'Good Cause' is the great cause of market renters in 2019 - so let's get it passed

On June 15th, rent regulation laws are once again set to expire in New York, potentially impacting millions of renters. This happens every few years but, outside of a collection of tenant groups, politicians, and journalists, most New Yorkers don’t ever notice.

Why should they? More than half of the renters in NYC don’t have any type of rent protections at all — and NYC is by far the largest concentration of rent regulated apartments in the US, let alone in the state. If the rent laws only impact a small (getting smaller) group of renters, who cares? Honestly, in past years, there hasn’t been much reason for market-rate tenants to care.

That’s all changed this year. This year we’re fighting for Universal Rent Control. It means what it says — protection for all types of renters.

For the first time in living memory, if you’re a market-rate tenant, you have a big, big stake in this year’s fight — it’s called ‘Good Cause’. And we need your help to make sure it passes.

The purpose of the bill is simple but revolutionary. If you live in a building with more than 3 units anywhere in the state, you are guaranteed the right to a lease renewal with a limited increase in rent. 

It’s that simple. And it covers millions of market-rate renters. It is the single biggest expansion of rent protections in New York since rent stabilization was reformed in 1974.

That means you won’t have to worry about your landlord jacking up your rent if you live in a gentrifying neighborhood. That means you don’t have to worry about your landlord kicking you out because they don’t like your kids. That means you won’t have to worry about complaining to your landlord about fixing the stove because you’re afraid they might tell you to move. 

That means you will have a hell of a lot of leverage to renegotiate with your landlord because they can’t just assume they can get someone else to move in for more. It also means you have a say in your building along with all your neighbors.

That’s never been the case for market-rate tenants. You’ve never had any protections or any leverage. And you’ve never had any reason to fight for tenants rights.

Now you do. And trust me, we need your help.

First, the housing crisis demands that all renters work together right now. Over half of all renters in New York are considered rent-burdened, meaning you pay more than 30% of your income towards rent. That’s a big reason why there is a record 90,000 homeless New Yorkers across the state. Market-rate tenants are often times the most vulnerable to eviction and homelessness in the state.

Second, the real estate industry is the most powerful special interest in New York and will do everything it can to stop Good Cause and the rest of the Universal Rent Control package. It has spent untold millions of dollars over decades to elect supportive politicians and block tenant protections. They spent millions in last year’s election and lost big for the first time. (A lot of the same developers also spent $80 million last year in California on TV ads confusing people about a rent control ballot vote that was popular with voters but lost). We can expect them to spend a lot of money and exert a lot of pressure from now until June.

Third, there are a lot of politicians, even allegedly progressive Democrats — check up on your rep, trust me — who don’t support tenants. That might be because they are dependent on real estate money to win re-election or it might be because they are landlords themselves. But in a lot of cases, politicians simply don’t know much about housing policy (it’s confusing for everyone) and they don’t hear enough from stressed renters in their district.

This year and this fight is different, though. There is a real chance to transform our housing market across the state for all renters. It’s also a real chance to shake up our political system that runs on real estate money. Those interests find and elect Republicans and conservative Democrats that end up blocking a lot of other progressive policies that most of us want.

The good news is that we’ve already seen some big wins. The same people fighting for Good Cause right now — and the rest of the Universal Rent Control platform — are the same people who helped unseat real estate-backed Democrats and Republicans in last year’s election that gave the Democrats the biggest majority in the State Senate in a century. In their place, we got a number of new pro-tenant progressives elected to fight for all renters.

One of those progressives is Julia Salazar, who introduced the Good Cause bill in the Senate.

We’ve done a lot so far, but we have a long way to go until June. The real estate industry is bloodied, but looking to rebound. Some Democrats who supported tenants’ rights when Republicans were in charge don’t seem so sure now that Democrats are. And Governor Cuomo thinks he can bully everyone away from pro-tenant policies that scare his developer friends.

You don’t need to know anything about rent regulations or housing policy to know that you’re paying too much money in rent. You don’t need to follow politics to know that the real estate industry has had too much power in this state. And you don’t need to be on the street protesting to make a real difference.

If you’re a market-rate tenant, find your state senator or state assembly member. Call them. Write them an email. Send them a tweet. Make it known that maybe you haven’t been involved in tenants’ rights before, but you’re a market-rate tenant and you’re tired of paying so much and having so little protection. Good cause is your cause. Let’s make it happen.

The Green New Deal needs a theory on cities, fast

Promising start tho (Time/Saul Loeb/AFP — Getty Images)

Promising start tho (Time/Saul Loeb/AFP — Getty Images)

Last week, Rep. Ocasio-Cortez and Sen. Ed Markey introduced a resolution outlining the broad ambition of the Green New Deal. It’s a stunning document that calls for the full transformation of the American economy and society to a degree that our political system has seemed incapable of producing for decades. Given the urgency of the climate and inequality crises, this failure is untenable. The Green New Deal offers a very exciting beginning to how we solve these problems.

However, because we’re at the beginning, there are still a lot of unknowns. There is plenty of time to address what, for my money, is the biggest blindspot in the resolution: cities.

Right now the only implicit mention of cities is about public transportation and high-speed trains (which are both great). That misses the challenges and opportunities inherent to cities for fighting climate change and economic injustice. It needs a theory on cities, fast.

Cities will win or lose the future of our planet

One of the least appreciated stories of the late 20th century is the rapid transition of humans from rural or urban living. The global urban population went from 750 million in 1950 to over 4 billion today. More than 53% of humans live in cities, the first time in recorded history that more than half have done so. The UN expects it to increase to 68% by 2050, largely driven by growth in Africa and Asia (though demography is tricky to predict.)

The explosive growth of cities across the world is in part a reaction to the problems outlined in the Green New Deal — climate change and economic injustice. Climate change is making large swaths of rural inlands and coastlines unproductive and even uninhabitable, causing a mass exodus to cities that is destabilizing many regions.

The triple blow of neoliberalism — globalization, privatization, and deregulation have created an economic race to the bottom between countries that have left millions of urban dwellers in the US and internationally in poverty or near poverty. The disgust many Americans feel about the now cancelled Amazon HQ2 “contest” has been happening on a global scale for 40 years. As capital has been allowed to flow across borders, labor has not, which leaves a lot of people vulnerable and powerless.

It is safe to say that the future of our planet will be decided in cities. If we get the growth and development of cities right, we stand a good chance of addressing climate justice, economic justice, and social justice at a global scale. If we don’t get cities right, we’re screwed. It’s that simple.

The Green New Deal doesn’t do enough to address cities right now, so let’s fix that. This is something it and Congress can do a lot about. Allow me to pitch why cities are so important to the success of the Green Neal Deal going forward.

Cities promote density — which is the foundation of modern justice

We know that cars are terrible for the environment, but the bigger problem is that car-centric development is terrible for our health environmentally and socially. This development in 20th century America — commonly known as sprawl — was deeply racist and deeply unjust.

The government and private industry subsidized the exodus of white families to the suburbs, where they built generational wealth. The same forces blocked communities of color from doing so and instead exploited and/or neglected them in cities. This eighty-year government project is where the racial wealth and health gap comes from.

Zero-emission standards outlined in the GND solve direct pollution from cars, but they don’t solve this structural legacy of discrimination. There is simply no way to address climate change, economic justice, and social justice in the US without fundamentally rebooting the built environment towards density. With density comes greater accessibility, agency, and opportunity for all income-levels.

Luckily, we have existing infrastructure to accomplish this — in cities. The problem is that we don’t have enough of them. Few American cities have a high level of density or the means to achieve it right now. Even the ones that do, like New York City, have terrible accessibility and affordability challenges that make it hard to live there. As a result, the urban revival that has been talked about over the last 10 years is mostly bullshit. We’re still a sprawl nation.

For the Green New Deal to deliver in practical ways, it must focus on cities and demand that we abandon the 20th century car-centric, racist assumptions caked into our land-use policies. That means it must address everything from land-use to building codes that promote low-density and separate commercial and residential life at a city, neighborhood level, and individual building level.

We need to promote density in our cities and connected inner suburbs so we can create greater accessibility for the disabled, elderly, and families with young children. We can provide all income-levels, particularly historically marginalized communities, with more agency and opportunity when they are integrated into the built environment. And we can change the energy and transportation habits called for in the GND.

Cities rely on socialism to work and it does

Neoliberalism has pushed public ownership and engagement out of favor in America over the last forty years. They have been replaced by the much more individualistic ideas of corporate shareholder value and consumer identity. That’s a big reason why our physical infrastructure is crumbling, our institutions are fraying, and our civic culture is stratifying.

We need to make all three work to tackle climate change and inequality. Doing that requires abandoning neoliberalism and embracing a new commitment to shared, publicly controlled action. That means socialism — in the American tradition that has quietly and successfully worked in cities for over a century.

You might bring up the fire department or public transportation as good examples of socialism to your angry uncle at Thanksgiving, but cities themselves are the best example of socialism working in America. Public transportation and housing, public schools and hospitals, public libraries and parks — these are all deeply ingrained institutions that make cities possible for all residents at all levels of income and types of background. They were all the products of public-minding government in the Progressive and New Deal eras.

None of these institutions are in great shape today, but that’s not because of problems inherent to socialism. It’s because neoliberalism has crept into cities and attacked these institutions for multiple generations. A failing public institution is an opportunity for private profit. As bad as NYCHA or the MTA is today, the fact that they are even working at all is a testament to how well built and managed they were for so long — through strong public commitment and vision.

There is no way the GND can work unless we embrace public ownership and engagement at a renewed level. We can start be reviving American socialism that built these treasured public institutions in cities.

But cities have more people than power right now

The Constitution does not recognize cities and has a rural-bias that artificially limits the power of urban centers in American politics, both at the state and federal level. This is partly because cities are classified imperfectly in the US — overall more people live in surrounding suburbs than cities themselves, which doesn’t reflect the economic and cultural ties between them (and ignores the legacy of race-based decisions white enclaves made to secede from cities.) Given the problems facing the US and cities’ abilities to address them, this disconnect is untenable.

The GND must embrace Constitutional reforms that empower cities. This means adding representation in Congress (we need more reps and more states), abolishing the electoral college and, perhaps most radically, a realigning existing state boundaries to better incorporate natural urban geographies.

Some of these ideas sound outlandish and are probably unfeasible in the short-term, but they are also necessary to talk about. The GND is about injecting big thinking back into politics as much as it is about climate change. Introducing long overdue structural changes to our government to make cities as powerful as they should be must be a central pillar of that effort.

The Green New Deal is a work in progress. Critics can dismiss it for where it is right now, but activists are focusing on where it is going. And all roads lead to cities being its primary weapon against climate change and inequality.

Report Confirms Obvious: Rent Control Works

(cssny)

(cssny)

Now that the new legislative session has opened in Albany, the Housing Justice for All campaign has ratcheted up its fight for Universal Rent Control, a platform of bills that strengthen and expand tenants’ rights across the state. Even with united Democratic control for the first time in decades, there are a lot of structural obstacles in place that could derail the campaign over the next few months.

Half of all renters in New York City and the vast majority in the state don’t have any protections and aren’t typically activated in the fight for tenants’ rights. The real estate industry has millions of dollars to spend on lobbying and media influencing. And many legislators, just like the average person, have a lot of outdated misconceptions about rent control.

Changing the popular narrative of rent control is one of the most important, and hardest, challenges facing the Housing Justice for All campaign for Universal Rent Control. We only need to look to California, where the real estate lobby spent $80 million exploiting the same misconceptions to help defeat a rent control initiative called Prop 10.

This week, help came in a big way from Oksana Mironov of Community Service Society of New York who published a timely report on rent control in New York City that should help every activist fighting for Universal Rent Control frame their arguments for the general public.

It’s no secret that housing policy is a vast and confusing assortment of policies, agencies, acronyms, and formulas that scares off most people. Rent control (broadly used here to incorporate all rent regulations) is one of the most confusing aspects of this larger very confusing space.

That makes it hard to step back and understand the bigger picture of rent control, which is really quite simple and positive. This report shows why that is the case. It makes three important points that deserve quick focus:

Rent Control is the best affordable housing policy

As the report points out, there is an inherent power imbalance between landlords and tenants. Landlords will always have more information, more control, more political access, and more money than a tenant, particularly in a stressed market (which NYC has always been and most cities have become). The marxist critique would go further and highlight the absurdity of tenants providing the capital that gives the landlord power over them.

Rent control is the best way to offset this dynamic by securing real protections and power for tenants. One of the biggest achievements of the report is how clearly it explains how rent regulations do this and why it matters. Put simply, it shows that rent control is the best affordable housing policy we have (aside from expanding public housing).

Rent control is a legal structure that helps cities and towns stay affordable without massive direct public subsidies. They restrict a landlord’s ability to raise rents, they guarantee a tenant’s right to a lease renewal, and they provide legal resources to combat abusive behavior. These tools together give tenants the power to negotiate with a landlord that they simply don’t have when they can’t easily move to a cheaper or better apartment or fear getting kicked out.

It also has a larger impact on the health of a city. Rent control provides tenants and communities of color long-term protections against displacement in rapidly gentrifying neighborhoods. It offers more housing security for seniors, lower-income workers, and formerly homeless families than market rate housing. It also scares off speculators like private equity firms that raise property values, which gives non-profits, community land trusts, and other local ownership models the opportunity to own buildings.

The report also goes through a brief but widely unknown history of rent control laws in the US and in New York particularly, showing how widespread it used to be and why it was so necessary as a policy. It’s worth reading, but the gist is simple: we’ve always been in a housing crisis because housing doesn’t function like a normal market.

If the market was even somewhat designed to incentivize affordable housing, we’d have more affordable housing. But it isn’t and we don’t and never will by relying on it. Our solution now is to give billions of public dollars to private developers to subsidize “affordable housing units” that aren’t affordable, aren’t permanent, and aren’t built enough.

The report makes the overwhelming argument that rent control is a much sounder policy for private affordable housing policy.

Current laws suck, Universal Rent Control is the fix

Even though rent control works, it doesn’t take a housing nerd to see that current laws…don’t. They don’t “work” in a number of ways that the report covers well. It also shows how Universal Rent Control fixes them.

First, rent control doesn’t protect enough tenants. Of 8 million renters in New York state, only 2.5 million have any type of protections. The vast majority of those folks live in NYC, but still less than half of all rental units are regulated. That doesn’t leave a lot of tenants protected or interested in fighting for them.

Second, the current laws basically undermine the entire point of rent control. This is largely because the real estate lobby has effectively written these laws from the beginning. Their biggest problem is called vacancy decontrol, which allows units to exit the system and return to market rate when they reach $2733. This gives landlords a powerful motive to find ways to raise rents to that threshold. They have means through a series of loopholes that allow landlords to raise rents on existing tenants or in between leases.

Throw in the fact that oversight is flimsy at the state and city level (one issue that URC needs to address better) and you’re left with a system that does not protect tenants as much as it suggests it would. Since 1994, almost 300,000 units have been deregulated. That offsets all of the units protected under Mayor de Blasio’s housing plan.

The problem isn’t rent control as a concept, it’s rent control that is designed to fail slowly. Given this analysis, it’s no surprise that the report endorses the full platform of Universal Rent Control because it fixes these problems (ending vacancy decontrol, eliminating every loophole, expanding legal rights.) Most importantly, URC extends new protections to all renters, including market rate tenants, across the state.

Rent control critics are wrong either on purpose or by accident

The final part of the report is the most important for housing activists because it debunks the lazy talking points against rent control. These will absolutely be used by the real estate lobby and will likely be repeated uncritically by the media. Much like the emerging debate over marginal tax rates, this is either because critics don’t actually understand how housing works or they are operating in bad faith.

I encourage you to read the full section, but I’ll highlight one of the most important myths debunked in the report: rent control limits the supply of new construction, which raises rents for everybody.

Ignore for a moment that new construction isn’t even covered under rent regulations (unless they receive tax subsidies) and focus on the logic. If rent control magically vanished, would rents go down and would construction boom?

Well, no. We can look at examples like Cambridge, MA, where rent control vanished in 1994. Property values went up dramatically, and rents doubled in just three years. But there was and remains no construction boom that lowered rents. Rents continue to rise and displacement of low-income residents has increased, especially over the last five years, sparking housing protests from the Movement for Black Lives.

Rents are going up in Cambridge and plenty of other places without rent control and construction isn’t keeping pace. So what is driving that? Scarcity of land, speculation, and zoning restrictions. Even without rent control, these factors still exist. You can debate solutions to those problems, but rent control doesn’t impact them and it’s absurd to suggest that it does.

