Image by Mycael via FlickrFriday, November 13, 2009
A Box of Pandoras
Desperate times may demand desperate measures, but be careful what you ask for.
Ever since the President signed a bill last week that included provisions to extend and expand the tax incentive for first time home buyers, and now some other folks as well, the trade associations for the housing industry have been throwing a self-congratulatory message party to convince the nation's home builders, and others in the shelter industry, that their universal interests have been served. The public relations specialists, who actually contrive the wording on their behalf, have the spokespeople for the industry groups reveling like drunken sailors in a daisy chain of back slapping victory celebration.
Not so fast. In an open letter to some of these folks back in March of this year I expressed (in part) the following:
"Publicly, the members of the industry … have predictably circled the wagons and hunkered down under a communal blanket of denial when confronted with the notion that builders themselves, regardless of size, are at least partially responsible for the combination of factors that contributed to the disastrous economic situation we are now facing, along with the rest of the country, indeed, apparently the rest of the world.
While we may not have planned all the courses of the meal—nor anticipated or especially concerned ourselves with the raging heartburn and indigestion that would eventually result from the gluttony engaged in by so many who lapped up the seemingly endless flow of gravy—at best we stood by and did little while we watched as the greediest among us slaughtered and plucked the golden goose of home ownership in plain site of anyone who was paying attention.
To the surprise of some, that bird has been resurrected, not once, but amazingly, twice! Not only that, it has been reincarnated in the form of the federal sow, the mother protector and provider of nourishment for all those willing to overcome the stench of the trough. And when the first teat ran dry, we simply squealed and squirmed until a second was provided to quiet our cries.
It seems that no matter how deeply ingrained the aversion to "government interference" runs in the DNA of the industry (don't we still hold sacred the eternal claim that ours is the most overregulated and persecuted occupation in history?) and how often the choruses of our hymns are sung by the choir as we hold regular worship services for the gods of market-driven free enterprise and the American Dream, we have eagerly added another entrée onto the dinner plate already bearing tried- and-true menu favorites like the mortgage interest deduction and other recipes for topping previous calorie counts of ever-higher home ownership numbers.
The apron strings binding us to the federal government have just been cinched with a new set of tight and very complex knots, which will be difficult to release. In the immortal words of former New Mexico Governor Bruce King, the last of the old-style western cowboy governors: "We might have opened ourselves a box of Pandoras."
When the new supply of government milk and honey runs dry in a few months, will we find ourselves shouldering our way to yet another spigot or do you suppose we can actually wean ourselves off this new source of sweetener and return to our professed preference, free enterprise? In truth, is our current celebration of success going to bear a bitter harvest because these devices actually amount to a premature picking of the next crop of market demand that will only repeat itself down the road?
A wise man once warned me: "We have to be careful to not become what we despise the most." My March letter to the "spokesmen" concluded with the following:
"The 'golden goose' I spoke of earlier is not nested in the windfall profits expressed not so very long ago on those gaudy quarterly reports of the publicly trade building corporations, whose business is really little more than mass producing containers in which to package millions of America's families when the boom is on. Nor does it reside in the glowing, intoxicating bumper-crop lists of housing starts that we all feasted on during the recent fat times.
The real Holy Grail of this nation's home builder is embedded in the American Dream itself, which, in our rush to harvest profits we have helped to plunder by going along with the notion that home ownership is a right, not a privilege to be earned, and that the price of everything of importance can be accounted for in our fixation on first cost, which allows us to systematically devalue the fruits of our labors that have been held so dear, practically sacred, by our fathers and grandfathers, most of whom would never have understood the concept of dollars-per-square-foot or why we would allow ourselves to be suckered onto such a treadmill of destruction designed by someone else for their own self-interest.
If it is not too late already—some say it may be—I encourage … builders to re-establish our credibility … through a return to the values that made home building an indispensable thread running through the fabric of our great nation—its economy, its culture, and its peoples—from generation to generation."
It would be hard to deny that for the housing industry these are, indeed, desperate times. But let's make sure that the medicine we have prescribed for ourselves is not more harmful and habit forming than what prompted us to take it in the first place.