Clearly government regulation has been a big problem. Why do we have a mortgage interest deduction? Completely unnecessary and it just serves to push up prices. Also, all of these bailouts are just delaying the inevitable. These are the sort of things that make Friedman economics seem so appealing. With intervention having so many bad effects, wouldn’t getting rid of it solve lots of problems? In a perfect world, maybe. Unfortunately for us chickens, the foxes make sure that only the regulations they’re interested in get removed. They didn’t care about the mortgage interest deduction, but they did care about being able to package up bad loans and pass them off as good. End result? Even higher house prices and now a big crash. And the foxes have made off with all of the eggs.
I guess the only thing I’ve learned is that whenever some guy in a suit is on TV telling me that he’s going to solve my problems, I know I’m about to get screwed.
