One of the worst aspects of the federal tax code is the way it treats saving. Under ordinary circumstances, saving is treated to double taxation at the individual level, reducing after-tax returns to saving and...
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Question for National Association of Realtors: Should Homebuyer Credit Ever Be Eliminated?
The issue of whether or not to extend the homebuyer credit is before Congress. The housing lobby of course is out in full force saying that the U.S. economy needs this help. For example, here's what one paid shill from the National Association of Realtors said:
"The housing market would not have moved without this tax credit," said Lucien Salvant, spokesman for the National Association of Realtors. "It's a fragile recovery, which is why we think it should be extended."
When the economy is recovered, is the NAR going to support its elimination? Not a chance. There's a better chance of Glenn Beck being appointed to Obama's cabinet than NAR ever advocating for eliminating a tax preference for housing.
Assuming the homebuyer credit is extended to June 30, 2010, come May next year the NAR and NAHB lobbyists will be on Capitol Hill again saying that the economy still hasn't recovered. And then when it's extended for another year and the economy is fully recovered, they'll be saying things like "we can't afford to go back to where we were 18 months ago with lower home prices." By then, it will be permanent, and any time discussion of repealing it or scaling it down is brought to the forefront, NAR will cite how home prices are going to fall if it's repealed. You get what Milton Friedman called a tyranny of the status quo, or an endowment effect of a tax provision.
By the way, here's what the NAR had to say back in 2007...according to this ad, you'd never think our economy would "need" a credit for homebuying.
A year later, here's what they were saying:
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