Furthest Right

How Government Leaves Crisis in its Wake

Now that the COVID-19 debacle has come to an end — its origin was military, it was not severe, the treatments did not work, the shutdowns killed people — we can start admitting to the damage that was done.

In particular, the COVID-19 panicdemic response caused a housing price crash because speculators bought houses with government dosh:

House prices in ZIP Codes with high fraud were 5.7 percentage points higher than in low-fraud ZIP Codes in the same county, even when controlling for a range of other possible factors, researchers at the University of Texas at Austin’s McCombs School of Business said in a study released Thursday.

The new research says people who received fraudulent loans were significantly more likely to purchase a home during the program than those who got the money legitimately, ultimately driving up home prices for everyone around them.

About $117 billion in fraudulent Paycheck Protection Program loans—amounting to 15% of all the money doled out—were issued during the course of the program, which ran from April 2020 through May 2021, according to research from Kruger and his co-authors, one of whom testified on his findings before Congress.

When you hand out free money, you have to expect that some of it will be stolen because the determination of who gets the money is decided by low-capability bureaucrats. Anyone else would have a real job, so you get the dross.

This free money plus the fraud then causes a market distortion and ordinary people suffer.

In the meantime, absolutely no one denies the equation that free stuff from government means higher prices. They all know it is true, and also know that the egomaniac solipsist voters will never figure this out because it would require thinking of someone other than themselves for twenty seconds.

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