INSTAPUNDIT: If You Can’t Afford a House, Don’t Buy One
IF YOU CAN’T AFFORD A HOUSE, DON’T BUY ONE:
“When legislators and activists say that we need low-down-payment loans because most people couldn’t possibly save up for a 20 percent down payment, what they’re really saying is that people can’t actually afford to buy a house. Helping them to go buy one anyway is not a great idea; it will work out well for some, to be sure, but it will have tragic consequences for others, and for the housing market as a whole if there’s another downturn. We just spent six years learning, the very hard way, that you can’t borrow yourself rich. That knowledge is too expensive to throw away so easily.” – Megan McArdle
Our government hasn’t learned that yet.
Sorry Glenn, this fits into a very old pattern: “A Feature, NOT a Bug.” McArdle, too, misses the obvious.
The point is threefold:
Begin by disrupting the banking system so that it has to come to the rulemakers for favors and solutions;
Then “borrowers” will vote for even more toxin hoping to get something for free;
And in consequence, banks and real estate players will fund election campaigns in hopes that the gravey train keeps rolling.
It’s a lucrative power grab for those making the rules. Think “friends of Anthony.” Think “Jon Corzine.”
. . .
In the first place, Government, like any collective, is incapable of learning, and in the second, Government isn’t the ignorant party.