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The House You'll Never Own · I Believe

• 0:03
  SPEAKER_01: Welcome to I Believe, where we talk about governance and philosophy in America.
• 0:07
  SPEAKER_01: I'm Joel Douglas, and I believe in America.
• 0:10
  SPEAKER_01: Thanks for joining me.
• 0:36
  SPEAKER_03: The Penny Auctions.
• 0:39
  SPEAKER_03: Nebraska, October 6, 1932, five and a half miles southwest of Elgin, in the middle of farm country.
• 0:47
  SPEAKER_03: Teresa Von Baum, a widow who worked her eighty acre farm with only the help of her sons after her husband's death, couldn't make the payment on her four hundred forty-two dollar mortgage.
• 0:57
  SPEAKER_03: The bank moved to foreclose.
• 1:00
  SPEAKER_03: The bank expected to make hundreds or even thousands of dollars for the farm.
• 1:04
  SPEAKER_03: Nearly three thousand farmers from Antelope and neighboring counties showed up at the Von Baum farm that day.
• 1:10
  SPEAKER_03: They stood in silence, waiting.
• 1:13
  SPEAKER_03: The receiver, the bank's man, wanted to reschedule.
• 1:17
  SPEAKER_03: The farmers didn't move.
• 1:19
  SPEAKER_03: After some back and forth, the receiver finally backed down.
• 1:23
  SPEAKER_03: The auction would proceed.
• 1:25
  SPEAKER_03: The auctioneer started.
• 1:26
  SPEAKER_03: Cows went for thirty five cents apiece.
• 1:29
  SPEAKER_03: Six horses sold for a total of five dollars and sixty cents.
• 1:32
  SPEAKER_03: Ploughs, a hay binder, and a corn planter all brought just a few cents.
• 1:37
  SPEAKER_03: Harvey Pickle remembered it later.
• 1:40
  SPEAKER_03: Some of the farmers wouldn't bid on anything at all, because they were trying to help the man that was being sold out.
• 1:46
  SPEAKER_03: When it was over, the farmers passed the hat among themselves.
• 1:49
  SPEAKER_03: The total came to one hundred one dollars two cents.
• 1:52
  SPEAKER_03: They immediately returned the animals and equipment to Theresa Von Baum.
• 1:57
  SPEAKER_03: Then the farmers handed the money to the receiver.
• 2:00
  SPEAKER_03: He looked at the crowd, probably counted heads, probably decided that forcing the issue wasn't likely to get him a cent more, and might get him a broken nose or worse.
• 2:10
  SPEAKER_03: He accepted the money as payment in full for the mortgage, got in his car, and drove back to town.
• 2:17
  SPEAKER_05: People called them penny auctions.
• 2:19
  SPEAKER_05: Others called them Sears Roebuck sales, because a penny was what you paid for something in a catalog.
• 2:26
  SPEAKER_05: A joke price.
• 2:28
  SPEAKER_05: This wasn't for just one widow in Nebraska.
• 2:30
  SPEAKER_05: In 1931, about 150 farmers showed up at another foreclosure auction, the Von Bonn family farm in Madison County, Nebraska.
• 2:39
  SPEAKER_05: The first bid was five cents.
• 2:42
  SPEAKER_05: When someone else tried to raise it, he was forcibly requested not to do so.
• 2:47
  SPEAKER_05: Item after item got only one or two bids.
• 2:50
  SPEAKER_05: The total proceeds were$5.35.
• 2:54
  SPEAKER_05: The farmers expected the bank to accept this sum to pay off the loan.
• 2:58
  SPEAKER_05: In Wood County, Ohio, on January 26, 1933, some 700 to 800 farmers stood out in the cold at Wally Cramp's farm.
• 3:08
  SPEAKER_05: Cramp owed$800 on a loan he couldn't repay.
• 3:12
  SPEAKER_05: He'd been hospitalized with appendicitis, and crop prices had collapsed.
