The Only Government Guarantee Is UNAFFORDABILITY | Freedom Friday

Government promised affordable college.

Government promised affordable housing.

Government promised affordable insurance.

Today those are the three least affordable parts of American life.

Coincidence?

In this Freedom Friday episode, Chad Law examines how government incentives, subsidies, guarantees, mandates, and regulations often create the very problems they were supposed to solve.

Featuring:
✔ Student Loan Crisis
✔ College Cost Explosion
✔ Housing Market Distortions
✔ 50-Year Mortgage Proposal
✔ Insurance Rate Shock
✔ California Insurance Collapse
✔ Florida Reform Results
✔ Incentives vs Intentions

PLUS: 12 minutes of Rumble-exclusive audience Q&A.

If you see us, share us.

📞 252-CHAD-LAW

Related Link

https://rumble.com/c/CommonSenseWithChadLaw

00:00 Cold Open

05:00 Show Introduction

11:00 College Affordability

30:00 Housing Affordability

44:00 Insurance Affordability

56:00 Closing Thoughts

56:00 Rumble Exclusive Q&A Begins

01:08:00 End

#CommonSense #ChadLaw #FreedomFriday #HousingCrisis #StudentLoans #InsuranceCrisis #Affordability #Economics #GovernmentPolicy #Politics

