Exactly one year ago, Hurricane Katrina tore a devastating strip out of the U.S. economy, and revealed the failure of successive administrations – Democratic and Republican – to deal with poverty, housingand racism.
The bigger lesson from Katrina has been that the steady dismantling of progressive social policy has a deadly impact on the lives of real people. McMaster Prof. Henry Giroux, writing in the Sunday Toronto Star, notes:
as Hurricane Katrina vividly illustrated, the decline of the social state along with the rise of massive inequality increasingly bars whole populations from the rights and guarantees accorded to fully fledged citizens of the republic and increasingly renders them disposable, left to fend for themselves in the face of natural or man-made disasters.”
For more on Katrina and its aftermath, check out the Katrina Survivors Association.
An increasing number of economists are warning that the next big disaster to hit the U.S. won’t be a force of nature, but a force of imploding markets, specifically, thehousing market.
House prices in the United States’ housing market have been climbing rapidly, and, in recent days, sales have started to slip. The main debate among economists is not whether the housing market is collapsing, but whether it will be a “soft” or a “hard” landing.
In the Sunday Observer, predictions of a big crash that will take down at least 73,000 jobs per month are being offered. While many millions of Americans have been forced out of the market and onto the sidelines (the ranks of the homeless and under-housed are, simply, enormous), a housing market crash will pull down millions more who are in the lower and middle parts of the housing spectrum.
The U.S. housing market is almost entirely dependent on the private sector. Even government subsidies for low-income housing mostly flow into the private market. A crash in the U.S. housing market will not only hurt Americans, but it could have global consequences.
Fasten your seat-belts!
- Michael Shapcott