Ruining my Day
By Arnold Kling
it is the duty of the press to scour the known universe looking for ways to ruin your day.
Indeed. David Broder writes,
Each year, as the money comes in, the trust fund will distribute it to the states using a formula that measures the seriousness of their low-income-housing needs. At least 90 percent of the funds must be used to construct or rehab rental units. All of the benefits are ticketed for very low- or extremely low-income households.
What he is referring to is a provision of the new housing bill that takes about $500 million a year from Freddie Mac and Fannie Mae to fund an “affordable-housing” program. Broder notes that since the FM’s are undercapitalized right now, the program will not take effect until 2010 (as if they will have enough capital by then).
Broder helped ruin my day in a number of ways. First, he reminded me about this program, which I had only seen in early versions of the housing bill, and which I had been assuming was dropped in order to avoid embarrassment. Second, he praised the program effusively, because Congress is doing something about “affordable housing.”
Affordable housing? We have millions of unoccupied homes in this country. Housing is becoming more affordable every day. There is no shortage of houses. If people can’t afford housing, what they need is money. They don’t need a state-run rehab program that adds to the inventory of houses.
Rooting for Congress to do something about affordable housing is like rooting for a thief to find an empty car with the door open and the keys inside. “Affordable housing,” like “family farmer,” is nothing but a stalking horse for pork.
Also on the Washington Post op-ed page, the governors of New York and Maryland pat themselves on the back.
In New York and Maryland, we have made targeted investments in clean, renewable energy. We have stepped up where the federal government has fallen down to make critical investments in our infrastructure, including mass transit and roads. We are also supporting foreclosure prevention programs and investing in public education so our students continue to improve and excel, and increasing access to health care for those who remain uninsured.
They suggest that the Federal government follow their example by doing more to “stimulate” the economy.
It is estimated that for every $1 billion invested in transportation projects, 42,000 jobs are created, and that every dollar spent on infrastructure projects generates about $5.70 in economic activity.
In that case, since the Federal government collects 20 percent of all economic activity in taxes, the Federal government deficit declines by $.14 for every $1 it spends on infrastructure projects. If we spend about $3.5 trillion on infrastructure, we can turn the $500 billion deficit into a surplus!
Unless the source for the governors’ estimates (they do not give a citation) miscalculated. It will be interesting to see how the governors’ own budgets perform, given their economic judgment.
Finally, we have Daniel Henninger.
Recently the subject came up of Al Gore’s assertion that the U.S. could get its energy solely from renewables in 10 years. Sen. McCain said: “If the vice president says it’s doable, I believe it’s doable.”
Have a nice day!