Would-be home buyers may be forced to rent the American dream, rather than buy it

Narrated by Leslie Stahl for the 60 Minutes so-called news program

Reviewed by Steve Halpern

The other day I viewed a story reported by the so-called news program 60 Minutes. This was about the astronomical increases in household rents. The story began with an interview of a couple who live in Jacksonville, Florida.

The landlord of this couple raised their rent from around $1,000 per month to about $1,400 per month. After negotiating with the landlord, the rent was reduced to $1,300 per month. One way this couple has compensated for this huge increase is by purchasing less food.

Leslie Stahl reported that these increases are taking place in most of the rest of the country, especially where the weather is warmer.

Stahl then interviewed Gary Berman who is the CEO of Tricon Residential. Tricon is one of the corporations that is buying up homes and then renting them out at astronomical prices. These corporations are supported by the investment houses of Blackstone, J.P. Morgan, and Goldman Sachs.

This new relationship is making work a lot easier for many real estate agents. When a home goes up for sale, the agent will get on the phone with a representative of these rental corporations. The home is sold immediately, sight unseen. The home is then renovated and rented out at astronomical prices. 

Because young home buyers might have college and car debts, banks are not eager to give these young people mortgages. Since corporations are buying the available homes rapidly, this atmosphere makes it difficult for young people to purchase a home. So, the future generation will be more likely to rent, rather than buy a home. 

What does Leslie Stahl have to say about this problem? Nothing.

To place this problem in perspective, we need to look at a bit of history. In the year 2008, the stock market collapsed. Banks had issued loans to home buyers who weren’t able to repay those loans. We might consider that the assets of banks are in its loans. So, when the stock market collapsed, the assets of banks vaporized. 

We might also say that commodities only have financial value when they are purchased in the market. When commodities aren’t being purchased, those commodities have no financial value. So, when the stock market collapsed in 2008, for a time, no one was purchasing homes. Therefore, the financial value of homes in this country, for a time, had the financial value of zero. 

Well, the supporters of capitalism in the government and in corporations didn’t like the fact that, all of a sudden, all their money had vanished. So, they went to work.

Henry Paulson was the Treasury Secretary in 2008. He came up with a three-page proposal to give $700 billion to the banks. The Congress initially saw the insanity of this proposal and voted it down. 

Then, the Presidential candidates John McCain and Barrack Obama interrupted the campaigns and went to Washington to beg congresspeople to support Paulson’s proposal. Eventually Congress gave Paulson what he wanted. 

After Barrack Obama became President, he continued to give banks trillions of dollars in what his administration called quantitative easing. President Trump followed the lead of Obama and during the pandemic continued to give corporations trillions of dollars.

As a result of these corporate giveaways, today the stock market is at about 30,000 and there are four individuals who own over $400 billion in assets. We see this while working people are facing astronomical prices and home ownership is becoming an impossibility for increasing numbers of people.

This is all happening while there is an entire television station, HGTV, dedicated to home-remodeling. Today, the most affluent ten percent of the population owns at least $1.2 million in assets. So, HGTV is dedicated to showing how that minority of the population can have a beautiful home. However, for the least affluent ninety percent of the population renting is becoming more of a necessity.  

So, now we might sit back, take a deep breath, and think about how things might be different. 

First, when banks lend money to people who are not paying on those loans, who is responsible for this? If massive numbers of people weren’t able to pay on their loans, clearly the banks made the mistake of issuing those loans in the first place. Therefore, the liability for the default on those loans needs to be with the banks and not the government. 

However, in this country, while the government pretends that we live in a democracy, this history clearly demonstrates that the government is nothing more than a support committee for financial interests.

So, if we had a workers government in this country, that government would say to the billionaires that, “You have gouged out tremendous profits from capitalism for many years, but now that system has collapsed. As a result, all of your money is gone.”

A worker’s government would then organize the economy in such a way as to work to eliminate poverty, guarantee that everyone has food to eat, clothes to wear, a decent home to live in, health care, and education. Clearly there are millions of workers who would be overjoyed to do this work and the material resources are there to make this happen. 

However, the people who have power in this country find this rational proposal inconceivable. This is why the answer to the problem of housing in this country and around the world can only be a worker’s government that makes human needs and not profits their top priority.

In order to move towards making this a reality, we need to view ourselves as workers who live in the world. Therefore, we need to be in solidarity with all workers who are struggling for human dignity. This includes those who demonstrate against police brutality, for women’s rights, in solidarity of those who struggle against colonialism, and against the national oppression in the Ukraine and Palestine.