• 3:16
  SPEAKER_05: The farmers bid pennies on each item, then returned everything to Cramp on a 99-year lease.
• 3:22
  SPEAKER_05: They passed the hat.
• 3:24
  SPEAKER_05: Even the auctioneers donated their take from the sale.
• 3:27
  SPEAKER_05: In some places, farmers threatened outsiders who might think about bidding with physical harm and death threats.
• 3:33
  SPEAKER_05: These were not empty threats.
• 3:35
  SPEAKER_05: This was happening all over the Midwest.
• 3:38
  SPEAKER_05: There were maybe a dozen auctions a day in early 1933.
• 3:42
  SPEAKER_05: Iowa, Nebraska, Wisconsin, Minnesota.
• 3:46
  SPEAKER_05: Farmers who had paid their mortgages for 10, 15, 20 years, never missed a payment, were losing everything.
• 3:54
  SPEAKER_05: The banks had structured the loans to fail when credit dried up.
• 3:59
  SPEAKER_03: Before the 1930s, most mortgages in America were five to ten years, interest only, with a huge balloon payment at the end.
• 4:07
  SPEAKER_03: You paid the bank for years, then you had to refinance the whole thing all at once.
• 4:12
  SPEAKER_03: If you couldn't roll it over, the bank took the farm.
• 4:15
  SPEAKER_03: Or the house.
• 4:16
  SPEAKER_03: When the economy crashed in nineteen twenty nine, banks stopped lending.
• 4:20
  SPEAKER_03: In nineteen thirty two, two hundred seventy three thousand people lost their homes to foreclosure.
• 4:27
  SPEAKER_03: By nineteen thirty three, banks foreclosed on more than two hundred thousand farms.
• 4:32
  SPEAKER_03: Between nineteen thirty and nineteen thirty five, farmers lost a third of all American farms.
• 4:48
  SPEAKER_05: Lamar's, Iowa.
• 4:50
  SPEAKER_05: April 27, 1933, a Thursday afternoon, Judge Charles Clark Bradley, 54 years old, a bachelor with 15 years on the bench, looked up from his desk at a rowdy crew shoving their way into his small courtroom.
• 5:05
  SPEAKER_05: Some were farmers in ragged overalls.
• 5:08
  SPEAKER_05: Others looked like ruffians from nearby Sioux City.
• 5:11
  SPEAKER_05: They kept their hats on, kept smoking.
• 5:13
  SPEAKER_05: They'd come to demand that Judge Bradley suspend foreclosure proceedings until recently passed state laws could be considered.
• 5:21
  SPEAKER_05: One farmer remarked that the courtroom wasn't Bradley's alone.
• 5:26
  SPEAKER_05: Farmers had paid for it with their taxes.
• 5:30
  SPEAKER_05: Judge Bradley refused.
• 5:31
  SPEAKER_02: He said, Take off your hats and stop smoking in my courtroom.
• 5:38
  SPEAKER_05: Next thing he knew, dozens of rough hands were mauling him.
• 5:42
  SPEAKER_05: They yanked him off his bench and dragged him out to the courthouse lawn.
• 5:47
  SPEAKER_05: Will you swear you won't sign no more mortgage foreclosures?
• 5:50
  SPEAKER_05: demanded a man with a blue bandana across his face.
• 5:53
  SPEAKER_05: Judge Bradley's quiet answer.
• 5:57
  SPEAKER_02: I can't promise any such thing.
• 6:01
  SPEAKER_05: Someone struck him in the mouth.
• 6:02
  SPEAKER_05: Will you swear now?
• 6:04
  SPEAKER_05: The jurist toppled to his knees.
• 6:06
  SPEAKER_05: His teeth felt loose, but he managed to reply.
• 6:10
  SPEAKER_02: No, I won't swear.
• 6:13
  SPEAKER_05: A truck rattled up.
• 6:15
  SPEAKER_05: The men threw Judge Bradley into it.
• 6:17
  SPEAKER_05: His kidnappers tied a dirty handkerchief across his eyes.
