Greenhut on nutty new mortgage idea

Oct. 18, 2012

By John Seiler

In the New York Times, our colleague Steven Greenhut wrote on another nutty government idea — direct mortgage loans:

“If the government offers direct lending of mortgages just as it offers direct lending for many student loans, the mortgage business will face the same serious problems faced in the student-loan business.

“Taxpayers will be forced to provide more subsidies, thus contributing to the national debt. Default rates will jump. Lending decisions will be made by political factors rather than sound business. Investment decisions will be distorted. There’s nothing to be gained by this idea. The best way to keep down costs of any good or service is through competition….

“The best way to provide loans of any type is through a market system, not through a government bureaucracy that puts political considerations above good financial sense.”

Read the rest here.

Next the government will just force us all into government-owned shoddy high-rise housing, like in the old Soviet Union.