Obsessive Housing Disorder

[AU_domer]

Fantastic historical look at government attempts to manipulate the housing market.

---------------------------------------------------------------
Steven Malanga

Obsessive Housing Disorder

Nearly a century of Washington’s efforts to promote homeownership has produced one calamity after another. Time to stop.


In December, the New York Times published a 5,100-word article charging that the Bush administration’s housing policies had “stoked” the foreclosure crisis—and thus the financial meltdown. By pushing for lax lending standards, encouraging government enterprises to make mortgages more available, and leaning on private lenders to come up with innovative ways to lend to ever more Americans—using “the mighty muscle of the federal government,” as the president himself put it—Bush had lured millions of people into bad mortgages that they ultimately couldn’t afford, the Times said.

Yet almost everything that the Times accused the Bush administration of doing has been pursued many times by earlier administrations, both Democratic and Republican—and often with calamitous results. The Times’s analysis exemplified our collective amnesia about Washington’s repeated attempts to expand homeownership and the disasters they’ve caused. The ideal of homeownership has become so sacrosanct, it seems, that we never learn from these disasters. Instead, we clean them up and then—as if under some strange compulsion—set in motion the mechanisms of the next housing catastrophe.

And that’s exactly what we’re doing once again. As Washington grapples with the current mortgage crisis, advocates from both parties are already warning the feds not to relax their commitment to expanding homeownership—even if that means reviving the very kinds of programs and institutions that got us into trouble. Not even the worst financial crisis since the Great Depression can cure us of our obsessive housing disorder.

(continued at the link)

http://www.city-journal.org/2009/19_2_homeownership.html

[Just Win]

Fantastic historical look at government attempts to manipulate the housing market.

---------------------------------------------------------------
Steven Malanga

Obsessive Housing Disorder

Nearly a century of Washington’s efforts to promote homeownership has produced one calamity after another. Time to stop.


In December, the New York Times published a 5,100-word article charging that the Bush administration’s housing policies had “stoked” the foreclosure crisis—and thus the financial meltdown. By pushing for lax lending standards, encouraging government enterprises to make mortgages more available, and leaning on private lenders to come up with innovative ways to lend to ever more Americans—using “the mighty muscle of the federal government,” as the president himself put it—Bush had lured millions of people into bad mortgages that they ultimately couldn’t afford, the Times said.

Yet almost everything that the Times accused the Bush administration of doing has been pursued many times by earlier administrations, both Democratic and Republican—and often with calamitous results. The Times’s analysis exemplified our collective amnesia about Washington’s repeated attempts to expand homeownership and the disasters they’ve caused. The ideal of homeownership has become so sacrosanct, it seems, that we never learn from these disasters. Instead, we clean them up and then—as if under some strange compulsion—set in motion the mechanisms of the next housing catastrophe.

And that’s exactly what we’re doing once again. As Washington grapples with the current mortgage crisis, advocates from both parties are already warning the feds not to relax their commitment to expanding homeownership—even if that means reviving the very kinds of programs and institutions that got us into trouble. Not :

It is indeed a troubling report"

2004 House Committee Hearing

[NCVol]

I had no idea housing had been such a government focus for so long.  What's disappointing about the article - and I'm not sure how to do it in less than book form - is that it doesn't really address how someone in the private sector used every one of those programs to get wealthy. 

I know that CRA and Freddie and Fannie pushed loans onto the low income sector, but it's also very true that the lenders at the end of the day made money hand over fist and got just about exactly the regulatory environment they wanted.  So if Fannie and Freddie pushed into low income areas of cities, minority districts, etc. it was because shareholders and officers were getting fabulously wealthy doing it because there sure as hell was no pushback form those folks high paid and extensive lobbying programs.  Same with the rest of the banks.  The people lining Barney Franks pockets aren't poor blacks and hispanics in LA or ACORN - it's the MBA and other groups who are using "affordable housing" and similar BS to advance a familiar PROFIT agenda. 

[Just Win]

I had no idea housing had been such a government focus for so long.  What's disappointing about the article - and I'm not sure how to do it in less than book form - is that it doesn't really address how someone in the private sector used every one of those programs to get wealthy. 

I know that CRA and Freddie and Fannie pushed loans onto the low income sector, but it's also very true that the lenders at the end of the day made money hand over fist and got just about exactly the regulatory environment they wanted.  So if Fannie and Freddie pushed into low income areas of cities, minority districts, etc. it was because shareholders and officers were getting fabulously wealthy doing it because there sure as hell was no pushback form those folks high paid and extensive lobbying programs.  Same with the rest of the banks.  The people lining Barney Franks pockets aren't poor blacks and hispanics in LA or ACORN - it's the MBA and other groups who are using "affordable housing" and similar BS to advance a familiar PROFIT agenda. 

what is a ninja loan?