The only obvious way to protect tenants right now is capping rents. The only way to make it an effective policy is to have strong protections that reach all tenants.

Now that Governor Cuomo has announced his intention to address “aggressive rent regulations reforms” during the budget process over the next few months, it is crunch time to make the case for strengthening and expanding rent protections. There are many obstacles ahead, including the governor. Every member of Housing Justice for All and every housing activist should read and share this report to make sure people know why we must pass Universal Rent Control.

Progressive Housing Priorities for 2019: Go Big or Go Home

Hike wages, not rent

Hike wages, not rent

For many housing activists in New York, 2018 felt like the beginning of something big. The relentless scale of the affordable housing crisis finally reached a tipping point with the public. Hundreds of community groups on the ground around the state mobilized around this new energy and the result was stunning. The maturation of a truly state-wide tenant coalition in Housing Justice for All, the emergence of universal rent control as a viable policy platform, and the electoral victory of a new class of anti-real estate progressives have shaken up the political landscape in the state for the first time in generations.

The task now is how to ensure that we translate the organizing energy of 2018 into legislative victories in 2019 — and beyond. The first and most obvious priority will be passing the package of bills that encompass universal rent control before the rent laws expire in June. The peculiar mechanics of power in Albany make this a challenging task even with unified Democratic control, but there is undoubtably a large energized base of activists and groups committed to the fight.

There is a lot of work to be done, but I want to step back as the New Year starts and take a wider view of how housing activists should think about URC and its relationship to other issues in the progressive movement. This has implications for how we proceed with the URC battle in Albany over the next few months, but it matters for all progressive issues over the long run.

Where we’re falling short

Many other housing activists have pointed out that as much success as we’ve had with building a broad housing movement in 2018, we still experienced a lot of challenges around uniting different groups, agendas, and ideas within “housing”.

We also struggled to bring in obvious potential allies like young market-rate tenants, construction labor, and even small working-class landlords. We need to understand why these challenges exist, because we need these groups to sustain progressive victories.

The lack of inroads to some groups is probably in part due to the complexity of housing policy in general (and the difficulty of getting media to talk about it, before the election at least). Some is due to the perception that rent control won’t help market-rate tenants, or that it will slow down development and cost construction jobs. I’ve covered all of these issues in various blogs last year and I think we have some good ideas to address them.

But I’ve had a nagging sense (I don’t have any data to be clear) that some people tune out because they don’t see how universal rent control fits into a larger effort to reform our society. They might think of it as a “one-off” issue rather than part of a larger effort.

What’s the Big Idea?

That’s a failure on our part. We should be able to reach these types of folks with the right message — if we can show how our housing goals are part of a single unifying theory of progressive reform in New York.

What is that unifying theory? I read the same writers and thinkers as everyone else on this and I’m eager to hear what others think. But I believe, certainly as many others do, that the broad progressive theory to build a just society means fulfilling our individual roles as citizens before consumers, reestablishing democratic control rather than market control over our economy and politics, and investing in the public good over private profit. Pursuing policies around these broad goals are the best and most legitimate way to address the dual crises of wealth inequality and climate change.

Feel free to disagree with that assessment or add/subtract to it. The progressive movement is full of important discussions about the role of personal and group identity in shaping our priorities (I think outsiders give these discussions a bad rap for the most part) and the housing movement is no different. The point is, whatever the movement defines or has defined as its central theory, we need to be clear and consistent with how we want our society organized and why we think that offers a more perfect future for America. I’m not sure we’re doing enough of that, certainly not in the URC fight.

It’s hard to convey this on signs and buttons during actions, so it is important that we talk about the organizing theory in other places and on other platforms where we can be more in-depth. Whether its more op-eds or (definitely) more video or attending more local meetings, we need more people to hear that message directly. Groups like the DSANew York Communities for Change, and Make the Road Action are working on this already, so helping these organizations expand their efforts should be a big focus for housing progressives.

Along those lines, here are three Big Priorities that the progressive housing movement should work hard on as we ramp up the URC fight in the coming months. If we keep these ideas in mind as we talk to other folks in housing and to anyone in general as we go, we should be able to translate the energy of this coalition into a larger transformative progressive movement.

1. Unite all housing issues under Housing as a Right

Mayor de Blasio’s recent year-end review of his housing policy is a good symbol of the problem we face. He continues to view affordable housing, public housing, and homelessness as three separate issues. He’s not alone. Housing policy and advocacy has always been a balkanized mess with groups often competing for very limited funding and attention.

There are groups that should seemingly be aligned because they all work on low-income housing issues that aren’t in reality because they have deep divisions over things like prioritizing homeownership over renting. Other examples include homelessness advocates sparing with public housing advocates over prioritizing available NYCHA units. Affordable housing advocates spar about definitions of affordable and whether to prioritize for-profit, not-for-profit, or public development. The list goes on.

Some of these divisions are natural and healthy because housing is a vast policy landscape that has multiple potential outcomes of value. But many of them are the unhealthy result of a zero-sum funding game dictated by the narrow ideology of prioritizing the private market above all else.

To be clear, that’s because New York housing policy is not about how we provide adequate affordable housing, it’s about how to provide adequate funding to the private market to build more affordable housing then they would otherwise. (Developers give more money to campaigns than low-income renters after all.)

That has obviously worked — because it is providing billions of dollars to private developers, but it has not worked as a housing policy. (The term “affordable housing” is increasingly meaningless because of this too.) That’s what happens when the housing world is as divided as it currently is.

This dynamic must change. It starts by making housing a right the central goal of all housing groups.

The current policy landscape is narrow and static, which blocks out ideas and voices that we need to hear. To truly expand policy thinking on housing, the housing world must become united around a single political goal of providing affordable, adequate, and available housing to all residents of New York.

By necessity, such a vast goal will need to draw from all corners of the political spectrum. Homeownership and rental options must be expanded. Public housing and private development must be encouraged equally. Land-use and building codes must be reimagined. All ideas must be on the table.

This won’t magically cure real policy disagreements or funding problems, but it will break the political status quo, which has paralyzed both discussions. Thinking about affordable housing, supportive housing, public housing, and homelessness as separate issues has trapped many dedicated housing groups, some well-meaning non profit developers, and a few elected leaders in a cage match over dwindling funds and ideas.

Housing as a right as a political goal will encourage new voices, new ideas, and new alliances. The Housing Justice for All coalition has done a remarkable job of building a wide coalition because it has committed to this goal already, but we need to reach out to other groups like NYCHA residents, homelessness groups, low-income homeownership groups, small landlords, market-rate tenants, and construction trade groups to form a single united housing as a right movement.

There are many knowledgable and creative housing groups that could be useful parts of the coalition that are fence-sitting because of reasonable political calculations around funding and relationships. Change the politics, and those calculations change. This is the kind of bold reset that the affordable housing crisis is demanding of our politics and we have the opportunity to seize it this year — if we act boldly.

2. Embrace progressive urbanism

I studied Urban Planning in grad school because I believe the city is humanity’s best idea. Humans are social, collaborative, and competitive — concentrating them in one place brings out the best of those qualities in us and drives progressive as a civilization. — if we manage it well. Progressive urbanism offers that chance.

Cities also best represent the unique possibilities of the American character. You can find community. You can find opportunity. You can find purpose. That’s why they are magnets to immigrants, entrepreneurs, artists, and exiles.

Contrary to what others say, cities are where the real America exists and where its future lies. That future is diverse, dense, and digital. America is already an urban country and will only grow more so in the 21st century.

But if 21st century America is going to work, we need to make its cities work. And they aren’t working right now. Communities are under fire. Opportunity is out of reach. Purpose is illusive. That’s especially true in NYC, which is one of the most economically and racially stratified cities in North America.

The problem is America’s politics are anti-urban. The Constitution doesn’t recognize cities. The Electoral College undervalues them. The federal government has favored (and subsidized) the rural and suburban parts of the country for most of the 20th century at the expense of them.

The racist anti-urban ideology baked into 20th century American politics is a large reason for the inequality crisis and climate crisis shaking our country apart, but cities don’t have the political power to fix it.

It’s time for the politics to catch up. A progressive urbanist agenda must be the core of 21st American politics. Housing progressives must argue that living in cities is how we live well together and how we best solve the problems facing our country and planet. We must explain why the advantages of urban life — the diverse, dense, and digital I mentioned earlier — are built-in ways to address inequality and climate change quickly and sustainably.

The housing movement must be a foundational partner in building the popular movement to reform our political system around cities. That means fighting for things as big as structural changes in the US Senate and House or changing housing and transportation policy at the federal level. And it means fighting for smaller immediate things like making sure the 2020 Censuscounts urban populations accurately and without racial animus baked in.

Cities are where the country is already moving, literally, and where the political future lies. Recognizing this and empowering cities will create thousands of democratic laboratories designed to fight inequality and climate change from the bottom up.

But only if they are midwifed with progressive values. Guaranteed affordable housing is the lynchpin of a larger set of issues that include improving wages and labor rights, recommitting to public education, creating universal healthcare, deconstructing systemic racism, and pursuing environmental justice and sustainability, among many others.

Progressive urbanism fits well into any potential organizing theory of progressive principles. It has to be a core tenant of the housing movement and it has to be the core message to bring in other non-housing groups to the cause.

3. Organize workers and consumers against late capitalism

It’s no coincidence that housing activists fighting for URC are also involved in the Anti-Amazon HQ2 protests in NYC. They are the same fight in the end. To really end the housing crisis, we must tackle the crisis of late capitalism that Amazon represents.

Capitalism has stopped working the way Americans have been raised to imagine it. Only the most ideologically blinded and deeply compromised partisans can look at the state of our economy and pretend otherwise. Most industries, especially finance, energy, telecoms, and pharmaceuticals have concentrated around a few dominant players who control their regulatory regimes at the expense of employees and consumers.

On top of this, the tech boom, despite the (now cresting) fascination with startups, has led to an unprecedented concentration of economic and cultural power in a few firms, industries, and geographies.

This has massive implications for the health of our economy and society, which we’ve only starting to reckon with properly. Getting cheap crap as consumers should not outweigh the cost to us as employees and citizens.

That tradeoff has been toxic. American entrepreneurship has plummeted. Wages for the top earners have exploded while wages for the vast majority of workers have stagnated — despite nine years of economic growth. Debts of any kind are skyrocketing to fill the gap. The chance to enter the middle class has all but vanished for many while the chance to remain there is diminishing for a huge swath of the country. This is late capitalism.

The commodification of housing is just another byproduct of late capitalism’s unchallenged thrust towards commodifying every aspect of our lives that undermines our civic and ecological lives. That is what is driving the rise of rents, displacement, and eviction. It explains part of the increase in climate disasters and is certainly a major factor in the failure to respond to them.

In New York at least, URC has a legitimate shot at clawing back democratic power over housing policy from the real estate industry for the first time in generations. But it is not enough to stop there. We must crawl back democratic control of the economy overall. URC should be the beginning of the larger movement to do so.

That means the housing movement must align with worker movements and progressive elected officials in their efforts to break up monopolies and oligarchies in every industry, but particularly in tech and finance.

This is already happening in NYC with the Anti-Amazon protests and other equally important movements like the protest over the redevelopment of Two Bridges (a major action is planned for MLK Day.)

Solidarity is the cornerstone of the housing movement, but we need that message to get out to the general public and to other potential allies: Passing universal rent control will not be enough to solve inequality. Because of that, even if we do pass URC, the coalition that made it possible won’t be going anywhere.

In the early 20th century, when the progressive movement first emerged, corporate power and capitalism itself were contested in the market place of ideas in America. Even Republicans like President Roosevelt warned against their threat to democracy.

That battle came to a head during the Great Depression when the other President Roosevelt famously said his New Deal was an attempt to save capitalism from itself. For a time, for America as a whole, it did that. The last 40 years have unravelled it.

It’s clear that we need a massive, New Deal-level reboot in this country. That doesn’t just mean a Green New Deal. And it doesn’t just mean housing as a right. It means rebooting every corner of our politics and our economy. As housing progressives fight for universal rent control in New York, we must step up and make sure people know that’s what we’re all fighting for.

The Mayor's Plan to Fix NYCHA Will Nix Public Housing (But Don't Blame Him)

Isaacs Houses (homebodynetwork)

Isaacs Houses (homebodynetwork)

Yesterday Mayor de Blasio announced an updated plan to fix the crumbling public housing stock in NYC before it falls into federal receivership — and even more uncertainty. The plan calls for selling air rights, allowing developers to build on NYCHA land, and most radically of all, transferring 1/3 of all NYCHA homes to private manage. 

If all goes according to the plan, these programs will still only account for 75% of the $32 billion in needed upgrades for NYCHA, leaving the remaining funding in the hands of an uncommitted Governor Cuomo and an openly hostile federal administration. 

It also doesn’t provide any new housing opportunities for the 360,000 New York families on the waiting list for NYCHA or Section 8 vouchers or the more than 60,000 homeless New Yorkers.

I don’t envy the Mayor’s position. This is his best option to find the significant cash infusion for upgrades to a vast system. NYCHA manages 176,000 homes across 2,400 buildings. Almost half of NYCHA developments are 50 years or older. Decades of underinvestment from the federal government (and years of mismanagement at NYCHA) has compounded to put many buildings on the brink of permanent decline and eventual condemnation. Over 400,000 New Yorkers live in NYCHA and deserve dramatic and fast solutions. The fact that this is the best option is not on the Mayor.

But let’s be clear what this plan represents: this is an admission that the idea of public housing in the US is over — from a progressive mayor in a progressive city with a long history of successful stewardship of public housing. 

There are 1.3 million publicly owned homes in the US, but NYCHA is by far the largest concentration of them. For 80 years, it has stood out as a well managed bastion of affordable housing, in sharp contrast to other cities that never had the political support to properly invest in a system. For every Pruitt-Igoe or Cabrini-Green in another city, there is a Queensbridge or Williamsburg Houses here. These developments aren’t perfect, but they are providing affordable homes and stable communities for thousands of New Yorkers. NYCHA showed that public housing worked.

The real story of NYCHA is how resilient it has proved to be despite a hostile federal government and indifferent public that have betrayed it at every corner over the last forty years. Just since 2001, the federal government has cut over $3 billion in operational funding. It’s only recently that NYCHA has started to fracture and it’s miraculous that it endured as well as it did under the circumstances.

 If after all of that, we’re throwing in the towel on NYCHA now, we’re throwing it in everywhere. At a time when virtually the entire country is feeling the pain of the affordable housing crisis, this is the exact opposite of what we need to do. 

One out of three American households (38 million) are cost burdened. Half of all renters are cost burdened (which has doubled over the last 50 years) and a quarter are severely burdened. Since 2000, the number of Americans living in poverty has increased by 28% to 12.8 million. In 2016 alone, 1.4 million people (including 175,000 families with children) were homeless at some point during the year. 

In New York City, it’s even worse. Half of all renters in NYC are rent burdened, including virtually all low-income households. Homelessness is at record numbers. Displacement of low-income communities is rampant. 

What is truly scary about all of this is that it is happening during one of the longest periods of economic growth in our history. 

At precisely the time where we need bold, transformative federal leadership on housing, when we need more public housing, the federal government under the Trump administration is retreating even further. 

Last month, HUD Secretary Carson sent a letter to public housing authorities outlining HUD’s plan to dramatically reduce the stock of public housing in the US. Housing advocates fear that next year they will see severe budget cuts to public housing and other housing programs.

It’s not enough to blame President Trump or Republicans. The Democratic Party doesn’t support public housing either. Despite champions like Rep. Barbara Lee, Nydia Velazquez, or Hakeem Jeffries, the party overall, and particularly during the Obama Administration, has actively supported privatization of public housing which demonstrably leads to a reduction of affordable housing. The Democratic Party has never made public housing the priority it should be and millions of Americans, not just NYCHA residents, have suffered as a consequence.

Instead, both parties have embraced subsidizing homeownership and incentivizing the private market to build affordable housing units for decades. The result of this bipartisanship is skyrocketing home and rental prices and millions of missing affordable homes.

The mayor’s plan in part reflects this ugly reality. The central component of the plan is the expansion of the controversial Obama-era Rental Assistance Demonstration (RAD) program. The mayor proposes transferring 62,000 homes — one third of the system — into private management supported by Section 8 vouchers. NYCHA would still own the properties, but private developers would be able to leverage private capital markets to make repairs and then collect rents on a 99-year lease. The mayor estimates that this process (which includes non-RAD programs as well) would generate $12.8b in repairs.

