How the Bush administration shoved the housing bubble down America's throat.

[Torie]

The dirty little secret is that there was near unanimous support from all sides to feed the housing bubble. Getting everyone into home ownership was as high a priority, if not higher, than a 19 year old high testosteroned male getting laid regularly. And it was a good deal for many, because as housing prices went up having put nothing down, or actually getting loans higher than the purchase price of a house (the notorious 110% mortgage), it was like almost free money out of a seemingly bottomless ATM machine, and when prices went down, you just stopped paying your mortgage, and lived rent free in your house for a year or two or three, before the lender finally takes it back at no cost to you. What a deal, particularly for those who don't pay any income taxes, so they don't need to worry about the multi trillon dollar cost to the feds.

During the savings a loan crisis in the later 1980's, I once had this fantasy of owning two savings and loan institutions, one of which went short on interest rates, and the other long. Then when there was a big interest rate move, you give the failed institution back to the FSLIC, and make your fortune on the other one. It seemed like a rather  brilliant approach to me.

[Torie]

No, it was more due to a change in tax policies, tighter zoning and building permit regulations, and the feds encouraging, subsidizing, and buying more risky mortgages actually. California has had three housing bubbles since I purchased my first place in 1979.

[Torie]

... Getting everyone into home ownership was as high a priority,

Not 'everyone' of course, but the great majority.  It was a worth, reasonable, and very easily achievable goal, Torie, and the part missing was requiring that workers be paid enough.  This was the missing link, and what was destroyed since Reagan - the deregulation, though very stupid, was only the kindling - inequality was what made the whole edifice so flammable.

Yes, I know that this notion that the workers' standard of living (and I take it the "workers" means everyone other than the privileged elites like Fezzy and myself) can be raised through some sort of government fiat above the current industrial democracy standard is your own particular leap of faith Opebo. It is like arguing about whether or not Christ has divine aspects or something.

And maybe someday you will actually offer up an example of where this has been accomplished, or even some economic theory offered up by creditable economists of how we might be able to go where no man has gone before.  Don't you find it odd that the standard of living in most of the industrial democracies is about the same no matter what the details of their economic policies are, and when some push the envelop, like some have in Europe, they are teetering on the edge, and are having to retrench on a rather Draconian basis?

In the end of course, the only thing that can accomplish it is an increase in per capita worker productivity overall. And that means restructuring our secondary school system from top to bottom.

[Torie]

Well I guess we just have one of those factual disputes Opebo. I will look up the per capita productivity thing in due course to confirm matters.