Week in Review: Great Recession Redux

Massachusetts Senator and Democratic presidential hopeful Elizabeth Warren has a plan for “affordable housing” that has the hallmarks of the costly policies that helped cause the Great Recession. It’s a policy that America can’t afford, as Goldwater Executive Vice President Christina Sandefur explains in a new article:

“The Warren proposal offers financial assistance to first-time homebuyers living in areas that were once excluded from government housing programs, and to those who lost their homes during the recent mortgage crisis. It would also commit $500 billion over 10 years to build ‘affordable housing.’

“During the housing crisis, low-income and minority homeowners witnessed a dramatic decline in the value of their homes—a predicament Warren seeks to remedy. But as the Manhattan Institute’s Howard Husock notes, minimizing or eliminating down payments doesn’t ensure stable homeownership. To the contrary, it increases the likelihood that homes will fall into disrepair or be foreclosed. The point of a down payment is to act as a form of insurance for the property owner. Eliminating it makes it more likely that the owner will have to seize the property in the event of default. And that, of course, has lasting financial consequences for the owner and neighbors.

“In fact, it was the federal government’s guaranteed mortgages that helped cause the Great Recession in the first place. People who would have moderated their purchases, or opted to rent, instead bought homes they could not afford, thanks to encouragement from Uncle Sam. Warren’s proposal would double down on that foolhardy approach and further incentivize people to take unwise risks that could devastate them, their families, and their communities.

Click here to read more about how heavy-handed government policies can make housing worse for homeowners—and what can be done to give everyone a shot at their American Dream.

Denver Strikes Again: Man Faces Felony
for Home-sharing “Crime”

Just look at poor Aaron Elinoff, with his bloodshot eyes and an expression somewhere between fear and despair. He must have done something pretty awful to deserve this mugshot, right? Well, only if you think that peacefully renting your property to someone on Airbnb or HomeAway should be a serious crime, because that is ultimately all that Elinoff is accused of doing.

Elinoff faces felony charges in Denver that could land him in prison for six years and result in a $500,000 fine. Find out why he’s facing such a steep penalty for a crime that harmed no one in a new article from Goldwater Senior Attorney Matt Miller.

Goldwater Takes a Stand against Taxpayer Dollars Funding Political Campaign

It is fundamental to American government that taxpayer dollars should not be used for funding political campaigns. In other words, citizens should not be forced to support candidates or causes they do not agree with. Yet that’s exactly what’s happening in Phoenix, Ariz., and that’s why the Goldwater Institute is taking a stand.  

Although Arizona state law wisely prohibits the use of taxpayer resources for electioneering and other political activities, Phoenix’s Valley Metro public transit authority appears to be using public resources to influence the outcome of Phoenix Proposition 105, a voter-led ballot measure that would prohibit the expansion of light rail and redirect revenues to other transportation requirements. 

The Goldwater Institute is challenging Valley Metro’s apparent use of taxpayer resources and has demanded that it stop using its personnel and resources on influencing the outcome of the proposition. Read more about the story here.