• 6:21
  SPEAKER_05: The truck drove a mile out of town and stopped at a lonely crossroads.
• 6:25
  SPEAKER_05: Again they asked the judge to sign no more foreclosures.
• 6:28
  SPEAKER_05: Again he refused.
• 6:30
  SPEAKER_05: They slapped and kicked, knocked him to the ground, and jerked him back to his feet.
• 6:36
  SPEAKER_05: They tied a rope around his neck, the other end thrown over a roadside sign.
• 6:41
  SPEAKER_05: They tightened the rope.
• 6:42
  SPEAKER_05: Judge Bradley wheezed, thought they were killing him.
• 6:46
  SPEAKER_05: Now will you swear to sign no more foreclosure orders?
• 6:50
  SPEAKER_05: A man unscrewed a greasy hubcap from the truck and placed it on his head.
• 6:56
  SPEAKER_02: Judge Bradley looked at them and said, I will do the fair thing to all men, to the best of my knowledge.
• 7:04
  SPEAKER_05: They pulled the noose tight.
• 7:06
  SPEAKER_05: Just in time, a local newspaper editor arrived in his car and intervened.
• 7:10
  SPEAKER_05: Judge Bradley refused to identify his assailants or press charges.
• 7:14
  SPEAKER_05: Iowa Governor Clyde Herring called the attack a vicious and criminal conspiracy and assault upon a judge while in the discharge of his official duties, endangering his life and threatening a complete breakdown of law and order.
• 7:28
  SPEAKER_05: He declared martial law in Plymouth County.
• 7:31
  SPEAKER_05: He sent in three National Guard companies from Sioux City and a fourth from Sheldon.
• 7:35
  SPEAKER_05: The case made the front page of the New York Times.
• 7:38
  SPEAKER_05: Twelve days later, Governor Herring lifted martial law.
• 7:42
  SPEAKER_05: Seven men were eventually tried for the attempted lynching.
• 7:46
  SPEAKER_05: They got sentences ranging from one to six months.
• 7:51
  SPEAKER_03: The penny auctions effectively forced the banks to release the property without an opportunity to be paid the balance of the loan.
• 7:58
  SPEAKER_03: If the pennies didn't clear the bank debt, the farmers physically threatened the bank officers.
• 8:03
  SPEAKER_03: So legally the farmer still owed.
• 8:06
  SPEAKER_03: But practically, the system had broken down.
• 8:09
  SPEAKER_03: With the beginning of Roosevelt's presidency in 1933, creditors and debtors began to work together to refinance and resolve payment of delinquent debts.
• 8:19
  SPEAKER_03: Between 1933 and 1935, 25 states passed farm foreclosure moratorium laws that temporarily prevented banks from foreclosing.
• 8:29
  SPEAKER_03: The Federal Farm Bankruptcy Act of 1934 aimed to provide farmers with the opportunity to regain their land even after foreclosure.
• 8:37
  SPEAKER_03: The penny auctions didn't erase the debt.
• 8:40
  SPEAKER_03: But they made normal foreclosure impossible.
• 8:43
  SPEAKER_03: They created chaos.
• 8:45
  SPEAKER_03: Mobs dragging judges out of courtrooms, nooses at farm auctions.
• 8:50
  SPEAKER_03: Armed farmers blocking highways.
• 8:52
  SPEAKER_03: This chaos threatened domestic tranquility.
• 8:55
  SPEAKER_03: That's one of our six national goals outlined in the preamble to the Constitution.
• 9:00
  SPEAKER_03: Ensure domestic tranquility.
• 9:02
  SPEAKER_03: When hundreds of farmers are willing to lynch a judge to stop foreclosures, you no longer have domestic tranquility, you have the early stages of revolt.
• 9:11
  SPEAKER_03: So the federal government had a choice.
• 9:14
  SPEAKER_03: It could side with the lenders and use force to restore order, send the National Guard to areas of interest, arrest citizens, or it could step in and redesign the system so that foreclosure wasn't the only option when credit dried up.
