Giving People Things Isn’t Necessarily Help, And Property Taxes Are Evil


There are a lot of big government, social engineering policies predicated on the idea that giving people something they haven’t earned on their own will improve them as people and citizens. Two examples are housing policy and student loans.

The subprime mortgage market, which came tumbling down like a house of cards at the end of 2008 with dire economic consequences, was created when big government decided that it could produce a better class of citizens by giving home loans to people who weren’t qualified for them. The know-it-alls in government (Republicans and Democrats alike) noted that home owners in general tended to be law-abiding, tax-paying, self-sufficient citizens, and decided that if more people owned homes we’d have more law-abiding, tax-paying, self-sufficient citizens.

So the government created laws and incentives pushing banks to make loans to people who, previously, hadn’t been qualified. This lead to a boom in demand for homes, a spike in housing prices, and all the attendant side effects (e.g. people financing fancy vacations and lavish impulse purchases with the newly-inflated value of their homes). But – surprise! – it turns out these subprime borrowers weren’t getting loans for a reason. They couldn’t pay them, and the market collapsed (after being protracted by some creative maneuvering in the banking industry).

The same is true of student loans. Big government, seeing that college graduates in general were more prosperous than non-college graduates, set about policy that promoted more college graduates. Now student loans are an entitlement. If you want to go to college, regardless of whether or not you’re ready for college, the government will finance your tuition. And colleges, seeing an opportunity to profit (they get paid up front, after all), have lowered standards to let in all these new students and the government money attached to them.

The outcome is now generations of Americans shackled to what is sometimes a lifetime of student loan debt for a degree that has diminished in value. After all, what value is a basic college degree when it stops being something that is earned and starts being something everyone willing to give up a few years of their lives is entitled to?

Which brings me to the subject of this post. In Texas, a Houston family has lost their home which they received as a part of the popular “Extreme Home Makeover” show. It turns out that they couldn’t make the insurance and tax payments, which maybe isn’t surprising given that they could never have afforded to build or purchase the home in the first place (thus, the premise for the show):

The Beach family said they were very happy with ABC’s show but the homeowner told the paper that it’s costing about $1,500 a month just on taxes and insurance. Larry Beach, who is raising four children with his wife, said “It is costing us more to live here than it would to sell it.”

He said it has been a difficult decision. He is grateful that the community came together to put the house together, but the family has been trying to sell the house since February 2013. They even reduced the price from $700,000 to $535,000.

Can we acknowledge for a moment how evil the property tax is? How many times in our society does this scenario play out? Someone owns a home free and clear, but then is forced to sell it anyway (or see it be seized and sold off by the government) because he or she can’t afford to pay the government “rent”  (i.e. the property tax).

Property taxes are an affront to the notion of property rights.

An “Extreme Home Makeover” project in the Fargo/Moorhead area stuck the family living in it with a big property tax hike. “The Moorhead family that was given a new, much larger home last year as part of the TV show “Extreme Makeover: Home Edition” will eventually get something else – a property tax bill more than triple what the family paid before the project,” reported Dave Olson for the Fargo Forum in 2011. That didn’t happen, but according to the family’s property tax statement they did see about a $1,200/year jump in their property taxes from 2010 to 2013.

The Moorhead family still owns their homes, but a lot of the “Extreme Home Makeover” families lose them. The Wall Street Journal reported on a number of them in 2010, and if you search the web you can find more.

Which goes back to my original point: There is a difference between giving somebody something, and allowing somebody the opportunity to earn it.

That speaks to a fundamental divide in American politics. There is one faction that believes people are entitled to things – like home ownership, student loans and months and months of unemployment benefits – and should be given them whether they have earned them or not. There is another faction that believes things must be earned, lest entitlement choke the impetus for self-improvement and achievement.

Rob Port

Rob Port is the editor of In 2011 he was a finalist for the Watch Dog of the Year from the Sam Adams Alliance and winner of the Americans For Prosperity Award for Online Excellence. In 2013 the Washington Post named SAB one of the nation's top state-based political blogs, and named Rob one of the state's best political reporters.

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