RAD has become liberal’s “best idea” for a long-term solution for public housing. That’s understandable. Given the way public housing is framed nationally, it represents the only idea to raise large amounts of capital for public housing right now. Many cities, like San Francisco, have or are in the process of converting their entire public housing stock into the RAD program. 

In NYC, developments have already been converted. The biggest so far, Ocean Bay in the Rockaways, has been viewed as validation for the program. The infusion of capital has led to renovations for all apartments and a palpable improvement in the quality of life for residents. This is of course welcome for the New Yorkers in these buildings. 

But what Ocean Bay proves is, wait for it, the quality of buildings and the quality of life for residents improves when you invest money in them. There is nothing intrinsically better about private management, other than there is political support to subsidize it. NYCHA used to be a model of property management because it used to have enough money to do it well too. 

In the short term, RAD-fueled private management might be a godsend to residents compared to a slowing and staggering NYCHA. But this is an illusion. The reality is, housing low-income residents is massively expensive, especially in older large-scale buildings. Adding the need for private firms to profit only increases the cost to the public in the long run.

At some point in the not too distant future, these private firms will no doubt come back to the table looking for more money. Roofs leak, elevators breakdown, boilers need replacing and investors change their expectations.

Incomes aren’t likely to increase for these residents, especially as the population ages, to cover higher costs. The cost of climate change (either adaption or mitigation) will eventually materialize and will likely be prohibitive given the location of so many developments near water. 

No amount of current tenant protections within RAD will stop the need to either raise rents or increase public subsidies to keep these private firms in business. 

No institution other than the federal government can handle the nation’s housing needs now or tomorrow. It is simply more efficient and more equitable to build, own, and manage these homes publicly through federal funding. 

It is bad enough that our society can’t produce economic prosperity and security for all of its citizens, but it is especially perverse to allow private interests to profit from the housing of the poor and working class, especially when it is clear that the private market is utterly incapable of meeting the affordable housing needs of our nation.

You might argue that the public shouldn’t be concerned about doing this, but you would be wrong. Unless our economy is rebooted to spread wealth and security to everybody, the increasing winner-take all society we live in will cease to have any legitimacy for the poor and working class (to the extent that it has any left). At its mildest the resulting pain will cause an exorbitant cost in social services and lost economic productivity. At its most severe, it will cause mass unrest and social revolution.

The Mayor has many flaws, but he can not carry all of the weight for NYCHA’s misfortunes. We’ll find out tomorrow in court if the Mayor’s plan is enough to avoid federal receivership. Surly the federal government doesn’t want to take responsibility for NYCHA.

That’s not good enough. We must demand that the federal government provide the funding necessary not only to upgrade existing NYCHA properties, but to expand public housing to guarantee that all Americans have a safe, clean affordable home where ever they need it. But until enough Democrats wake up about the housing crisis, we’ll keep seeing the steady, miserable erosion of public housing in the US.

Comptroller Stringer: NYC’s Housing Plan Isn’t Helping 582,000 Low-Income Households (Via Data For Progress

Not even close (homeBodynetwork)

Not even close (homeBodynetwork)

This article originally appeared in Data for Progress

On Thursday, City Comptroller Scott Stringer published a startling report on the affordable housing crisis in New York City that shows a significant gap between the housing needs of extremely low-income New Yorkers and the targets of Mayor de Blasio’s Housing New York 2.0 Plan. The report also proposes a couple of intriguing progressive ways to address it.

In total, 585,000 New York City households with very-low to extremely-low incomes face severe housing pressure, representing nearly 20% of the city’s population. Looking into the numbers a bit closer, an estimated 515,000 New York City households face severe rent burdens and overcrowding. Two-thirds of these households make less than $28,000 per year and are paying a staggering 74% of their monthly income towards rent.  

Chart 1: Income Distribution and Rent-to-Income Ratios of NYC Rental Households 2005 - 2016

Chart 1.png

More disturbingly, a record 60,000 New Yorkers are living in homeless shelters, despite a third of them having jobs. There are 5,000 families with children that have been living in shelters for over a year and another 2,000 that have been there for two years. In just 4 years, the city’s spending on homeless services has doubled to nearly $3 billion. (Chart 2)

Chart 2: Growth in Spending on Homelessness and Average Shelter Population

That’s a daunting amount of need, but the mayor’s housing plan has barely attempted to target it. The plan, which Stringer acknowledged was the most ambitious since the Koch Administration, calls for the preservation or construction of 300,000 affordable housing units by 2026 at a cost of $83 billion (up from 200,000 and $43 billion when the plan was introduced in 2014). To date, 75,285 units have been preserved and 34,482 new units have been constructed, which puts the plan at just over one-third of the way completed.

Chart 3: The Need vs. Housing New York Plan 2.0 Targets

Screen Shot 2018-11-29 at 5.45.09 PM.png

However, as you can see from Chart 3, only 25% of the 300,000 units have been allotted for very-low to extremely-low income households, despite those households representing 88% of the most severely distressed in the city. To put it in context, even if the plan is successful, it will have built 75,000 units to service a population of 515,000 households.

Groups like Real Affordability for All have criticized the mayor’s housing plan for ignoring low-income households before, but Comptroller Stringer’s report is less a criticism and more of a suggested pivot. It includes three proposals for the city to realign the existing housing plan towards these low-income households.

First, it suggests committing the remaining target of 85,000 new construction units to extremely-low income households. Second, it suggests raising the percentage of units set aside for homeless families from 5% to 15%.  Third, and most radically, it proposes a new operating subsidy for landlords for preserved units that go to extremely low-income households to help landlords.

Those won’t be cheap. According to the report, targeting extremely-low income households for the remaining 85,000 new construction units would require an additional $370 million per year, while the operating subsidy would be $125 million per year. Both numbers deserve more scrutiny, particularly the operating subsidy, which has been suggested on a larger scale by some notable presidential hopefuls but has come under harsh criticism.

For progressives, the most interesting aspect of the report is how it proposes creating new sources of revenue to cover the costs.  Comptroller Stringer first turns to his long-held support for creating a Land Bank to give city-owned vacant lots to non-profit developers and community land trusts, vastly reducing the cost of new construction. His office estimates that the 1,000 plus current inventory of vacant lots could produce close to 40,000 units. These units would have the benefit of being permanently affordable and locally-owned.

More significantly, he proposes a progressive change in how to tax home purchases. Currently, a potential buyer who pays in cash pays less tax than a buyer financing through a mortgage. This quirk exists because the city and state tax the purchase price through the Real Property Transfer Tax (RPTT) and the mortgage through the Mortgage Recording Tax (MRT), which effectively double-taxes people who can’t afford to pay in cash.

This is backwards for two reasons. Obviously it makes it even more expensive for middle class and working class families to buy homes in the city. It also grossly under taxes high-dollar cash transactions made almost exclusively by anonymous high-wealth individuals, foreign investors, and private equity firms. The report highlights the fact that in 2016, 80% of Manhattan condo purchases over $5 million were all cash.

Chart 4: Current and Proposed NYC Transaction Tax Rates on NYC Property

Screen Shot 2018-11-29 at 5.45.32 PM.png

The report suggests eliminating the MRT altogether and installing a new, progressive rate schedule for the RPTT, as seen in Chart 4. Although still relatively low compared to other global cities like London or Singapore, the tax could potentially create $400 million in new revenue (while reducing the tax burden on a middle-class buyer). Even if a higher tax lowers the volume of sales, scaring off the speculative frenzy enveloping the city would be welcome on its own.

Comptroller Stringer suggests that this tax would more than cover the cost of the report’s proposals. He also suggests that if enacted, the proposal would likely reduce spending in other areas, particularly around homeless services.

That may be the case, but the political path forward remains murky. Like a lot of progressives in the city, Comptroller Stringer is banking on the new Democrat majority in Albany being open to his proposals, but that line is long and loud. The City Council has been sitting on a land bank bill for several years and might not be eager to support a potential rival for 2021 (He notably doged any discussion about running for mayor). Most importantly, Mayor de Blasio is never eager for outside input into his administration, let alone on his signature policy.

Regardless of the politics, this report outlines a city in dire need for bolder action to address the affordable housing crisis while there is still time. The city’s government has become over reliant on skyrocketing real estate prices fueled by faceless investors and foreign entities while ignoring the lived experience of everyday struggling New Yorkers. That might be easier to ignore when the economy is growing overall, but it will be impossible to forgive when it inevitably goes in the other direction.

What the Fight for Universal Rent Control in New York Can Learn from Prop 10’s Defeat in California (Via Shelterforce)

We’ll find out soon (homeBody)

We’ll find out soon (homeBody)

This article was originally published in Shelterforce

Voters in New York have spoken, and they want relief from the affordable housing crisis. Last week, they handed control of state government over completely to Democrats, most of who ran on progressive, pro-tenant platforms. Particularly in the state senate, which flipped for the first time in years, many first-time candidates beat pro-developer incumbents by rejecting real estate money and instead embracing the call for universal rent control.

This doesn’t mean that voters will get relief, however. With current rent regulation laws set to expire early next year, voters have set up an unprecedented fight between progressive housing groups and real estate interests. It will be a brutal fight. For proof of this, housing advocates in New York need only to look at California.

National real estate groups spent $80 million successfully defeating a rent control ballot initiative known as Prop 10.  These groups, as well as powerful local groups like the Real Estate Board of New York and Rent Stabilization Association, won’t blink at spending lots of money to fight universal rent control in New York. (One of the biggest is Blackstone, which owns Stuyvesant Town in the East Village where I live.)

California and New York have extremely different political contexts, so making direct comparisons has limited value. However, there are several important lessons that New York housing advocates can take away from Prop 10’s defeat.

  1. Define Universal Rent Control clearly

Prop 10 didn’t stand a chance as a ballot initiative, partly because of the money aligned against it, but equally because it was confusing. It was not a “Yes/No” vote on rent control. The language of the proposal was about repealing the state’s Costa-Hawkins Rental Housing Act that prevented local cities or towns from enacting any kind of new residential rent control.  

That left a lot undefined for voters. They were asked to vote on repealing something—and many did not have a specific sense of what repealing it would mean for their city or town, or for them personally as renters or homeowners. Even with millions of dollars from tenant groups and the AIDS Healthcare Foundation, this dynamic made it easy for well-funded real estate interests to fill in the gaps and define it how they wanted to. This clearly cost Prop 10 a lot of should-be voters.

That is less of an issue with Universal Rent Control in New York. Although the scope of the proposal is still being worked out, the broad goals are clear and who benefits is clear: every rental unit in New York state will become protected (it’s less than half now.) Every loophole that allows landlords to raise rentsevict tenants, or deregulate units will be removed. Every renter will have new eviction and harassment protection.

Though URC is easier to understand than Prop 10, it is important that activists and progressive legislators work together quickly to define the specific proposals around universal rent control before real estate interests start flooding the air with advertisements against it. This will make it easier to rally the broad spectrum of renters that stand to benefit from the plan, particularly market rate tenants that must be brought on board to pressure other legislators in the Democratic Party.

  1. Seize the new political landscape in Albany

Pressure is key. California, just like New York, is blue, but that hasn’t translated into progressive housing legislation. This pattern cost them with Prop 10, which first died in a Democrat-controlled committee before reappearing as a ballot initiative. There are not enough Democrats in office in California with the stomach to challenge the real estate industry and their wealthy homeowner constituents to enact the type of far-reaching reforms necessary to fight the housing crisis.

That had been the case in New York before the November election, but now Democrats control all three branches of elected government and have a rare window to challenge the status quo. Democrats have dominated the Assembly for years, but the big difference is the Senate, where Democrats took control for just the third time in more than fifty years, fueled by an aggressively pro-tenant wave of first-time candidates.

Housing Justice for All rally on Nov. 15, 2018. Photo Credit: Pete Harrison

The wildcard will be New York’s Governor Cuomo, who ran to the left because he was pushed there by a spirited challenger. He has been a big friend of the real estate lobby for as long as he’s been in politics. He is now in uncharted territory, but it appears that he can no longer hide behind New York’s long standing closed-door dealdynamic.

Unlike in California, having complete control of state government should mean that universal rent control would get considerable attention from legislators. The severity of the crisis along with the significant shift away from real estate money in elections should keep pressure on the Governor and other members of the Democratic Party who might otherwise be wary of angering the real estate industry. 

Defining the proposals for URC quickly and keeping activist groups engaged throughout the process will hopefully be enough to turn the electoral momentum into firm legislative action.

  1. Debunk classic economic arguments against rent control

In California, the real estate lobby spent the majority of its money on television ads harping on the classic Econ 101 arguments against rent control. These arguments are not as strong as they appear. The reality of the housing market has always been more complicated than simplistic models suggest and it is critical to push back on them.

First, studies that claim rent control harms the creation of new housing or the quality of existing housing fail to properly account for the more demonstrable variables that limit supply in tight and densely populated markets like New York, San Francisco, or Los Angeles like natural geographic barriers, social preferences of land use, the limited extent of transportation networks, and even a desire to limit competition among developers.

Second, they tend to underplay how decades of (federal and local) government policies have privileged real estate and empowered financial markets to commodify housing.  The housing market ‘s priority is enriching investors instead of meeting the overwhelming demand for affordable shelter. That explains how the Low Income Housing Coalition estimates that the U.S. is missing 7.2 million affordable housing units, yet 250,000 units sit empty in New York City alone.

Third, they ignore the bigger problem with the housing market: rent-seeking behavior. There’s only so much land, particularly in desirable markets like New York where it’s value has skyrocketed over the last 20 years as more people and firms want to move here (for better or worse). This has made city landowners incredibly wealthy.

The pay-to-play nature of our political process means that they also have a disproportionate amount of power over things that impact the housing market like property taxes, zoning, and affordable housing policy. This almost always harms the public while driving up property values. It helps explain everything from why so many commercial spaces are empty to why it costs so much to build new affordable housing and homeless shelters.

When we acknowledge that the housing market in reality encourages rent-seeking behavior and show how much it corrupts public policy, rent control becomes a legitimate and necessary intervention to empower tenants and the broader public against economic and political exploitation.

Prop 10 was ultimately a bad presentation of a compelling and urgent public policy choice. Even if real estate interests hadn’t spent so much money distorting it, it failed to capture the general public’s attention or imagination.

That doesn’t have to be the case in New York, where Universal Rent Control has already done that for many renters and voters. Now that it has a shot in Albany, California’s experience can help it get over the finish line.

5 Reasons to Support Universal Rent Control

(stoprebnybullies)

(stoprebnybullies)

Election Day is here and, depending on your perspective and persuasion, our country will be saved or doomed. Maybe both, maybe neither. On a personal note, I’m proud of playing a small part in a cycle that has seen the emergence of a progressive left as a growing electoral force.

In the spring, I started hearing about a young woman running for Congress in the Bronx, and it was a single tweet from her talking about housing as a right that hooked me. It was something I believed, but never thought would become an actual rallying cry in American politics.

Since then, over the last 6 months, I’ve knocked on countless doors across 4 of the 5 boroughs (sorry Staten Island) for Alex Ocasio-Cortez, Julia Salazar, and for many other progressive candidates that believe the same thing.

I’ve met amazing, committed activists of all ages and backgrounds that have come together to talk about important issues, promote great ideas, and elect amazing candidates. For a housing nerd like me, I’ve especially been inspired by the community of housing organizers that I’ve come to know.

There were a lot of important issues that got people fired up this cycle. However, universal rent control is one of the most exciting movements that has started to come into focus. It is an opportunity to radically change the political landscape in Albany, but has a long way to go, even if things go right on Election Day.

I wanted to make one final pitch to voters about what universal rent control means, why its so important, and why supporting the candidates who believe in it is so important. Here are 5 reasons to support universal rent control:

1. It’s the first step in breaking the rigged the political system

Everybody complains about how corrupt Albany is, but it really is, and real estate is the reason why. REBNY (The Real Estate Board of New York), one of the major political arms of big real estate developers, spends like crazy every election cycle on politicians from both parties and gets its members to spend even more.

It’s money well spent. It gets its members generous tax incentives, weak tenant protections, and a stable, predictable political landscape that favors developers. Then they take advantage of extreme gerrymandering, lax campaign finance laws, and voter suppression measures to keep their preferred candidates in power and to keep voters out of the process. (Many of the candidates they back also block other progressive issues in Albany.)

This means that renters, the homeless, small landlords, and low-income communities across the state are blocked from expressing meaningful political power. There are just enough politicians speaking for these groups to give the appearance of a fighting chance, but the supremacy of the status quo is undeniable.

