Fannie and Freddie spent the first 10 years of this century doing what Rep. Waters says she wants the government to do: promoting affordable housing. Meanwhile, prices were soaring almost everywhere. The government’s actions triggered a bubble -- the exact opposite effect than its words called for.
Today, with the government finally talking about getting out of the mortgage market, “home prices in some sections of the country are now comparable to prices of luxury cars,” reported housing Web site zillow.com recently.
We won’t know what homes are really worth until there’s a market that’s reasonably free from government interference. What we do know is that federal attempts to promote “affordable” housing had the exact opposite effect.
Or consider President Obama’s proposed federal budget. “Obama Budget Makes Deep Cuts, Cautious Trades,” reported the front page of the Washington Post. Obama himself promises “some significant spending cuts so that by the middle of this decade our annual spending will match our annual revenues. We will not be adding more to the national debt.”
Well, the president aims to spend some $3.7 trillion, of which $1.1 trillion would be borrowed money. As politifact.com puts it, “with deficits every year for the next 10 -- and no surpluses -- the nation’s accumulated debt will rise every year for the next decade.”
Proposed “cuts” never seem to develop. When times are good and tax money is rolling in, politicians are eager to boost spending. When times are bad, politicians insist they need to boost spending to “save” the economy. That only leads to failed “stimulus” packages and unsustainable budgets.
President Bush’s final budget proposal promised a balanced budget by 2012. Missed by a mere trillion dollars. Expect Obama’s rosy scenarios to fall short, too. It’s time for our language to reflect reality, not promote fantasies. That way people can know what they’re voting for.