My brother Bob recoiled at my idea the other day that the U.S. government consider tearing down some homes that are in default. I saw that idea, proposed in the Wall Street Journal, as a way to avoid further urban blight and spur the housing market by shrinking the overall inventory of unsold homes. Here is what Bob wrote me:
"DON'T tear the houses down. Instead, use them to house homeless individuals and families, including Katrina victims, with virtually no-cost long-term contracts, so long as the heads of households agree to be retrained to work on massive infrastructure programs. The result. You:
1) Get the housing off the market without destroying anything,
2) Help solve the homeless dilemma, and,
3) Gather together the labor force needed to help repair the nation's ailing infrastructure.
Win/Win/Win. It's stupid just to tear these houses down."
Although Bob's idea is filled with compassion and logic, one wonders about the additional bureaucracy needed to figure out who qualifies for the houses; what it will take to set up the entire retraining scheme; and what kind of buyout those who hold the paper on the homes will accept. I am tempted to wonder as well if it is possible to train some people who signed up for loans they had to know they couldn't repay. I don't buy into the theory that all of them were ignorant stooges hoodwinked by greedy mortgage brokers. Not all of them.
On the other hand, I am willing to cut them all a break if they promise to march to the mansion of Countrywide Financial's Angelo Mozillo and drag him to Las Vegas or Miami or some other area savaged by foreclosures, and give him the public flogging he deserves.
And when they are done, lock him up...in one of those foreclosed houses.