I just stumbled over a strong argument in the Washington Post against renewing the first-time home buyers’ credit, put forth by the Baseline Scenario blog’s Simon Johnson and James Kwak. I’ve argued in favor of the credit but believe it should remain isolated to first-time buyers. Johnson and Kwak have some valid criticisms, but I think there might still be ways to fix the credit and largely shield it from their worries.

Those Homes Would Have Sold Anyway

They begin with the often-heard complaint that many people claiming the credit would have bought homes anyway. That’s true. But I think that the number of people who say they would have bought homes without the credit is highly exaggerated. Think about the current economic environment. Real estate is more unstable than it has been in decades; nearly 10% of Americans are unemployed with many others fearing for their jobs; and many people have lost wealth in real estate holdings and the stock market.

Full story is avaialble on Atlantic Online