The Obama Housing Plan

So, you took out a loan you could not quite afford to buy a house, because you believed you would be able to refinance in a year or two when the house was worth 20-40% more than you paid for it.

And had you been right, you would have pocketed hundreds of thousands of dollars, tax free.  Not a penny of that profit would have been taken from you and given to me.  And that is fine.

Except your speculative bet — and let’s be honest, that’s what it was — did not pay off.  So why is my money being given to you?  Why are all the people who did not overextend themselves, who bought houses within their means, being penalized to enrich speculators?

Obama Housing Plan

This plan continues the severe misallocation of capital that triggered this depression, and so I believe it will not work and will ultimately make matters worse.  But even if I am wrong, even if it would somehow help the economy, it is still just wrong to protect people from the predictable consequences of their own actions at others’ expense.

Granted, it is “only” $75 billion, which is 10 or 20 times less than the gift we are about to give to our largest financial institutions.  And even my capacity for rage is finite.  So I do not plan to spill too many more electrons on this topic.

1 comment to The Obama Housing Plan

  • fratris filia nullius

    So have we gotten to the point yet when we just shrug our shoulders and ask:

    Who is John Galt?

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