According to reliable sources, the government has decided that I am to underwrite mortgages for people who can't afford to buy a home. Apparently, this will "give many more people the satisfaction and security that comes with stepping over their own threshold". Satisfaction? Has the government forgotten that borrowing in the cause of instant gratification has brought us to this pass? Security? Has it forgotten that it already has one trillion pounds of debt, growing at about £150 billion per year? That it has unfunded liabilities for public sector pensions of another trillion pounds? Of another quarter of a trillion in PFI liabilities? That countries whose underlying finances are in no worse shape than the UK's are paying 7% interest to fund their borrowings—which would blow the economy to kingdom come? That in a country called the United States of America, this ruse has already been tried, ending exceptionally badly for a couple called Fannie and Freddie?
But at least this won't bother some hard-pressed taxpayers—because the government has decided to outright gift £400 million from the rest to property developers (who prospered so well during the Blair/Brown years); a sort of inverse Robin Hood tax.
I have a simpler plan to help first-time buyers: why not allow house prices to fall to a new market level, from the preposterously inflated level caused by a decade of lax monetary policy? Then, in the unlikely event of taxpayers having any spare cash, they might invest it themselves to fund the growth of productive enterprises, which is the only hope for digging ourselves out of this mess.
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