• 9:28
  SPEAKER_03: Roosevelt chose the second path.
• 9:31
  SPEAKER_05: In 1934, Congress established the Federal Housing Administration, FHA, as part of the New Deal.
• 9:39
  SPEAKER_05: The idea was simple.
• 9:40
  SPEAKER_05: The government would insure mortgages for private lenders, which would get banks lending again.
• 9:46
  SPEAKER_05: But FHA came with a condition.
• 9:48
  SPEAKER_05: If the government was going to insure a mortgage, that mortgage had to be fair to the borrower.
• 9:54
  SPEAKER_05: No more interest-only traps.
• 9:56
  SPEAKER_05: No more time bombs.
• 9:58
  SPEAKER_05: Every payment would include a portion of the principal.
• 10:02
  SPEAKER_05: And the term had to be long.
• 10:04
  SPEAKER_05: Initially 15 years or more, later extended to 20, and eventually to 30.
• 10:09
  SPEAKER_05: At the end of the term, the borrower would own the house free and clear.
• 10:14
  SPEAKER_05: That was the deal.
• 10:15
  SPEAKER_05: The government would step in to set conditions to make the housing market fair for Americans.
• 10:20
  SPEAKER_05: And those loans would be designed to end.
• 10:23
  SPEAKER_05: Designed to turn debt into property within a normal working life.
• 10:28
  SPEAKER_05: Designed to make the borrower an owner, not just a lender from a bank, someone with equity and security.
• 10:35
  SPEAKER_05: Then, in 1938, Congress created Fannie Mae, the Federal National Mortgage Association, to buy those FHA insured mortgages from banks and create a secondary market.
• 10:47
  SPEAKER_05: They built the whole system around the principle that mortgages had a finish line achievable by working Americans in their lifetime.
• 10:54
  SPEAKER_05: When government first stepped into housing finance, it used its power to limit how long the debt could last.
• 11:00
  SPEAKER_05: Because the alternative, letting the old system grind on, meant more Judge Bradleys with ropes around their necks, more penny auctions, more bricks through windows, more breakdowns of law and order.
• 11:12
  SPEAKER_05: The government stepped in on behalf of borrowers because not stepping in meant civil unrest.
• 11:19
  SPEAKER_03: Fast forward to 2025.
• 11:21
  SPEAKER_03: Today we have the same basic structure.
• 11:24
  SPEAKER_03: Now, there's a new proposal.
• 11:34
  SPEAKER_03: But because the term is longer, it would add hundreds of thousands in extra interest over the life of the loan.
• 11:40
  SPEAKER_03: And if you buy at forty, the current average age of a first-time homebuyer, you're making your last payment at ninety.
• 11:47
  SPEAKER_03: Only about twenty five percent of those who reach sixty five get to be ninety.
• 11:52
  SPEAKER_03: Instead of using government power to shorten the road from debt to ownership, we are proposing to use that same power to stretch it.
• 11:59
  SPEAKER_03: The proposal might keep payments small enough to feel manageable, but it also maximizes how much interest a family pays over a lifetime, and many will never achieve a house they own free and clear.
• 12:12
  SPEAKER_01: So, our question.
• 12:15
  SPEAKER_01: Why would government deliberately choose a structure that benefits lenders instead of buyers?
• 12:21
  SPEAKER_01: Everything costs something.
• 12:23
  SPEAKER_01: If we are going to subsidize home ownership, we have choices about what we're subsidizing.
• 12:29
  SPEAKER_01: To give power back to the people, there are lots of things we could do.
• 12:33
  SPEAKER_01: We could subsidize the interest rate instead of stretching the term, saving first-time home buyers money over their lifetime, and enabling them to own their home outright sooner.
• 12:43
  SPEAKER_01: We could incentivize builders to build more houses that hit lower price targets.
• 12:48
  SPEAKER_01: We could ban zoning laws that make building houses less profitable.
• 12:52
  SPEAKER_01: A 50 year mortgage does the opposite.
