From the depts. of “they still don’t get it” and “I’ve never read a Thomas Sowell column” comes this gem of a column.
After reading this recent column from syndicated Washington Post columnist Michelle Singletary, you wonder if she’s actually read a newspaper in the last four years. No small feat considering she’s a newspaper columnist.
Ms. Singletary argues that we should be using law and tax codes to encourage rather than discourage home ownership. I say no, that’s the nonsense that in large part got us into the mess to begin with. The public policies we enact should be agnostic with respect to home ownership. Neither encourage nor discourage.
I think the root of the problem is to confuse correlation with causation. People looked at homeowners and said, “hey those people are statistically much more successful and better-off than their non-home owning counterparts. If we can get everyone into their own house, then everyone will be successful!” But the original homeowners weren’t successful because they owned homes, they owned homes because they were successful. That’s VERY different.
It would be like noting that nearly everyone with a Porsche was very well-off, the deciding that buying everyone a Porsche with taxpayer money would make us successful.
And definitely do read yesterday’s post from Dr. Rizzo on topic. He nails it.
There’s a bigger house of cards that hurt minorities’ wealth – The Washington Post: Yet closing the housing and wealth gap is still going to require some good, well-executed policies out of Washington. Bush noted that the top barrier to increasing homeownership was coming up with a down payment. Under the Obama administration, there’s a proposal to require a 20 percent down payment for families to qualify for the best mortgage rates. If they don’t meet this threshold, their loans would be considered more risky. Such a requirement would disproportionately affect minorities. It wasn’t the lack of down payments that crippled the housing market. The fact is, lenders can and have made loans for years that perform well without people plunking down hefty sums upfront. The Pew report is further evidence that we need to continue encouraging families to diversify their financial holdings. But at the same time, as a public policy, we should not abandon efforts to increase minority homeownership for financially stable families.