This election cycle is challenging the status quo. During the Democratic primary in September, pro-tenant progressive candidates beat a slate of establishment Democrats, including 6 out of the 8 state senators of the now defunct Independent Democratic Conference (IDC).

These candidates (and even candidates from other parties) all ran on a platform that rejected real estate money and most embraced universal rent control. These candidates are pro-tenant, but as importantly they are pro-democracy. By taking rightful power from a tiny group of wealthy developers and giving it back to the broader population of New Yorkers, we can start to solve the deeper political crisis in our state that is fueling the housing crisis.

URC is the first and biggest opportunity to turn this momentum into law, just as our current rent regulation laws are set to expire in 2019.

2. It’s the only immediate way to slow down rents

Universal rent control will apply to every renter in New York state and is designed to block extreme rent increases, prevent unfair evictions, and eliminate perverse incentives to kick out tenants. This is the only way, right now, to protect tenants from increasing rent pressure. When half of all rentersare already burdened, help is needed fast.

URC will improve on the existing rent regulation protections in two critical ways. First, it will apply to all renters. Current laws apply to less than half of all renters in NYC and a tiny fraction outside of the city, so the benefits are not widely shared and understood. Second, it will remove the many loopholesthat allow landlords to raise rents in regulated units and to remove units from regulations altogether.

By closing loopholes and spreading protection to all renters, the housing market in New York will change dramatically. Every renter will gain meaningful protections against the type of stress and abuse that have become typical for too many.

It is a blunt tool for sure, and it must be part of other large reforms in land use policy, property tax law, and occupancy requirements, among others. But on its own, right now, it will help protect tenants from the onslaught of the housing crisis and show them that political change is possible if they remain united.

3. It’s the best way to stop the homelessness crisis from getting worse

There are a record 89,000 homeless New Yorkers across the state, 62,000 of them are in NYC. A large portion of them are families. Many of them are veterans. Lots of these adults are working. This is happening while our economy has been “booming” for ten years.

This is a moral failure. If that’s not enough for you, then it’s also a policy failure. The number one reason for the spike of homelessness is a lack of affordable housing. People can’t afford to stay in their homes and can’t afford to move and/or secure new housing.

New York spends millions of dollars trying to fill the gap with shelters and supportive housing, but we should be working on keeping people in their homes to begin with. Eviction prevention is a proven method to improve outcomes for housing insecure individuals and is a substantially more cost effective policy for taxpayers.

URC includes the expansion of eviction protections currently underway in NYC like right-to-counsel and anti-harassment measures, but it can also include a streamlined system for short-term rental assistance before eviction proceedings start. Many of the existing rental assistance programs at the state level are difficult to navigate and apply to a narrow pool of applicants. Federal programs are even worse.

Simplifying and expanding these programs under a URC platform will be a net benefit for these New Yorkers and for the state. Ending homelessness is a choice and one that we can do with a relatively small operational lift.

4. It will spur competition and innovation in housing construction

URC is a drastic intervention in the housing market and flies in the face of every 101 econ class lesson, but it is also necessary and justified because the housing market in New York, and especially NYC, has always been broken. It might be counterintuitive, but URC can actually fix this.

In a classic market simulation, perfect competition between rational actors creates an equilibrium between supply and demand cancelling out profits. No capitalist actually wants that and, historically, capitalists have worked very hard to prevent that from happening. Our current form of late capitalism has perfected this.

This is especially true in the housing market. Simply put, the market doesn’t build enough quality affordable housing because it isn’t interested in doing so. It only does so with expensive public subsidies. Every activist agrees that we need a greater supply of housing, but our reliance on this method has produced few affordable units relative to need at truly astronomical per unit costs. The only winners here are developers.

As much as developers complain about it, the cost and complexity of building in NYC benefits them because it prevents new developers (big or small) from entering and competing. A restricted supply and complex regulatory landscape raises profits and limits competition, leaving a small, wealthy community with a lot of power and incentive to maintain the status quo, which is what REBNY does well.

This hardly makes for a healthy market. Tenants don’t have corresponding market power because they don’t have the power to “vote with their feet” to change this status quo. Without a “pure” market (never gonna happen) to even the playing field for tenants, the argument for URC becomes obvious.

URC would remove the worst predatory actors from the market by restricting rents, but if it includes complimentary reforms that create more competition, (things like reforming occupancy laws, zoning restrictions, property tax law, but there are many ideas to pull from) it could spur a renaissance in construction practices and productivity that have been slow to materialize under the current status quo.

We need to encourage more innovation and competition within the development community to add housing more responsive to the public’s changing needs. This includes more use-specific options for seniors, special needs individuals, families, and young singles, as well as incorporating more sustainable construction and energy-use methods.

URC is a rejection of the current structure of the housing market, but that doesn’t mean it can’t be a vehicle for innovation. By establishing Housing for All as the goal of the housing market, URC is challenging who gets to compete and what ideas get to compete.

5. It will stop displacement and encourage local ownership

The post-recession emergence of foreign and institutional investors at the high-end and the growth of house flipping platforms at the low-end have created unprecedented competition for real estate in many corners of the state. These forces have particularly targeted low-income communities of color, triggering levels of displacement that we are only just starting to understand.

It’s no surprise that large scale investors have turned to single-family properties and small multi-family portfolios in cities like NYC. They are safe, highly privileged assets in American tax law and are the benefactor of the larger trend of people preferring to live in urban environments. High debt levels and stagnant wages have further increased the demand of rental housing for younger and older Americans. The prospect of weakening already leaky rent regulation laws only creates more interest in these buildings.

URC will obviously change the calculation on rising rents. This will in turn have a potential impact on the attractiveness of housing as an investment asset overall. Removing the speculative value of housing will lower the costs not only for renters, but for local landlords and community groups to take on ownership.

If URC gets passed, making it easier for these types of local actors to own the land and buildings in their community will prevent displacement and retain prosperity within these communities. The same coalition could support alternative equity models like community land trusts to further empower community-led ownership.

The fight is just beginning

I am too burned from 2016 to want to hear, let alone, make predictions about Election Day. But at the local level in New York, there is a real chance that progressive change can take hold in Albany after the election. If the Senate flips, there is a credible chance to enact universal rent control.

But the fight will be brutal. REBNY, RSA, and high-influence developers were clearly caught off guard by the rebellion in the primaries, but they have considerable structural advantages in Albany. Governor Cuomo will be a particularly vexing wild card.

Whatever happens on Election Day (I may update this as needed) I hope that voters, long-time or first-time, continue to stay involved with other activist groups. The coalition for universal rent control is still in its early stages, but the housing rights and tenants rights communities have been around for a long time. Channeling the experience of these groups with the energy of newly engaged local voters could produce some truly remarkable change in 2019. Here’s hoping.


Universal Rent Control is about more than tenant power, it’s about reestablishing democratic power over the market


As election day approaches, the stakes keep getting higher and the political environment keeps getting scarier. It was inevitable that the President would turn to imaginary fears and blatantly false claims to poison the climate, partly because he sees the grave risk in “losing” the midterms, but mainly because that’s who he is. It is disheartening that so many other Americans seem to share his darkest impulses. It might not be enough to prevent Democrats from retaking the House, but we’ve seen that song and dance before. 

The real question for me is: how much will change if the Democrats win? The battle in New York for Universal Rent Control is a good place to consider what needs to change, what could change, and what might not change within the Democratic Party.

(Honestly, this blog got away from me and is more about the political process around URC than specific policy proposals, but feel free to check out something I wrote about it here for more details. I will be following up this article with more about URC.)

Now, of course things will change considerably for the President if Democrats take back the House. There will be actual oversight of the administration. There will be meaningful roadblocks to the Republican agenda on the hill. There will be some reaffirmation of some democratic checks and balances. This is all great.

But, look, we’re still in a bad way. The faith in our democratic institutions has eroded because the institutions themselves have eroded. The faith we have in each other as a whole has eroded because our vision of each other as a whole has fractured. The faith we have in the American Dream has eroded because our economic reality is a world away from it. Most disturbingly, the faith we have in our climate security has eroded because our planet is clearly in grave trouble and we’re failing to face it.

None of this changes if the Democrats take back the House

It won’t change and it’s not for the obvious reasons that they might still lose the Senate, don’t control the White House, and don’t control the Court. It’s the same reason why even taking power back in New York might not result in real change.

It’s because the Democratic Party doesn’t have any real answers for these problems. They haven’t for decades. Just look at this recent interview with Rep. Nancy Pelosi (starting at 2:58.) Seriously, what the hell is she actually talking about? They are nowhere near the nihilism of the Republican Party, but that’s not hard or virtuous. 

As the party continues to make commendable strides in promoting diverse candidates that better reflect the 21st century American experience, it has been notably less successful at promoting ideological diversity. They have allowed candidates to run to the right, but have mostly isolated those that run to the left. 

It’s obvious why: Democrats have been corrupted by the same system that has corrupted the Republican Party, only in slightly different ways, by only slightly different actors. And that system isn’t working.

For decades, both parties fully embraced neoliberalism as the end of history ideology

Privatization, deregulation, and globalization have been the name of the game for 40 years in America and both parties have become beholden to the moneyed interests that wanted it, benefit from it, and jealously guard it.

To be clear there is nothing inherently wrong with a competitive private sector, a proactive regulatory regime, or a deeply connected international world. In balance these elements can make us all safer, richer — financially and culturally- and healthier. But neoliberalism hasn’t delivered that world. There is no balance. 

There is something inherently wrong with “trusting markets.” 

The obvious point is that neoliberalism by definition doesn’t trust or value democratic control of power. It’s central belief dictates that power will be competitively dispersed between rational economic actors and that that competition will inevitably produce better outcomes for society. 

Those are some major leaps of faith to build a global society on:

  • It assumes that economic actors are rational (which is far from true for individuals, firms, and even states) and discounts the consequences of when they aren’t rational, which is most of the time. 

  • It assumes that competition between these actors will be honored rather than crushed, which is what always happens (either by brute force or collusion) and is unprepared for the fallout. 

  • And it assumes that all of this will produce a better society, while it has clearly ignored the toll it takes on the planet and on vulnerable populations.

What neoliberalism has left us with is a vastly unequal and unparalleled concentration of wealth and power that we can barely see let alone hold accountable. It has left us with a wake of destructive exploitation of human populations and natural resources that we can’t prevent or replenish. It has left us with severely compromised democratic governments that can’t represent or protect us. And it has put the very-near-future of our planet in peril. 

This is because the hallmark of neoliberalism is illiberalism, a fake democracy. It’s a term that we’re starting to hear used more about countries like Turkey, Russia, and Poland, but we have been experiencing it here for a long time. The structural flaws within the Constitution, the shameful voting suppression efforts in many states, and the corruptive flow of money across all levels of politics and media have warped our government far from any definition of “self.” Neoliberalism requires this. It’s a really raw deal for most of us.

How Democrats went from the New Deal to Neoliberalism matters for how we get them out

The Democratic Party is complicit in this. The party abandoned its New Deal commitment to democratic control over the economy, to public investment and ownership, and to sharing the benefits of prosperity evenly across society with an ever wary eye towards the future.

The New Deal represented a clear, unifying theory of self-governance forged from the trauma of the Great Depression: a strong interventionist state to create and spread wealth. It became the bedrock for the greatest sustained civic growth and wealth creation in the history of the world and it kept Democrats in power for 50 years. It remained the de facto organizing principle for decades because not only was it a powerful narrative, but it did what it said it would do. People believed in it because it did make life in America better.

Mostly for white Americans. That commitment wasn’t perfect and its fatal flaw was its reliance on actively preventing other groups, domestically and internationally, from partaking in it, often violently. 

By the 1970s, the world was starting to catch up with the US economically or resist it’s influence militarily and at home the civil rights and gender equality movements, plus opposition to the Vietnam War, began to fracture the coalition. Tragically, it could not adjust to these new voices and realties. 

For the first time, many people felt that the American pie was as big as it was going to get and that it was necessary to fight over and protect your piece of it and prevent others from getting close to it. The right started exploiting these tensions to further crack the coalition with growing success. Nixon’s infamous “Southern Strategy” worked twice and has remained the Republican Party’s default playbook ever since. It has only been more naked with Trumpism.

When the New Deal seemingly ran out of answers to expand the American pie, it created a vacuum that neoliberalism filled.

Racial appeals and resentment were powerful subtext, but a movement needs actual text to rally around. Neoliberalism was a powerful narrative answer, especially in the hands of President Reagan. It was cloaked in Cold War rhetoric and spoke about expanding freedom throughout the US and the world. The way to expand the pie was to end communism and open up the world’s markets. It seemed very American.

But, unlike the New Deal, neoliberalism hasn’t done what it said it would do. Or, perhaps more accurately, it has done exactly what it was intended to do, but its supporters who said otherwise were either villains or fools. It has seized political power from popular representation and given it to a small amount of corporations and wealthy individuals. 

There is nothing “American” about enriching a tiny portion of stateless oligarchs and firms by turning people against each other, by robbing the public of our own social and economic capital, and by selling out future generations even as the current population’s slice of the pie is actually getting smaller. But that is what has happened under neoliberalism.

Although President Reagan was wildly popular and enacting neoliberalism created an air of revolutionary spirit, it never did kill the New Deal coalition. Democrats remained in control of Congress all during this period and voters remained wary of calls to totally deconstruct the welfare state (at least for white people.) 

But Democrats killed the New Deal Coalition. Bill Clinton killed the New Deal Coalition.

Though many old guards held out, a new generation of party leaders eagerly accepted the premise that the New Deal was failing, that America had turned right and that it was advantageous to go with them. Rather than try to challenge corporations’ and wealthy individual’s power, they wanted to channel it.

In the wake of several presidential losses (though, again, Dems held Congress each time) Clinton became Nixon essentially in 1992 and ushered in a Democratic machine that relied on big donor money and cosy relationships to corporations and Wall Street while distancing itself from “the era of Big Government” as though it hadn’t worked for the majority of Americans all along. Tough on crime, tough on welfare, tough on unions looked like “Serious People Making Serious Decisions” but was really slow moving betrayal of the New Deal coalition. 

The party has remained in the Clinton image ever since. President Obama included. It hasn’t been able to counter Republicans slow turn to the right because it has largely accepted their worldview and has been left arguing over degrees.

Ironically, Republicans realized the neoliberal game was up first

Despite pulling a Weekend At Bernies with the corpse of Ronald Reagan for years, it has been clear for a long time that Republicans have largely abandoned neoliberalism and replaced it with an ethno-nationalism that is really just zero-sum oligarchy with a bunch of racism and fanaticism to scrape out electoral victories.

The Democratic Party, at the national level, but also at local levels, has been left in the awkward and clearly untenable position of half-heartedly defending neoliberalism. Sure, compared to the nihilism of the Republican Party, protecting the status quo seems appealing and even noble, but it isn’t. 

Neoliberalism in the first place was a betrayal of the modern Democratic Party’s New Deal ethos and hasn’t worked for most Americans anyway. The American pie is getting bigger for the wealthy (many of which aren’t American) but fewer people are getting slices at all.

Forget #theresistance and resist the Democratic Party’s continued dereliction of duty

At all levels of the Democratic Party, the reliance on big donors and corporate coziness has killed its ability or desire to counter this and to address the issues facing our country in meaningful ways. Big, sweeping visions of societal change are anathema to these interests and thus the party has turned to bland incrementalism and technocratic insularity to keep muddling along. 

It is obvious that this has failed as a political strategy, particularly at the state level where Democrats have lost over almost a 1000 seats since 2008. But it has failed as a moral imperative. 

We need big thinking to turn things around. We need big actions to save the country and the planet. We need big ideas to overcome the cultural decadence and civic rot fueling all of this, which was encouraged by the individualist consumerism that neoliberalism requires.

That’s why the Senator Bernie Sanders 2016 campaign was so important, even if it fell short. It started much needed and much unwanted soul searching within the party because it was about big ideas. It was about what kind of country and what kind of world we can create if we control it. 

It offered a glimpse of a 21st century version of a New Deal coalition that has had a powerful impact on the party, despite every effort to resist it. It shows that there is a hunger for taking back democratic control over the economy and the environment from the market that neoliberalism trusts exclusively.

It has been slow and will continue to be, but the successes of leftist social-democrats like Alexandria Ocasio-Cortez (full disclosure: I volunteer for her on housing policy), Ayanna Pressley, and Rashida Tlaib at the national level means there will be more voices in Congress speaking for more people that have been voiceless there and within the Democrat Party for too long. This is an important development, regardless of who wins control of the House on November 6th.

