[branchless]

That is insane. Why are working people paying someone's mortgage? The personal situation this woman finds herself in sounds dire and my sympathies go out to her.

However from a financial point of view this is simply the state preventing mortgages from ever failing. Banks are protected by our taxes.

[leoedin]

Guess what happens when you receive housing benefit while living in rented accomodation.

The state pays your landlords mortgage.

Why is it more insane for the state to pay the mortgage of someone who clearly has very little, than for them to pay, via housing benefit, the mortgage of a buy-to-let landlord? Assuming the amounts of money are similar, the former seems preferable to me.

For some reason _noone_ seems to be talking about the fact that the people profiting most off the benefits system are middle class buy-to-let landlords. Housing benefit costs the government £20bn a year and it's just going to go up with house prices.

http://budgetresponsibility.org.uk/wordpress/docs/Welfare_tr...

[pjc50]

The alternative would be to wait for her house to be repossessed and then pay for her rent, which would probably be a greater figure; and in the short term the local authority would have to house her and the children in a hotel until they found a suitable house. Along the way she would lose the vast majority of her personal possessions.

It only pays interest, not principal, and it's conditional on receiving another benefit.

[branchless]

Feels like a safety net for the banks that she happens to benefit from.

We badly need a massive crash in house prices. This woman's case is pretty exceptional and emotive so I don't think it's a great example.

In general we need a huge crash and to hell with the few who bought in near the top. All future generations are facing turning over most of their wages to the banks without a correction.

And yes you correctly point out we need property taxes.

As I said stop using this one person as an example it's not helpful for a discussion of policy. We can all cite disabled people negatively impacted by high prices as a counter-point.

[pjc50]

No, it really is part of the housing safety net and always has been. And I think it's not all that rare either: people generally only stop paying their mortgages as part of a life collapse (unemployment, divorce, bereavement). If you want to engineer a price crash try realistic property taxes rather than throwing the disabled under a bus again.

[branchless]

Just read something that made me think of this:

    When the workers swelled the ranks of the poor, the government stepped in once more — 
    this time to assist capitalists who petitioned for tax-funded favors.
    As even the anti-libertarian historian Christopher A. Ferrara explains, 

    “England’s response to the crisis of poverty among the landless proletariat” was a system of poor relief supplements 
    to meager wages, adopted de facto throughout England (beginning in 1795) in order to ensure that families did not starve.
    The result … was a vast, government-subsidized mass of wage-dependent paupers 
    whose capitalist employers, both urban and rural, were freed from the burden of paying even bare subsistence wages.

http://fff.org/explore-freedom/article/enclosure-acts-indust...

Just like tax credits (and housing benefit).

The UK establishment have been "helping" the poor for a long time.

[ZenoArrow]

Isn't part of the problem that a high number of council houses got sold into the private market, and haven't truly been replaced?

[pjc50]

This is also part of the problem.

It's of a piece with the other 80s privatisations: rather than provide services by the state, move them into the private sector (but still paid for by the state), guaranteeing profits to the purchasers.

[DanBC]

> Why are working people paying someone's mortgage?

They aren't. They only pay the interest. The claimant still has to pay off the capital.

Your lack of understanding of this bit of SMI (previously housing benefit (and this rule has been a rule of HB for very many years)) makes it pretty clear that you don't have a clue what you're talking about.

[branchless]

Housing benefit is a major cause of the problems we have.

It's "landlord benefit". Rents should not be topped up because landlords want more.

If you don't think housing benefit is a problem we are just wasting time. Your view on market rates, on how land prices are set is just not thought-through.

You don't understand how prices are set and are sadly one of a large bunch of people who want to help but who are making life worse for everyone because you want to get all touchy-feely instead of reading some books.

[DanBC]

What problems are caused by housing benefit?

It's not an unlimited payment. Do you know what a local housing allowance is?

> It's "landlord benefit". Rents should not be topped up because landlords want more.

How else are poor people supposed to pay for accommodation?

[pjc50]

Housing benefit isn't brilliant, but we can't just cut it off without a huge expansion of council house building for people to live in instead.

[branchless]

Sure I'm not proposing a single "solution". However I am saying that housing benefit is a substantial part of the near-enslavement of the UK. It's so bad even "shelter" haven't been calling for it recently as it dawns on them how things actually work and that they've been campaigning for the bankers for years.