Your question asks why should you buy a house (and have all the costs and worries that go with it) rather than sponge off the taxpayer. You then go on to criticise mortgage lenders for refusing to lower their interest rates.
Firstly, I imagine you chose to buy a house because no realistic alternative that suited your requirements existed. The fact that others are virtually given a house (and indeed almost everything else) probably did not influence that decision, so the two matters are not really linked.
Now, on to the current credit situation. Banks and building societies are in business to make money for their shareholders and savers. They do this by borrowing money from some people (the savers) and lending it to others (the borrowers). If they do not have any money to lend they cannot do this part of their business.
At the moment, because of a problem which began with the �sub-prime� mortgage situation in the US, a source of a large amount of their funds (borrowing from other institutions) has dried up. Banks now need to look elsewhere to raise funds and they are trying to attract funds from retail investors. The way to do this is to offer attractive interest rates on the High Street and this, of course, leads to higher interest rates for borrowers.
The �50bn that the government has pledged to help ease the situation is far too little and will not address the root cause of the problem. This is, that for the past ten years at least, the country has been enjoying apparent growth on the back of a badly controlled cheap credit philosophy. Cheap money has inflated house prices to ludicrous levels and a correction is due.
Unfortunately it is borrowers who will have to pay for this.