All the while glimpses of college-age (or, to blow a progressive’s mind: entrepreneur-age, blue collar worker-age, ambition-age) men in communist red serenading their partisan girlfriends, or holding-hands and “sharing a moment,” as The Atlantic described a 15-M couple), as they walk approvingly past signs boasting, “No job. No house. No future. And no FEAR!”
No joke? A tent city date invite is like a graveman’s marriage proposal: as Joyce’s Bloom puts it, “Come out and live in the graveyard. Dangle that before her. It might thrill her at first. Courting death.” Mightn’t these guys have the romantic qualms of George Orwell’s anti-capitalist Keep the Aspidistra Flying protagonist Gordon, who, while living “en bon socialiste” in London’s slums as “part of a lifelong attempt to escape from his own class and become, as it were, an honorary member of the proletariat,” is quite ashamed to shillinglessly date a woman? “What rot it is to talk about Socialism or any other ism when women are what they are! The only thing a woman ever wants is money.” Orwell himself took up arms with Spain’s Socialists during their civil war “to fight against Fascism,” for “common decency.” But today, the romance of the socialist cause is pitching a tent for common handouts.
What fearless changes are J-14’ers demanding? “The revolution was not about the price of watermelons,” Iran’s Ayatollah Khomeini once said, but the Israeli tent summer started as a revolution to change the price of cottage cheese. Cursed be the cheese-makers: high taxes and regulations on entrepreneurs had allowed commodity cartels to inflate prices to levels exceedingly disproportionate to Israeli incomes. So having boycotted cartels into cutting cottage cheese prices by 25%, the emboldened J-14’ers have taken to their tents to protest housing prices – sky high thanks to mystical construction codes and a virtual government monopoly on land – and, while they are at it, car, preschool, diaper, and anything-that-costs-money prices. One outspoken J-14 leader demands that government spending increase from 43 to 55% of GDP. Socialism is in the air, and the pseudo romance of red-bannered marches and tent-outs has yet to burn out in cities across this ancient land of over-priced milk and honey.
But aspidistra or not, unless the Israeli youth rethink their socialist rhetoric and look to pro-market reforms, the only ones they’ll be “sharing a moment” with are Americans, whose embrace of decades of government intervention in the housing market deserves a plurality of blame for our ever-roaring Great Double-Dip Recession.
For, to paraphrase Monty Python, the beatitude of the cottage cheese-makers is not to be taken literally, and ought to be taken in the context of the entire dairy industry. Consider, for example, the parable of the milking machines at the infamous Casa Grande, Arizona co-op, one of America’s first great attempts at “community organizing,” and, I’d suppose, the ideal of the “share the land” tenters. Conceived out of a romantic, well-intentioned government desire to alleviate the suffering of Dust Bowlers who could barely afford more than a tent, “Little Russia,” as skeptics called the resettlement camp of 80 mini-farms, was the answer to FDR Brain Truster Stuart Chase’s question, “Why should the Russians have all the fun remaking the world?”
The Eau Claire Wisconsin Leader called it “just another of those things created by wastrel busybodies whose practical experience must be near zero.” Indeed, settlers worked strictly regimented hours under the supervision of a camp director who openly admired Hitler and, according to one settler, “can’t even crank a tractor” (for heaven’s sake!), only to make enough income to repay a fraction of the project’s government loan. As morale rotted under forced equality and inefficiency, some milkers petitioned for a milking machine, which their research showed would save the co-op three men’s wages each day. The government housing camp director, whose concern was not efficiency but jobs, was furious. One milker recalled his reply: “You are jeopardizing the loan of the United States government, and it’s my job to protect that loan. You’re through, everyone of you – get out!”
The US government’s free housing ambitions chastened only moderately since this New Deal nightmare. Fannie Mae and Freddie Mac, known in insipid Orwellian speak as “government sponsored entities,” were children of the New Deal themselves, but were given Congressional charter for their mortgage bailouts in the wake of the 60s’ Great Society. The 1977 Community Reinvestment Act forced banks to give mortgages to people who did not meet credit standards. Then in 1994, President Clinton fearlessly directed Andrew Cuomo of Housing and Urban Development to release the Fannie, or to put Matt Taibbi’s metaphor to better use: “the a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money” …or an unpaid mortgage.
The problem with Fannie, besides the moral question of punishing responsible borrowers by forcing them to bailout irresponsible borrowers and incentivize Wall Street betting on guaranteed government bailouts, is that it acts for a political return. As “Reckless Endangerment,” a new book by two New York Times columnists of all people, argues, the public-private Fannie partnership meant that profits were privatized and losses were socialized. And profits, it turns out, are a funny thing in government partnerships. For Democrat Fannie director Jim Johnson, profits meant $100 million from Fannie’s federally underwritten slush fund. Meanwhile, Fannie handed out money to corrupt political activist groups like ACORN and friends of insiders like Sen. Chris Dodd, and spent $164 million on its own lobbying interests. With the bursting of the housing bubble and subsequent recession, Fannie is on pace to be the most handsomely rewarded of the bailout brigade, with an expected $300 billion. Alas, brothers and sisters of J-14, let me tell you: you don’t want more government in housing.
The best way to make housing affordable in Israel is to incentivize increased supply. The government, i.e. the Israel Land Authority, owns 93% of public lands. As with Fannie, the ILA acts for political returns, which in the case of housing means picking real estate lords. Competitive pricing requires a transfer of these lands to private ownership. But even if privatization occurs, the government needs to also relax its construction code: planning apartments in Israel takes over 5 years, compared to 1 year in most western countries. And finally, it shouldn’t take a callous Cheney acolyte like me to note that rejecting 94 percent of Palestinian building permit requests in Area C from 2000-2007, or demolishing 730 “illegal” Palestinian homes in East Jerusalem from 2000-2009 (according to Human Rights Watch), while simultaneously subsidizing the housing for wealthy religious settlers, is not going to do wonders for housing prices…nor cottage cheese prices, for that matter.
As shown by the quick and professional response of Israel’s brave security forces to this month’s Al Qaeda-linked bus attacks and Tel Aviv night club jihad, there is no famine of worthy causes in Israel. Yet when it comes to the economy, there is little romance and honor in imploring the government to sprinkle its stale magic. As Orwell’s Gordon puts it, “Every intelligent boy of sixteen is a Socialist. At that age one does not see the hook sticking out of the rather stodgy bait.” Better to take pride in the power of competition and the ingenuity of the individual. To that end, keep the government shrinking, and keep the cottage cheese revolution flying.
(Photo 1: The Atlantic; Photo 2: The Founders' Porch!)
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