Transcript

Chadq: So a few months back, the federal government rolled out its big new idea to fix the housing crisis. Ready for it? The 50 year mortgage. 50 years. They put out a graphic and everything. FDR on one side with the 30 year mortgage, our current guy on the other side with the 50, like it's a sequel, like it's an upgrade. The housing finance director went online and called it, and I'm quoting, a complete game changer. And he's right. It does change the game. The game where you eventually pay the thing off. Yeah. That one's canceled. Because here's how the fifty year mortgage works. On a three hundred thousand dollar loan, your monthly payment drops about three hundred bucks. Sounds great. And over the life of the loan you pay roughly a quarter of a million dollars more in interest. So you save three hundred a month y to lose two hundred and forty seven thousand dollars total. In certain circles, we call that a worse deal. And the whole pitch, the entire reason they floated it, is affordability. We gotta make home ⁓ affordable. Meanwhile, the average first-time home buyer in America is now years old. 40. At that point, you're closer to collecting Social Security than you are to your high school reunion. And it's not just housing, it's every week. Every single week there's a new one, a new housing affordability plan, a new college affordability plan, a new insurance affordability plan. And every one of them opens with the exact same sentence. We're gonna make this more affordable. But can I ask a rude question? How's that working for you? It's my Dr. Phil. Because the three least affordable things in American life right now, the three things that actually decide whether you ever get ahead, happen to be the exact three things the government has spent 50 years trying to make affordable. At some point, you stop calling that a coincidence. At some point, you start calling it a pattern. I'm Chad Law, the last gay conservative, America's binary brother, the common sense extremist living in radical reality, the walking contradiction all your professors warned you about. Broadcasting truth on the only rainbow that matters: the red, white, and blue rainbow. And folks, this common sense. ⁓ The show where we read the fine print so you don't have to, where we bring receipts so you don't have to ruin another Thanksgiving. The show for the other eighty percent of Americans. The people busy raising families, building businesses, paying taxes, coaching Little League, serving their communities, and wondering when common sense became controversial. While cable news, political consultants, professional activists, and social media outrage merchants spend all day arguing about the loudest 20% of the population, we focus on the people who actually keep America running. This is the big tent, the shelter for the politically homeless, the politically exhausted, the politically independent, and The common sense conservatives and everybody else tired of being told they have to choose between two bad ideas. Here, reality gets a vote, results matter, truth matters, common sense matters. Welcome home. All right, let's talk about money. Not your money, that'd be rude twice in one show. Let's keep talking about the money you hear about. For the last few years, the whole country's been stuck in one conversation. Prices, right? You felt it, I felt it, everybody felt it. Eggs went to eight bucks. I bought eggs one morning and the cashier asked if I wanted to finance them. Gas, groceries, the electric bill. The thing where dinner for two now costs what a car payment used to cost. That was the inflation conversation, the my check doesn't go as far conversation. And here's the thing about that conversation, folks: it hurts, it's real, it's infuriating and also survivable. The $8 eggs are a cost of living crisis. Cost of living is the stuff that hits your week, your wallet, your Tuesday. It's loud, it's brutal, and you notice every single time you tap your card. But it doesn't decide your life. You can hate the price of eggs and still build a good life. Underneath that one, though, there's a quieter crisis, one that doesn't show up at the end of the grocery store. Doesn't trend, doesn't get a cable news countdown in the corner of the screen. It's called the cost of life. Not cost of living, cost of life. Three things: college, housing, insurance. And these three don't hit your Tuesday, they hit your whole arc. Whether you ever build any wealth at all, whether you own the roof over your head or just rent it from someone who bought it in 1994. Whether you retire or whether retirement turns into one of those words like phone booth that you have to explain to your grandkids. Whether your kids walk across the stage at 22, free and clear, or walk across it owing more than you earned in the first five years of your working life. Eggs are a bad week. College, housing, and insurance are a bad life. That's the whole difference. One is the cost of living, the other is the cost of life. Here's what I can't stop chewing on, folks. Here's the thing rattling in my skull 24-7. Eggs, gas, groceries, nobody designed those to go up. That was just the economy doing its ugly thing. Nobody in Washington walked up to a podium and announced the Affordable Egg Initiative. ⁓ but college, housing, insurance, those three, those exact three, have had decades of help. Decades, program after program after program, plan after plan after plan. Every one of them with the word affordable stamped right on the front like a sticker on a used car. We have been trying to make college affordable my entire life. Housing affordable, my entire life. Insurance affordable, my entire life. And those are now the three things you can't afford. So that's the question. That's the whole mystery sitting on the table tonight. If the government has spent fifty years trying to make college, housing, and insurance affordable, why are those things the least three affordable in America? Okay, show of hands at home, and I can't see you, but I'll know if you're lying. You've heard of FAFSFA, right? F-A-F-S-A, that form, the financial aid form, the one with more questions than a TSA agent who doesn't like your face. You filled it out, or your kid filled it out, or you co-signed something at a kitchen table at 11 o'clock at night while quietly d questioning every decision that led you to that moment. Pell grants, federal student loans, student aid. And here's the part where I'm supposed to sneer. Where the conversation guy goes, ⁓ government program, bad, right? That's the script. Well, you know me, I'm not gonna do that because I think most of the people who built those programs actually meant it. The whole idea was beautiful. Smart kid, poor family, shouldn't matter. We'll help you get to college, we'll help you become a doctor, an engineer, whatever you got in you. That's not a villain origin story. That's a genuinely lovely thing to want. I'm with you. I supported it. Most of America still supports it. You pull this stuff and helping kids afford college is up there with puppies and air conditioning. Nobody's marching against the dream of an educated kid. So let me be clear before we go one inch further. This is not the part where I tell you student aid is evil. No. This is the part where I ask one annoying little question. And once you hear it, what's the name of the game on this show? You're not gonna be able to unhear it. And I apologize in advance. You'll think about this at a dinner party someday and resent me? That's okay. Here's the question. What if helping someone borrow money and making something affordable? Aren't the same thing. Sit on that for a second, because we use those two ideas like they're the same thing. We say, we made college more affordable. And what we actually mean is we made it easier to borrow for college. And nobody stops to check to see whether those sentences are the same. That's not the