Housing Conundrum

There are tons of ideas about how to solve the housing crisis. One is to bail out the banks. Not to your liking? Another flavor is to bail out homeowners. Don't like that? How about using immigration? Huh? A number of people are suggesting a plan that reads "Buy a House, Get a Visa". This country was founded with immigrants. Immigrants made this country what it is. Why are we so afraid of immigrants? Alex Tabarrok at Marginal Revolution quotes a New York Times article that faces this idea head on, saying that the restriction on hiring skilled immigrants is "S-T-U-P-I-D". I don't know enough about the issue to agree or disagree too strongly, but barring companies from hiring smart people seems pretty S-T-U-P-I-D.

I thought this quote from an Indian newspaper editor was well said. Let innovation and ambition ring!

“All you need to do is grant visas to two million Indians, Chinese and Koreans,” said Shekhar Gupta, editor of The Indian Express newspaper. “We will buy up all the subprime homes. We will work 18 hours a day to pay for them. We will immediately improve your savings rate — no Indian bank today has more than 2 percent nonperforming loans because not paying your mortgage is considered shameful here. And we will start new companies to create our own jobs and jobs for more Americans.”

While his tongue was slightly in cheek, Gupta and many other Indian business people I spoke to this week were trying to make a point that sometimes non-Americans can make best: “Dear America, please remember how you got to be the wealthiest country in history. It wasn’t through protectionism, or state-owned banks or fearing free trade. No, the formula was very simple: build this really flexible, really open economy, tolerate creative destruction so dead capital is quickly redeployed to better ideas and companies, pour into it the most diverse, smart and energetic immigrants from every corner of the world and then stir and repeat, stir and repeat, stir and repeat, stir and repeat.”

It probably sounds anti-American or something, but that's not my point. We're American because immigrants came and built this great country of ours. We need help. Let's not be too proud to accept it.