Universal Rent Control is one of many local fronts in the fight for the soul of the Democratic Party

Wrestling back democratic control of the Democratic Party at the national level will be a multi-cycle project. There are, however, a lot of opportunities to impact the party’s future where you live. The real fight for the soul of the Democratic Party is happening locally as we speak over issues like Universal Rent Control.

In New York City, Ocasio-Cortez’s upset victory swept national attention and has made her an instant rockstar on the left, but she will be the first to say that she is part of a ground-up grassroots movement that is bigger than any one candidate or office.

That was on display in many New York Senate primary races on September 13th where 5 of the 6 NYC members of the infamous Independent Democratic Conference (IDC), who voted with Republicans in Albany, all lost to left-leaning candidates. All of these candidates ran on an unapologetically social-democratic agenda that includes universal rent control. They and others need help to win in the general election.

There is a real chance that despite severe gerrymandering, and real estate lobby money, Democrats will win the Senate in Albany for the first time in decades (the Assembly has long been in Democratic control) on the strength of this social-democratic agenda.

Democratic control of Albany doesn’t mean social democratic control — or that Universal Rent Control happens

If that happens, we’ll see just how much of a battle taking back the Democratic Party will be and why neoliberalism has such deep roots in Democratic politcs. The IDC and Republicans are an easy target to blame for the lack of more progressive policy in New York state, but the truth is more complicated. 

Many New York Democrats, notably Governor Cuomo, who is the poster boy for cynical Third Way Clintonism (he was HUD Secretary in Clinton’s second term after all), are skeptical of progressive policies and have deep ties to the real estate industry that make up the base of the traditional big donor interests in Albany.

Will these traditional Democrats listen to their constituents and the grass-roots movement trying to save the Democratic Party? How many Democratic voters recognize how much of the problem lies within the Democratic Party itself? The primary results show that there is real momentum, but the activists fueling this rise need to rally more Democratic voters to the cause, and it means talking about big ideas again.

URC and every progressive fight must be framed as taking back democratic control over our economic and environmental destiny

Universal rent control is a big idea. At heart, it is a series of policy proposals that aim to protect all renters in New York state from harassment, displacement, and homelessness. It’s a completely justifiable policy proposal given the structural nature of the housing crisis that cries out for more tenant protections. Half of all renters in New York are rent-burdened and there are over 89,000 homeless New Yorkers in the state. On top of this, the city and state are not ready for climate change, which will effect many of these low-income communities first.

Universal Rent Control has been and will continue to be attacked by the real estate lobby, most economists, and many members of the media as a foolish, self-destructive fantasy. That’s horseshit.

“Highest best use” has been the religion defining neoliberalism’s economic and political policy for decades, even as it has enriched faceless corporate entities at the expense of local communities and popular representation. The principles of efficient allocation of resources appear to be agnostic and empirical, but they are still subjective assessments of fundamentally moral arguments about what a society should be and whom a government should serve.

That’s why URC must be understood as being the head of a larger political spear aimed at fighting the illiberalism at the heart of neoliberalism. It is about taking back power from the high priests of the market. The goal is to give power back to the people through democratically elected leaders and popularly supported laws. 

Illiberalism has been on displace within New York State for years: blatant gerrymandering, terrible voting laws, and endless amounts of anonymous money (much of it coming from the real estate lobby) make New York’s government a truly anti-democratic institution. Only popular movements like URC can finally end this system.

To be clear, the point isn’t to suggest that ‘the people’ will agree on every issue. The point is to reestablish democracy as a forum where all sides felt heard, all views are addressed, and as much consensus is reached as possible. Only then will our self-government live up to its definition. Only then will it have legitimacy and buy-in, even if the results are compromises. That’s the whole point.

This is all a moral failure. Let’s keep calling it that.

Democrats have long abandoned the sense of morality that was the foundation of the New Deal coalition’s success. I’m not suggesting that the Democratic Party is devoid of morality. They have adopted moral language rhetorically for certain vulnerable populations and on the environment. Some of this language has resulted in real, meaningful action. 

But most hasn’t. As a result it falls into the lose-lose situation of being lambasted for its overly “PC” rhetoric and focus on identity politics while not actually taking legislative stands for those issues, harming those constituencies.

Democrats don’t need to try to revive the New Deal coalition per se. 40 years of increased diversity and increased economic burden has greatly expanded what this coalition should and could look like. But to do so will require reviving the moral clarity and civic purpose that it represented. If the New Deal came out of the Great Depression, the next version should come out of the Great Recession. 

It is a message that already polls well with Americans from all political spectrums. There will be political victory if the Democrats do, but that will pale in comparison to saving the country and the planet. The only way to do that is to wrest control back from the markets.

Let’s start with calling out the immorality of our housing policy. 80,000 of our fellow New Yorkers should not be homeless. Half of all renters should not be burdened. So many seniors should not be so close to housing disaster. Communities shouldn’t be displaced for the sake of private equity profits. 

These are choices that have been made without our consent. Universal Rent Control is the first step in taking control of these choices and fixing them. That means greater public investment and ownership of housing. That means holding the private sector accountable as a partner, not as a master. It means redefining what our society should value and who should get to debate and ultimately define that.

For all of us as individuals, this means getting out there and supporting movements and candidates that want to take control of these choices. There is still time before November 6th to get involved, but the work won’t end there. It won’t end if Democrats win or lose in Albany or DC. We must keep shaping the fight for the soul of the party and keep making it clear that this is about saving our shared future.

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Trump's Real Estate Taxes, the Supreme Court, and Climate Change Are All Related (That's a Good Thing)


It’s only been a week since the New York Times published an article about Trump’s prolific tax cheating with his father’s real estate fortune, but it’s fallen out of the news. That’s not surprising given the complexity of the story and the baked-in awareness that Donald Trump was/is not an honest businessman. It’s also nowhere near being the most important national story given the ugly Kavanaugh confirmation debacle and the dire UN climate change report. That doesn’t mean it isn’t important. In fact, all three stories are deeply related.

To put it broadly, without radically changing our real estate laws, we can not save our country from climate change and to change our laws that radically, they will need to pass through the Supreme Court eventually. 

As of today, both seem like a daunting if not impossible tasks. The Supreme Court is set up to spend the next generation turning us back to the 19th century. The entire conservative movement over the last 40 years has worked to empower a judicial philosophy that is openly hostile to popular democratic governance and legislative oversight of the economy. And they just locked in power for next 40. 

On top of that, real estate has long been one of the most privileged industries and asset classes in America. That makes it deeply small-c conservative and has given it a powerful set of tools and incentives to prevent major reform, whether on its tax policy, its relationship to political contributions, or its environmental impact. 

These interests have lots of lobbying power at the national level, but their true power is on the state and local levels. They block candidates and policy initiatives that are perceived to “threaten” property values and are the main barrier to reforming land-use policy around economic and environmental justice. Overcoming that structure is extremely challenging.

But before you despair, let’s consider why the Trump tax cheat story is so important: it offers a hack into changing all of this. 

To defeat President Trump or the Republican Party, we must defeat Real Estate Developer Donald Trump.

To quickly recap, the Times story poured over thousands of court and tax documents and spoke with hundreds of people associated with the Trump Organization and family to reveal three fundamental facts: 

  • Donald Trump didn’t build his real estate empire like he claims, he illegally inherited it from his father. 

  • Fred Trump, the father, built most of that empire through gaming the federal government for millions in tax subsidies. 

  • Father and son committed systemic tax fraud over decades that directly harmed tenants

All of this happened by aggressively exploiting the already favorable tax code that allows real estate developers to self-assess lower property values for tax purposes, to arbitrarily split management structures to hide profits while overcharging vendors and tenants, and to shield ownership through obscure legal entities to further dwindle tax liabilities. 

The bad news is that, at this stage, it seems likely that the Trump family has already gotten away with it (although New York is looking into it). Most (but definitely not all) of these moves are perfectly legal given how the real estate lobby has helped write the tax code at the local and federal level for decades. That’s true in every state.

This is largely because a tiny fraction of the population, like the Trump family, has an immense amount of the wealth generated over the last few decades and as a result has captured almost all of the political power. Real estate money is the foundation of this power structure and always has been. Who owns the land is the very basis of power in America, which both Republicans and Democrats have protected. 

When then-candidate Trump bragged about giving money to both parties, this is basically what he was bragging about. Almost every big real estate interest is like that. 

The Trump tax cheating story then is incredibly useful as a rallying cry for real estate reform because it is a shorthand to explain how damaging real estate law is in the US and it is also a roadmap for how to change it. 

That’s where the good news comes in: we are already starting to dismantle this power structure. 

In New York, the Democratic primary on Sept 13th saw a slate of progressive pro-tenant candidates defeat real-estate backed candidates, potentially shifting the balance of power in Albany for the first time in generations. Their victories were backed by a growing bottom-up coalition for universal rent control that has a real shot of removing the type of legal loopholes that the Trumps used to jack up rents and avoid taxes for decades.

If Democrats take the senate in Albany next month, there is a real chance that a once-in-a-generation reform movement can take hold in Albany. Universal rent control should start with issues related to rents of course, but it should expand to address all of the background mechanics of real estate tax law and political contributions that have fed this unjust system for decades. 

This coalition is gaining power as a popular response to the affordable housing crisis and has a real plan to address it. But just as importantly it is also helping people begin to see that the affordable housing crisis is part of a larger inequality crisis across our late capitalist society. The environmental destruction ravaging our planet is a logical outcome.

There are few, if any, states that aren’t subject to the toxic mix of shadowy real estate law and shadowy political contributions from real estate. Without removing their hold on power, we will never be able to make the changes we need to protect the environment in the long-term and protect the must vulnerable populations in the short-term. 

Even if that happens, the real estate interests profiting from this power structure will inevitably look to the Supreme Court to protect it. 

Anti-union, pro-voter suppression, and generally skeptical of the administrative state, the current court, now with Kavanaugh confirmed, looks set up to bail out “Big Real Estate” (or maybe the more Georgist “Big Land”?) But on closer look, they shouldn’t be so sure.

The Supreme Court famously does not have the power of the purse or the sword. It is a deliberative body that interprets laws, which is inherently a subjective process (which so-called “originalists” prove in action). It’s credibility as a separate, legitimate third branch of government has always rested on its popular support regardless of any rhetoric suggesting otherwise. It can get away with being out of step with the majority of people for only so long.

Senate Majority Leader Mitch McConnell doesn’t need to worry about that. Blocking Judge Merrick Garland and now jamming through Brett Kavanaugh has severely damaged the court’s image as a non-partisan institution, but Republicans will be rewarded by their donor class for it. (Their base may get some short-term victory on further restricting abortion access, but it will pale in comparison to the losses they suffer in the long-run from the conservative movement’s real priorities). 

Chief Justice Roberts does need to worry about the Court’s image. It’s one thing to strike down EPA restrictions on (flimsy) grounds of federal overreach, but it’s entirely another to strike down direct laws passed by state legislatures. There is at least some evidence that Chief Justice Roberts understands that blindly delivering partisan victories for conservatives is bad for the health of the court, and, perhaps generously, for the country. Overturning popularly supported state laws even if they are counter to prevailing a la carte conservative judicial theory seems unlikely. There is hope, at least.

But even getting in front of the Supreme Court starts with getting laws passed at the state level. That will take building broad coalitions across and within states that agree on a narrow set of legislative priorities that can get them passed. 

I believe that real estate reform is the perfect issue to kindle the formation of these coalitions. The power of developers and landowners over our politics has crippled our democracy, long before its crippled our ability to face climate change. There are immediate and well-defined legislative goals that can be achieved to break that structure. 

The progress made on electing candidates in the New York Senate that support universal rent control is a great start. There is much to be done from there. But if we can create a model for passing progressive laws on real estate reform, we can do so for climate change. 

It starts with telling a simple story to as many people as possible. We have one now. Showing how Real Estate Developer Trump has harmed New Yorkers both as a landlord and a political contributor is a powerful way to start dismantling the system that created President Trump, the plutocrat supporting, climate-change denier. 

(market watch/ getty images)

(market watch/ getty images)

Ben Carson, The Redeemer

(marketwatch)

(marketwatch)

It’s never good when HUD Secretary Ben Carson is in the news and sure enough his latest appearance carries on the tradition. The Washington Post reported this week that 1 out of 3 of his senior political appointees, who represent the highest levels of housing policy, don’t have any housing experience. I mean, they probably have lived in a house, but have not worked in housing. 

It’s easy to forget that before coming to HUD, Dr. Carson didn’t have any housing experience either (still doesn’t), but that wasn’t enough to stop his abundantly insulting nomination from going through. Not having experts in housing, or even experienced in housing, in the federal department in charge of housing has barely registered with the the public, even though it should be an enormous scandal. 

But that’s still not the biggest scandal about Secretary Carson’s run at HUD. As with many aspects of the Trump Era, the stupidity, pettiness, and corruption at the heart of the administration trends, but the insidious unraveling of policy aimed at protecting the vulnerable does not. In truth, Secretary Carson has been a highly effective agent of the president’s agenda: to unravel any attempts at racial desegregation of the American landscape undertaken by the Obama administration and others.

I’ll get back to this point in a second, but it bares repeating: Dr. Ben Carson is not qualified to run HUD. He has never worked in housing policy, never worked in development, and never worked in government. He has spent his career in medicine and then the self-help circuit. Both of those things are fine, even admirable, but they offer absolutely no rationale for his nomination, let alone confirmation. 

His is insulting to the work done at HUD, to the thousands of HUD employees across the country, and to the millions of Americans who rely on HUD’s services. It has a budget of $53 billion, oversees the regulation of the mortgage industry and public housing authorities, administers rental assistance programs like Section 8 and homelessness aid, and enforces fair housing laws (more on that later.) The work HUD does is not trivial and shouldn’t be treated that way.

HUD has been a backwater in other presidential administrations and having an inexperienced secretary in other circumstances might not be such an issue if HUD is allowed to go about it’s business. But that’s not what is happening with Dr. Carson or the administration. It would be one thing if he was simply ignorant of policy, but he’s ignorant and hostile to it. That can be summed up by the fact that he considers enforcing fair housing policies that encourage more integration in wealth majority-white communities “social engineering.”

Of course, it is social engineering, but then again the entire development of suburban America was social engineering. None of the 20th century’s sorting of white families into suburbs and black and brown families into inner cities was “organic.” The federal government crafted a policy regime for 80 years that pushed that racial agenda. Dr. Carson’s ignorance or dismal of this perfectly aligns with the Trump administration and the Republican agenda.

As with immigration, law enforcement, and just about anything else, the Trump administration has defined itself by a transparent retraunchment of white supremacy, which it and its allies perceive as being under threat politically and demographically. Any attempt, through federal policy, at challenging the traditional view that white men should be in charge, white people should be privileged, and equal rights should be a administered on a limited allowance has been purposefully halted or reversed wherever possible. 

Nothing has codified white supremacy more than housing policy. Most Americans are simply unaware of this. For a short period of time during the Obama administration, there was a surprisingly successful challenge to it. 

First, in 2015, HUD outlined rules drawn from the Fair Housing Act called Affirmatively Furthering Fair Housing (AFFH) that required local communities that receive federal block grants to submit plans that show how they are taking active steps to reverse years of racial segregation. It took a long time to get through the approval process, and the Obama administration could have taken bolder steps, but it was significant progress.

That same year, the Supreme Court made an even more significant decision on a case in Texas that expanded the definition of racial discrimination (which the Fair Housing Act made illegal) to include “disparate impact.” This means that even if a housing policy was not explicitly racist, if it still resulted in a disproportionately negative impact on a minority group, it would violate the Fair Housing Act.

Combined, both efforts opened a window to address deeply entrenched racial segregation in the US that has only accelerated over the last 50 years since the Fair Housing Act passed. It is no coincidence that this corresponds with skyrocketing wealth inequality. Fixing one fixes the other and both are required to make America fair and prosperous.

But since Dr. Carson has taken over at HUD, this agenda has quietly and effectively been halted, abandoned, or reversed. He hasn’t fought for HUD on the Hill. He has tried to raise rents for public housing residents. He has killed AFFH and tried to say it was in support of more development. He is there to stop attempts at addressing the legacy of racial discrimination in housing. You can see why he doesn’t want people with housing experience. 

I don’t know what is in Dr. Carson’s heart. He may sincerely believe, based no doubt on his remarkable personal story, that racism is at best a mild hinderance and self-determination can help a family overcome any obstacles. He may look at the American landscape and not see that actively racist policies sorted communities. He may not think its the federal government’s role to fix this even if it is a problem.