• 12:55
  SPEAKER_01: It extends the trap.
• 12:57
  SPEAKER_01: It makes real, debt-free ownership something most buyers will never live to see.
• 13:04
  SPEAKER_04: Act two.
• 13:06
  SPEAKER_04: Sarah and Michael Meet Sarah.
• 13:11
  SPEAKER_04: It is 1955.
• 13:12
  SPEAKER_04: She is twenty seven, a nurse at Louisville General.
• 13:16
  SPEAKER_04: She comes home from the night shift with swollen feet and the smell of antiseptic clinging to her hair.
• 13:23
  SPEAKER_04: Her husband, Tom, sorts mail for the post office.
• 13:27
  SPEAKER_04: His back aches when he bends to pick up their two little boys.
• 13:31
  SPEAKER_04: Sarah is expecting their third child.
• 13:34
  SPEAKER_04: They're still in a rented duplex.
• 13:36
  SPEAKER_04: One tiny bedroom for them, one for the boys.
• 13:41
  SPEAKER_04: Crib jammed against the wall.
• 13:43
  SPEAKER_04: There's a damp spot on the ceiling over the kitchen table that nobody ever fixes.
• 13:48
  SPEAKER_04: One Sunday, after church, they drive through the highlands.
• 13:53
  SPEAKER_04: They see a for sale sign in front of a small brick house.
• 13:57
  SPEAKER_04: Three bedrooms, one bath, hardwood floors, eleven hundred square feet, built in nineteen forty-eight.
• 14:06
  SPEAKER_04: Price eleven thousand five hundred dollars.
• 14:09
  SPEAKER_04: You've been saving every spare nickel for a down payment.
• 14:13
  SPEAKER_04: The bank offers a thirty-year FHA insured mortgage at four and a half percent.
• 14:19
  SPEAKER_04: Ten percent down one thousand one hundred and fifty dollars.
• 14:24
  SPEAKER_04: Payment would be around fifty two dollars a month with taxes and insurance.
• 14:30
  SPEAKER_04: That night, Sarah sits at the kitchen table with a pencil and a pad of cheap paper.
• 14:35
  SPEAKER_04: The boys are asleep.
• 14:37
  SPEAKER_04: Tom is reading the sports page.
• 14:40
  SPEAKER_04: She does the math, lips moving.
• 14:43
  SPEAKER_04: If they do this, if they make every payment, they will send the bank about nineteen thousand dollars in all.
• 14:50
  SPEAKER_04: About eight and a half thousand in interest, the rest toward the house itself.
• 14:56
  SPEAKER_04: She circles one number.
• 14:58
  SPEAKER_04: The last payment would come when she is fifty eight.
• 15:02
  SPEAKER_04: Tom would be sixty.
• 15:04
  SPEAKER_04: After that, there would be no more checks to the bank, just taxes and insurance.
• 15:10
  SPEAKER_04: The house would be theirs.
• 15:12
  SPEAKER_04: She presses her hand to the spot where their third baby kicks and imagines that child running down a hallway that belongs to them.
• 15:21
  SPEAKER_04: Her parents never owned a house, they worked and rented and worked some more, and at the end there was nothing but a trunk of clothes and a few dishes.
• 15:32
  SPEAKER_04: They don't follow Sarah's numbers, but they understand the stakes.
• 15:37
  SPEAKER_04: She is about to break the pattern.
• 15:40
  SPEAKER_04: Sarah and Tom got the loan.
• 15:42
  SPEAKER_04: Years later, Sarah made her last payment in 1985.
• 15:47
  SPEAKER_04: She was fifty eight.
• 15:49
  SPEAKER_04: She tore the check out of the checkbook, walked it to the mailbox herself, and stood there for a minute after she closed the lid.
• 15:58
  SPEAKER_04: Tom asked her later why she'd done that.
• 16:01
  SPEAKER_04: She said she didn't know.
• 16:05
  SPEAKER_00: Now meet Michael and Emily.
