« The Fierce Urgency Of Whenever, Ctd. |
Main
| The View From Your Window »
05 Oct 2009 11:44 am
Solving The Wrong Problem
Doug Holtz-Eakin, former McCain economic adviser and former director of the CBO, wants the the $8,000 first-time homebuyers tax credit ended (it expires in November but there has been talk of extending it):
I’m not sure if it is
worse if the policy “works” or if it doesn’t, but it likely won’t. The
$8,000 first-time homebuyers tax credit is straight out of the same
pool of bad ideas that gave us the misbegotten “cash for clunkers”
program. The latter produced essentially no environmental or
energy-security benefits (not too surprising when you could get $3,500
for simply raising your mileage by only four miles-per-gallon) – just
as a homeownership push has no real benefits.
Cash for clunkers was a
superficial “success” from a sales point of view; we saw all those cars
driven off the dealers’ lots powered by taxpayer subsidies. Similarly,
a check from Uncle Sam has sweetened home sales. But most of the cash
for clunkers sales would likely have taken place anyway, albeit later
in 2009 or in 2010. All the program did was steal sales from the
future and provide a midsummer bump that will soon fade. Similarly,
more cash for homeowners will not represent real recovery in the
housing market; it will just mean that next year and the year after
will see less sales.
Share This
TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d83451c45669e20120a5be2687970b
Listed below are links to weblogs that reference 'Solving The Wrong Problem'
