Now that health care reform is being given the slow morphine drip which can be characterized as assisted suicide or euthanasia Washington has turned its attention to jobs, jobs, jobs. It seems that everyone has gotten on the bandwagon about the unemployment situation (still in double digits) since there seems to be a “populist” uprising in the country. At least, it seems like everybody. Personally, I’m a “wait-and-see” kinda guy when it comes to the “‘Just Say No’ to Everything” party that seems hellbent on making sure that nothing happens. Will they really try to work with Democrats to fashion some kind of program that will help get Americans back to work?
My guess is that the Republicans see continued posturing and bellicose rhetoric as a path to majorities in both houses of Congress and, possibly, the White House. That may be. What they forget is that if powers shifts because of these tactics, Democrats will adapt them if they ever become the “loyal opposition”.
Jobs First or Housing?
In a recent post here on AG, Lani Rosales noted the lack of attention housing got in President Obama’s State of the Union address. Lani may be on to something but I’m thinking it may be the other way around. Jobs will create the income necessary for people to buy homes which, in turn, will spur new home building which, in turn, will create more jobs. It may actually be a kind of nice upward spiral. Unfortunately, since employment is a lagging indicator we don’t see the proof of job growth until the recovery is well underway.
That doesn’t address the current issues of massive foreclosures and the huge glut of short sales on the market. Perhaps with jobs people could make their mortgage payments. This would reduce inventory which would stabilize prices and, perhaps, create demand. Absent a good jobs program to get people back to work, my guess is that no amount of loan modifications or re-financing will really solve the housing problem.
I agree that there should be a way for people to re-finance out of ARMs and Interest Only loans and other “exotic mortgages”. To be honest, I’m not sure how that can be done with any great efficiency or that it would really be helpful.
It’s really a perplexing challenge. In my mind, though, people tend to feel a lot better about themselves and the prospects for the future when they have a job and some income to take care of some of the basics like food and shelter. Once that’s taken care of the rest will follow right along.