FWIW # 21 Build Back Bad December 2021

This is a short FWIW due to the Washington focus on the Build Back Better (BBB) legislation. I am confused. The Republicans in Congress want to take control in the 2022 elections. They, however, are focused on taxes and immigration when the real issue that has the potential to severely erode the financial security of the middle class in America over the long term has nothing to do with immigration and taxes. Have you heard any Republican senators talking about protecting middle-class financial security? No. Neither have you heard any of the conservative media, which are focused on immigration and taxes, doing so. It makes a person wonder why the conservatives in Congress and the media are ignoring the one issue that could just about ensure a landslide in the congressional elections in 2022 and in the presidential election in 2024.

President Obama was the first to try to put in place this middle-class wealth-destroying move, but he could not get it implemented. President Trump put a stop to it all together. President Biden and the liberal leadership in the House of Representatives have it in the BBB. Majority Leader Schumer has it in the Senate’s version of the bill. What is this middle-class killer?

In the BBB, there is a provision to federalize state and local zoning laws. The progressives want to do away with single-family residential zoning. They call single-family zoning “outdated,” “needless barriers to affordable housing,” and “economically discriminatory.” Their theory is that single-family zoning replaced racial discrimination after the Supreme Court ruled racial discrimination illegal in 1917. The liberals believe that economic discrimination through the zoning laws is racist and that local and state governments enacted it to hold people down. This provision to remove single-family zoning is not just for the future, it is for all existing property that this zoning restriction covers. Liberals think this will allow for more affordable housing. They believe putting duplexes, triplexes, quads, and large multifamily units in former single-family neighborhoods will bring diverse socioeconomic groups together and result in more affordable housing. Hear what they are really saying: They want to bring the value of single-family homes and the associated neighborhoods down so that multifamily units can profitably be built in those neighborhoods. In all likelihood, the multifamily units will be government-subsidized rental units

Forget the wealthy. They live in areas where, even if the land value were cut in half, it would not be economically feasible to develop affordable housing without massive subsidies, but, even in wealthy neighborhoods, the specter of the federal government deliberately subsidizing low-income rental units in the neighborhood is real. Throughout history, families in this country selected neighborhoods of single-family homes that were right for them. The residents in these neighborhoods were the same types of people, who worked hard and strived for the same goals. Some people will say that statement is discriminatory, but it is not. Striving to better your family and have a more pleasing life is part of the American dream, no matter what anyone says. Let me make it clear: Seeking opportunities to rise above one’s original station in life is part of the fabric of this country. If a person wants to strive to get ahead, no matter what their education level, skin color, gender, or age, it is easier to succeed today than at any other time in the history of this country. Anyone who says that’s not true is a failure themselves. Anyone who is willing to work long hours and sacrifice like our parents and grandparents did can do it. Look at many of the Hispanic families that have come here, not knowing the language, not having any serious education, and, in some cases, not having a great deal of training or experience. Many are succeeding and now have their own businesses. Watching them is inspiring. Those who preach, “Woe unto me, I’m discriminated against,” are the true impediments to success for those who listen to them.

Many families took out mortgages that forced them to be tight on their budgets but were doable. They did this to be a step higher on the social ladder. They also felt that when they retired, paid off their mortgages, and wanted to downsize so that they could experience comfort in retirement, they could sell their homes for more than they had paid, keeping most of the gain for investment to supplement their retirement incomes. Look around your local community. Whenever a neighborhood changed and allowed multifamily housing, did the homes maintain and increase their value? Not likely. Home value is a major component of many middle-income families’ net worth as they struggle to give themselves a stable environment, with both spouses working full-time jobs. How does undercutting hardworking families’ efforts to succeed translate into putting in place the right governmental policies for this country? It does not.

There is a segment of this country that resents and detests what this country is. How did these people get into positions of political power? Blame big business and its greed for more profits through globalization. While the senior management stuffed their pockets with unearned bonuses, they allowed their workers to go more than thirty years without real wage increases. Starting in 1980, under the administration of the revered Ronald Reagan, lower and middle-class families found that it took two spouses working to maintain their lifestyle. Children had to be put into day care. Schools became the primary source of nutrition for lower-income children. Shame on Republicans and Democrats alike. Having undermined the freedom and pride of a wide swathe of Americans, they are now targeting the next rung up on the social ladder by systematically undermining a major part of families’ net worth. How did the majority of Americans allow this to happen?

In this age of mass communication across the internet, somehow voters have developed a standard of picking leaders by personality and celebrity status. Voters no longer ask tough questions and pick their leaders at local, state, and federal levels based on candidates’ well-thought-out answers to these inquiries. The internet could be a place where candidates answer tough questions. This concept came from one of our readers, who understands the imbalances in this country. Next year will be a good time to begin changing the direction of how we elect our leaders. Each of us should develop a list of important questions about a candidate’s stand on policy issues like zoning, what is taught in schools, and how the candidate will protect everyone’s opportunity to work hard and succeed.

You now know why Democrats are saying the BBB will reduce inflation. It will eventually destroy single-family home values.

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On another subject, Fitch Ratings has declared China’s two major property developers to be in “restricted default” on their debt. Both owe substantial amounts of money to foreign (non-Chinese) bondholders, many of which are funds and institutional investors in the US. Yet these investors are still pouring money into this adversary country. This is another reason why most individuals and pension plans should only invest in individual securities in the US. An individual securities strategy is contrary to investing doctrine today, but funds and non-US investing have high unnecessary risks, which will become more evident in the future.

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Aly’s fiction debut focuses on the impact of a decision one judge made 17 years before—and the challenge of achieving justice. Ernst “Cal” White-Callaway, a judge in Berkshire County, Massachusetts, complied with his mother’s wishes almost two decades back to continue with his engagement and marry Catherine White instead of Josey, the woman he fell in love with after a short acquaintance. Now trapped in a loveless marriage, Cal conducts an affair with Maggie Latham, a librarian committed to aiding abused young women. Cal and Maggie are members of the Berkshire Book Club, an organization banded together to make decisions outside of the law about how to handle issues of crime in a community rocked by organized crime activities.

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Print Date: 11/29/2021

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