But even in this generous guess, he is still dangerously wrong and still guilty of supporting the goals of an administration that is blatantly racist and actively pursuing the protection of white supremacy. His personal policy ignorance and indifference to acquiring it or requiring it is not a bug, it is a feature. And a very effective one that is erasing a small window of progress against racial segregation.

Rent control doesn't work, but universal rent control could (via Data for Progress)

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This blog originally appeared in the Econo-missed section of Data for Progress

Dear Econo-missed,

I live in a major city and I’m increasingly engaged in local politics. But I’m still trying to get a sense of the issues - I hadn’t thought much about them before.  Candidates I like like Zellnor Myrie and Julia Salazar talk about the idea of universal rent control? I’ve heard from economists that rent control is bad because it distorts free markets, which have never failed anyone. - Definitely Not Sean, New York

Universal rent control (URC) at this point is a fairly broad term, but in the context of New York City, it’s essentially a series of policy proposals that aim to fix the many flaws in current rent regulation laws (which, for the purpose of this blog, includes rent stabilization and rent control policies, but not Section 8 or public housing policies). These laws only apply to some, mostly older buildings and have tons of loopholes that allow units to be deregulated. Universal rent control would expand protections to every rental unit and remove those loopholes. It would “distort” the housing market, but, as we’ll discuss, it could also fix the bigger issue distorting it.

The URC fight has been embraced by a group of insurgent state candidates on the left and has the support of many leading activist groups in the city and upstate (full disclosure: I volunteer for the Ocasio-Cortez and Salazar campaigns). With these laws up for renewal in Albany next year, this framing marks an important shift away from previous (mostly losing) battles over the issue and is quite timely.

What really excites me about URC goes to the second question about rent control and markets. URC would of course impact rent costs, but what it could do to land costs is potentially even more important.

Rent regulations are one of economists’ favorite “gotcha” concepts because they go against every basic market theory that says the highest and best use of an asset is intrinsically the best for a society. The scale of displacement in NYC puts that concept to bed. New York City has been a vibrant place historically because it has been possible to be poor and working class here. Without protecting these New Yorkers, that vibrancy will end.

Rent regulations limit how much a landlord can charge for an apartment and how much they can increase rent over time. They are often blamed for raising rents and/or lowering supply in cities overall but these arguments vastly overstate their impact compared to more pressing issues like rising construction costs and, especially, skyrocketing land costs.

Land costs are the key here. Economists argue that rent regulations create terrible inefficiencies in markets, but they should also be worried about rent-seeking behavior doing the same.  An “economic rent” is the extra wealth earned from an asset used in its present form (not to be confused with the “rent” we pay each month) and rent-seeking is the attempt to manipulate circumstances to increase that rent without creating new value from it. Owning land, particularly in a city like NYC, is a “gotcha” example of rent-seeking behavior run amok.

The economic value of housing is mostly tied to the value of the land its on, which has little to do with a landlord’s investment and more to do with surrounding public investment. From the tenant’s perspective then, why should she pay more for something the landlord didn’t even create? You don’t need to be a Georgist to see that this is inefficient. It robs the tenant and the economy of more productive use of her income (while completely ignoring the overall well-being of her community.)

To be clear, current rent regulation laws in NYC aren’t designed to challenge rent-seeking behavior. Given the patchwork history of legislation and the oafishly corrupt nature of Albany politics, they don’t have a cohesive goal, let alone design. They limit the rent increase for some renters to some degree, but they ignore or create a host of other problems.

Universal rent control does challenge rent-seeking behavior. Doing so could fundamentally change the economic calculus in NYC real estate and the potential value of land by making housing more of a utility than a commodity. Keep in mind URC is still just a series of broadly defined proposals, but conceptually it offers a glimpse at a more equitable and democratic future.

To start with, less than half of all rental units in NYC fall under current rent regulations, which severely limits the political power of renters as a united front against the well funded and organized real estate industry. There is little incentive for market-rate tenants to cooperate with rent-regulated tenants. This leaves a smaller, poorer, and older population to fight for tenants’ rights for everyone.

URC calls for extending rent regulations to all rental units in New York, which would radically change this political dynamic. The sheer number of renters as a political constituency could offset the financial power of the real estate industry in Albany and create more protections and, most importantly, real innovation in affordable housing.

Another problem with current laws is loopholes - too many perverse means and motive for landlords to force rent increases and/or to force out tenants. The most disastrous policy, vacancy decontrol, allows apartments to leave rent regulations altogether when they hit $2,733/m. The city lost an estimated 147,500 affordable units over the last 24 years to this alone.

URC would end vacancy decontrol and remove loopholes around vacancy bonusespreferential rents, and major capital improvements. In effect, they would permanently prevent the speculative (and cynical) calculations that some landlords make to get passed regulations.

It’s not that landlords can’t still make a profit, but there would be a cap. This would suppress the speculative value of land across the city. It would certainly scare off the worst actors in the market and likely create space for local landlords, non-profits, and models like community land trusts to enter the market instead. This would be a net positive for NYC.

Rent regulations attempt to maximize the value of shelter over financial value, which is a foreign concept at this stage of late capitalism America. Most economists think that’s a mistake, but keeping wealth and power in local communities rather than private equity firms or foreign investors is more democratic, better for the economy, and better for the life of the city in the long run. Universal rent control can help rebalance our economic priorities in NYC.

2020 Democratic Presidential Hopefuls Shouldn't Focus on Lowering Rents - Here are 3 Other Things

Frenemies at the gate (usnews)

Frenemies at the gate (usnews)

Along with every housing activist, I have been beating the drum for more attention to housing at a national level for several years now, so on one hand, the recent focus from Senators Kamala Harris and Cory Booker is a welcome development. Both senators have proposed similar housing bills that would aid renters nationally. On the other hand, neither of the bills, which are very similar, would solve the affordable housing crisis and would likely feed it in other ways. It goes without saying that both bills are largely rhetorical devices for shoring up progressive cred leading up to 2020 and won’t go anywhere, but let’s take them both at their face and see why they don’t excite me.

First, it’s important to point out that the affordable housing crisis is a crisis of late capitalism. In our current era, wealth and opportunity are concentrating in a narrowing pool of individuals, firms, industries, and geographies. Housing costs are skyrocketing in the select few environments where many of these factors overlap and housing costs (and values) are going down in the many more environments where few or none of these factors exist.

That is to say that there is no national housing policy that alone can address those forces AND there are no national economic or social policies that are currently up for debate that come close either. I believe we can absolutely craft smart housing policies at the national level that can help millions of Americans, but the larger crisis of late capitalism must be addressed to end the factors that fuel the housing crisis. That will take big change.

I don’t see Senator Booker or Senator Harris acknowledging the larger fatal flaws in our current iteration of capitalism (though they may have to if they want the nomination). Both have made their careers supporting this system and supporting those who benefit from it. No amount of social progressiveness can erase their explicit endorsement of this economic system even if they say otherwise. If either of them did, these bills wouldn’t look the way they look.

Instead, both senator’s plans aim to treat — or really, manage — the symptoms. That doesn’t mean that either plan lacks good ideas. There are some good ideas and good intentions, which should be acknowledged. Although there is virtually zero political courage behind either of these, so I don’t give either that much credit. The bigger issue is that they accept the basic economic and political premise that the market must drive the solution. That’s just not true or viable in the face of our present reality.

Senator Booker’s plan differs slightly from Senator Harris’s in that it proposes tying community development block grants to efforts to increase density in local jurisdictions. Basically, its a soft diplomacy effort to remove local land-use regulations (things like parking requirements, height limits) while encouraging more construction (density bonuses, as-of-right development). 

Both of these are admirable and necessary policy goals. But it’s a too-cute way to get around the vast limitations the federal government has on local land-use policy and that’s where it ultimately falls apart. The carrot isn’t that great and there is no stick. HUD currently ignores existing Fair Housing laws, so they aren’t going to care about this bill even if it did pass. 

It would take much more political courage to argue that the Fair Housing Act empowers the federal government to supersede restrictive local zoning and create an Eisenhower Interstate Highway System-esque system of federally-funded local development systems (or even just enforcing Further Affirming Fair Housing efforts at the late end of the Obama Administration) but the Senator from New Jersey (of Mount Laurel fame, no less) did not take that opportunity. 

Like Senator Booker’s plan, Senator Harris’s plan proposes a set of interventions that include discounting rents above 30% of income even for six-figure income households up to 150% of HUD’s Fair Market Rent calculations. By covering the difference as a tax credit, it would sort of work like the Mortgage Interest Deduction and would help some low-income families in high rent geographies and even middle-income families. 

That’s also an admirable policy goal. But the MID is a terrible waste of public money (that mostly gets to wealth households) while inflating the value of homes, so doing that for renting is arguably worse since we should know better. It would clearly create an inflated market as landlords would just raise rents even more. It also doesn’t help people outside of the usual suspects of coastal cities with high rents, so it’s impact would miss the vast majority of renters.

Both plans rely on the market with some subsidization. This isn’t a surprise since that’s how housing policy has (not) worked for 80 years. That this doesn’t work seems to have gone unacknowledged. But there are more creative ways to pursue a market-based solution and there are other non-market solutions that should also be included. (I have written about how any housing policy needs to fundamentally remove the advantage of homeownership, so I won’t touch on that for this particular article, though its obviously important.)

Here are three broad areas where the federal government can address the housing crisis right now. These are by no means the only areas or the most detailed analysis of them, but they are great starts:

Build the best public transportation systems in the world

It’s obvious that public transportation is an afterthought in the US. Post-war policy makers bet on homeownership and car ownership and socially engineered our modern landscape around them. That makes it particularly hard for people to get back and forth within most American cities commuter sheds 

Just as a small example of this, even for a transit rich city like NYC, it is a pain in the ass to get to Hoboken, NJ from where I live in the East Village (a 3-mile trip) because it involves two different transit systems (the MTA and the PATH). It would go from a roughly 30-min multiple-seat (and ticket-swipe) trip to a 10-min single-seat trip if they extended the L train into NJ (which has been proposed at various times, to no avail.) Christof Spieler in Houston writes a lot about this particular problem and I highly recommend you check out his stuff and upcoming book.

The more interconnected a commuter shed, the bigger the housing market. High rents are partially a product of land-use regulations and land scarcity in certain markets. But rents are high because people want to live close to things and there are huge cost increases the further out you go. 

If we developed deeper, more frequent rapid transit systems that cut down on time and cost of commuting, we would make surrounding areas more viable. It’s been done before in the US. Look at how the Bronx was developed in the 1920s and 1930s when the subways reached the area. Even if you can’t make the argument for more public intervention in housing in the Senate, you can get transportation networks built.

Fund public housing and expand what it can include

I write a lot about how we need more public housing. It works when the necessary tools and processes are put in place. There is no reason to subsidize private landlords when we can build and manage publicly owned homes directly. 

Most people think of towers-in-the park megablocks that fell into disrepair and became crime riddled. That did happen in many areas, but it also didn’t happen in many public housing complexes, particularly in NYC. Committed funding, competent management, and empowered tenants have been the winning formula for many years with NYCHA even as its funding gap has eroded that in more recent years to tragic results. The playbook exists, however.

There are also new ways to think about public housing. Instead of building new developments, we can preserve exiting communities by converting housing into municipal land trusts. This is already happening in Houston’s Third Ward. The city owns the land and removes it from the speculative market and a community board of elected officials and residents runs it. This would address many of the concerns of displacement and affordability. It would take federal funding to maintain, but would that be as much as subsidizing rent or a massive building program? Definitely not.

Stop wasting public money on dumb shit

The final point is much larger than a few paragraphs, but it warrants repeating. We give away too much public money to powerful, private interests — at all levels of government. We can absolutely afford to address the housing crisis if we stop subsidizing these interests.

We spend trillions of public dollars on our military and national security complexes - enriching contractors, arms manufacturers, and many other private actors. These things murder lots of people, erode our civil rights, and generally keep us permanently afraid. 

We spend billions of public dollars on local pet projects like stadiums, casinos, and privately-owned mixed-use developments — that in most cases turn around and charge us to use them.

There are laws on the books that are supposed to manage these costs or outright prevent them from happening and yet our money keeps getting hoovered up on policies that the majority of us don’t support. Until we hold our elected leaders accountable for spending our public resources on priorities we do support, this will never change. (I have no time for people who think we shouldn’t spend public money in general.)

That goes back to my earlier point. The housing crisis is a crisis of late capitalism. We can’t fix housing without fixing our economy and our politics. That means rejecting the premise that the market is the sacred end all be all that we all must slave away for. It means rejecting the idea that the accumulation of wealth is the best and highest use of our labor and our resources. 

It is encouraging that Senators Harris and Booker are moving in the right direction, even if these bills are dead on arrival and flawed on their face. They are creatures of this system and even the smallest acknowledgement from them that it is failing is reason to be optimistic that our political process can evolve to fix it.

CityViews: Why Quibble Over Who's 'Homeless'? We Can Afford Housing as a Right for All. (via CityLimits)

(dod/citylimits)

(dod/citylimits)

(This article was originally published in CityLimits)

What does it mean to be homeless? Does it mean that you live on the street or can it mean you live on someone’s couch? Is the homelessness rate going up or going down? As with all public policy matters, the devil is in the definitions. There’s a bill moving along in Congress called the Homeless Child and Youth Act that’s trying to expand the definition of ‘homeless,’ which is causing an interesting, if distracting, debate within the housing community. (Rachel Cohen has a good recap at CityLab.)

This debate matters a great deal to a lot of homeless people that need help. Just exactly how many people are homeless depends on what you consider homeless. There is a finite amount of federal funding for homelessness services and where we send these funds impacts a lot of peoples’ lives. 

The bill is designed to expand the definition of homelessness to capture people, particularly children, that don’t live on the street or in shelters, but don’t have their own reliable or safe homes (maybe they are doubling up, maybe they live in an abusive home). Right now these people are not considered homeless by HUD standards (although other federal agencies do consider them homeless) and are therefore not eligible for assistance (more on this later.)

The debate comes down to who do you help with limited resources: the truly, chronically homeless that might take a longer-term intervention or the housing insecure that might just need a short-term intervention? It’s a Sophie’s Choice type trade off that all sides of the political spectrum with a dog in this fight can debate in good faith.

I’ve been a longtime volunteer for the HOPE count, which is the main federal effort to count unsheltered homeless, so I care a great deal about this debate too. But I’m more interested in where the sausage is made: the nature of politics that surrounds public policy . Often times in America, our politics frame public policy debates in strikingly narrow terms that shroud the values that should be expressed, leaving us with false choices masked as hard-fought compromises. 

Housing as an issue suffers a lot from this and the current debate over the definition of homelessness is a perfect example. Of course no one is “pro-homelessness” but the accepted scope of the debate has the practical effect of making everyone pro-homelessness. Why? Because the debate isn’t about ending homelessness. And it should be. Because we can.

Let’s start with a simple premise: we are the wealthiest nation on earth. We can afford our public policy goals. The federal budget is $4 trillion. That is plenty of money.

However, our political system has spent about $5.6 trillion on war over the last 18 years and another $2.3 trillion will be spent on a tax cut over the next 18 (give or take.) These are choices our political system has made. 

Similarly, millions of Americans still don’t have affordable healthcare and 38 million American households are considered “rent burdened” (which is another important and arguably flawed definition). Just as going to war in the Middle East and cutting taxes for corporations are choices, so too are these. Our political system has decided not to provide basic needs.

Not because we can’t afford them. Don’t ever believe that bullshit. Of course we can afford them. Holy Shit. Obviously. None of this is new.

This brings me back to the homelessness bill. It is politics framing, frankly distorting, a public policy issue that should be very simple — end homelessness. Anyone that needs housing assistance gets it. 

Make housing a right. It is that simple.

It’s scandalous that we would rather blow up homes (and you know, people) in foreign countries than supply them to anyone who needs them in ours. We could probably still afford to do both, but the scandal scandal of is our war-making. Of course this opinion is rarely taken seriously by “serious” people, which also shows how broken our political premises are. I digress.

It’s scandalous because we should feel the moral obligation to provide shelter, but don’t. It’s scandalous because we have the means to do so, but choice not to. It’s scandalous because there are countless sound economic arguments that providing guaranteed housing reduces long-term public spending in other things like healthcare, unemployment, and even criminal justice.

This bill accepts all three terrible premises. Sure, naming something after children makes it easier to build political support for the homeless, but it shows that our definition of the deserving poor continues to narrow and excludes adults suffering with disabilities, addiction, or just poverty. Even children aren’t doing it for a lot of people anymore.

