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On the folly of state-backed mortgages

You have to hand it to this government in the UK. Having watched at how the US has demonstrated the foolishness of distorting the housing market in sub-prime mortgages, and hence encouraging a huge “moral hazard” problem, the UK is, according to a report, going to back hundreds of thousands of home loans in measures to be announced in the 21 March budget.

One grows weary. The shoulders sag. It becomes more difficult to think of a smart-arse piece of satire when confronted with the latest cretinous idea to come out of David Cameron’s limited mind, or from the minds of his colleagues.

Over dinner a few weeks ago, Brian Micklethwait and I agreed that Cameron is not, in fact, all that bright, apart, perhaps, from having a sort of superficial, feral cunning.

13 comments to On the folly of state-backed mortgages

  • Alisa

    Paul Marks says: ‘I agree.’

  • Rob H

    It is often a knowledge and fear of their lack of intelligence that drives their feral cunning and total focus on self advantage at all costs.

    I’ve seen his type before.

  • RAB

    Oh genius!

    Just what we need in such desperate days as these…a bit of pitch black thinking.

  • New Boiled Potato Peeler

    He’s a communitarian, he is not clever, but he is fashionable.

  • Schrodinger's Dog

    Johnathon,

    I agree with you absolutely. On so many levels, this makes no sense: it creates moral hazard; it makes property less affordable and, because property is so expensive and wages need to reflect this, it makes Britain less competitive internationally.

    But the political reality is that the British see their houses as investments, which they expect to increase in value. Should they fail to do so or, worse still, actually fall in value, the government on whose watch this happens is not going to be the government for very long.

  • that Cameron is not, in fact, all that bright

    If he was bright he would not have ended up in a coalition government. They don’t call the the Stupid Party for nothing.

    He’s a communitarian, he is not clever, but he is fashionable.

    Quote of the day :-)

  • I am actually rather disappointed in our leader Perry de Havilland, for being so optimistic and positive about the prospect of David Cameron as Prime Minister.

    Cameron has turned out to be vastly worse than Perry expected, unfortunately.

  • Menidcant

    Baby Boomers get richer as property prices rise, while the young get shafted.

    Property prices reaching insane levels + Wages steadily falling = Disaster.

  • JohnB

    But he is not stupid.
    He, and his ilk, are clever when it comes to getting where they want to go.
    So one has to ask, what are they really up to?

  • With Cameron, there is no point in looking for sinister explanations. He really is that stupid.

  • PeterT

    I made the exact same point as Jonathan on the FT’s comments page (or was it the BBC?). It appeared someway down, below comments such as “brilliant, finally they are helping people get on the housing ladder”.

    But the sheer idiocy of it is depressing I agree.

  • Paul Marks

    Perry- you are actually being too kind to Mr Cameron, he actually wanted to prevent the Conservative party having a majority after the election.

    David Cameron always wanted a deal with the Lib Dems – so he would have an excuse to ignore evil “right wing” Conservatives.

    Last week (as I was leaving the U.K.) the Daily Telegraph business section (Cameron types) was pushing an “Infrastructure Bank”.

    “What is such a thing Paul?”

    Do not ask.

    I mean that – do not ask.

    I am too tired to waste time even attacking such as crack brained fallacy (in fact series of fallacies).

  • Rob

    A brightidea if you think like a politician:

    The pay-off is immediate, either votes for or at least the absence of angry homeowners voting against;

    The disaster is long into the future, when either the Other Side will have to deal with it (good) or your own side (bad, but it won’t be you, so who gives a sh*t really?)