So, this is what annoys me about the "HOUSING IS A HUMAN RIGHT" crowd: they are RESPONSIBLE, in large part, for the current housing crisis. I will elaborate below. #politics #econ
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First off, real wages have been mostly flat since the 1970s and housing prices have increased exponentially. So what explains this?
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Normally some correlation is preserved between wages and house prices because people must be able to afford those houses. Not so with aggressive home ownership programs! They destroyed the link between wages and house prices.
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You don't have the money to buy the house? We'll lend it to you. But wait, there's more: the bank doesn't have the money to loan you? No problem! We'll let the bank create the money out of thin air! (This is fractional reserve lending.)
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Technically, the bank has to have SOME of that money. But the fractional reserve ratios at banks run from 1:20 to something around 1:40 for a BoA-sized bank.
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Now so far I've dunked on the banks and exposed consequences of well meaning but foolish government programs. Here's where I get philosophical, and some of you get mad: Every attainment in life has qualifications.
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The qualifications to climb Mt. Everest are stamina, mental toughness, and mountaineering skill. Try to climb without these and you might have to turn back or wind up dead.
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It doesn't matter if someone else bankrolls your trip; you still need those qualifications. Even if you think you are tough enough, and qualified, you might not be. An experienced mountain climber met with tragedy recently. That is the nature of challenge.
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The fundamental error of the "housing is a human right" crowd is the denial that the qualifications for the attainment of home ownership mean anything. The discipline to be financially stable, the wisdom to know when to call experts, and so on are swept under the rug.
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Instead, it's just money. And money's just a number, and we can just create more of it and arbitrarily assign it to these people, and then they will own houses and they can be the same as people who attainded it on their own, right? Wrong.
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My reaction when people say that all we need to do to fix American transit is "increase funding"
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