same as we made college cheaper. Hang on to that one. We're going to come back to it. So let's look at what actually happened, not theory, not vibes, the actual scoreboard Since 1980, and I want y'all to picture 1980, you know, the big hair, the cars were the size of pontoon boats. So since 1980, the all-in cost of college, tuition fees, room and board has gone up about a hundred and fifty-five percent. And that's after you adjust for inflation. That's on top of normal price increases. To put that in English, regular prices roughly doubled over the stretch. College more than tripled. College looked at inflation, the thing everybody complains about, and said, cute, watch this. Tuition's been climbing at something like 8% a year for decades, while regular inflation's down around three. Every single year, college quietly lapsed the rest of the economy and doesn't even break a sweat. And here's the one that actually matters, because a price only means something next to a paycheck. Tuition didn't just outrun inflation, it outran wages. It outran what families can actually earn. So the gap, the distance between what college costs and what a normal family makes, that gap didn't shrink over 50 years of help. It got way wider, which is now why we're sitting on something like 1.7 trillion with AT in student debt in this country. Trillion. That's not a number anymore. That's a weather system. Now riddle me this. We spent 50 years, hundreds of billions of dollars, program after program, all of it aimed at one word, affordable. And the thing that got less affordable the whole time. Now, if your diet plan worked like the college affordability plan, you'd stopped doing that diet a long time ago. So let me try to explain how this happens, and I'm not gonna use economic words, because the second somebody says elasticity, half of America blacks out and wakes up in a different tab. I'm gonna use a Ferrari. Suppose tomorrow morning the government announces a brand new program. Beautiful program, compassionate program. They look at the American people and they say, you know what, every family deserves a Ferrari. It's a long commute out there. People deserve nice things. So here's the plan. The government will now guarantee a loan to anybody, anybody who wants to buy a Ferrari. Don't worry about the price. Don't worry if you can't pay it back. We've got you. Sign here. Question. What happens to the price of a Ferrari? Does Ferrari, a company run by Italians who are very good at money, does Ferrari look at a nation of buyers who suddenly all have a blank check and say, you know what? Let's lower our prices. No, no, they do not. Ferrari is not a charity. Ferrari is laughing. Ferrari sees that every customer just walked in holding a check somebody else signed. And Ferrari does the only thing a business would ever do in that spot. It raises the price. Right up to the edge of whatever you're now able to borrow. Because here's the thing about the guarantee: the guarantee didn't make the Ferrari cheaper. The guarantee made you a better funded customer. And those are, say it with me, not the same thing. We didn't lower the price of the car, we raised the size of the buyer. And the thing is, from Ferrari's side, They didn't do anything wrong. They didn't twirl a mustache. They just answered the customer in front of them. Anyone would, you would, I would, I'd buy a second Ferrari just out of spite. Now swap the Ferrari for a college. Same machine. It's the exact same machine, really. Think about it. You're running a university, and every year a fresh wave of 18-year-olds shows up at your door and they're holding what? Loans, big ones. Loans they can almost get no matter what number you put in front of your invoice. The financing follows your price wherever your price goes. So let me ask it the way a board of trustees would never let me ask it out loud. If you were that university, what is your incentive to lower the price? Think about it. In a normal business, if you charge too much, customers walk. They go down the street. They buy the cheaper one. That fear, that's what keeps prices honest. That's the thing that keeps the guy selling you a sandwich from charging $40 for it. But college doesn't feel that because the customer can always borrow more. The money stretches to meet the price. So that little voice in the back of every business's head that says, careful, you'll scare them off. That voice took out a student loan and went quiet. And look, the people running these schools aren't cartoon villains. They're doing exactly what's in front of them to do. Same as Ferrari, same as you would. When the customer can always pay more, charge more, stops being greed, and starts being just what everyone does. The incentive to get cheaper didn't shrink, it disappeared. Now, if you give an outfit decades of customers who can always pay more and zero pressure to charge less, here's the fun part. They gotta spend it on something. ⁓ and boy, do these universities find things. Let me take you on a little campus tour. And not the academic buildings, nobody's fighting over the chemistry lab. I wanna show you the amenities, because somewhere along the way, colleges stopped competing to teach your kids. And started competing to recruit your kid and those, you guessed it, not the same thing. Started LSU, Louisiana State. They built an $85 million upgrade to their rec center. And the centerpiece, I want you to really hear this, is a lazy river. A lazy river. 536 feet of gently flowing water, shaped like the letters L S U. You can float your tuition dollars in a loop that spells out the name of the school that's charging them. It's almost beautiful. And how'd they pay for it? ⁓ they quadrupled the student rec fee. Students voted for it. 84% said yes, build the river. So you know the recruiting works. And this is right around the same time the university is out in public crying about its terrible budget problems. Sir, you have a budget crisis and a lazy river shaped like your initials. Those two facts are having a real hard time sharing a room. An LSU is not even special. Texas Tech, $8.5 million water park, 64-foot lazy river, 25-person hot tub, 53-foot climbing wall. You're not enrolling, you're checking in. University of Missouri, same deal. Another lazy river, three-story climbing wall. At what point, serious question. At what point did rock climbing wall become a college expense? When I'm trying to figure out why college costs more than a house, my first guess is not the bouldering. But here we are. And it's not just the water parks, it's the people too. Between the early 90s and the late 2000s, the number of administrators at American colleges grew about 60%, roughly 10 times faster than they were adding actual professors, 10 to 1. For every new professor, a whole herd of associate deputy assistant vice provost started. And at a lot of the big name schools now, there's about three administrators and staffers for every one person actually teaching a class. And the slice of the budget that goes to instruction to the literal point of the place. ⁓ that keeps shrinking. We went from spending 41 cents of every dollar on teaching down to around 29 cents. So just so we're clear on what you're buying, the teaching part is shrinking, and the Lazy River and Vice Provost part is booming, and you're financing all of it for 30 years. ⁓ Okay. But here's the one that gets me. This is where I stopped laughing. You hear all that and you think, well, these schools must be broke. Spending like that, they must be scraping by. That's why they keep coming back for more tuition. Let's check. Harvard's endowment, their giant investment pile is somewhere north of $50 billion. $50 billion. Yale, $44 billion. Stanford $41 billion. Princeton $36 billion. And these aren't piggy banks sitting in a drawer. They're invested. And last year a bunch of them earned eleven, twelve, almost fifteen percent. Harvard's