Thursday, February 14, 2013

Great, Let's Do It

Naturally, I agree strongly with Martin Wolf here.  Commenters there don't seem to agree as much, but it always strikes me whenever I read an article in a financial section/magazine/paper that the comments are overwhelmingly right wing (and generally hacks at that: "Fiat currency is a fraud!"). 

I'm not sure why this is exactly, but I suspect that most of the people who read such articles are the same as the people who blew up the economy for everyone, but that are doing quite well now (while others continue to suffer).  It's kind of a shame, because most people do not and will not understand economics well enough to figure out that we are being screwed over for no good reason.  The things that will fix the economy sound outrageous to most people, but that's only because our economic system itself sounds (or would sound) outrageous to most people.

Monday, February 11, 2013

Can't Stand HOA's

The idea behind a home owners' association is really good.  For a lot less than it would normally cost an entire neighborhood can get things like lawn care and snow removal and other benefits.  But the rules that most HOA's add-on to that sensible base arrangement are nothing short of tyrannical

I can not begin to comprehend people who defend such antics.  Yea, the couple were maybe jerks in how they handled things, but $900 for a sign 4" too big?  That would piss me off too, and so I don't see their response as particularly untoward, but rather a clever protest (definitely passive least until the lawsuits). 

When I went looking for houses I very deliberately avoided HOA neighborhoods.  I don't want someone telling me acceptable grass height or whether I can make certain changes to the house/property (I already don't like the township rules for those things).  It seems to me the couple in that article would have been better served by doing likewise. 

Tuesday, February 05, 2013

Definitely a Problem

I don't know that the housing bubble is the correct analogy for the student loan clusterfuck, but I suppose it references something people have some sense of scale of.

There are some fixes that would be hugely beneficial: the ability to have student loan debt written off in bankruptcy, no federal backing for private loans, caps on annual loan amounts for federal backed loans (maybe $10k/year for tuition plus some sliding scale for living expenses of up to maybe $15k/year, with most places being limited to $5k or so), probably a few other things.

That doesn't really deal with the problem of existing/outstanding student loan debt.  I like the idea of a structured, massive, one-time forgiveness plan.  It could be something like the stimulus idea(s) I've put up here before, or just a dramatically enhanced version of the slightly-better-than-it-used-to-be student loan debt changes Obama put through (pay a max of a certain percentage of your income, and all outstanding debt forgiven after, I think, 20 years).  Making student loan payments fully deductible rather than just interest (yes, I know, I hate deductions, but it's how we roll)--also maybe raising the income limit at which you can no longer deduct--and lessening the payment forgiveness term to 15 years would be a start, reducing the max payment amount to 10% of income, or at least by a point or two would also be nice. 

Another Vampire Squid Article

I know people complain about epistemic closure (living in the bubble) on the right, but I often wonder if there is a similar but opposite phenomenon on the left.  Basically, if Obama and/or his people were to read this piece would they instantly discount it as valid because it is "left-wing"?  My feeling is that they do.  Just think: despite being correct always and forever Paul Krugman's ideas are not even brought up by the president...not even as a what if, as in what we should be doing if congress wasn't dysfunctional.

Monday, February 04, 2013

Well, yea, but...

I am far more libertarian when it comes to zoning laws than most people, so I too think that adding an in-law suite to a house should be perfectly fine, though I do understand why it mostly isn't.  That said, if you want to have them you can't say this:
Cherry Hill ordinances lump "mother-in-law suites" with auto-salvage businesses, junkyards, and heliports as impermissible in residential areas. The township wants to prevent single-family homes from conversion into duplexes or rental apartments, which makes sense. [emphasis added]
Um, no, it doesn't make sense. A house with an in-law suite is a duplex/house with apartment.  If one family owns a house, adds an in-law suite and then sells that house, the new owners can easily rent out the in-law suite as an apartment.  You cannot both want to have in-law suites and not have apartments.  The closest you can come is to limit them somehow (no more than 1 suite, and the size of the suite must account for less than 40% of the total square footage of livable space). 

Also, what about someone who wants to add an in-law suite for down the road, and is hoping that a few years of renters could help to offset the cost before mom/dad move in?

Particularly in more dense areas (cities and close in suburbs) adding an apartment/flat/in-law suite is an excellent idea, but even if it is only serving as the in-law suite for the original owner, it must be available as an apartment for that value to be realized.

Deductions are Insane

Yes, I will take advantage of as many deductions as I can (easily) manage.  No, that is not hypocritical. 

Our tax code is artificially complex and inordinately stupid.  Deductions are very, very unfair for multiple reasons, but the biggest are that wealthy people get more breaks, and they encourage bad behavior (e.g. bigger houses with little down).

The regressive side probably bothers me most.  Someone with $27k in income (MAGI minus standard deduction) only gets $0.15 back for every extra dollar of deductions.  Someone with $102k in income gets $0.28 back for each extra dollar.  On top of that, higher income individuals can afford more house and more children (and pay more in state/local taxes), which means the size of their deductions are often much larger.

If we want people with kids to get something from the government, we should do that: pay everyone $2500/year/kid.  That way income doesn't matter, and we now have a big spending program that Republicans can go after.  Same with housing.  If we want people to buy a house, rather than rent (for whatever reason) we should just have the government send every homeowner a $4k check each year and lose the mortgage, PMI, and real estate tax credits.

I'm actually kind of surprised that the state/local income tax thing doesn't come under more fire from red state (Republican) politicians.  Basically if you live in a low tax state you are subsidizing people in CA and NJ.  Why is that remotely fair?  (Yes, I know, red states tend to get far more back in federal outlays than they put in, unlike high tax blue states, but this still seems like an easy break for them to target, especially since the entire GOP tax ideology is illogical.)