Economists: Expand the Housing Tax Credit

Now we are seeing the banking industry, and academic economists, supporting an extension and expansion of the home buyer tax credit: I got this from the NY Times, and I have to say I agree whole heartedly... John Maynard Keynes used to call it priming the pump, but we have seen this called "socailism" by those obviously unfamiliar with what Socialism actually is...

I quote:

More than 40 percent of all home buyers in 2009 will qualify for the federal tax credit, costing the government about $15 billion, twice the original estimate, but most housing experts applaud the policy and favor expanding it.

Now the decision is up to Congress.

Mark Zandi, chief economist for Moody’s Economy.com, believes that the credit should be expanded to all homebuyers, even investors, through summer of 2010. “The risks of not doing something like this are too great,” he said. “I don’t think the coast is clear.”

James Glassman of JPMorgan Chase also favors expanding the credit but continuing to limit it to first-time buyers.

Industry members who are lobbying for the extension are optimistic and say they believe an extension will be approved in some form. “There will be a lot of water under the bridge, a lot of compromise, between now” and a final bill, said Richard A. Smith, chairman of the Business Roundtable’s Housing Working Group.

End Quote
Source: The New York Times, David Streitfeld (09/15/2009)

Given this, and the fact that the economy is still losing jobs at alarming rates, we should stimulate in many ways, and this is a good one, impacting many industries.