The lesson that should be learned from the massive failures of housing projects and government intervention in the credit markets to create affordable housing is that heavy handed government involvement in the economy creates worse problems than the ones it is attempting to solve. The counter reaction to a government action seems to be greater in scale and more damaging than the original government action in every case that I can think of; after all, ask yourself whether the low interest rates and easy to access credit really made housing more affordable being that it created a housing bubble that doubled historical prices of homes. The unfortunate problem is that most people are unwilling to learn that lesson, and in a couple of years we will be dealing with another wave of problems caused by government intervention in another area.
