This congressional meeting was about the FHA and congressmen/woman were being asked to fund FHA multi-family homes just like they have funded simple-family homes.
When a congresswoman asked the supporters of FHA funding if they published information on delinquent loans, they could not provide any published numbers. What are they hidding?
The FHA supporters went on to suggest lower interest rates will help provide more affordable housing to help people at a time when the nation is in a recession.
Then Peter Schiff went on to explain why this is not true. Government backed lower interest rates cost taxpayers money is many ways, first by putting people in houses that they cannot afford which results in defaults which are directly paid for by taxpayers.
The poor are given houses that they cannot afford and then when they default the loses cause an increase in taxes on them and they end up even poorer than they were before with lower credit and higher interest rates on any other debts in the future.
Mr. Schiff predicted the defaults on government supporting housing will be 20-30 percent, much higher than the supporters of FHA loans suggest.
The real beneficiary of government funding in the housing market are the homebuilders, real estate agents, and banks.
The congressional panel then tried to turn the conversation to government subsidized flood insurance, which Mr. Schiff quickly showed how subsidized flood insurance does not really help people.
What it does is lower the cost of living in areas that are prone to flooding, therefore costing everyone money when the floods come – by increasing the taxes to pay for the damages.
If the government didn't subsidized flood insurance, fewer people would build house in flood prone areas, which would lowing the cost of housing + damages for everyone.
This video is a clear example of just how congress has gone off the deep end and instead of helping people they are causing them to sink further into poverty. Government housing subsidies convince people to make bad decisions about the homes they purchase that result is costing everyone billions of dollars.
Freddie Mae and Fanny Mia are prime examples that have cost hundreds of billions of dollars already and are likely to cost tax payers trillions before they are complete dismantled.
Here is the video of Mr. Schiff at this congressional meeting;