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Anyone here subscribe to WSJ? Apparently there was an article or editorial about how more immigrants are needed to solve our housing glut.
Also it was talked about on CNBC's Power Lunch program starting about 1:22 according to cellphone time. I haven't been able to snag either of them as I don't want a subscription to WSJ, and haven't yet figured out how to snag a video, much less edit it down to the important parts.
I did a search: http://s.wsj.net/article/SB123725421857750565.htmlQuote:
Originally Posted by vortex
Immigrants Can Help Fix the Housing Bubble Article
By RICHARD S. LEFRAK and A. GARY SHILLING
The Obama administration should seriously consider granting resident status to foreigners who buy surplus houses in this country. This makes more sense than the president's $275 billion housing bailout plan, which Americans greeted with a Bronx cheer.
The federal bailout forces taxpayers to subsidize overextended homeowners who bet on ever-rising house prices and used their abodes as ATMs, and it doesn't get to the basic problem -- the huge inventory of excess houses. We estimate that 2.4 million houses over and above normal working inventories are left over from the 1996-2005 housing bubble. That's a lot, considering the long-term average annual construction of 1.5 million single- and multi-family units.
Excess inventory is the mortal enemy of house prices, which have already fallen 27% since the peak in early 2006. We predict another 14% drop through the end of 2010 if nothing is done to eliminate the surplus.
Chad CroweDoing nothing to eliminate the excess inventory might well push the recession through 2010 and into a depression. Declining home values, for example, are eliminating the home equity that has funded oversized consumer spending for years.
As consumers retrench, production is cut, payrolls are slashed, and consumer confidence, incomes and spending are savaged in a self-feeding downward economic spiral. But if the government buys surplus houses and sells them at low market-clearing prices, other house prices will drop, destroying more home equity and driving many more mortgages under water. Bulldozing excess houses would be an inefficient end for perfectly habitable structures.
A better idea is to offer permanent residence status to the many foreigners who are clamoring to get into the U.S. -- if they buy houses of minimal values (not shacks). They wouldn't need to live in those houses, but in order to remove the unit from the total housing market, they couldn't rent them. Their temporary resident status granted upon purchase would become permanent after, perhaps, five years, if they still owned the houses and maintained clean records. The mere announcement of this program might well stop the ongoing collapse in house prices, especially in cities such as Las Vegas, Miami, Phoenix and San Francisco, where prices are down 40% -- but where many foreigners like to live.
Each year, 85,000 H-1B visas are granted for foreigners with advanced skills and education, and last year, 163,000 petitions were filed in the first five days after applications were accepted. The Ewing Marion Kauffman Foundation estimates that as of Sept. 30, 2006, 500,040 residents of the U.S. and 59,915 individuals living abroad were waiting for employment-based visas. Many would buy homes if their immigration conditions were settled.
These people tend to be highly productive. In 2006, foreign nationals residing in the U.S. were listed as inventors on 25.6% of the patent applications filed in the U.S., up from 7.6% in 1998. A Council of Graduate Schools survey found that in the fall of 2007, 241,095 non-U.S. citizens were enrolled in graduate programs. Some 55% were in engineering and the biological and physical sciences, compared with only 16% of U.S. citizens. In 2007, more people on temporary visas received doctorates in physical sciences and engineering than U.S. citizens.
There is a high correlation between education and incomes, and in today's uncertain economic climate, many wealthy foreigners desire U.S. resident status just as a number in Hong Kong secured residences in Singapore and Canada before the British handover to China in 1997. They rapidly became over a quarter of Vancouver's population, and brought in billions of dollars to buy houses and make other investments.
We could benefit from such an influx. Merrill Lynch estimates that in 2007 there were 10.1 million individuals in the world, 7.1 million outside the U.S., with at least $1 million in financial assets that totaled $29 trillion. If new immigrants bought the 2.4 million excess houses at today's $184,000 median price with funds from abroad, they would bring untold billions. The immigrants would also buy consumer goods, pay taxes, and start many new businesses.
