The Pursuit of Happiness
"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness."
"No person shall be...deprived of life, liberty, or property, without due process of law..."
In those distant years, the issue was slavery...some considered it a "right" to hold slaves as property, and as a key to their happiness, in terms of the material wealth they delivered. Our modern equivalent, at least for the sake of today's topic, is the "right" to own a home.
For most of the last century, owning a home was considered to be the linchpin of the American dream. If you had one, you had achieved the dream, at least to some degree...if not, well, you probably hadn't yet fulfilled your pursuit of happiness. Owning a home came to symbolize the achievement of freedom...freedom from the landlord. In one's home, we were taught, a man was the king of his own castle.
Somewhere along the way, the concept of "owning" a home became muddled with the reality of "owing" a mortgage. Older generations of Americans can remember when "burning the mortgage" was a family celebration that was looked forward to, even more so than retirement. But gradually over the decades, the idea of moving into your new home, even though you owned very little of it, became the ultimate definition of "owning" one's own home. Once you were in it, it was yours.
Sadly, this alluring illusion of property ownership was shattered in the world banking collapse of 2008. Millions of homes now have been lost to the "owners" and have reverted back to the mortgage holders. They sit empty...a tribute to the misguided ideal that property and happiness are one and the same.
Ask those who moved into the home of their dreams with little or no down payment, only to have to pack their families and leave a couple of short years later. Does home "ownership" come easily, without a cost?
Ask those who now owe a mortgage that is larger than the market value of the home that it is held against. Is home ownership a guarantee of short-term financial gain?
Ask those who would like to sell their homes but can't, due to the deflated state of the real estate market. Does home ownership ensure freedom to move about the country, making profit after profit as subsequent houses are turned?
Ten years ago, even five years ago, all these things were believed by most Americans. Now, we all know better, and the country is a sadder but wiser place.
Included in that wisdom is the realization that the housing industry, precisely because it delivered the American dream, is key to the general economic miracle that is, or was, the United States.
And the housing industry is near ruins, a mere shadow of it former exciting, job-intensive, production-driven self. All because we have collectively learned that home ownership is not realized at the mortgage signing. The pursuit of happiness may include that first day of sitting in your newly-acquired house...but until that final payment is made, the home mortgage acts more like an anchor to our pursuit of happiness.
This, I am afraid, has become a lesson that has deeply impacted at least two generations of Americans. In the process, the tradition of home ownership may have gone the way of the traditions of marriage, large families, and patriotism. They now all represent quaint, if somewhat dated, components of an American dream that is seemingly no longer shared by a large percentage of our population. We may be in the early stages of becoming a renter nation.
Does that mean that the housing industry is dead, never again to regain its luster as the vehicle to heaven on earth? Perhaps. One thing for sure...the vision of all Americans as homeowners is dead, not just because well-meaning politicians have killed it, but because the realities of world economics are grinding down the American Dream.
What of the industry? Can it be revived? There is no doubt that our government has tried, and will continue to try, because there is now a dawning recognition in the halls of Congress that housing is a bellwether of our economy.
But like the auto, energy, and healthcare industries, the debate is whether the government should take the reins or hand them off to the private sector. We'll take up the pros and cons shortly in a future post.