President Bush’s 2009 budget includes a proposal to spend hundreds of millions of dollars on programs aimed at helping people avoid foreclosure on their homes. Although the programs are small and won’t help many of the people who are in trouble, any help at all sends the wrong signal: that you can borrow beyond your means and the feds will bail you out when you get in trouble.
But, as the Antiplanner has noted before, the real reason why many people bought houses that were more expensive than they could afford was that state and local land-use rules had driven up housing prices. So Heritage Foundation scholar Ron Utt has an idea: make mortgage relief conditional on deregulation of land use.
