Even though voters seem to want to elect an outsider this year, it’s unlikely that dark horse Jonathan Smoke, chief economist for realtor.com, or anyone else with front-line housing industry experience, will be elected to the nation’s highest office in 2016.
Which is a shame, because a basic understanding of how the housing economy works would benefit our country immensely.
The Republican debate last night was focused on foreign policy issues, particularly how to combat terrorism, so economic issues weren’t part of the discussion. But even when economic issues have been talked about in the Democratic and Republican debates, there was little to sink your teeth into if you are involved in the housing economy day-to-day.
I’m sure that’s true for most industries, but most industries don’t have the kind of outsize effect that housing does — for good or for ill — on the larger U.S. economy.
A lack of direct housing experience is largely true for the members of Congress as well. When HousingWire Magazine analyzed the incoming 114th Congress last April, we found only a smattering of housing-related job titles, although it’s a little hard to quantify. For instance, if someone practiced banking law, does that count? What about stockbrokers? How about those who have an insurance background?
If you take a somewhat strict interpretation of what housing experience looks like, here’s what you get. Out of 541 members of both the House and Senate (not including 5 delegates or 1 commissioner), there were:
- 18 who had been bankers or bank executives
- 36 who had worked in real estate
- 16 who had worked in construction
That’s a total of 70 members with housing experience, or 12.9%. North of 10%, but just barely, and it’s hard to know how long or substantial their experience was in those fields.
Presumably, those members are serving on committees or subcommittees that use their industry knowledge to inform housing policy. For instance, on the Senate Committee on Banking, Housing and Urban Affairs, seven Senators out of 22 have some background in economic/housing/banking issues:
- Bob Corker, R-Tenn.: construction, real estate
- Dean Heller, R-Nev.: stockbroker, trader
- Mark Kirk, R-Ill.: economist, banking
- Jerry Moran, R-Kan.: banker
- Jack Reed, D-R.I.: banking, securities law
- Mike Rounds, R-S.D.: real estate
- Patrick Toomey, R-Pa.: financial services
(Of the above, all but Moran also serve on the Senate Subcommittee on Financial Institutions and Consumer Protection.)
Of course, representatives with from any background can develop additional areas of expertise during their stay in Washington, and leadership on housing issues can come from anywhere. Elizabeth Warren, for example, became the architect of the Consumer Financial Protection Bureau after teaching law for 30 years.
Presumably, the next administration will turn to housing experts in both Congress and the industry as they develop and implement their economic policies. There are many critical issues facing the next occupant of the White House, including figuring out the role of the GSEs, what constitutes a stable housing market and how to really address housing for low- and middle-income earners. These issues affect every American, as well as the American Dream.
Here's hoping we choose wisely.