The Home-Owner-Ist Death Spiral

Based on a thread over at HPC on inflation/deflation:

1. ... wages and profits fall, which puts downward pressure on unaffordably high land prices.
2. This does not go down well with the Home-Owner-Ist coalition, so the central bank (i.e. part of government) buys crappy mortgages off banks to prop up land prices or gives them low interest loans
3. This increases government liabilities (where else does the government get the money from to pay the banks?)
4. So taxes have to go up, now or in future to repay those government debts, plus to cover the losses the central bank incurred by buying up crap at overvalue.
5. The government can't increases taxes on land values, as this would defeat the object of point 2, so it increases taxes on incomes and production.
6. So wages and profits fall further, which puts downward pressure on unaffordably high house prices.
7. This does not go down well with the Home-Owner-Ist coalition, so the central bank (i.e. part of government) buys crappy mortgages off banks to prop up land prices or gives them low interest loans
8. This increases government liabilities (where else does the government get the money from to pay the banks?)
9. So taxes have to go up, now or in future to repay those government debts, plus to cover the losses the central bank incurred by buying up crap at overvalue.
10. The government can't increases taxes on land values, as this would defeat the object of point 2., so it increases taxes on incomes and production.
11. Wages and profits fall further, which puts downward pressure on unaffordably high house prices.
12. This does not go down well with the Home-Owner-Ist coalition, so the central bank (i.e. part of government) buys crappy mortgages off banks to prop up land prices or gives them low interest loans
13. This increases government liabilities (where else does the government get the money from to pay the banks?)
14. So taxes have to go up, now or in future to repay those government debts, plus to cover the losses the central bank incurred by buying up crap at overvalue.
15. The government can't increases taxes on land values, as this would defeat the object of point 2., so it increases taxes on incomes and production.
16. So wages and profits fall further, which puts downward pressure on unaffordably high house prices.
17. This does not go down well with the Home-Owner-Ist coalition, so the central bank (i.e. part of government) buys crappy mortgages off banks to prop up land prices or gives them low interest loans
18. This increases government liabilities (where else does the government get the money from to pay the banks?)
19. So taxes have to go up, now or in future to repay those government debts, plus to cover the losses the central bank incurred by buying up crap at overvalue.
20. The government can't increases taxes on land values, as this would defeat teh object of point 2., so it increases taxes on incomes and production.

Repeat to fade.