The blueprint for a program to sell surplus housing to immigrants is already in place with the EB-5 visa program. Each year, 10,000 EB-5 visas for this country are available for foreigners who each invest $1 million in a new enterprise ($500,000 in economically depressed areas) that creates at least 10 full-time jobs. After two years, the entrepreneur and his family can become permanent residents.
America's relatively open immigration policy makes this country better off than many other developed lands whose governments also must fund the pensions and health care for growing numbers of retirees. Yet there's still a huge need for more productive and skilled people, both current residents and immigrants, who will produce enough goods and services to provide for their own needs and for those in retirement. Otherwise, entitlement spending eventually will touch off intergenerational warfare.
Granting permanent resident status to foreigners who buy houses in this country will curtail a primary driver of the deepening recession and financial crises -- excess house inventories and the resulting collapse of prices. Since the people who will buy these houses will tend to have money, education, skills and entrepreneurial talents, they will be substantial assets to America in both the short and long runs.
Poor Americans, is all I can say.
Illegal immigrants and ACORN started the Housing Bubble!!!Quote:
Originally Posted by vmonkey56
Thank you, Worried!
What narrow and short-sightedness by the authors. Sure more people will take care of the housing problem, but how much more pressure can we stand on our resources--from water to food to even room to move?
And what about societal damage? I really don't want some millionaire with all 110 members of his extended family coming and going and slithering into our society by taking our jobs. And would loathe the idea of some old religion worshiper next door dancing naked on the front lawn during the solistice or sacrificing animals as an offering.
Giving anyone residency used to be, from what I remember, was those that invested $1 million or more in the US and created a business. There are plenty of Americans who can write a check for $184,000, so where is the patriotism? The Chinese are here snatching up developments and buildings already and taking tours of our major cities to see what makes a good investment. Our toll roads and bridges and other infrastructure are increasingly foreign-owned or foreign-leased just for the quick dollar to bail local governments out of the mess created by their over-spending.
While housing starts were up 22 percent last month, the majority of those units were multi-family housing, not single family. Some family who has lost their home needs to rent an apartment, will their rent money stay in this country or go to some remittance to the old country or to support some Communist Chinese?
Protectionist? Yes, as far as trying to protect what this country was while watching it erode every day.
The whole thing makes me sick. I'm a Protectionist and proud of it!!!Quote:
Protectionist? Yes, as far as trying to protect what this country was while watching it erode every day.
I just sent this out to my contact list:
History Repeating Itself
By Pat Dollard, filmmaker, educator and author (Google under his own name)
I am a student of history and have studied it all my life. Professionally, I make documentary films, teach college and have written 15 books in six languages.
I think there is something monumentally large afoot, and I do not believe it is just a banking crisis, or a mortgage crisis, or a credit crisis. Yes these exist, but they are merely single facets on a very large gemstone that is only now coming into a sharper focus.
Something of historic proportions is happening. I can sense it because I know how it feels, smells, what it looks like, and how people react to it. Yes, a perfect storm may be brewing, but there is something hap pening within our country that has been evolving for about ten to fifteen years. The pace has dramatically quickened in the past two.
We demand and then codify into law the requirement that our banks make massive loans to people we know they can never pay back? Why?
We learn just days ago that the Federal Reserve, which has little or no real oversight by anyone, has "loaned" two trillion dollars (that is $2,000,000,000,000) over the past few months, but will not tell us to whom or why or disclose the terms. That is our money. Yours and mine. And that is three times the $700B we all argued about so strenuously just this past September. Who has this money? Why do they have it? Why are the terms unavailable to us? Who asked for it? Who authorized it? I thought this was a government of "we the people," who loaned our p owers to our elected leaders. Apparently not.
We have spent two or more decades intentionally de-industrializing our economy. Why?
We have intentionally dumbed down our schools, ignored our history, and no longer teach our founding documents, why we are exceptional, and why we are worth preserving. Students by and large cannot write, think critically, read, or articulate. Parents are not revolting, teachers are not picketing, school boards continue to back mediocrity. Why?
We have now established the precedent of protesting every close election (now violently in California over a proposition that is so controversial that it wants marriage to remain between one man and one woman. Did you ever think such a thing possible just a decade ago?)