Sure, expanding the definition of homelessness could mean reaching more people who need assistance, but it still accepts that only 1/4 Americans who are even eligible (under any definition) get any. Even if some programs have seen an increase in funding, others haven’t, and most people don’t get help.

And it doesn’t raise the most obvious and scandalous point: that we are already fine guaranteeing housing assistance, but for wealthy people. Every homeowner is eligible for the mortgage interest deduction and the American taxpayer pays around $70 billion a year providing it. We spend $134 billion overall on subsidizing homeownership. Remember that when politicians say we can’t afford to end homelessness.

It is clear that our politics are broken. Our public and civic health have continued to deteriorate as a result. Bills like this are important in their own right, but its low ambition betrays a lack of moral vision and energy that should shock any American. 

But there is hope. There are many candidates, notably NYC progressives Alex Ocasio-Cortez at the Congressional level and Julia Salazar at the State Senate level that are running on housing as a right. Even Senator Kamala Harris is belatedly getting in further on housing more than traditional Dems have (ironically based on similar work by Rep. Joseph Crowley). 

Politicians who support housing as a right get what many activists get: the only way to fix our politics is to reject the premises that they rest on. Activists have noticed, but more importantly, everyday people have noticed. It’s not enough to write bills yet, but, for the first time in a long time, it sure feels like that vision and energy might be on the way.

Late Capitalism is coming for the last pillar of the American Dream

Bullseye (nationalrealestateinvestor)

Bullseye (nationalrealestateinvestor)

Today the Wall Street Journal and its dizzying “everything is fine” tone explored the booming sector of home-buying. We’ve built our entire economy and political cultural around homeownership in the US, so you can see why this could be a good thing. But it is not. It is a terrible thing.

That’s because the people buying these homes aren’t people at all. They are “sovereign-wealth funds, insurance companies, hedge funds, pensions, [and] asset managers” and they are buying bundles of single-family homes with the clear intention of renting them for the long-term. In fact, many of these groups are raising billions of dollars to expand their portfolios. 

I’ve written about how Wall Street is becoming a lot of peoples’ landlord, and how it exposes how fraudulent US housing policy is, but the trend is only getting bigger and scarier. The biggest players in this new market own thousands of single-family homes, mostly in markets like Atlanta, Phoenix, or Nashville where populations are growing. They are squeezing out many potential homeowners in the process.

The economics are clear and deeply cynical. Mega-financial institutions are taking advantage of the average American’s inability to buy a home because of high debts and low wages on the household-side and higher mortgage rates/prices and leaner inventories on the market-side. 

If that wasn’t bad enough, these institutions still reap all the government-subsidized benefits of homeownership that were designed to be passed along to families. I’ve written about the $134 billion the US government spends a year on subsidizing homeownership, most of which goes to wealthy home-owners already. It’s insanely wasteful and deeply unfair. But does anyone want a hedge fund to get tax breaks for owning a home and renting it out to a cash-strapped family?

Homeownership policy is broken. Housing policy is broken. Our economy is broken. Nothing screams this more than late capitalism’s calculated lunge towards single-family homes, the final pillar of the American Dream. Wall Street and the investor class get how broken our economy is and respond by exploiting it. And they aren’t even pretending to care about optics:

‘“The American dream no longer includes homeownership,” said Jordan Kavana, chief executive of Transcendent Investment Management LLC, a south Florida firm that has been a big acquirer of rental homes. “You will earn your equity in other ways, not your home.”’

I’m not sure where Mr. Kavana assumes this new source of equity will come from, but given that few Americans own stock and most draw their wealth from their homes, the options appear to be limited. But that’s your problem.

The new, frightening (and baffling) development is that many of these cash-rich entities are building new housing expressly for foreign owners — expressly as rental/investment properties. Mr. Kavana goes on to say that these investors “Get that this [homeownership] is the lynchpin of the American economy.”

The paradox of identifying (correctly) that homeownership is the lynchpin of the economy while actively subverting it goes unaddressed in this article, but it gets to the core of this market play. 

These institutions know that the game is up for most Americans. They know that many young Americans can’t (and won’t) afford to buy homes and many baby boomers will eventually be forced to sell. They know that special interests have frozen any ability to politically address the structural deficiencies in housing policy or for that matter the American economy. They know that at best politicians from both parties are going to pound their chests about homeownership, perhaps offer some empty new incentives around the margins, declare victory, and move on. They know that they can continue to reap the rewards of homeownership subsides while sitting on ever-increasing housing prices as the housing crisis grinds on.

They know that this is a cash cow for their shareholders and will be for a long time.

We should all be sounding the alarm at this outrage. It’s outrageous on the face of it as this new normal goes against everything that 80 years of bi-partisan domestic policy was created to foster (as flawed and racist as it was), but its even more outrageous given that we are only 10 years removed from the damage caused from the Great Recession — damage caused by many of these same actors under these same structural realities in housing. For many Americans, my generation included, we will never recover from it.

The Great Recession may have ultimately been triggered by the exotic and fraudulent nature of mortgage-backed securities, but it really happened because people couldn’t afford their homes.

That is even more true today: household debt is $13.2 trillion, which is half a trillion dollars higher than the previous record set in 2008. Real wages for the majority of Americans have barely moved in forty years. Wealth inequality has skyrocketed over that same period. Generational wealth passed though home equity is the only path for most first-time homebuyers, furthering racial and demographic wealth gaps.

What happens when the next downturn comes? Sure, it may actually benefit some families who don’t own their homes — these institutions can in theory weather it better than individual homeowners (or get bailed out before a homeowner would). They could lower rents to keep some cash coming in. In turn that could give families more flexibility and mobility. But somehow I don’t think the average American family will be that much better prepared than last time.

Housing policy rarely gets the attention it deserves, which is maddening and disheartening. There are certainly many fires and leaks spreading across the land, but it all starts with home. If our entire economy and political structure is built on the fundamental concept that you will own a home, then we are entering unchartered water if that stops being the case. There could be benefits for our economy moving away from homeownership, but simply turning it over to hedge funds and foreign investors could further destabilize our fragmented country while only benefiting a tiny sliver of the super-wealthy.

The investor class has taken nearly all of the wealth created over the last 30 years and gotten away with it. Now it’s coming for our homes and appears to be getting away with that too. If we lived in a healthier political climate with a clear moral north star, this would be met with bi-partisan condemnation. But if we’ve learned anything about late capitalism, it’s that no one is coming to save us. We must do it on our own.

We should all be worried that the housing market is so bad while the economy is so 'good'

Amen. (s.h.a.r.p.)

Amen. (s.h.a.r.p.)

 

Last week, The Join Center for Housing Studies at Harvard released their 30th annual report on the state of housing in the US. With a few exceptions, the picture is bleak. At every corner there are major red flags about the present and future of housing in the US for owners and renters alike. What is clear, a full decade after the foreclosure crisis, is that the housing market is at best exacerbating wealth inequality and at worst sowing the seeds for an even more destructive economic downturn. This is all happening while the national economy is allegedly roaring along. And that should scare all of us.

Let’s start with the most important point: for a lot of Americans, there is simply no evidence that the economy is doing well. Sure, the stock market is up and unemployment continues to fall.

These data points have long been two popular shorthands for talking about our economy’s health, but it’s hard to believe that it is healthy when 40% of adults don’t have $400 on hand to cover an emergency. The ‘millennial’ generation is already 34% poorer than previous generations at the same age. Clearly, if we think this is a good economy, how we measure it and how we talk about it are deeply flawed.

Who cares about the stock market when half of Americans don’t own stock and the richest 10% of Americans own 84% of them? Who cares about a low unemployment rate when wages aren’t increasing and most job creation is in low-wage, high-insecurity positions? Who cares about how well the economy is doing if the richest 1% captured 82% of wealth created last year while the bottom 50% captured none?

The crooked nature of our housing market is making this all worse, perhaps for generations to come. The JCHS report reflects this widening wealth gap and its impact on housing in the US with some startling stats. It breaks down into troubling dichotomies between renters vs owners, wealthy vs everyone else, old vs young, white vs not-white. It’s worth picking out some quick ones and related stats:

  • 38 million American households (owners and renters) are cost burdened
  • Half of all renters are cost burdened (which has doubled over the last 50 years) and a quarter are severely burdened
  • Rents and home prices have risen 20% and 41% respectively over inflation in the last 30 years
  • Homeowners have on average 46 times the net wealth of renters
  • Overall, since 1960, wages have gone up 5% while rent payments have gone up 61%
  • Minority homeowners have half the net wealth as white homeowners and their homeownership rate is falling
  • Since 2000, the number of Americans living in poverty has increased by 28%t to 12.8 million
  • During the same period, the number of high-poverty census tracks grew by 53%
  • 51% of blacks and 44% of latinos live in areas of concentrated poverty, compared to just 17% of whites.
  • In 2016, 1.4 million people (including 175,000 families with children) were homeless at some point during the year
  • 56% of homeless live in the highest cost metros
  • 83% of homeless families experience it acutely as a product of eviction

This is during 9 years of continued growth that has little historic precedent.

The report highlights a couple of under-appreciated factors causing these stresses: the aging population of the country, the decrease in immigration, and the concentration of economic opportunity in fewer geographies, industries, and individuals. These all represent “new normals” that so far have failed to be acknowledged at the national policy level.

One factor that the report covers in great detail is obvious: we aren’t building enough homes, anywhere. Most urban centers, and virtually all of them in coastal regions, are not building enough housing to meet the economic growth (and concentration, relative to other regions) they are experiencing. That’s partly why mobility, an actual sign of economic and social health, has collapsed in the US.

Some of this is the problematic regulatory regimes of individual cities, but largely its the cost of land, labor, and materials, which has gone up across the country. The lack of productivity gains in the construction industry, whether for single-family or multi-family, is a major problem and doesn’t get nearly enough attention from the media, academics, or policy makers. While many industries are slowly starting to see gains from the IT revolution (while others are shrinking), construction hasn’t.

That’s not hard to understand. The industry was built on cheap labor and cheap land — those are not inputs that demand innovation. Add in 80 plus years of massive government subsidies either from financial guarantees or infrastructure spending, and what you get is a cartel of mostly local/small groups of very profitable players that have never needed a culture of innovation. Instead, they have formed a culture of protection that has largely manifested in spending millions to support their local political status quo.

Today cheap land and cheap labor are harder to come by, but, for the most part, public subsidies are still available. So we have in place a perverse system where an already-outdated industry has little ability or incentive to adapt that is matched with an equally outdated and inflexible policy regime. That’s a recipe for a disaster, which is what we are living through.

This is all to say that, of course our housing market isn’t providing enough housing (except at the top, where it is producing too much). But it is operating in a state that our policy makers can’t seem to recognize reflects a larger political failure. None of these problem are going away. They are, in fact, going to get worse.

That’s because, inevitably, the economy will sputter again. So what happens when it does? 10 years ago it meant the greatest economic crisis since the great depression. I’m not suggesting we are due for another foreclosure crisis, but at the same time, we haven’t fixed the underlying problems people have that caused it. Primarily, those problems include people not making enough money, having too much debt, and not having a lot of flexibility if the economy tightens suddenly. That has gotten worse since the great recession. Remember, 40% of Americans don’t have $400 on hand for an emergency.

People are barely getting by right now during a ‘good’ climate, but what about the government?

You can make a lot of complaints about how President Bush and President Obama handled the crisis ten years ago. (It is clear that both administrations focused on the financial system at the expense of the individual household. There were more options on the table than that and we’ve been suffering from what ended up being a blanket immunity for the financial industry ever since.) But they both worked together during the transition and both drew from a deep well of experts with steady hands and public trust. It could have gotten a lot worse, but it didn’t. As flawed as the process ultimately was, that’s what we expect of our government.

Nobody in their right mind can say that the current administration has steady hands or public trust. Obviously, the President clearly doesn’t understand economics and doesn’t know what he is doing other than exploiting racial animus. But look across the cabinet — HUD Secretary Carson thinks poor people should have a harder time and doesn’t know what he’s doing. Commerce Secretary Ross is spewing conspiracy theories about soybeans and doesn’t know what he is doing. Treasury Secretary Mnunchin either doesn’t understand the tax cut or is still lying about it and doesn’t know what he is doing.

Does anyone expect the Trump administration to handle a downturn well or honestly? Have they shown any ability to think strategically on policy? Or to even execute a policy well? The inevitable downturn will cause pressure on this administration that we have no reason to believe it can handle.

Even if we had a more predictable political landscape than we do today, we have fewer policy tools available to deal with a significant downturn. The government is starved for revenue and will get worse over the life of the tax cut. Republicans plan to come for the safety net next. Even the Fed, though in steady hands for the most part, has fewer policy tricks up its sleeves than last time even if it somehow remains insulated from political pressure or partisan erosion that has crippled other institutions in the Trump Era. Will it still be immune when a crisis hits?

It’s not hard to see what has to change. Fundamentally, the public needs to claw back a large portion of that 82% of wealth created in the last year (and over the previous decades) in order to raise our collective standard of living. We need to reject the money-fueled political status quo at the federal and local levels that have killed long-term planning and prevented big ideas from entering the public discussion. And we need to reboot our social and economic contract that currently makes education, healthcare, and childcare/elderly care prohibitively expensive.

Fixing the housing market can go along way to starting this process. Housing is a right and should be the baseline for any public or private policy goals. We need a robust private sector to support housing, but we need to incentivize innovation by shaking up the tired regulatory and subsidy process. Public goals for the private sector should move towards equitable access, community ownership, and sustainable affordability. Public ownership of housing (which was not even covered in the JCHS report) must be expanded with direct ownership of housing and direct ownership of land.

It’s not hard to see what has to change, but it is hard right now to see how or where that change begins. The last great opportunity to have this conversation occurred during the great recession and it was ultimately squandered. It is hard to see how we even weather the next downturn in whatever form it comes let alone how we begin a massive reboot in housing. That might be the best we can hope for, but it is not what we need.

Public housing works, it can help the housing crisis, but The New York Times isn't helping

This Richmond Barthe sculpture near the Johnson Houses contrasts the image of intended residents (white families) with the current racially diverse demographics of NYCHA residents, which is part of why support for public housing has vanished. That must change. (homebodynetwork)

This Richmond Barthe sculpture near the Johnson Houses contrasts the image of intended residents (white families) with the current racially diverse demographics of NYCHA residents, which is part of why support for public housing has vanished. That must change. (homebodynetwork)

Over the weekend, the New York Times came oh-so-close to writing a fair, nuanced story about NYCHA. Most of the time, the paper of record ignores the 80-year old agency, the 2,500 buildings it manages, and the 400,000 New Yorkers who live there. When the paper does write about it, it is almost always in the context of failure, scandal, and waste. There’s plenty of that to go around, which is fair game, but there are many other positive facets of the agency’s story that remain, at best, alluded to while the core problem fueling these issues — federal abandonment — is only referred to passively.

The paper’s approach to public housing does a disservice to NYCHA residents and the agency, but it also does a disservice to public housing in the US in general. The simple truth is that public housing works and should play a larger role in solving the affordable housing crisis. In order to leverage public housing’s vast potential, we must first change how we talk about it.

I find this particularly frustrating because at the same time, there are elements within the Times that are (slowly) changing the conversation around housing. It published Matthew Desmond’s work on how the federal government spends $134 billion a year subsidizing $1million dollar homes across the country. Emily Badger and Quoctrung Bui wrote a devastating series on the eviction machine in much of America.

These provide important context to the affordable housing crisis, but public housing never seems to get that same coverage. The paper certainly doesn’t put all of these elements together to show why public housing (and other models like community land trusts) need to be part of the solution.

The problem with the Times coverage on public housing can be captured almost entirely in the title: “After Years of Neglect*, City Public Housing Is Poised to Get US Oversight.” Two problems jump right out.

(*The online edition appears to have replaced “Neglect” with “Disinvestment” after I started writing this. The print edition’s title is “US is Expected to Get Oversight of City Housing”. In either case, the problems remain obvious.)

First, it is bizarre to refer to impending federal oversight of a domestic government agency as “US oversight.” This might strike you as nitpicking — and I’m not blaming writers for editor’s decisions — but this falls into the much longer problematic history of how the Times (and the media at-large) adopts colonialist language when writing about housing in the US. Think of every real estate section story about mostly white “urban pioneers” moving to neighborhoods that…have been lived in by (mostly non-white) New Yorkers for decades.

Framing the built environment like this completely warps the public discourse around housing, specifically on gentrification and displacement. These are complex topics with significant policy trade-offs, but we aren’t presented with equally-weighted narratives to consider them responsibly.

