The United States is a nation full of spoiled brats. If we can’t have what we want, we borrow it. And if we can’t borrow it, we force politicians to give it to us. This is true for everything from boats, to RVs, to expensive housing.
It has become popular — among the most vociferous of the spoiled brats — to blame Wall Street for the housing woes that have driven our nation, and the world, into the depths of economic malaise. But Wall Street is nothing more than a tool the government used to mollify voters: we will guarantee loans, and we need you to foist these loans on the American people — whether they’re qualified or not.
Thus began the longest protracted era of easy money in American history. If you were breathing, you could borrow money to buy a house, and Uncle Sam stood ready to guarantee the loan. Suddenly every single spoiled brat with enough energy to extend a hand could own a home. And what, exactly, does Wall Street have to do with that? We’re going to vilify mortgage lenders because they did what the government gave them permission to do?
Not long ago, a piece came out in the York Times, describing the federal government’s plan to reduce the amount of money it would guarantee on homes in wealthy areas. And the spoiled brats are furious. Here’s my favorite sentence in the article:
“…buyers and sellers are wondering why they should be punished simply for living in an expensive region.”
I had to read the passage several times, just to make sure I wasn’t missing a pronoun or a conjunction that would have dramatically altered its implication. But I hadn’t. Apparently, if you want an expensive home, and the government won’t guarantee the loan, you’re being punished.
Thomas Jefferson would be so proud of the nation we’ve become.