The last time whitehouse.gov posted anything about home mortgages was on August 3rd of this year. President Obama also did not even touch the housing issues that continue to plague the economy in the jobs plan he gave to Congress. As the employment rate continues to hover around 9 percent, it has forced many banks to foreclose on homes to families they lent money to. At the same time banks are not lending any money out so new homes can’t be built, or for businesses for them to hire. But then again, there aren’t a lot of people asking for money either. But that is no excuse for Obama not to take on the housing problem. In fact, it would be good for him politically as well.
Whatever you think about Obama’s jobs plan, there is nothing in there that will actually create jobs in the short term. In the plan that he said Congress should pass now, the tax breaks that act as incentives for businesses do not take effect until 2012. We of course need more jobs in this country so families can be supported, and banks are not going to get their money back if no one has a job. It’s a cyclical problem which is not going to go away anytime soon if no one has any guts to spend money. Even though the basic functions of the economy are fine, no one is demanding anything that will get it moving again.
If Obama did propose a plan to help families pay their mortgages it might actually have a bigger affect than the tax based one he proposed. Housing is a large part of the economy because it affects so many other areas. Building a house of course creates jobs for the contractors and the suppliers they buy from. But it is also great for areas because businesses are more likely to open a store where they know people will live. Schools can also be built, along with fire houses and police stations.
One of the heaviest hit states in the country is Florida and its 27 electoral votes. There have been so many written and televised pieces on how bad the situation is I can’t help but think politicians are afraid to talk about it. Not in any of the Republican debates that recently took place (two of which were in Florida) was the housing crisis mentioned. If any candidate next year is serious about fixing the economy, they have to propose a plan on housing.
A part of it is that anything they seriously put forward won’t help families in the short term and there’s no real way to promote it like it will. But that should not stop them from trying to enact policies that might solve the problem.
Senators Menendez and Enzi proposed legislation that would allow foreign banks to lend people money specifically to build houses. The problem is that Europe is having the same problems, if not worse, that the U.S. is having. While it is a nice thought, there is no reason why other banks would want to invest in the housing market. One idea that might help is to raise interest rates on new home mortgages. If banks know they will make more money if they are able to find people who want a mortgage, they will want to find those people themselves instead of waiting for them to come to them.
There are also a lot of houses and apartment complexes around the country that need a lot of work. By renovating them for new families, the prices for them will go up in the long term and people will be getting jobs to work on them. The renovations could also include making the houses more energy efficient. After Hurricane Katrina a lot of the houses that have been built in the area will save the families living in them thousands of dollars a year.
You could also make it easier for investors to build new houses or renovate them. By giving them tax incentives for a limited amount of time, say a year, to put money into projects that will spur the housing market they might bite. There are plenty of families that need a home to live in right now and the new developments/projects will help grow the area and jobs they take place in.
These are just a few ideas that might help. But implementing them will take time and Americans do not always have a lot of patience. But with things as bad as they are right now, people are willing to listen. That includes the thousands of people without a home right now in Florida. They are looking for someone who they believe understands what they are going through and at least has an idea on how to help them.