications director for the Nevada Policy Research Institute, told the Review-Journal.

The program needed months to establish a complicated application process that required extensive reviews by caseworkers. For a time, only the unemployed qualified for means-tested help, but they had to commit to remain in the state even though they couldn't find work. It would have been far more efficient for caseworkers to simply knock on doors and hand out checks. But even that course would do nothing to help the broader market.

Yes, the hardest-hit fund has made a difference in the lives of a handful of Nevadans - at the expense of everyone else. How is that fair? It's simply not possible to bail out every distressed homeowner in this state, one at a time. Nevada needs a real economic recovery and jobs - pro-growth economic and tax policies at the state and federal levels sure would help - to heal our housing woes, not more debt-funded government interventions. The hardest-hit fund is hardly a hit.