Tomah Journal - "Unsustainable exurban development exposed by mortgage meltdown"

I was led to this excellent article via The Political Environment blog:

From the Tomah Journal:

Thursday, April 10, 2008

Editorial:
Unsustainable exurban development exposed by mortgage meltdown

One of many realities exposed by the recent mortgage meltdown is the economic and environmental unsustainability of exurban development.

So, what did the U.S. Senate do in response? It passed a bill to subsidize more exurban development.

The Senate passed an awful bill last week that would create $6 billion in new tax subsidies for homebuilders. It also includes $10 billion in tax-exempt bonds for local housing agencies to refinance subprime loans and provide new mortgages for first-time home buyers, $4 billion in grants for local governments to buy foreclosed properties and $100 million to expand counseling for homeowners at risk of defaulting on their loans.

In an overbuilt housing environment, the last thing the federal government should do is encourage another building binge. While the government can’t stop anyone who can afford it from scraping off a piece of farmland and erecting a 2,500 square foot home, the government has no obligation to subsidize it. If the government is going to be an active player in the housing market, it should pursue policies that:

• Encourage people to live closer to where they work. A family may have every right to choose an exurban subdivision, but the government is under no obligation to pave a convenient commuter road or provide preferable tax treatment. Such funds are better spent on mass transit and refurbishing existing neighborhoods.

• Encourage the purchase and renovation of existing housing stock. While there will always be a need for new residential housing construction, much of the recent boom is driven by families who scoff at the idea of a used house. There’s nothing wrong with that, but the government is under no obligation to subsidize that preference. It’s difficult to imagine a circumstance in which the Federal Housing Administration (federal) or Wisconsin Housing Economic Development Authority (Wisconsin) should issue a loan for new residential construction.

The explosion of residential development in the countryside has environmental and economic consequences that have finally come home to roost. It’s more sustainable to live in a city or village and consume less gasoline driving to work. It’s time for government taxing and spending policies to reflect that truth.

All stories copyright 2006 Tomah Journal and other attributed sources.