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Sunday, February 22, 2009

Thoughts and Fears about Stimulas for Home owners

This week the Obama administration announced plans to help homeowners avoid foreclosure. I saw the Chairperson of the FDIC, Sheila Bair, talk about it on CNN and I heard people talk about it on KQED Forum. People have been talking about the plans and try to figure out what is really in the package. Even with the package being announced, people are not sure how it is really going to work.

I ask the question, "How important is it that the Stimulus package be fare in the way it helps homeowners?" When I was listening to KQED I was getting angry. I am not a home owner. I have been sitting in Silicon Valley watching house prices get further and further out of my reach. The housing bubble had a lot of air around here. I am angry at the idea of those house prices not getting to the bottom. I am angry that my tax dollars will be keeping the price of the house I buy someday higher. It is if I can ever afford to buy a house. I am worried my tax dollars will build the wealth of home owners.

Today on CNN I saw Housing Secretary Shaun Donovan say, "This package helps all Americans." Then he went on and talked about how all house prices go down when I house is foreclosed on and all homeowners should support this. I guess I am not an American because I do not own a house.

I am not too worried about the fairness of who gets help and who does not. I am not worried that we are not helping people who will stay current without help. Helping them is a waste of taxpayers money. I am reading a lot from these homeowners in the papers.

My fear is clear, I am worried that house prices will not reach the bottom. I have spent the last decade watching home ownership get further and further away from me. Even as my career has improved and my salary has increased, I still not afford to buy a condo without help. I am worried that if house prices do not hit the bottom there will be another bubble. I am worried that fixing the Crisis will not fix the problem. I am worried that we will back at this point again if we do not fix it correctly.

Also Read: WSJ Dukes of Moral Hazard

Labels: Barack Obama, CNN, Economics, homeowners, Shaun Donovan, Sheila Bair

- Rich, 10:44 AM

Thursday, February 05, 2009

Is Economics a Sciences ?

On Marketplace yesterday there was a commentary about President Obama's pledge of putting science back into it's rightful place and the economic stimulus. Was Barack Obama only talking about Steam cell research and Global Warming, or was he being open to science other than what the Bush Administration ignored.

Economics is not a science, exactly. But it does have enough scientific elements that it might contribute something useful to the debate.

Before the president signs anything, why don't we assemble a panel of distinguished economists -- say, the past half dozen chairs of the Council of Economic Advisers plus all the American Nobel prize winners -- to rate the different spending measures in the stimulus package according to how many jobs they will deliver at how much cost?

This is an important to answer this question. I know that the commentator David Frum is a partisan, but it is a good point. I hear lots of reports lately questioning the spending in the new stimulus package. People are pointing out bad spending and it is starting to worry me. It is starting to sound like politics as usual from Congress.

Barack Obama was elected not to be an old style democratic. He was elected with words like Hope and Change. To me that means that people wants Barack Obama will be a transformational politician. I think the stimulus package will be the first test of his ability to be a transformational politician. If he signs a bill full of old style pork, this can hurt his image and what he wants to do in the future.

Labels: Barack Obama, Economics, economy

- Rich, 1:54 PM

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