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23 October 2011

Martin Feldstein Wrong About Housing

Harvard Economics Professor Martin Feldstein recently wrote an op-ed in the NY Times in which he asserts that the 15 million households whose mortgages are underwater are single-handedly keeping the economy from recovering.  Those 15 million (out of 112 million) certainly hold a lot of power if that's the case and would explain why Mr. Feldstein is arguing that we kowtow to this minority of people. 

Like most statists, Mr. Feldstein insists that the government should step in and absorb a big chunk of the loss that these households have suffered.  Now, I feel for anyone who, fooled into buying a house because the government made the lending rules far too easy, is now underwater in their house.  However, that doesn't give them the right to force me to fix their problem.  I have problems of my own.  I'm a renter who is trying to save up to buy a house.  Why should I have to bail these people out?

Of course Mr. Feldstein doesn't frankly care about renters because they aren't the preferred class of people in his mind.  Homeowners are.  So we need to do whatever we can to take care of homeowners.  Maybe we should pass a law that requires renters to massage the feet of those 15 million households too.

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