I’m replying to Connie Clements’ opinion column, American Dream or American Nightmare, in the July 5, 2023, edition of the Navasota Examiner.
Her statistics on housing costs are accurate but I fail to see the correlation between “Bidenomics!” and the rapid escalation of home prices. In fact, I’d say that Ayn Rand’s political philosophy of “Objectivism” is more relevant since a major tenet of that is laissez-faire capitalism, meaning that business should be free to make money unfettered by any form of government regulation. Truth is, housing prices didn’t just magically explode from 2021-2023. I’ve lived in Grimes Co. since 1983 through seven different administrations. In that time I’ve seen land values/ appraisals increase way over 100%, right along with the cost of building materials. In the 1990’s, bank deregulation allowed bankers to offer subprime mortgages, which led to the Great Recession of 2007 where thousands of people lost their homes and jobs.
Interestingly enough, in 2008, Steve Mnuchin and a group of investors bought the failed Indy Mac Federal Bank for 1.3 billion dollars and renamed it OneWest. In the next seven years the bank foreclosed on 36,000 homes, then collected loan insurance from the FDIC. In 2015, Mnuchin sold the bank for 3.4 billion dollars. He then went on to serve as Trump’s Secretary of the Treasury from 2017-2021. Where do you suppose those 36,000 former homeowners are now compared to Mnuchin? That was just one bank.
Let’s consider Black Rock, Vanguard and Three States, ‘Investment Management’ companies operating quietly in the economic background. These are wholly owned by around ten billionaire families and together they control more than 22 trillion (that’s with a T) dollars in assets. That means they control 25% of Total Global assets. They own/control stock in every, single, major, American company, period.You think they don’t control economic policy?
It’s a fact that corporate buyers bought 15 percent of homes for sale in 2021. One of the companies owned and then spun off by Black Rock is Invitation Homes. It operates nationwide with 21 billion in assets and has bought over 12,000 homes in Atlanta, GA, alone. The kicker is that these companies are buying up the relatively inexpensive homes that would be obtainable by younger, working, and middle class buyers. They can offer cash at 5 to 10 thousand dollars over the asking price because they can get very low cost loans to cover that extra expense. Then they turn these into rental units, effectively forcing middle income buyers out of the market.
The point is that if you really study Bidenomics you’d see that by strengthening labor unions, rebuilding the nation’s roads and bridges, and bringing manufacturing back to the States, it’s a win for the middle class and a possible return to that nostalgic time when us ‘common folk’(of all colors and ethnicities, I might add) could afford to buy a home and send the kids to school.
Nothing is solved by complaining. How about some constructive criticism for a change?