Here’s my most recent offering to the good people of Saskatoon on the antics of the fools at City Hall, who have developed another scheme to rip off, er, the good people of Saskatoon:
The city’s new equity building loan program appears at first glance to be a progressive incentive to improve the lives of those who need a bit of help to get them their first home This is a laudable intention. However, we all know which road is paved by good intentions.
There are several things wrong with this program, which seeks to provide low-cost loans for those with incomes between $45,000 and $70,000. First, it creates an artificial demand in the city’s current housing bubble. By adding 250 new buyers on the market, housing prices will rise that much higher, creating even more difficulty for those who can now barely afford a home and cannot be assisted through this program.
Second, as the demand for new private homes increases, the incentive will be for developers to build new homes for sale rather than sorely needed rental accommodations. Rental space has been at all-time record lows, and the last thing developers need is an excuse not to build more rental units.
If the city truly wanted to handle the affordable housing crisis, they would provide incentives for developers to build new multi-family rental complexes or remove barriers for homeowners to build rental units on their own property.
But of course, municipal politicians would rather cut the ribbon in front of a brand new home they directly financed with taxpayer dollars rather than quietly ensure that 100 new granny suites open up around the city.
Due to the 250-word limit, I was kind enough to omit the fact that this stupid idea has been tried already on a national level in the United States, which of course spawned the global financial meltdown in 2008. To think that somehow Saskatoon is immune to the forces of economics is beyond hubris; it is insane.
Governments have no place providing loans to private individuals to support political pet projects. None. This goes especially for Saskatoon’s municipal government because, well, that’s my tax money. How dare they?
Pat Lorje, Saskatoon’s perpetual political panderer, says that “this isn’t bleeding heart socialism … This is the city deciding housing is important. Instead of investing in stocks and bonds, we’re investing in people.”
I’m sorry, but no. When a government uses tax dollars to subvert the market, it is socialism, “bleeding heart” or otherwise. It doesn’t matter what the intention is, especially because good intentions are almost always behind failed socialistic market-rigging schemes.
(Her insinuation that stocks and bonds aren’t “people” is another canard — what are stocks and bonds if they don’t finance activities of people — but I addressed that issue in my previous post.)
Look, I have to give City Council credit for having avoided the mandatory curbside recycling debacle for so many years. That’s a money pit if there ever was one. But they also have this obsession over affordable housing and yet are unwilling to develop real solutions, like staying out of the way of development. This has got to stop.
Prices are high for rental units. If the private development sector knows that the city isn’t going to build more and more “affordable housing” units, and the price stays high, more units will be built and the rent comes down. That’s how the market works. Similarly, if the home prices in the city are too high, people will stop buying and the prices will come down. That’s how the market works.
Stop these fucking socialist enterprises. Now.
UPDATE: They posted it on Feb. 10, and I noticed the grammatical error in the final paragraph. Anyone else spot it?
I needs me a proofreader.