gains in a single year ran into the billions, billions in one year, just from having money, having money. Some of those endowments are bigger than the whole economy of an actual country. Harvard could buy Iceland and still have walking around cash. And here's the situation: you've got these institutions sitting on tens of billions of dollars, earning in a good year more off their investments than a giant company makes in profit. Money, making money, making money. And tuition keeps going up. The richest nonprofits in America. Keep asking broke teenagers for more money. Let that one sit there a second. The wealthiest schools on the planet sitting on a mountain of cash, looking at a seventeen year old dead in the eye and going, We're gonna need a little more, and make sure you bring a cosigner. If a regular business did that, we'd have a word for it. Now and this matters, so stay with me, because I told you I'd be fair and I mean it. Because somebody smart is yelling at their screen right now, and they've got a real point. So let me make their point for them better than they'd make it. Here it is. Chad, because of all this aid, millions more people got to go to college. Kids who never would have made it through the door got through the door. First generation kids, poor kids, kids whose parents cleaned other people's houses, now have a daughter who's a pharmacist. That's not nothing. That's the opposite of nothing. That's the whole point of the program. And for a lot of people, it worked. And you know what? That's true, completely true. I'm not gonna stand here and pretend access didn't go up. It did. But here's where I want us to be grown-ups about it. Because the lazy move is to pick a team. Either aid is good, shut up, or aid is bad, burn it down. And both of those are stupid. I mean, can two things be true at the same time? Can it be true that more people got in and also true that the price exploded for everybody? Because That's the part nobody wants to hold in their head at once. Yes, we opened the door to more people, and we made the room behind the door cost a fortune. More kids got in, and every one of them, and their parents, and the kid who could have paid cash back in 85, all of them are now paying a price that only ever went one direction. Access went up, affordability went down. That's not a contradiction. That's the same machine looked at from two ends. And I think you can be glad your neighbor's kid got to go to college and still be allowed to ask why it costs what a starter home used to cost. You're allowed to hold both. This show requires you to hold both. Smart people can hold both. So here's where I land, at least on the college piece. We told ourselves a story for 50 years. The story was we are making college affordable. And we believed it because every program had the word stamped on it. But that's not what we did. We didn't make college affordable. We made borrowing for college easy, and then we acted shocked, genuinely on television, shocked when the people selling college noticed there was now basically unlimited checks attached to every customer and priced accordingly. We guaranteed the loans, the colleges raised the prices. Easy to borrow, never cheaper to buy every single year. Інірсы моет шейк. What if colleges aren't special? What if I just happened to point the camera at colleges first? And this exact thing, the guarantee, the price climbing up to meet it, the word affordable, slapped on the thing that keeps getting less affordable. What if that same thing is running somewhere else in your life right now? Somewhere a lot closer to home than a lazy river at LSU? So let's do that thing again. The show of hands thing, and I can't see you, but I can feel judgment through a camera lens. It's a gift. You've heard of FHA loans, right? VA loans, first-time home buyer programs, down payment assistance, affordable housing initiatives. You hear those words. Down payment assistance, first-time buyer help. And what's the gut reaction? It's a good one. Aw, that sounds nice. Somebody's helping a young couple get into their first place. Somebody's helping the veteran buy a house after he served. That's a warm phrase. Down payment assistance sounds like a casserole your neighbor brings over. It sounds like a hug with a notary. And again, I'm not here to sneer at it. The dream underneath it is the most American dream there is. Own a little patch of dirt. Paint the door whatever color you want. Put up a basketball hoop your wife says is Temporary for 18 years, that's a beautiful thing to want for people. I want it for people. So no villains today either with housing. Just the annoying question. The same annoying question. Because it's the same machine, and you already know this machine. You just met it. Here it is again, the housing version. what if making the mortgage easier isn't the same thing as making the house cheaper? same trick your brain plays. ⁓ We say we housing affordable. And we mean we made it easier to borrow for housing, and nobody checks whether those are the same sentence. We made mortgages easier, not houses cheaper. You've heard this song with a different instrument. And look at what they're actually proposing right now, today, this year, the big fix. ⁓ You remember the mortgage from the top of the show? FDR on one side, our guy on the other, like it's a movie sequel. 30-year mortgage 2.0. This time it's personal. Before that, they were kicking around 40-year mortgages, down payment assistance. Let's expand it. First-time home home buyer programs. Let's juice them. More guarantees, bigger guarantees. And I want you to notice something. I want you to actually look at the menu. Look at every single proposal that comes down the pike with affordability stapled to it. Notice what is never on the menu. Cheaper house. Nobody, and I mean nobody stands at the podium and says, here's our plan to make the house itself cost less. That one's not in the brochure. Every solution is about the loan. Make the loan longer, make the loan bigger, shrink the down payment, lower the monthly, stretch it out, spread it thin. 50 years on a mortgage, think about what that even is. You take the loan out at 30, you pay it off at 80. I mean, you meet your End of the mortgage and your grandkids at the same time. Your house and your hip replacement financed in parallel. And the payment drops a couple hundred bucks a month, which feels like help. It really does. And you pay a quarter million more in interest over the life of it. The bank loves it. The bank is thrilled. You didn't get a cheaper house, you got a longer leash. Same word stamped on the front, affordable. And the same thing happening underneath. We are not lowering the price, we are enlarging the buyer. You understand? And an enlarged buyer is a bubble. Now I want to show you the thing that the first time I really sat with it made me put my coffee down. Everybody, left, right, center, your uncle, the news, everyone says the same two words about housing. Ready? Housing shortage, right? Not enough houses. We gotta build, build, build. And I used to nod right along: housing shortage. Sure, that makes sense. Then you look a little closer, and that phrase starts hiding something because here's the number that wrecked me. Back in the 1970s, America was building somewhere around 400,000 starter homes a year. Little homes, entry-level homes. The kind a young couple actually buys first, 400,000 a year. You know what that number is now? Somewhere around 55,000. We went from 400,000 starter homes a year to 55,000. We build the starter home now at about fifteen percent of the rate we used to. The starter home didn't get expensive. The starter home went into witness protection. Meanwhile, same stretch of time, the average new house basically doubled in size, doubled. We quit building the little first house and started building the big forever house, the one with the two story Fourier