I think you are dead on about the math.  Both the fact that many of these loans just cannot be reasonably structured, and the fact that most people don't even know elementary math. 

I do think disclosures could be improved, and they should reign in these mortgage brokers in some of the behavior.

Let's just hope these politicians don't get too excited, and start campaigning on this stuff!  The thing that really worries me, we have a presidential election around the corner.  Pandering on this issue would be really easy.