I was presenting our economic outlook to about 250 C-Suite executives in San Francisco and was answering a question on tax policy when a woman in the back of the room made the following statement:
"It a sin for someone to own ten homes."
I asked her if she meant a Biblical sin because I have a fair amount of experience in the area of Biblical studies and could not think of any examples that would validate her statement. In fact, there are some very rich, highly praised people in the Bible. I went on under the assumption that she meant morally questionable and responded to her this way:
Suppose someone here did own ten homes. That means that there were ten people who wanted to sell and were willing participants to the transaction. They presumably used the cash to deleverage or to pursue some other goal. No one was hurt. We can also assume that lawyers were involved, title companies, banks, and of course, realtors. In short, many people made money off these transactions. Additionally, the ten homes are no doubt using electricity and are maintained, which means more jobs. Real estate taxes are available to the city, county, and state for various government and social services. Again, no one is being hurt. So with jobs being created and government collecting their taxes, how is it morally wrong for a person to own ten homes?
Her answer? "It just is."
I was momentarily stunned and realized that the argument had nothing to do with economics or finance. It was actually about a belief; beliefs are not easily shaken by reason.
This showed me that the ideological polarity occurring in Washington and among the electorate will be with us for a long time despite all the reasonable alternatives we can muster.
Both the Right and the Left can't leave their ideology behind in a quest for answers; thus, we are left with unanswered fiscal and economic problems and ITR's long-standing forecast of a severe economic downturn in the U.S. in about 20 years.