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MAY 1, 2006
The Value Of Homeownership That Economists Miss As a real estate salesperson in San Francisco, what concerns me about "Buyer (and seller) beware" (Cover Story, Apr. 10) are the conclusions arrived at by economists in determining whether real estate is overvalued, whether based on historical trends or on comparable rental costs. Homeowners have the right to make choices and decisions regarding changes to their homes that renters may not be able to make, and owners are not subject to the whims of rent increases or losing a lease and having to move. Similarly, those advocating selling at supposed market highs and renting are recommending a market-timing philosophy that historically has been counterproductive for investments. Michael Mandel's predictions are not as earth-shattering as the doom-and-gloom predictions we have become accustomed to ("Think of it as a return to normal," Cover Story, Apr. 10). While no one would be happy losing 10% of their home's value, most homeowners who have owned for even a short period and those who plan to buy using established types of loans and avoiding creative financing, with the intent to enjoy their homes for a reasonable period of time, are not likely to be too hurt by such a price drop. I agree that a drop is possible, but predictions of "experts" should be viewed as what they often are: merely guesses. Bernard Katzmann San Francisco I am a real estate professional with 35 years of experience. I do not dare to comment on what may happen in places such as Texas, California, or Florida. However, in the area where I practice, northwest New Jersey, the fundamentals are strong: Demand for housing (single-family homes, multifamily properties, condos, and rentals) continues to outstrip current and projected supply. Strong demographics provide support to demand. Yet buyers have become choosier and more careful, and sellers are beginning to lose confidence in the market and fret about the future. This has created a temporary slowdown in home sales. At the end of the day, buyers will have to bite the bullet once more because supply-and-demand fundamentals will prevail over media hype and slightly higher mortgage rates. For me the old truism is still valid: All real estate is local. Domingo E. Galdos Vernon, N.J. Re "Real estate brokers are racing for shelter" (Cover Story, Apr. 10): This piece of investigative journalism is why I have subscribed to BusinessWeek for 20 years. As the Justice Dept. is investigating the industry for being inflexible in adjusting the "gold standard," maybe they should get a BusinessWeek subscription! Doug Francis Fairfax, Va. California Already Has A Nifty PC-Recycling Program As a member of a coalition of 16 leading global electronics manufacturers, I read "HP wants your old PCs back" (Environment, Apr. 10) on e-waste with dismay. It fails to portray the successful California Advanced Recycling Fee system accurately. The California system has many advantages over a haphazard collage of disjointed manufacturer take-back programs. It completely eliminates the so-called orphan problem (i.e., who will pay for recycling of products from manufacturers no longer in business), sorting and managing products by individual brand, and is easier, and therefore less costly, to enforce. Since starting up in January, 2005, the California system has collected 64.8 million pounds of computer monitors and TVs for recycling and has come in below budget. Most important, the advance fee embodies a strong educational message, letting consumers know that they have a positive role to play. As a result, the advance fee highlights the importance of recycling and creates a platform that will force manufacturers to compete by making products that are easier to recycle. David A. Thompson Director, Corporate Environmental Dept. Panasonic Corp. of North America Secaucus, N.J.   Don't Blame Lobbyists For The Health-Care Stalemate The primary focus of former Senator Tom Daschle's editorial, "Health reform: Good business" (Outside Shot, Apr. 10), concerning the lack of health-care reform, seems to be a deflection of responsibility. His claim that business "lobbyists in Washington often blocked change" is disingenuous and self-serving. Since when do lobbyists have a vote in the U.S. Senate? Unless someone has rewritten the Constitution lately, I believe it is the former senator and other past and present elected officials who are responsible for our lack of meaningful health-care reform. Dr. Jeff Mueller Scottsdale, Ariz. Common Sense On Immigration Reform In "Immigration reform: Why business could get burned" (Washington Outlook, Apr. 10), I find it astonishing that intelligent businesspeople can't figure out that if one cannot attract workers at a given salary, the solution is to increase the wages offered. If we are serious about our laws, we cannot allow the widespread flouting of the immigration law. There are easy means to verify an applicant's Social Security number. Byron Slater San Diego Your article blurred the line between proposals for undocumented workers and highly educated foreign workers. Big Business, as well as leading U.S. educational, research, and medical institutions, are all seeking to remedy a broken visa system that prevents legal, highly educated, sought-after foreign professionals from living and working in this country. The shortage of temporary employment visas is well documented, and the backlogs in the "green card" system for permanent residency are legendary, forcing thousands of valued foreign-born professionals, including researchers, scientists, teachers, and engineers, into legal and professional limbo for years. Bringing the world's best talent to work in America not only keeps jobs here but also helps to keep us the world's innovation and technology leader, which means everything to our economy and our future. While the focus of Congress and the media may be on "illegal" immigration, we must also find a solution for the highly educated and sought-after professionals who want to come here legally. Sandra Boyd Vice-President, Human Resources Policy National Association of Manufacturers Washington Editor's note: The writer is chairperson of Compete America, a coalition focusing on legal, employment-based immigration. I just returned from my third tour of duty with the Minutemen serving in Pima County, Ariz., on ranches located 25 to 35 miles north of the border. I witnessed scores of gaunt, emaciated, and exhausted Latinos risking life and limb to make it to those lawbreaking American businesses to work for submarket wages. The Mexican government (a large majority of the illegals are Mexican) should be ashamed of themselves for their corruption and gross inefficiency in managing a potentially strong economy and for allowing their citizenry to sink into such despair as I have seen at the border. The U.S. government is also guilty of not taking our southern border security seriously and not effectively enforcing immigration laws for the past 20 years. As an American businessman, I keep in mind that I am an American first, capitalist second. My employees are all hardworking American citizens who will do the job if treated with respect, paid a decent wage, and labor under acceptable working conditions. I hope a strong border-security-and-enforcement version of the immigration reform bill is passed and that stiff penalties and fines are levied against those businesses that have profited while taking advantage of human suffering. Greg Sheehan Altoona, Pa. No matter what is decided in Washington, the illegals will still be here. What we need is a 50 cents-an-hour charge to their employers. These monies would be given to the schools and hospitals that care for them. Michael Grogan Moreno Valley, Calif. Why Layoffs And Hatchet Men Are Here To Stay As a veteran of several layoffs, I was interested in your review of The Disposable American: Layoffs and Their Consequences ("The shortsighted solution," Books, Apr. 10). The problem with layoffs is that they almost never solve the underlying problems that caused the need for layoffs in the first place. Think of General Motors Corp. (GM ) using layoffs to solve product problems. Louis Uchitelle is right: America loves layoffs -- easy, quick fix, looks like you are doing something, and well received by the media. Also, workers almost never have any recourse, so there's no downside for the company doing the layoffs. Layoffs will continue until investors and the media hold the corporate managers who make bad decisions responsible instead of giving them a nice retirement package and bringing in someone else to do more layoffs. Brian Card Springwater, N.Y. In This Case, Our Item Didn't Cut The Mustard I understand from "Of salt and spices"(Developments to Watch, Apr. 10) that "a key to pain relief may be sitting on your hot dog bun." Well, I sat on my hot dog bun, and it didn't help. Eric J. Evans Denville, N.J.
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