analysis by Arnold Kling on the current housing bill's
efforts to bail out homebuilders
who speculated unwisely on ever-rising housing prices.
Arnold concludes with a more general lesson:
Pundits have been braying that the subprime mortgage crisis demonstrates
the failure of private markets and the need for more regulation. They
say that the crisis is a reminder of why we need more government
intervention, not less. The housing bill is a reminder of the opposite.
So true. (And a sage commenter sagely comments: "Note that when we want to bail
them out, they're not developers. They're homebuilders.")
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