I don't think people should "walk away", they should, stay and fight. visit shortsalesarebad.com for more information. Or see my hubs. If you are significantly upside down and can't afford your payments, it is financial suicide to walk away or to continue to pay.
Imagine if you make 100,000 per year and got a 500,000 house with no money down (lots of people did). This was way too much house at the time for that income, but everyone said don't worry, the house will go up and your income will go up.
Unfortunately, neither of those things happened, and now the house is only worth $250K to 300K depending on where you live. Even if you could take 25% of your pre-tax income and pay it towards this shortfall, it would take 8 years to recover.
If your interest rate is 5% and taxes and insurance add another 2.5%, that $500,000 mortgage is 37,500 per year (not to mention maintenance and utilities). This person is probably drowning in other debt as well.
If a business found itself in this situation it would restructure everything in order to survive. Homeowners are expected to "hang in there, it will get better".