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Salient. Victoria University Student Newspaper. [Volume 39, Number 2. 11th March 1976]

Loans for Housing

Loans for Housing

Because the savings incentives are supposed to attract more money, there should be more money available for housing loans. If, as argued above, they don't, what does that mean. Nothing. The only real effect of the measures here is to making low interest housing loans more expensive. If you're mortgaged to the hilt you've got problems.

Who benefits? Housing finance will be no more expensive for the wealthy, so there's no change there. Things just get worse for the rest of the population. Muldoon also varied overdraft rates more, so now if you're a good golfing mate of the bank manager (i.e. rich), you've got it easier. If not, watch those overdraft rates rise. This could hit hard some business firms (most of which operate on large overdrafts). If so, they could well put more people out of work.

So, we're thoroughly unconvinced Muldoon has the faintest idea how to run an economy. He claims to be worried about a high rate of inflation and a large Government deficit. The measures he's just announced do absolutely nothing for the first, and the only way they can affect the second is if he's planning to reduce Housing Corporation Loans. There's nothing else. With no general effects on the economy, the only thing to be affected is the distribution of income. Things for the rich have been left the same or else improved. Things for the poorer sections of the community have got tougher. Housing loans are more expensive, and unemployment could well rise. But then we all know that class analysis of society doesn't make any sense. Don't we?

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