For once, I agree with Megan McArdle:
If you want to know why us libertarian types are skeptical of the government’s ability to prevent housing market bubbles, well, I give you Exhibit 9,824: the government’s new $1000 down housing program. No, really. The government has apparently decided, in its infinite wisdom, that what the American economy really needs is more homebuyers with no equity.
While McArdle wouldn’t know what a real libertarian was if Murray Rothbard’s zombie bit her on her bony ass – she actually voted for Soebarkah – she is correct to point out the madness of this homebuying incentive program. It does not help the economy to encourage more poor people to buy homes they cannot afford to buy and take out mortgages on which they will almost surely default.
Glenn Reynold’s succinct summary is more astute: “These people are idiots. Idiots who’ve been entrusted with nuclear weapons, and their economic equivalents.” Of course, this insane program might not exist if “libertarians” like Megan McArdle hadn’t voted the people who created it into office.