Saturday, September 8, 2007

The communists are back...

The economic success of America rested on one simple premise; if you worked hard, took risks and made good investment decisions, then you became rich and lived in a big nice house; if you were lazy, risk-averse and made bad decisions, you were poor and you lived in a house like this one here.

The housing bubble has overturned that simple formula. Today, poor people sell 2 bedroomed, 600 sq. ft. shacks, like this one from Newport (CA), to rich folks for $1,150,000. In the process, the underlying incentives to succeed in America are being undermined by massive wealth redistribution from the rich to the poor.

Ultimately, the housing bubble is communism in a modern form. It threatens to turn rich folks into poor people. While the poor may have more cash, they will undoubtedly find ways to spend that money so that they become poor again. Who benefits from this new regime? A narrow elite, known as the realtors. Here is a question open to debate; is the NAR the new Communist Party?

Senator McCarthy once wisely said that "Communism is unamerican". If he were alive today, he would undoubtedly recognise that this housing bubble is also unamerican.

Thanks to Kane for a second excellent recommendation. The listing can be found here. If you see any other communistic unamerican listings, send them here

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