• 16:07
  SPEAKER_00: It's 2025, they are 33, both work full time.
• 16:12
  SPEAKER_00: Michael teaches history at DuPont Manual.
• 16:15
  SPEAKER_00: Emily does marketing at Brown Foreman, sliding between meetings and endless email.
• 16:22
  SPEAKER_00: On paper, they are doing everything right.
• 16:24
  SPEAKER_00: They are also early.
• 16:26
  SPEAKER_00: Most of their friends still rent.
• 16:28
  SPEAKER_00: A few have moved back in with their parents.
• 16:30
  SPEAKER_00: Michael and Emily are trying to get ahead of their generation and buy a house before prices climb again.
• 16:37
  SPEAKER_00: They have been trying for a baby too.
• 16:40
  SPEAKER_00: Quietly.
• 16:41
  SPEAKER_00: They haven't told their parents yet.
• 16:43
  SPEAKER_00: Every month that passes without a second line on the home test makes them think about money even more.
• 16:50
  SPEAKER_00: If it does happen, will they be able to afford daycare and a mortgage and groceries?
• 16:56
  SPEAKER_00: One evening, they sit at their own kitchen table in a rented apartment and pull up a listing.
• 17:01
  SPEAKER_00: Same neighborhood.
• 17:03
  SPEAKER_00: The exact same house Sarah and Tom looked at 70 years earlier.
• 17:08
  SPEAKER_00: Three bedrooms, one bath, 1100 square feet, the kitchen has granite now, the photos are brighter, the old bones are the same.
• 17:17
  SPEAKER_00: Price,$265,000.
• 17:20
  SPEAKER_00: The bank offers a 30-year mortgage at 7% interest.
• 17:25
  SPEAKER_00: With taxes and insurance, the payment comes to about$1,765 a month, roughly a third of their take-home pay.
• 17:34
  SPEAKER_00: Michael feels his stomach clench when he says the number out loud.
• 17:38
  SPEAKER_00: The loan officer smiles and offers something else.
• 17:42
  SPEAKER_00: A 50-year mortgage, same interest rate, longer term.
• 17:47
  SPEAKER_00: The payment drops to about$1,600, just under 30% of what they bring home.
• 17:53
  SPEAKER_00: It is not comfortable, but it is not impossible.
• 17:57
  SPEAKER_00: Back at their table, it's Emily who opens the laptop.
• 18:01
  SPEAKER_00: She pulls up an online calculator.
• 18:04
  SPEAKER_00: Michael sits across from her, hands knotted together so tightly his knuckles go white.
• 18:09
  SPEAKER_00: Emily does the math.
• 18:11
  SPEAKER_00: She shows the screen to Michael.
• 18:13
  SPEAKER_00: He looks at the number and doesn't say anything for a time.
• 18:17
  SPEAKER_00: They walk through it, line by line.
• 18:20
  SPEAKER_00: If they take the 50-year loan and never miss a payment, they will send the bank a little over$956,000,$265,000 in principal.
• 18:32
  SPEAKER_00: More than$690,000 in interest.
• 18:35
  SPEAKER_00: The last payment due when they are$83.
• 18:40
  SPEAKER_00: Not many of the men in his family live into their late 80s.
• 18:43
  SPEAKER_00: Emily would have to carry the debt.
• 18:45
  SPEAKER_00: She'll be 83, still writing checks to the bank for a house they thought they were buying together.
• 18:51
  SPEAKER_00: Michael stands up and paces a tight circle in the small room.
• 18:56
  SPEAKER_00: Emily stares at the number on the screen.
• 18:59
  SPEAKER_00: Then she closes the laptop gently, like she is afraid to break it because she can't afford to buy a new one, and crawls into bed in the next room.
• 19:08
  SPEAKER_00: She pulls the covers over her head.
• 19:11
  SPEAKER_00: Somewhere under all that fabric is the thought she does not want to say out loud.
