I agree with a lot of what Bill Black says, but not all.
Having the government as an 'employer of last resort' (EOTL) is brilliant. Paying people who want to work to sit at home watching TV is *nuts*.
The interviewer suggests that an EOTL program would drive up hiring costs since unemployment would fall. That's possible, but only if the government program were incompetently implemented. Government should pay EOTL employees far more than they'd make collecting unemployment, but less than they'd make if they marketed themselves outside of EOTL. For some, depending on the work they're doing, EOTL should mean that they'd earn less than MINIMUM WAGE. Employees need to be motivated to leave the EOTL program at the first opportunity.
Bill Black makes a statement at the 8'20" mark that 'The most common reason [people bought houses that were too expensive] was through fraud in the inducement'.
BULL. He needs to prove that because I don't believe it. I think the most common reason people rushed to buy houses that were too expensive and that they couldn't really afford is because they acted stupidly - out of fright that they'd lose their opportunty to ever own a home (and, may I remind you, government was responsible for the whole situation), and out of GREED to get in on what they perceived to be easy riches.
If Bill Black believes salesmen who paint an overly optimistic picture of their products are guilty of FRAUD, we have a serious problem in this country. Every fast food joint, car dealership, workout place, casino, country club, television ad, Army recruitment effort, and every political campaign . . . IS EQUALLY GUILTY OF FRAUD.
But that's not what fraud is. Fraud is either a TRICK that's pulled on a victim, or a failed PROMISE... and it should generally be regarded as unenforceable if it's not a failed WRITTEN promise.
So Bill Black's argument ticks me off. Americans already have too much inclination to put the blame for life's problems onto other people. Competent adults are not DEFRAUDED when someone persuades them to purchase something at too high of a price. They're simply displaying their own willingness to make stupid decisions and forego their obligation to do their own due diligence.
You don't blame the salesman for that.
As for his argument about WaMu, I don't doubt that fraudulent practices were at work, but I do doubt that they played as much of a role in home prices as Bill Black tries to lead his listeners to believe.
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