Can We Afford Another Housing Boom?
As I read this editorial Can We Afford Another Housing Boom? in yesterday’s Wall Street Journal, the refrain of “Oh when will they ever learn, oh when will they ever learn?” from “Where have all the flowers gone?” by Pete Seeger (although I was hearing the Peter, Paul and Mary version), came into my head.
Some people may be surprised that the WSJ should be a critic of policies aimed at driving home prices higher, but I think what the Journal is trying to point out is that government-sponsored social engineering of the housing market is exactly what played such a large role in the last boom and bust cycle.
There are several variations of the following quote but as an Englishman I will use Winston Churchill’s: “Those who fail to learn from history are doomed to repeat it.”
“Oh when will they ever learn, oh when will they ever learn?”
yes, it was government policy, the irrational, self-serving “a chicken in every pot”, but, let’s also ascribe a healthy share of the blame perspective:
the debacle manafested from: the leaders-government: Barney Frank & Chris Dodd; the minions: greedy lending institutions; and, the non thinking, greedy consumers/buyers of mortgages and the refinancees.