and the room nobody's allowed to sit in. So when somebody says housing shortage, ⁓ want to gently push back because maybe it's not a shortage of houses, maybe it's a shortage of the house you can actually start in. See, we're not short on granite countertops. ⁓ are short on first place a 26 year old can actually buy. The starter home disappeared. The subsidy did not. And this connects to something I think we've quietly lost. And most people under 40 have never even seen it, so they don't know it's gone. There used to be a ladder, a housing ladder. You know what I mean? You started at the bottom, the starter home, the little two-bed, one-bath, questionable shag carpet, water heater older than you are. It wasn't the dream. It was the first rung. You bought it, built a little equity. Fixed the stuff, painted, cursed at a toilet on a Saturday that you had to plumb. Then you climbed, sold the starter, bought the fixer upper, bigger, climbed again. The move up house, the one with an actual dining room, and maybe eventually the dream house, the one you retire in. Starter, fixer, move up, dream. Four rungs. That was the deal. That's how a normal family turned 30 years of paychecks into actual wealth. Where's the bottom rung? It's gone. We stopped building it. So now the kid trying to get on the ladder reaches up, and the first rung up is at his shoulder height. There's nothing to step on. And the answer we keep handing that kid isn't, here's a first rung, it's here's a 50-year ladder up to the third rung. Climb that at your age with those knees. We built more debt, not more owners. And here's the proof in one number. The average first-time homebuyer in America is now 40 years old, 40. Ten years ago, that number was 31. In one generation, the first-time buyer aged nine years. The starter home left and it took the buyer's whole 20s with it. Now, I gotta walk careful here because this next part involves a generation, and I am not here to beat up on the boomers. ⁓ I mean it. My inbox doesn't need it, and neither does Thanksgiving. The boomers didn't sit in the layer and draw this up. Most of them did exactly what they were told. Buy a house. It's the safe bet. It'll be your nest egg. They followed the instructions. You don't get mad at someone for following instructions. I'm not mad at the player. I'm looking at the rules, and the rules are wild when you actually read them. Because for 50 years the government's been trying to do, count them, four things at once. Get more people into homes, protect the value of the homes people already own, push those values up because rising home values, that's good, that's the nest egg, and also keep housing affordable. Read those back slow. Protect home values, push home values up, and make homes affordable. Those last two, they're not partners, they're in a fist fight. Make your house worth more every year and make houses costs less cannot both win. One of them is lying. A house can be a great investment that always goes up, or it can be a cheap and easy for your kid to buy. It cannot be both. That's not policy, that's just math, and the math is mad about it. Washington wants houses to be more affordable and more expensive at the same time. And every homeowner, totally rationally, no villainy required, wants their own house to go up and the new development down the street to never get built. That's not greed, that's human. But multiply it by every neighborhood in America, decade after decade, and you get exactly what we got. I mean, folks, can that run forever? A country where the house has got to get more expensive for the people who own it and cheaper for the people who don't. I mean, at some point that check bounces and it bounces on a 40-year-old first-time home buyer. All right, one more piece because somebody's still hung up on shortage and they're right to be, so let's chase it down. Here's the wrinkle. We are building cranes everywhere. But go look at what's actually going up. In most of these cities, it's luxury apartments, luxury this, luxury that, the live, work, play, lifestyle community with a dog spawn, a rooftop fire pit, and rent that requires a trust fund or three roommates. Every new building's got a name like it's Cologne, the Lumen, the Ascent, View at Something Crossing. Nobody ever builds the affordable. There's no complex called the Starter. Apparently, it didn't test well with focus groups. So you get this weird thing where the headline says shortage, but what's really going on is a mismatch. We're building plenty of one kind of housing: the expensive kind, the big kind, the amenity kind. And almost none of the kind a normal person starts in. What if it's not that we're not building enough houses? What if it's that we're not building enough houses that people actually need? I mean, we built the granite, we forgot the ladder. Now, fair is fair, the same as the last block. I told you I'd make the other cases side, and there's a real one. A lot of very serious economists are yelling right now, Chad, it's not the loans, it's zoning, it's supply. You can't build a starter home because some city council made it illegal to build anything but a single family house on a giant lot with a two-car garage and a setback and a parking minimum and a public hearing where a guy named Gary objects to everything. I get it. And they're right. They are. I'm not gonna dodge it. In a ton of American cities, it is flat out illegal to build the cheap thing. Three-quarters of the residential land in a lot of places You legally cannot build anything but the big single house. ⁓ The permitting drags labor's short, materials got expensive, interest rates locked everyone in place. ⁓ All of that true, and the supply folks have the receipts. ⁓ So here's where a dishonest guy picks a fight. It's the loans, no, it's the zoning. And they argue forever on cable and sell each other mugs. But I don't think you have to choose. I think, stay with me. I think they're the same story from two ends of the road. Picture it. On one side, government's pumping out how much everybody can borrow: bigger loans, longer loans, guaranteed loans, more money chasing the houses. On the other side, the same governments, local this time, made it illegal to build the cheap house. ⁓ So got a fire hose of borrowed money pointed at a closet. More and more dollars, ⁓ fewer fewer of the right homes. ⁓ Now you don't need an economics degree to guess what the price does. You just need to have been to a concession stand with one hot dog left. The easy money and the locked-up supply aren't rivals. They're tag teaming you. One pumps up the demand, the other strangles the supply, and the gap between them, that gap is the price of the house. ⁓ Pour a subsidy a market where you've outlawed the cheap option and the subsidy doesn't turn into affordability. It turns into the new higher price with a 50-year payment plan attached. The loan got affordable, the house did not. We told ourselves the same story we told ourselves about college. We said, we're making housing affordable. And we believed it because the programs all had the word right there on the label. But that's not what we did. We made it easier to borrow for a house. We did not make the house cost less. And then we acted surprised, surprised when the price floated right up to meet every new loan we invented. We guaranteed the mortgages. ⁓ Houses raise the prices. College did it, housing did it, same machine twice, the guarantee. The price that climbs to meet it, the word affordable on the one that keeps getting less affordable. And now that you've watched it happen twice, you're probably feeling pretty good. Pattern spotted. Easy money makes things expensive. Got it, Chad. We're geniuses now. So let me ruin that for you. Cause there's a third one. A third great unaffordable thing in American life. And I went in assuming it'd be the exact same story. Easy borrowing, climbing price, roll the tape. It's