A couple of weeks ago, Kevitt Hassett, director of the White House’s National Economic Council, announced that the Trump administration was moving forward with a new policy proposal: Americans, he said, should be able to use 401(k) funds to make down payments on a home.
The idea, Hassett added, would be included in Donald Trump’s presentation at the World Economic Forum in Davos, Switzerland, as part of a larger rollout of the president’s initiatives on housing.
But when Trump spoke in Davos, he made no reference to the proposal. In fact, he largely ignored housing policy altogether. What happened? As it turns out, Trump didn’t like the idea crafted by his White House, so it was quietly scrapped.
It was an embarrassing development, but it was also a timely reminder that when it comes to housing policy, the president and his team don’t exactly know what they’re doing. This came to the fore again at the most recent White House Cabinet meeting.
The quote that stood out — and that the public is likely to see many times in the coming days, weeks and months — was the Republican declaring, “I don’t want to drive housing prices down.” Even so, the context matters.
The full quote is a little long but worth a close reading:
Existing housing, people that own their homes, we’re gonna keep them wealthy. We’re going to keep those prices up. We’re not gonna destroy the value of their homes so that somebody who didn’t work very hard can buy a home. We’re going to get, we’re going to make it easier to buy, we’re going to get interest rates down. But I want to protect the people that, for the first time in their lives, feel good about themselves. They feel that they’re wealthy people. And I want them to understand it. You know, there’s so much talk about, ‘Oh, we’re going to drive housing prices down.’ I don’t want to drive housing prices down, I want to drive housing prices up for people that own their homes. And they can be assured that’s what’s going to happen.
If this doesn’t seem altogether coherent, that’s because Trump seemed unaware of the contradiction at the heart of his position: He wants to “make it easier” for Americans to buy a home they can afford, but he also wants to “drive housing prices up.”
To put that another way, he wants sellers to benefit from higher prices, and buyers to benefit from lower prices — which certainly sounds nice, even if it’s a position badly at odds with how basic arithmetic works.
After Trump became the first and only modern political leader to say publicly that he wants to make homeownership more expensive, Democrats wasted little time in seizing on the quote.
“Are you trying to buy your first home? Trump wants your prices to go up,” Sen. Tammy Duckworth wrote via social media. The Illinois Democrat added, “But sure Donald, keep saying affordability is a hoax.”
