Regulating Fannie and Freddie

[Adrian II]

Perhaps by renting cheap apartments and then renting them at a low price to those with low incomes. But the goal should not be profit, as with F&F.

So the state should intervene in the housing market, thereby distorting it?

Your view that 'government [..] shouldn't mandate or regulate [..] the private market to enforce a certain aim, because that always leads to the government screwing up the situation' sounds like a mantra. It reminds me of Alfred Marshall's word: 'Every short statement about economics is misleading (with the possible exception of my present one).'

Regulation works fine in the Dutch telephony market, to name one example. We have a watchdog called 'Netherlands Competition Authority' which does a good job of preventing monopolization and other obstacles to competition, irresponsible use of collective facilities, as well as malpractice or unfair treatment of customers. Since its inception in the 1990's the NMa has been consistently run by gentlemen of the choleric persuasion who don't take crap from companies. It doesn't do well in certain sectors simply because markets in those sectors are not open and/or well-regulated to begin with. And it lacks clout to enforce rules and principles in certain instances. But it's a start. I see this as an important contribution to new ways and means to regulate markets in order to make them work in the public interest without impeding their natural dynamics.