Government gets involved, government screws it up – from Smart Money:
The government’s recent $8,000 cash incentive for first-time home buyers has proved even more costly for recipients than for taxpayers, according to data released Monday. Typical buyers have lost twice as much to price declines as they received from the program.
The median home value fell to about $170,000 in March from $185,000 a year earlier, according to Zillow.com. That means a buyer who closed on a house just before the tax-credit program expired in April 2010 collected $8,000 but has since lost $15,000 in value. Those who bought earlier in the program have done worse; the median price is down $20,000 from March 2009…
There is nothing quite so asinine as a government attempt to fix the economy. It just can’t be done – not ever. You see, no matter how smart the people in government are, no matter ho much information they have, they will never be smart enough or have enough information to determine what will happen when tens of millions of people live their lives. It is why socialism – of whatever stripe – never works. The trick just can’t be done – there is no way to know, at any given moment, what millions of people will do with their time, labor and money.
All government can do regarding the economy is protect against force or fraud in the market place – police the transactions to make certain that people aren’t being cheated, and then just leave everything alone. If a company is going to fail, then let it fail – if it is making massive profits, then don’t impose a “windfall profits tax”; things will be as they will and as long as no one is being defrauded, government has no place.