Let Them Rent Tenements

A couple of weeks ago, Barney Frank (in explaining the financial crisis) said that we shouldn’t push “low income people into owning homes that they can’t afford.” Last week, an economist wrote in the Wall Street Journal that “the poor are better off renting.”

All of this pious blaming of the meltdown on poor people misses the point: the mortgage crisis wasn’t caused by poor people buying houses they couldn’t afford. It was caused by middle-class people buying homes made unaffordable by urban planners. As previously noted here, most foreclosures in the last couple of years happened to people with prime, not subprime, credit ratings, suggesting that most were middle class, not poor.

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