On NPR, the Fairness Doctrine, and Debt
Tonight I write to you from my new lair. I have moved from Charlottesville Virginia, home of Thomas Jefferson, to Warrenton Virginia capital of Virginia horse country and a burgeoning bedroom satellite of Washington DC. Warrenton was as close as my wife and I could get to the Heart of the Beast without completely losing it. We are still only a half hour from the Blue Ridge Mountains, though before we could see them from our front porch step.
But I have every man’s best friend- a basement- in the new house and that my friends is worth quite a lot.
Over the past week I have spent quite a bit of time traversing the piedmont of Virginia shuttling the various things the Sorrentinos have accumulated over the years from the old place to the new.
During this time I’ve spent far too much time listening to talk radio. A couple of points;
First, how can the statists argue that there’re needs to be a “fairness doctrine” implemented in radio when the left has a federally subsidized wholesaler of ideas in NPR? I know, I know, a relatively small amount of NPR’s funding comes directly from the feds. But a good bit still does. There ain’t nothing fair about NPR.
If it’s not Talk of the Nation bemoaning the recent Supreme Court decision actually supporting the firefighters in New Haven Connecticut, or Marketplace explaining how debt was actually the way the post World War II working class became middle class, NPR always seems ready to make the case for greater state intervention. This is practically without exception as far as I can see.
Interestingly, in the Marketplace piece, the reporter on NPR explained how it was that in post war America, before the government changed things of course, one had to put down as much as 50% of a home and then pay it off “in a relatively short period of time.” Read 10 years. What Marketplace failed to point out was that the average house in 1946 was $5600 dollars. A dollar in 1946 was worth about 10 times what it is today. So that means that the average house nowadays should run about $56000.
Who wouldn’t kill for a 3 bedroom, brand new house for $56000? Save up 28K and spend the next 10 years paying back other $28000? That is a deal. And that was the deal for most of the history of this fine republic.
But houses don’t cost $56000. In fact, the average house price in the USA as of this writing is $276,000. Why?
Because many people only care about their monthly payment. They care very little about actually “owning” a home. That’s a pipe dream. Most people figure that they will die without ever owning a house. This is a mode of thought that has been perpetuated over the last 30 years. So people opt for interest only loans and the like. They care little what the actual principle of the loan is.
And so home prices reach skyward as loans become ever more exotic and principle becomes less and less important. I know this is so 2005 but bear with me.
And who benefits from this idiocy? The homeowner? Not bloody likely. No, it is the lender that benefits. A loan over 30 years is much, much, more profitable than a 10 year loan. Most lenders do not want you to ever own your home. If you do, the cash stops flowing to them.
But hey, screw it right? Living in a giant house is almost the same as “owning” it. Why not live it up? You only live once right?
Thankfully this kind of thinking is dying. Carnage litters the streets of Miami, San Diego, Las Vegas, and suburban Washington DC. But I just get the feeling that the real estate guys have not learned their lesson yet. There is too much hope still. Their hope needs to be crushed by the market. Then we can start again.
The guy on NPR said that debt encouraged “responsibility.” That debt encouraged people to fall in line, and that this was a good thing for society. Crap.
I personally believe that debt encourages servitude, so long as one is the one paying the interest. The founders understood this. You should too.
Rambling post I know. I have just had beer number 4 after hauling couches all day.