• 19:16
  SPEAKER_00: The room is very quiet, just the hum of the refrigerator and the distant sound of a train.
• 19:24
  SPEAKER_04: Let's pause here.
• 19:26
  SPEAKER_04: Same house, same street, same square footage.
• 19:31
  SPEAKER_04: For Sarah and Tom, the total interest bill is around$8,500 over 30 years.
• 19:39
  SPEAKER_04: For Michael and Emily, the interest is more than$600,000 over fifty years if they choose the new product that makes the monthly number work.
• 19:49
  SPEAKER_04: The house didn't grow.
• 19:51
  SPEAKER_04: The walls aren't thicker.
• 19:53
  SPEAKER_04: The yard didn't expand.
• 19:56
  SPEAKER_04: What changed is who the mortgage is built to serve.
• 20:00
  SPEAKER_04: In nineteen fifty five, the local bank likely kept Sarah's loan.
• 20:05
  SPEAKER_04: Her payment flowed into a building downtown and came back out as savings interest and salaries for people who lived near her.
• 20:14
  SPEAKER_04: Officials who had watched farms and homes fall in the nineteen thirties designed the mortgage.
• 20:21
  SPEAKER_04: They wanted loans that ended, loans that turned renters into owners during their working life.
• 20:28
  SPEAKER_04: In twenty twenty five, Michael and Emily's loan won't stay with their bank at all.
• 20:35
  SPEAKER_04: It'll be sold to Fannie May, bundled with hundreds of others, turned into a bond, and sold to investors who may never set foot in Kentucky.
• 20:46
  SPEAKER_04: Pension funds, insurance companies, wealthy families, foreign governments.
• 20:53
  SPEAKER_04: They will collect the interest for as long as Michael and Emily can keep paying.
• 20:58
  SPEAKER_04: The extra twenty years on that fifty year loan are not there for Michael and Emily.
• 21:04
  SPEAKER_04: They are there for the people on the other end of the bond.
• 21:10
  SPEAKER_01: It doesn't have to be this way.
• 21:13
  SPEAKER_01: The government could use its power in housing to help in cleaner ways.
• 21:17
  SPEAKER_01: We could lower the interest rate for first-time buyers, as we did for veterans after the Second World War.
• 21:23
  SPEAKER_01: Same thirty years.
• 21:25
  SPEAKER_01: Smaller payment because the loan itself was cheaper, the family pays off the house while they are still working.
• 21:32
  SPEAKER_01: Or we could lean on prices, as FHA once did when it tied maximum loan amounts to wages and construction costs.
• 21:39
  SPEAKER_01: It could lean on zoning and tell states that want federal money to allow more homes on the same land.
• 21:45
  SPEAKER_01: We know how to do every one of those things.
• 21:48
  SPEAKER_01: We have done them before.
• 21:50
  SPEAKER_01: Instead, the new idea on the table is a mortgage that lets Michael and Emily sign now, feel a little relief when they see the monthly payment, and quietly gives away.
• 22:00
  SPEAKER_01: Two more decades of their future income to bondholders.
• 22:04
  SPEAKER_01: Put Sarah and Michael in your mind.
• 22:08
  SPEAKER_01: For Sarah, the mortgage is a hard climb with a clear top.
• 22:11
  SPEAKER_01: At 58, she steps off the last rung.
• 22:14
  SPEAKER_01: When Tom dies, the households are up.
• 22:16
  SPEAKER_01: For Michael and Emily, the mortgage is something else.
• 22:19
  SPEAKER_01: It runs out past their working years into a fog of what ifs.
• 22:23
  SPEAKER_01: What if the baby comes?
• 22:25
  SPEAKER_01: What if one of them gets sick?
• 22:26
  SPEAKER_01: What if a job disappears?
• 22:28
  SPEAKER_01: The house is no longer a promise that one day the payment goes away.
• 22:32
  SPEAKER_01: It is a contract that follows them to the end.
• 22:36
  SPEAKER_01: The bank owns the house for their lifetime.