not. It's stranger than that. The third one, the government didn't make it easier to borrow, it did something else entirely. And somehow you still ended up holding the bill. What is it when the thing getting unaffordable isn't even something you borrow for? Quick question. By a show of hands, I can't see. Did anyone else open their insurance renewal this year? Homeowner's auto, whatever. Open that envelope, look at the new number, and quietly wonder if your insurance company had slipped a second mortgage in the bill? You read it twice. You did. You went, that can't be right. Looked at it again and it was right, and somewhere a small part of you died. My auto renewal showed up, and I checked the envelope to make sure they. Hadn't also signed me up for a timeshare. And it's not one kind, that's the thing. It's all of it. Homeowners, auto, umbrella, the business policy, health, they all went up all at once. Like they got thrown together and unionized. Even your eggs got in on it for a while, but here's the difference: the eggs eventually came back down. Your premium did not get that memo. So here's the honest question: why is every single kind of insurance crushing people all at the same time? Before we go anywhere, same as the last two, let me say the nice thing. Because insurance is the responsible thing, the grown-up thing, the thing your dad lectured you about. You buy it, so the worst day of your life isn't also the day you go broke. That's smart. I'm for insurance. I've got a lot of it. I'm a warrior with a credit card. So no villains here either. Not even the insurance companies, and I know that's a hard sell. Don't boo the insurance company. I get it. But here's the annoying question, the third annoying question, and I'll warn you right now, the answer is gonna be a little different than the last two. But stranger, stay with me. What if government trying to wipe out risk and guarantee coverage and protect everybody from every bad thing isn't the same as making insurance affordable? Let's warm up with the easy one. Auto. Try this. Try to remember the last time a politician, anybody, any party ran for office promising you less insurance coverage. Take your time, I'll wait. Yeah, never happened. There has never been a candidate who stood up and said, My opponent wants you to over-protect it, and I'm here to require less. No. It only ever goes one direction: more coverage, more mandates, higher minimums, more protection. Every session somewhere somebody's adding a new thing to your policy has to cover. And every one of those on its own sounds totally reasonable. Of course you should be covered for that. Who's against that? but here's what nobody says under the microphone. Every new protection has a price tag, every single one. Add a requirement, you add a cost. And 10 of them over 10 years, each one perfectly sensible, and you've quietly built a mountain. And then everybody stands around amazed at the size of the mountain. Auto insurance went up about 46% in two years, 46%. ⁓ And we stood around going, gosh, why is it so expensive? Well the answer was a stack of reasonable little requirements nobody ever votes against. Every new protection has a price tag. And who pays it? ⁓ not the politician who got the headline for requiring it. You do. Twice a year in an envelope that feels like a mortgage. Okay. Now the homeowner stuff, and and this is where it gets weird, and where I gotta be straight with you, because this third one does not work like the first two. College. Government made borrowing easy, price climbed up the loan, housing, same machine, borrowing easy, price climbed up the loan, two for two, easy money, rising price. You don't borrow for insurance. There's no 30-year insurance loan, so the machine has to be different, and it is. It's much sneakier. Here's the only thing you need to know about how insurance actually works, and it's not economics, it's common sense. Insurance works when the price tells the truth about the risk. That's it. The price is a little messenger. It walks up and goes, Hey, this house is in a spot that burns. That's gonna cost more. Or, hey, this kid's Totaled three Mustangs. Maybe ease up. The price is information. It's the smoke detector for the whole system. So common sense. What happens if the government walks in with the best intentions in the world and decides that the messenger is being mean? Decides the price is too high, so we cap it. Decides the coverage is too thin, so we mandate more. Decides some risks are too scary to even let the insurer look at, so we forbid them from pricing it. You didn't change the risk, the house still burns, the risk is exactly as big as it ever was. All you did is yank the battery out of the smoke detector because you didn't like the beeping. When risk stops being priced, prices stop making sense. Let me show you the cleanest example in the country, California. California's had a rule on the book since the 80s, and it basically says an insurance company can't really raise your rates without going through this long government approval process. And there's a magic number in there. Ask for more than a 7% increase, and it triggers a whole hearing, a whole circus. Can take a year or more. So do you know what the companies do? They ask for 6.9% every time forever. Doesn't matter what's actually happening to the risk, the request is 6.9. Not because that's the real number, because that's the number that doesn't summon the bureaucracy. And for years they weren't even allowed to use up-to-date fire models to price the real risk. So picture being the insurance company. The risk is going up, the fires are real, you're not imagining it, and you are legally not allowed to charge what the risk actually costs. So what do you do? You leave. That's it. That's the whole mystery. You don't lower your standards, you don't eat the loss forever, you just stop writing new policies and back out of the state, which is exactly what happened. Seven of twelve biggest home insurers in California pulled back. Something like 400,000 people lost their coverage. Not because anyone did anything wrong, the math just stopped working. And then January 2025, the LA fires, 16,000 structures gone, tens of billions in losses, one of the worst in the state's history. So now all those people who can't get private insurance anymore, where do they go? ⁓ well, there's a state run pool. The insurer of last resort, the backstop. And that backstop is now the fastest growing insurer in California. Enrollment up 43%. The government accidentally became the biggest fire insurance company in the state. Not on purpose. Nobody sat in a room and went, step one, drive everybody out. Step two, become state farm. It just happened one reasonable rule at a time. And here's the kicker: when the state pool got hammered by the fires and ran low on cash, it sent a $1 billion bill to all the insurance companies still operating in California. And those companies get to turn around and pass a big chunk of that on to their customers. Everybody's premium, including yours. Even if you live nowhere near a fire, even if your house is a brick box in the middle of a parking lot. So did you catch what actually happened there? The risk never went anywhere. The fire was always coming. All the government did was take the cost of it, peel it off the price tag where it was honest and aimed at the actual danger, and smear it across every single person holding a policy in the state. When government moves risk, somebody else gets the bill, always. And surprise, it's you. It was always gonna be you. And don't think this is just a California thing. ⁓ well, that's a California thing. Come up to Oregon, my neck of the woods, part of the year. Premiums up about 30% since 2020. The fires up here have been brutal. The state's losses from fire and storm the last few years run something like four times the previous 40 years combined. The risk is