Time and again we hear Brad Miller touting "cheap homes" or "affordable homes". These are euphemisms for indebtedness. Only the loans, due to government incentives were cheap, not the homes. Many of those "home owners" are now home less.
During the economic buildup of the early 2000s that lead to our current housing crises Brad Miller stood athwart attempts to reign in the speculation and excesses that had become stables at Fannie and Freddie Mac. In an attempt to stymie the introduction of economic soundness in the Government Sponsored Enterprises (GSEs) Fannie and Freddie Mac, Brad Miller went on record saying:
We have been concerned that the Administration’s legislative proposal regarding the GSEs would weaken affordable housing performance by the GSEs, by emphasizing only safety and soundness. While the GSEs’ affordable housing mission is not in any way incompatible with their safety and soundness, an exclusive focus on safety and soundness is likely to come, in practice, at the expense of affordable housing.(Copy of complete letter here)
(Giant H/T to RedState)
(emphasis added)
This summer Brad Miller was still pushing loans on the poor. In Zebulon:
Miller said affordable housing is an important goal in troubling times for the industry.To that end Brad Miller introduced legislation to create more construction in an economy suffering from a glut due to a decade of government induced overbuilding. Miller does not learn from his mistakes.
H.R. 5409, the Residential Construction Lending Act, would create a new residential construction loan guarantee program within the Department of Treasury to provide loans to builders with viable construction projects.And in his bill.
It is outrageous that after the misery created by policies that induced unsound indebtedness among the most vulnerable of Americans, Brad Miller is continues pushing his debt slavery.
The video below lists the sound practices Brad Miller was fighting against.
Brad Miller is a Grade School Economist and you suffer.
out
Getting the govt, (tax payers), to guarantee builders' development loans is a recipe for more economic damage. Not only did these builders overbuild, but new houses are becoming more and more shoddy, needing expensive repairs far sooner than buyers realize. Forget about holding bad builders accountable in any practical way; warranties are usually worthless, and ubiquitous arbitration clauses in builders' and warranty co's contracts take away your right to use the courts anyway.
ReplyDeleteSo, building more shoddy houses, and putting tax payers on the hook when developers default, is asking for more trouble. Developers are already defaulting on projects and doing major harm to banks. But banks are not innocent victims; they approved the loans and in their line of work should've known the risks. Now, they get tax payers to back the loans, so don't have to do their due diligence to make sure these loans get paid back.
This is not good for America, and it's mighty hypocritical of builders to whine for less big govt out one side of their mouths, then demand corporate welfare out the other. They've already gotten billions by way of special tax breaks, house buyer tax credits, etc, courtesy of tax payers.
It is time to stop subsidizing a fraudulent, cyclicaly industry and time to stop basing our economy on it, too.
Agreed -- And I'm a builder!
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