• 22:38
  SPEAKER_01: They'll likely never own it outright.
• 22:42
  SPEAKER_01: Sarah stood at that mailbox in 1985, and the house was hers.
• 22:46
  SPEAKER_01: Michael might stand at that same mailbox in 2075 if he lives that long.
• 22:51
  SPEAKER_01: Fifty years of checks.
• 22:52
  SPEAKER_01: Both of them worked hard.
• 22:54
  SPEAKER_01: Both of them loved their spouses.
• 22:56
  SPEAKER_01: Both of them wanted the same thing.
• 22:58
  SPEAKER_01: But only one of them got to be free of it while they could still walk to the mailbox on their own.
• 23:05
  SPEAKER_03: Act 3.
• 23:06
  SPEAKER_03: The dead have no rights over the living.
• 23:10
  SPEAKER_03: Thomas Jefferson wrote to James Madison in 1789 about debt, about whether one generation could bind the next.
• 23:18
  SPEAKER_03: Jefferson said, the earth belongs to the living, not the dead.
• 23:22
  SPEAKER_03: No debt should last longer than a generation, because the dead have no rights over the living.
• 23:28
  SPEAKER_03: Madison wrote back, Thomas, if we did that, we'd have no continuity, no long-term projects, no bonds.
• 23:37
  SPEAKER_03: Jefferson backed off, but he never gave up the core idea.
• 23:41
  SPEAKER_03: A republic should not chain the living to obligations they never consented to.
• 23:46
  SPEAKER_03: Michael's kids will inherit the debt for his house while the mortgage is still being paid.
• 23:51
  SPEAKER_03: They didn't sign the paper, but the debt will still be there.
• 23:55
  SPEAKER_05: The Fifth and Fourteenth Amendments say the government can't take our life, liberty, or property without due process.
• 24:02
  SPEAKER_05: The courts agree.
• 24:11
  SPEAKER_05: Liberty includes the right to marry, establish a home, and bring up children, along with the rights to contract, to engage in any of the common occupations of life, to acquire useful knowledge, the right to establish a home, not rent one from a bank forever.
• 24:32
  SPEAKER_05: Nobody's saying the government has to buy you a house.
• 24:35
  SPEAKER_05: But once it steps into the housing market and it already had to in 1934, due to shady bank practices, it's no longer a bystander.
• 24:45
  SPEAKER_05: If Fanny and Freddie say we'll buy 50-year mortgages, they're putting the power of the United States government behind a loan structure where most buyers will never own their house free and clear.
• 24:56
  SPEAKER_05: They'll spend their whole adult lives paying the bank.
• 24:59
  SPEAKER_05: Liberty isn't just the freedom to sign a contract.
• 25:02
  SPEAKER_05: Inherent in a contract is a beginning and an end.
• 25:05
  SPEAKER_05: It's the freedom to finish it and move on.
• 25:10
  SPEAKER_01: We are condemned to be free.
• 25:13
  SPEAKER_01: We grow under the weight of our own choices, not under the weight of a payment book that outlives us.
• 25:20
  SPEAKER_01: When the government standardizes mortgages that run past a normal lifetime, it's not helping you get a key.
• 25:26
  SPEAKER_01: It's turning home ownership into permanent tenancy.
• 25:30
  SPEAKER_01: You live there.
• 25:31
  SPEAKER_01: The bank owns it.
• 25:33
  SPEAKER_01: And that shouldn't be the federally blessed default answer to a housing crisis.
• 25:38
  SPEAKER_01: If the Constitution protects our liberty to establish a home, then a government that normalizes 50-year mortgages is not expanding that liberty.
• 25:48
  SPEAKER_01: It is quietly redefining home as a place you can live in, but never live free of the debt that is attached to it.
• 25:56
  SPEAKER_01: Back to our question.
• 25:58
  SPEAKER_01: Why would government deliberately choose a structure that benefits lenders instead of buyers?
• 26:03
  SPEAKER_01: It pretends to solve a political problem, just not for you.