real. Nobody's making that up. So Oregon does a very reasonable sounding thing. The state draws up a wildfire risk map. The state basically says, Here, let's all just be honest about which homes sit on dangerous spots so folks can prepare. And people who landed on that map lost their minds. Understandably, nobody wants the government publishing a map that says your house specifically is a tinderbox. They were furious, figured it torch their insurance and take their home value. So you know what legislators did last year? ⁓ they replaced the map, erased it, fed it to the shredder. And I love this one because it's the whole thing in a single move. You can repeal the map. Sadly, you cannot repeal the fire. The fire doesn't check whether it's still on the official state map. The danger didn't pack up and leave because the legislator took a vote, and the insurance companies just kept using their own maps anyways. Of course they did. Same move as California. The risk got uncomfortable, so government went after the map instead of the fire, and the fire just sat there waiting. Now, fair is fair. I'll make the other side's argument for the third time tonight, hard as I can. Somebody's yelling to the camera. Chad, this isn't government, this is climate. Hurricanes and wildfires getting worse. The cost of lumber and labor through the roof. It costs way more to rebuild a house than it did five years ago. Reinsurance repricing. Real world risk going up for real world reasons that have nothing to do with some politician. And here's me looking you dead in the eye. That's true, all of it. I'm not gonna pretend the weather isn't. Doing what it's doing, or that rebuild costs didn't blow up because they did. Here's the honest tell. A lot of these companies have been losing money on home insurance, losing it. That is not the fingerprint of some fat government subsidized scam. That's a business getting hit by real rising risk. So I gotta be straight with you, straighter than I've been all night. This third one is not the same machine as college and housing. Government didn't invent this risk. Washington didn't light the fires. The first two, government cranked up the demand and the price chased it. This one, the risk was real and climbing all on its own. But watch what government did about it. It didn't lower the risk, it went after the price of the risk, capped it, mandated around it, hid the map of it. And when the honest price got unbearable, it didn't shrink the danger. It just spread the cost out so wide and so quiet you couldn't see who was paying anymore. Spoiler it was you. It's in your renewal page two. Go look it up. And here, here's the thing that flipped this whole story around for me, because by now you're probably feeling pretty grim, pretty fatalistic. Fire's gonna fire, government's gonna government, premiums to the moon, nothing's gonna be done, pour one out. So let me take you to Florida. Florida is the single most hurricane exposed place on the planet. If the weather did it were a whole story, Florida should be the worst insurance market in the history of insurance. The ocean is right there. The hurricanes are basically a subscription. ⁓ and a few years ago, Florida was a disaster. The premiums insane. Companies fleeing. The state pool, same story as California, ballooning over a million policies, the government turning into the insurer for half the state. But here's what Florida figured out. The problem wasn't only the weather. A huge chunk of it was a rule. They had this legal setup that turned insurance claims into a casino. Lawyers and contractors could basically print money suing insurance companies. At one point, Florida had something like three-quarters of all the insurance lawsuits in the entire country, with a tiny fraction of the actual claims. The whole nation's insurance lawsuits piled on one state because of the rules on that one state. So Florida changed the rule. Just the one thing. Shut down the lawsuit, casino. Didn't touch the weather, couldn't if they wanted to. Same hurricane, same ocean, same risk, same exposure. And the market came back to life. 17, 18 new companies showed up. The state pool started shrinking from over a million policies down to a few hundred thousand. And the rates that had been screaming up 20 plus percent a year flattened. Some companies started filing to cut prices. In Florida, the hurricane capital of the earth. Now, I'm not gonna oversell it because that's not what we do here. Florida's still expensive. Prices are still way up from where they were. Some of those new companies are small and shaky, and we'll see if they last. The job's not done. But you cannot miss what just happened there. Same fire, same flood, same risk in the sky. They didn't change the weather one degree. They changed one incentive, and the line bent back the right way. Which means, and this whole thing, this is the whole part I want you holding on to, this was never fate. It was never just the weather. The weather's the same in both states. The difference between the one that's collapsing and the one that's coming back. Is what the government decided to do about the price of telling the truth. We said we were making insurance affordable. We capped the prices, mandated the coverage, hid the risk, and we told ourselves that was kindness. But you can't make a risk disappear by refusing to look at it. The risk doesn't care that you find it rude. It just waits quiet for the moment. Somebody moves it into another person who never saw it coming. We guaranteed the coverage. We all got the bill. And now you've seen it three times. College, government made it easy to borrow, the price went up. Housing, government made it easy to borrow, the price went up. Insurance, government went after the price of the risk itself, and somehow the cost still landed on you. Three different moves, the loan, the loan, the risk, three different machines, and the exact same ending every time. The word affordable on the label and the thing underneath getting less affordable year after year after year. So I gotta ask you the only question that's left. Іздес три сепрат сторіс. Or is it one story happening in three different ways? So while we're sitting here tonight, I'd bet money on it. Somewhere in Washington, somebody rolled out a brand new plan to make something affordable. A new housing plan, a new college plan, a new something plan. Word right there on the front: affordable, bold letters, maybe a nice graphic. Maybe a guy at a podium with his sleeves rolled up. Cause nothing says, I'm fixing it, like rolled up sleeves. Another guarantee, another subsidy, another program, another envelope of relief, handed to people who are genuinely hurting by people who genuinely mean well. And I keep coming back to the rude question, the one that doesn't have a sleeve rolling answer. Why do we keep reaching for the exact same thing that keeps making it worse? Let that hang there a second, because I don't think the answer is what most people assume. We keep mixing up making debt easier with making life cheaper. And those feel like the same thing. That's the trap. They feel identical. When you make the loan easier, the payment smaller, the financing smoother in the moment to the person standing right there, it feels like help. It feels like the thing got cheaper. It feels like the door swung open. But the thing didn't get cheaper. You just got handed a bigger shovel to dig with. And the guy on the other side of the table, the college, the home builder, the home machine, he can see the bigger shovel. He always sees the shovel and the price climbs right up to meet it. Making it easier to borrow for a thing and making the thing cost less. Those were never the same sentence. We just really, really wanted them to be. Now, at the top of the show I drew a line. Remember? Crisis? Cost of living. Eggs, gas, the grocery bill that makes you do that little involuntary inhale at