We have corrupted our sacred political process by allowing unelec ted judges to write laws that radically change our way of life, and then mainstream Marxist groups like ACORN and others to turn our voting system into a banana republic. To what purpose?
Now our mortgage industry is collapsing, housing prices are in free fall, major industries are failing, our banking system is on the verge of collapse, social security is nearly bankrupt, as is Medicare and our entire government, our education system is worse than a joke (I teach college and know precisely what I am talking about) - the list is staggering in its length, breadth, and depth. It is potentially 1929 x ten.
And we are at war with an enemy we cannot name for fear of offending people of the same religion, who cannot wait to slit the throats of your children if they have the opportunity to 20 do so.
And now we have elected a man no one knows anything about, who has never run so much as a Dairy Queen, let alone a town as big as Wasilla , Alaska . All of his associations and alliances are with real radicals in their chosen fields of employment, and everything we learn about him, drip by drip, is unsettling if not downright scary (Surely you have heard him speak about his idea to create and fund a mandatory civilian defense force stronger than our military for use inside our borders? No? Oh of course. The media would never play that for you over and over and then demand he answer it. Sarah Palin's pregnant daughter and $150,000 wardrobe is more important.)
Mr. Obama's winning platform can be boiled down to one word: Change.
Why?
I have never been so afra id for my country and for my children as I am now.
This man campaigned on bringing people together, something he has never, ever done in his professional life. In my assessment, Obama will divide us along philosophical lines, push us apart, and then try to realign the pieces into a new and different power structure. Change is indeed coming. And when it comes, you will never see the same nation again.
And that is only the beginning.
And I thought I would never be able to experience what the ordinary, moral German felt in the mid-1930s. In those times, the savior was a former smooth-talking rabble-rouser from the streets, about whom the average German knew next to nothing. What they did know was that he was associated with groups that shouted, shoved, and pushed around people with whom they disagreed; he 0A edged his way onto the political stage through great oratory. Conservative "losers" read it right now.
And promises. Economic times were tough, people were losing jobs, and he was a great speaker. And he smiled and waved a lot. And people, even newspapers, were afraid to speak out for fear that his "brown shirts" would bully them into submission. And then, he was duly elected to office, a full-throttled economic crisis at hand [the Great Depression]. Slowly but surely he seized the controls of government power, department by department, person by person, bureaucracy by bureaucracy. The kids joined a Youth Movement in his name, where they were taught what to think. How did he get the people on his side? He did it promising jobs to the jobless, money to the moneyless, and goodies for the military-industrial complex. He did it by indoctrinating the children, advocating gun control, health care for all, better wages, better jobs, and promising to re-instill pride once again in the country, across Europe , and across the world. He did it with a compliant media-did you know that? And he did this all in the name of justice and . . . change. And the people surely got what they voted for.
(Look it up if you think I am exaggerating.)
Read your history books. Many people objected in 1933 and were shouted down, called names, laughed at, and made fun of. When Winston Churchill pointed out the obvious in the late 1930s while seated in the House of Lords in England (he was not yet Prime Minister), he was booed into his seat and called a crazy troublemaker. He was right, though.
Don't forget that Germany was the most educated, cultured country in Europe . It was full of music, art, museums, hospitals, laboratories, and universities. And in less than six years-a shorter time span than just two terms of the U. S.. presidency-it was rounding up its own citizens, killing others, abrogating its laws, turning children against parents, and neighbors against neighbors. All with the best of intentions, of course. The road to Hell is paved with them.
As a practical thinker, one not overly prone to emotional decisions, I have a choice: I can either believe what the objective pieces of evidence tell me (even if they make me cringe with disgust); I can believe what history is shouting to me from across the chasm of seven decades; or I can hope I am wrong by closing my eyes, having another latte, and ignoring what is transpiring around me.
Some people scoff at me, others laugh, or think I am foolish, naive, or both. Perhaps I am. But I have never been afraid to look people in the eye and tell them exactly what I believe-and why I believe it. I pray I am wrong. I do not think I am.