BOOM AND BUST IN HOUSING

Thomas Sowell:

In the spirit of bipartisanship, my newest book-- "The Housing Boom and Bust"-- shows how both Democrats and Republicans ruined both the housing markets and the financial markets.

Like so many disasters, the current economic crisis grew out of policies based on good intentions and mushy thinking.

For far too long, too many people have regarded home ownership as "a good thing." It is certainly true that home ownership has its benefits. But, like everything else, it also has its costs and its risks.

Weighing such trade-offs is something that each individual and each family can do for themselves. It is when such decisions are made by politicians-- of whatever party-- that trade-offs tend to vanish into thin air, replaced by pursuit of a "good thing."

Beginning in the 1990s, getting a higher proportion of the American population to become homeowners became the political holy grail of government housing policies. Increasing home ownership among minorities and other people of low or moderate incomes was also part of this political crusade. Read the rest...

-flynn