the register. And that hurts. God, it hurts. I'm not waving it off. But the cost of living, for all its cruelty, it breathes, it moves. Prices spike, prices settle. Eggs were insane, and then one day eggs were a little less insane. Nobody had to invert a 50-year mortgage for a cartoon of eggs. You don't finance breakfast across two decades. You just grit your teeth, buy the cheap brand for a while, and wait for it to come back down. The cost of living is a storm. Storms pass. And then there's another one, the quiet one. The cost of life, college, housing, insurance. And I hope it lands different now than it did an hour ago because the cost of life doesn't pass. It doesn't settle overnight. It's not a storm. It's the weather you live in inside your whole life. It's whether your kid walks out of school at 22 free or walks out already owing. It's whether you ever get keys to something that's actually yours or you rent your whole life from someone who got in before the ladder went up. It's whether retirement means anything to you, or it's just a thing that happened to your grandparents. It's whether your family ever gets ahead. Or just runs in place faster and faster, paying more every year for the same life. Eggs decide you're week These three decide your whole life. And that's why I call it the cost of life. And that's why getting these things wrong for 50 years with a smile and a sleeve roll is not the same thing, it's the whole thing. So why do we keep doing this? This is the part I really want you to sit with. So put your jersey down for a minute, both of you. Picture you're a politician. Any letter after your name doesn't matter. And a family walks in and says, We can't afford a house. We can't afford college. Do something. And you've got two doors you can walk through. Door number one, Make the borrowing easier. Bigger loan, longer loan, smaller down payment. Slap a guarantee on it. And the second you do that, that day, that afternoon, somebody gets the keys, ⁓ somebody gets the letter. There's a family standing there holding one of those giant cardboard checks. There's a photo, there's a ribbon, you show up with big scissors. Politicians love the big scissors. There's a whole industry of big scissors. Door number two is the other thing, the slow thing, the boring thing. Actually, go make the house cost less, which means picking a fight with every city council, every neighbor, every group that likes things exactly the way they are. It takes 10 years, there's no photo, there's no ribbon, and here's the killer. By the time it works, if it works, you're not even in the office anymore. Some other guy is standing there with your scissors, cutting your ribbon, taking your credit. So which door does a normal human being walk through every time? Door one, obviously. And not because the guy's evil, because all the reward is sitting behind door one and all the pain is behind door two. The relief shows up now with your name on it, the damage shows up in 15 years with nobody's name on it. And think about this: you cannot take a photo of a price that quietly went up. There's no ribbon cutting for this got 2% more expensive every year for 20 years. Nobody films that. It doesn't trend. It just happens. To a 40-year-old who can't figure out why the house's parents bought at 26 is somehow out of his reach for now. And here's the part that really gets me. The people who helped today, they vote today. They're grateful today. The people who get hurt by it down the line, half of them are 19 or they're not even in the market yet. They're not paying attention. They're not organized. Some of them aren't old enough to vote. You're handing the bill to people who can't fight back and won't even notice until it's their turn. It is the single safest move in all of politics. Help the people watching, build the people who aren't looking yet. And every one of these programs starts the exact same way with a good heart. Nobody launches the affordable whatever act thinking, let's wreck this for the next generation. They're thinking there's a hurting family right in front of me and I can help them today. And they can and they do. That's the trap. That trap was never cruelty. The trap is that helping the person in front of you right now in the way that feels best right now is exactly how you build the thing that crushes the person who comes next. Nobody campaigns on this hurt in fifteen years. That's not a bumper sticker. That's a confession. And here's where it all comes down to common sense, the kind your grandmother had without a single economics class. If everybody can suddenly borrow a lot more money for the same thing, what happens to the price of that thing? You know the answer. You've always known the answer. It goes up. If the people selling something find out their customers all just got handed bigger checks, do they cut their prices out of the goodness of their hearts? Have you met people? And if you take a real danger, a fire flood, and decide it's rude to put a price on it, so you shove the cost off somewhere else? Does the danger go away or does it just go quiet and wait for the bill to land on somebody who never saw it coming? None of that is a graph. None of it needs a podium. That's just how people work. We didn't repeal human nature, we just quit accounting for it. And that right there is the Reagan in all of this. Government programs don't run on paper, they run on people. The second a program exists, it creates an incentive. And the moment there's an incentive, people move. Families move, businesses move, universities move, insurance companies move, millions of people every day quietly rearranging their lives around the new rule. And no planner, no matter how smart, how decent, how good the intentions, how nicely the sleeves are rolled. No planner sitting in one room can outthink a hundred million people, all responding to what's right in front of them. And here's what I need you to hear, because this is where the people get me wrong. That's not me being anti-government. It's not cynicism, it's not burn it all down. It's humility. It's the most humble thing a person with power can say. I cannot outsmart the whole country. The failure was never that government tried to help. The failure is forgetting that the people you're helping are gonna react, and so is everybody else in the room. Good intentions aimed at people who respond to incentives with no thought for how they'll respond, that's not compassion, that's just more expenses. ⁓ Every time government goes to make one of these things affordable, making the borrowing easier or by hiding the price of the risk, the cost doesn't go away. It just moves onto you, onto your kid, onto whoever wasn't looking. Maybe the lesson was never every government program fails. Maybe it's simpler and meaner than that. Every program creates an incentive, and an incentive does not care about your intentions. You can have the best heart in the world and still, by making the wrong thing easy, make the right thing impossible. So here's where I'll leave you tonight. The one thing, the only thing government has truly reliably year in and year out guaranteed in college and housing and insurance is not affordability. It's unaffordability. That's the show. That's Freedom Friday. If something in there made you go, huh? I never thought about it that way, then go do the one thing the algorithm can't do for us. Tell somebody. Text it to your kid who's looking at colleges, send it to the friend who just got the insurance renewal that ruined their week. Remember, if you see us, share us. The phone, like always, 252-Chadlaw. We're on Rumble, X, Instagram, and Substack. And if you're hanging around, don't go anywhere. We're heading over to the after hours right now. Just us gotta get into your questions. Some of you came to fight. I respect it. Bring it on. Stay right there. We'll reset the studio and be back in under ten seconds.