Uncle Sam is Rich Enough to Give Us All a Farm (or at least our Houses back)

Sharon September 16th, 2008

A  welcome, warm and hearty, do we give the sons of toil

To come to the West and settle and labor on free soil;

We’ve room enough and land enough, they needn’t feel alarm -

O! come to the land of freedom and vote yourself a farm.

Then come along, come along, make no delay;

Come from every nation, come from every way.

Our lands, they are broad enough – don’t be alarmed,

For Uncle Sam is rich enough to give us all a farm.

Yes! we’re bound to lead the nations for our motto’s “Go ahead,”

And we’ll tell the foreign paupers that our people are well fed;

For the nations must remember that Uncle Sam is not a fool,

For the people do the voting and the children go to school.

Then come along, come along, make no delay;

Come from every nation, come from every way.

Our lands, they are broad enough – don’t be alarmed,

For Uncle Sam is rich enough to give us all a farm.

- Uncle Sam’s Farm, a patriotic song of the Westward Movement,

I recognize that as modest proposals go, this is of far lower likelihood of implementation than eating Swift’s suggestion that we should eat the children of the poor ;-) .  Still, I feel obliged to mention that there is a way of transforming the nationalization of Freddie, Fannie and the bailout of almost every mortgage-holding bank (at some level or other – they’ve all been bellying up to the Fed’s lending table, using your mortgage as collateral) from a straight out blind rape of the taxpayer and the sale of their children’s future to something reasonably just and good (not perfect).  Because it would be reasonably just and good, and because it would strip the assets of many rich people, it will not happen.  Still, I think it is worth mentioning that given that we’ve all just committed to nationalizing our mortgages – and as long as the taxpayers are going to be paying for millions of mortgages anyway, and as long as we’re nationalizing everything in sight, there really isn’t any reason I can see (other than that it would be a just decision and wouldn’t serve the rich) that we couldn’t simply give everyone with a mortgage held by Fannie and Freddie their houses, free and clear.  And for that matter, anyone with a mortgage held by any bank that needs a massive federal bail out.

There’s even some precedent for this – in the 19th century the US got “rich enough” to give us all (an exaggeration) a farm by buying a large chunk of what is now the US, from people who had previously stolen it from the people who lived there.  The US then promptly stole it some more (I realize this is not a technical description, but it is fairly accurate), and killed off millions of the denizens, and gave away (in trade for improvement and modest fees) a lot of land.  It then helped subsidize other people to buy back the improved or partially improved land from failed homesteaders, and to a degree, improving the lot of many people who went to live in the West on the land of the people they’d destroyed to get it.

There are other precedents as well – in the 1980s, Fannie Mae took over mortgages on New York City apartments that were so far behind code that it was cheaper to sell them to the residents and stick them with the burden of repair than it was to actually fix the buildings and bring them to code.  Friends of mine living in Harlem were offered a chance to buy their apartment for $1 from Fannie Mae – they declined, arguing that $1 was overpriced, and insisting that their landlord bring the building to code, but the precedent suggests that when faced with an irredeemable loss, even the institutions in question know that a below-market sell-off is better than the alternative. 

We effectively have the government owning millions of mortgages, many of which are bad paper or likely to become it. They are, in the net, not assets, but liabilities. The government isn’t precisely rich enough to do much of anything – and they are pouring money into a losing proposition – millions of those houses are going to have negative equity, millions will go into foreclosure – many already are approaching it, since 1 in every 10 Americans is having trouble paying their mortgage.  As the houses are foreclosed upon, millions of Americans get poor, angry and desperate, and most of the foreclosed properties will never even sell at auction – they will be stripped of value, dismantled, squatted in and then bulldozed.  The government will be sued by municipality after municipality because of losses of property values, upkeep, etc…. Right now the government is facing the total loss of a large percentage of the things we invested our wealth in for the last decades.

Or, they could do something truly remarkable and radical – they could obviate the mortgages, speed up the inevitable demise of the companies but allow them a massive tax writeoff, and sell every mortgage held by the government directly, or every corporation that requires a government bailout to the homeowner for a nominal sum – I would suggest $100.  That’s it, you own your house free and clear, the broken remains of our financial system will prevent you from getting a new mortgage, so I hope you like the place, but with that sized investment, most of us would get to have houses and we’d have the pleasure of seeing the housing market hit bottom right fast. 

I’m sure this idea will take hold in congress any time now, since we all know that Bush and Co. are all for the “ownership society.”  The last decade saw more people than ever before owning their houses – and we could, once and for all, make that ownership lasting and profound, allocate property ownership to millions of people facing foreclosure or endless debt slavery.  It would be an economic stimulus package of a sort never before offered.  It would win the election and the love of the people for whoever offered it.  It would transform something nearly worthless into something of infinite value.  It would screw the companies and save the people – because if we can hold on to those small plots of land and the houses that shelter us, we can find ways to grow food, make do, make use of what we have. 

I know that our leadership won’t do this.  But there is also another alternative – we could do it.  During the Great Depression, many rural areas had “penny auctions” for foreclosures – local residents would keep out (often with force) buyers looking for a bargain, and not allow them to bid when houses came up for foreclosure.  And then, as one’s house and goods came up for auction, each person in the community would bid a penny for each item.  At the end of the auction, a hand full of change would be dispensed and the farm and land returned to the original owners.  In other places, groups of tenant activists barred evictions, and sherriffs and city leaders declined to enforce evictions or foreclosures.

The truth is that there’s a great deal that could be done to reallocate housing to the people who need it, and housing wealth to the people who will appreciate it as true wealth – a place of their own, a bit of land to grow food on.  It would require great commitment, organization, a sense of justice and a good bit of anger.  The good thing is that events are certainly proceeding towards anger, anyway.  The truth is that Uncle Sam may not do much for us in the coming years, but he could give us our houses, our little backyard farms.

Not holding my breath, though.

101 Responses to “Uncle Sam is Rich Enough to Give Us All a Farm (or at least our Houses back)”

  1. [...] know who we were so unable to figure out we owed a mortgage. Sharon Astyk, a peak oil author, had a parallel thought suggesting that rather than bail out these failing institutions, the government should just give us [...]

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