Friday, October 03, 2008

Innovative Market Solutions:

I'm one of those libertarians skeptical of government bailouts of private enterprise. I wish more attention in these types of crises would be paid to innovative market oriented solutions. Here's mine for the mortgage crisis. I don't necessarily think this would solve the problem, but it could greatly help alleviate it: Automatic American citizenship for any person who buys a house, owned by a bank and previously foreclosed on, after a natural security check of said person. The national security check and payment in full to the bank for the real estate would be the only requirements for American citizenship.

Many anti-immigration folks argue against poor, uneducated immigrants coming to the nation looking for cheap work, that too much of it will turn America into a second or third world nation. And obviously those kinds of immigrants wouldn't be buying houses. I don't know how many potential immigrants there are in the first place who have that much $$ laying around. Certainly some relatively rich Europeans who wouldn't mind retiring in an American suburb would qualify. However 1) the dollar is still relatively weak, comparatively, which makes the deal relatively attractive and more affordable. And 2) companies who want to hire educated immigrant workers would be permitted to buy houses (perhaps with tax incentives) for and on behalf of their workers and award them as compensation, holding the "mortgages" for so many periods until the immigrant workers' full rights in the said real estate vest. And keep in mind, the world does have 6 billion people, with only 300 million in the United States. If this plan is open to the entire world, even a small fraction of the relatively world rich and upper middle class could make a difference.

This might be a pie in the sky plan. But, keep in mind, China and India alone each have over a billion people with sizable middle classes, many of them well educated. And there are other nations in similar positions.

American businesses and Universities, who would buy the houses and hold the mortgages on behalf of the immigrants, further, could help "drain the brains" from places like China and India whose rapid growth puts the fear of God into some experts that they soon one day will overtake America's dominant economic might.

So what's wrong with this idea?

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