Discussion in 'Economy' started by KMAN, Oct 27, 2008.
The Age of Prosperity Is Over - WSJ.com
Things do not look pretty, now or for the long term. The mortgage crisis has been drastically underestimated. While government officials and those in the banking industry give us all of their reasons for falling equities, they all miss one very basic point. We overbuilt. We have more homes on the market than are needed to house our population. Therefore, values are falling because demand is at a low. Increase the demand, values will increase.
So, how do you increase demand? It's very simple, and it actually is the answer to so many of our problems. While there is no short term solution, the long term solution is one that could be achieved if the government does the right things. First of all, government spending needs to be cut drastically. Other than necessary entitlement programs and justifiable military spending, get rid of as much of the federal government as possible.
Secondly, begin to encourage legal immigration but with parameters. Only allow those under the age of 30 to immigrate. If you are over 30, you don't get in. Secondly, only allow those with actual skills or certain levels of education to enter. We need a larger population. We also need to reduce the average age of our population. By only allowing new immigration to those younger than 30, you accomplish two things. Younger immigrants will pay into entitlement programs for a much longer time, which we need. Also, younger people will have children, reducing our average age, and bringing more people into the system who will pay for entitlement programs such as SS and Medicare.
While the population increases, demand for housing will increase, and things will slowly begin to improve. These are very simple basic solutions. They aren't the complete answer, but ideas such as these would help put us back on the right track. As it stands now, our population is estimated to grow to 440 million by 2050. Do we want an older population that is collecting benefits, or a younger population that is helping to pay for the benefits being collected by the older population?
We do have choices in how America is shaped over the next few decades. The choices we make today will determine what we leave for our children and grandchildren.
welcome, you got any hard numbers on the housing /population comparison for me?
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