Greenspan housing solution: Admit more "skilled immigrants" to stabilize U.S. housing market.
'Perhaps 150,000 of those are loosely classified as skilled,' he said. 'A double or tripling of this number would markedly accelerate the absorption of unsold housing inventory for sale -- and hence help stabilize prices.'"
Greenspan housing solution: Admit more "skilled immigrants" to stablize U.S. housing market.
Former Federal Reserve Chairman Alan Greenspan is arguing that the most effective solution to the housing downturn is for the United States admit more "skilled immigrants" who would earn enough to buy houses and stabilize the housing market.
ELMAT: I have some money but I dropped out high school on the seventh grade. Do you think I'd qualify?
In an interview with the Wall Street Journal, the 82-year-old economist estimates there are 800,000 units of "excess supply" housing for sale in the United States, and predicts the housing market will not recover until those homes are sold.
From the Journal: "He did offer one suggestion: 'The most effective initiative, though politically difficult, would be a major expansion in quotas for skilled immigrants,' he said. The only sustainable way to increase demand for vacant houses is to spur the formation of new households. Admitting more skilled immigrants, who tend to earn enough to buy homes, would accomplish that while paying other dividends to the U.S. economy.
More: "He estimates the number of new households in the U.S. currently is increasing at an annual rate of about 800,000, of whom about one third are immigrants. 'Perhaps 150,000 of those are loosely classified as skilled,' he said. 'A double or tripling of this number would markedly accelerate the absorption of unsold housing inventory for sale -- and hence help stabilize prices.'"
Also in the Journal interview, Greenspan sharply criticized the Bush administration's rescue plan for Fannie Mae and Freddie Mac, reasoning the government should have nationalized the companies instead of supporting them as for-profit, shareholder-owned entities. He says the administration and Congress should have "wiped out the shareholders."
-- Peter Viles
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