This may be because the press, at any given level in an organization, is uninterested, only partially informed, or even ideologically opposed to public housing (its hard to see how corporate media would be inclined to support it). As much as the press gets labeled “left wing” or accused of having a “liberal bias,” public housing is a good example of that simply not being the case.

So much of the media adopts a real estate-centric language that the public conversation has already been shaped to internalize the virtues of market outcomes exclusively. (This is also true because poverty barely gets written about in the press. And that’s because poor and/or minority writers are absent from pressrooms.)

When minority communities speak about feeling like they live in occupied territory, particularly in the context of excessive-force by the police, this type of real-estate centric language is also what they are referring to. It either erases existing communities or otherwise “others” them into feeling like they are part of some imperial conquest that views them as an inconvenience. This language has real world impact and the Times should know better by now.

It should also be noted that no NYCHA residents were interviewed for the article. It quotes Ritchie Torres, the councilmember from District 15 in the Bronx and chair of the committee that oversees NYCHA, who grew up in public housing. Not for nothing, he suggested, correctly, that NYCHA should sue the federal government for neglect.

That brings us to the second problem with the title — where is the blame for neglect placed? And what neglect is actually being referenced? Just reading the headline makes it seem that the city is to blame. Even within the article, it largely frames the neglect as failures of the agency. That. Isn’t. True. For all of the many flaws that NYCHA is guilty of, they are not guilty of neglect (nor is the city.) They are obviously trying to manage their buildings. But they are doing so under untenable and inexcusable circumstances.

The true neglect, as Councilmember Torres pointed out, comes from the federal government. The federal government helped fund the creation of NYCHA and public housing for the first 30 years of its existence but (as it became less-white) subsequently abandoned it and demonized it (and its residents).

In NYCHA’s case, since 2001, the federal government has cut an estimated $3 billion in operational funding. This is a catastrophic loss. Out of NYCHA’s $3 billion annual operating budget, almost 2/3 comes from the the federal government, either from direct federal budget support (29%) or Section 8 subsidies (30%). These are existential cuts that compound quickly across such a large and old system. When the premise of public housing is based on continued federal funding, it doesn’t work when that funding dries up. Pretty simple.

The article dutifully mentions these cuts but frames it as background on the agencies’ problems rather than central to them. While the failures of NYCHA are presented as direct fact from the writer, the funding cuts are presented as “city estimates” and even the issue of racial prejudice is mentioned in a quote by a professor. Those are apparently not facts. This may be unintentional (the Times and much of the media generally shies away from calling something “racist” or “a lie”) but it means the narrative of this story (like every other NYHCA story) misses the more salient point.

The real story is the federal government slowly abandoning thousands of Americans. Adding in the fact that these Americans generally aren’t white deepens the scandal, but not much more.

Just as problematically, this narrative absolves the federal government from responsibility for fixing NYCHA and presents the only real solution implicitly or explicitly as privatization. That’s been the editorial board’s position for some time.

This article, despite its detailed analysis, is no different. It mentions the city and state squabbling over increased funding but also says (accurately) that neither can fill the gap in funding. It discusses some of the public/private options being explored (which also won’t cover the gap) but doesn’t entertain the idea that the federal government could return to previous funding levels, let alone why it should. What is the solution other than the slow death of public housing?

It matters when no one at the paper of record is explicitly defending the idea of public housing. It’s not a reporter’s job, but they should at least be covering the many people who are. Ignoring the argument for it robs the public of the full housing policy landscape.

It matters further because most Americans, including many well-meaning liberals and even housing advocates, are guilty of holding decades of media-fueled negative stereotypes of public housing that harm residents and harm our prospects of solving the housing crisis: Public housing equates to scary looking, crumbling brick towers by the highway. Crime and rodent invested buildings. Poor and lazy minorities. A well-meaning but failed experiment from another age. A poorly run government program that should be privatized. But these images are bullshit.

There’s a more accurate way to think about public housing’s legacy and future. A civic treasure that has provided affordable homes for 80 years. A collection of buildings that have held up remarkably well and just need proper maintenance. A refuge for a population that the government and the market has otherwise ignored or exploited. A well-meaning but failed promise that should be renewed. A solution to a failed market that will always fail to provide enough housing. A vision for a more equitable republic.

The biggest tragedy of NYCHA’s recent history — which has included federal investigations for fraudulent lead inspections, boiler failures in the dead of winter, the slow selloff of assets, the unfortunate resignation of its Chairperson, Sholya Olatoye (who wasn’t exactly set up to succeed), and now a cynical state takeover — is that its viewed as a failure at all.

Its frankly remarkable that NYCHA is standing with such gaps in funding, indifference from the public, and flagrant neglect from the federal government. In a city where there are over 60,000 homeless and the average rent in Manhattan is over $4,000, the average rent in NYCHA is $509. That’s incredible. NYCHA is a success story. (The article points out that NYCHA is a “relative success” compared to other housing authorities.)

The truth is that NYCHA has been a victim. One that is as resilient as it is flawed. It has been a victim of federal neglect but it is also a victim of terrible federal policy, which is why the affordable housing crisis exists and persists. Without making the story about the federal government failing in its responsibility to fund public housing (while giving away billions of tax dollars to wealthy homeowners) nothing will improve for public housing or for the housing crisis.

Housing advocates should place more effort on making the case that public housing works and call out the media for lazy tropes that keep it off the political agenda. Even more importantly, they should help the already highly organized tenants groups within NYCHA have the reach they deserve to improve their homes.

Finally, we should all outline what public housing could look like in the 21st century if we force the federal government to return to its basic responsibility. We should then make the case that a reboot of public housing can help Americans all over the country have secure affordable housing.

The real estate section shouldn’t be the only place the average American reads about housing issues. And failures shouldn’t be the only thing they read about public housing. As the paper of record, the Times must do better.

What startups can teach community land trusts about narrative

You just need to sell it to people (neweconomyproject)

You just need to sell it to people (neweconomyproject)

Recently, Grounded Solutions Network, which is the national umbrella organization for community land trusts, received $1 million from Citibank’s development arm to form an accelerator to launch more CLTs. As a housing advocate, a startup founder, and a tech educator who runs an accelerator, I’m excited. I’ll talk about the accelerator in a moment, but I’m particularly excited because it finally gives me a chance to talk about all three through the power of narrative. Forming a strong narrative is drilled into startups from the get-go, but the housing community, so far, has failed to appreciate its importance, or at least how to do it right. That might be changing.

A bit of background first. I got involved with the community land trust movement 6 years ago to help solve the foreclosure crisis in Brooklyn. As part of a grad school studio at Columbia, we were contracted by the New Economy Project (they were NEDAP at the time) to come up with a way to protect minority homeowners from losing their homes or to regain their lost homes from the particularly heinous predatory lending practices that laid waist to many majority-minority communities. (The foreclosure crisis has never endedin these communities, by the way.)

While working with visiting professor Jeffrey Lowe and the legendary Peter Marcuse, we were able to study the CLT model in great depth. I visited and researched the Lake Champlain CLT in Burlington, VT (the biggest CLT in the country) and Dudley Street Neighbors Initiative in Boston, MA (the first community group to be granted powers of eminent domain).

I was and remain enamored by the story of these organizations and the people that made them possible. The CLT model changed the destiny of these communities. It created permanent, community-controlled affordable housing in places largely abandoned by the public and private sectors. These people showed how working together against unbelievable odds could make something big happen.

Their stories made me believe that CLTs could happen in NYC. By the end of the studio, we began crafting a vision for how the model could work and how it could help these homeowners and communities who had been sacked by the financial industry. It was a very exciting time.

However, most people in city government had no idea what a CLT was or flat out laughed at a bunch of lefty grad school students and community groups for suggesting that it could work in the real estate capital of the world (that is slowly changing). This is despite the presence and decades-long success of Cooper Square, the first CLT formed in NYC. Even in the wake of the foreclosure crisis, when the city was taking over hundreds of properties, the model never found an audience. In retrospect, we put a lot of work into research and policy, but failed to appreciate how crafting a good narrative could get people’s attention.

At the same time, on an entirely unrelated note, I was launching my first startup company, Brightbox. (Going to grad school for urban planning and building a tech company confused a lot of people -including my parents- at the time) Brigthbox is a secure cellphone charger for bars, nightclubs, and restaurants that allows people to charge their phones when they need to. My good friend Adam Johnson came up with the idea while we were bartenders in NYC’s Meatpacking District dealing with this problem every night. Our experience as scene-y bartenders gave our product two key insights —highlight security and sexiness. Through some grit, dumb luck, and smart luck, we got funding and began the Quest to Scale into other markets and sectors with some notable ups and downs.

Along the way, there was one key lesson that we could always come back to for guidance — no matter who we worked with, whether it was a dive bar or Disney, as much as they liked seeing the product, they loved hearing the story about how we were bartenders. We saw an everyday problem first hand and did something to solve it. It is a great story.

To this day, it is clear to me that the power of that narrative — simple, plucky, aspirational — is what took Brightbox from a literal cocktail napkin idea to a business with hundreds of kiosks across the country and world. (One of my former coworkers just shared a Facebook memory from Internet Week 2012, where Brightbox shared a small booth in the back corner of an event with Uber. We obviously didn’t learn how to scale compared to them.)

Telling a good story is the foundation for growing a startup company (or a campaign or a religion). It’s what attracts users, talent, and investors that ultimately help build the product and the business. I have kept that lesson with me as I have started my second company, homeBody, and we drill it in to my students at CUNY Startups: Everything is built on the power of your unique narrative. There’s a big problem a lot of people have. But there’s an elegant solution. You’re the one who can make it. You’re the one who can get it to people. A lot of people. And it’s going to change everything.

This urgently needs to happen with the affordable housing crisis. The crisis is massive and painful, but housing advocates have not been able to craft a narrative to solve it that captures the nation’s attention. Coincidentally, as I worked on this blog this week, Citylab had an article about the nonprofit agency Public Interest who is trying to make an “Inconvenient Truth” type doc about the crisis to do just that. I hope they do it.

That’s why I’m so excited about Grounded Solutions CLT accelerator. It shows that a powerful narrative is forming about how to solve the housing crisis: communities taking control. First, the fact that Citibank is investing in it shows that at least some major financial institutions are coming around to the model. I have no love for the financial industry or its role in creating the housing crisis, but there is no way to solve it without them playing some role either. Second, creating a formal structure to grow more local CLTs spreads the model to more organizations and more communities. The more people hear about CLTs, the more they like them. The more they get started and succeed in one place, the more they will get started and succeed in other places.

The Ground Solutions accelerator isn’t like a traditional startup accelerator, but calling it that shows a willingness to adopt a startup vernacular, which is an important signal to the public (and press) that there is something cutting edge going on in the housing crisis. I hope that insight is embraced within the accelerator as well — Leveraging technology to form and manage CLTs; Adopting branding and growth hacking techniques to gain support; telling a compelling story to secure stakeholders in the community.

I’m excited to see the beginning of a convergence with my startup experience and my housing experience. Of course there are unique complexities in trying to scale a community-based model of housing that don’t compare to scaling a hardware startup, but there is at least one major similarity. It’s a heck of a story.

There is a massive, wide spread problem (phone batteries die, housing is too expensive) with a really simple, elegant solution (secure phone charger, community-owned housing.) As the accelerator gets off the ground, I hope that Grounded Solutions, their local partners, and other housing advocates continue to embrace the tools startups use to craft their narrative. The CLT model can be a game changer in the housing crisis if more people hear its story.

3 Reasons Local Landlords Should Support Stronger Tenant Protections

(@homebodynetwork)

(@homebodynetwork)

Cynthia Nixon, the former actress and longtime public education advocate who is mounting a primary challenge to Governor Cuomo, announced a progressive housing plan that continues her disciplined assault on the governor’s dismal track record from the left. The plan, called Rent Justice for all, outlines many long-sought after reforms to protect renters across the state. A few real estate publications, including the Real Deal, have been quick to point out that landlords won’t like it.

I think this is partially true. Some landlords will absolutely hate these proposals and many of those landlords are quite powerful. However, I’m here to argue that I believe there are other landlords that should welcome stronger tenant protections — the majority of landlords, in fact.

Small, local landlords own more than half of the 2.18 million rental units in NYC and most have very little in common with bigger developers, publicly traded property management companies, or private equity firms that have flooded parts of the NYC market. However, small landlords don’t come close to having the same political power, which often means their interests are ignored or actively subverted.

Despite this contradiction, these more powerful interests continue to successfully flatten the perception that all landlords are the same homogenous blob (buffered by the generally uncritical real estate press in NYC). This narrative is obviously false, but big developers and Governor Cuomo trade in it freely. For example, the Governor’s Affordable New York plan does nothing for small landlords and gives away millions of public dollars to major developers (while failing to provide enough actual affordable housing).

This narrative maintains the strict landlord vs tenant political divide that feeds the toxic decades-old political status quo in New York: A small contingent of highly dedicated tenant groups fight to maintain tenant protections while the affordable housing stock slowly disappears. Small landlords get squeezed. Big developers get more tax concessions and rezoning opportunities. And the affordable housing crisis continues on unabated.

Breaking this toxic political status quo is the first step towards addressing the affordable housing crisis on a meaningful level. Housing advocates can start by rejecting the narrative that all landlords have the same shared interests and recognize that small, local landlords are hurt by this dynamic too.

We must do more to convince small landlords that they have more cause to work together with tenants. There is no meaningful solution to the affordable housing crisis that doesn’t incorporate small landlords and doesn’t make it easier for them to operate. As Matthew Desmond points out in his Pulitzer Prizing winning 2016 book Evicted, 3/4 of all affordable housing in the US is provided by small, local landlords. We must make the argument that these landlords will benefit from stronger tenant protections.

In previous blogs, I have written how I think a universal rental control could work, but to sum up quickly, I stress that it would not represent a simple extension of the current system (to be clear, I support the measures in Ms. Nixon’s proposals but think they must go further). It would be an entirely new system that would also need to offer more diversity in housing options (from co-living to senior living) and would absolutely involve trade-offs that no doubt would appear to be painful, particularly for some older rent controlled tenants. Measures to protect these tenants would have to be included (preferably with federal aid). Clamping down on the small minority of tenants that abuse the current system would also be a necessary step as part of a new system. This is no small task and I understand that many readers will be skeptical of even engaging in this discussion.

That being said, the first step in a larger reform is making the easy argument that small, local landlords will have more success by working with tenants rather than bigger landlord interests. Here are three reasons why I think this is true:

1. Simplifying compliance reduces costs and hassle

It is no secret that managing multiple classes of tenants makes compliance more challenging for small landlords. Many of these types of owners are landlords as a second source of income and are not professionally trained or resourced. This invites a lot of mistakes that can turn into costly problems that hurt both parties.

Having all renters fall under the same level of protection would remove a number of the steps that most small landlords trip over. Rather than having to follow every evolving law, loophole, MCI exemption, or annual RGB guideline and see how that impacts certain units, both sides would know exactly what to expect and what is required under a universal system.

A system where protections are offered across the rental landscape for every unit would potentially alleviate a lot of the tensions between rent stabilized tenants and landlords, particularly on fixing infrastructure within units. Much of the distrust that arises between both parties comes from a landlord’s reasonable need to make upgrades to a unit and a tenant’s reasonable fear that this will trigger a rent increase that may lead to a larger decontrol. Without the fear (and perverse incentive) of vacancy decontrol and bonus, both sides can operate in good faith.

It could also offer tenants more options. In many cases right now, landlords and neighbors change while a rent stabilized tenant remains. In a classic example, a tenant might age while their neighbors get younger. This might not be the ideal environment for that tenant, but moving to a better-suited location is virtually impossible financially. Knowing that a system is in place that could provide a similarly priced unit (again, presumably with some federal or state aid) with similar long-term protections could make moving more attractive.

2. More tenant protections mean fewer expensive eviction processes

Eviction is an ugly, painful process for all parties involved. However, the loss of shelter is simply nowhere near the loss of rental income. Greater tenant protections mean more resources to keep tenants in their homes — and to keep the rent checks coming to landlords.

This is already happening in NYC. Mayor de Blasio signed a Right to Counsel bill last year that guarantees tenant legal aid in housing court. These resources mean that fewer disputes will lead to evictions (which could save the city $320m a year). Intervening earlier in the cycle gives the tenant more opportunity to receive the necessary help to maintain good standing with their landlord.

No doubt there are bad actors in real estate (more on that later) but for the most part, small, local landlords aren't; they don’t have the resources for a lengthly eviction fight and don’t want it to get to that point. Landlords also generally don’t want to kick people out of their homes outside of the most extreme cases. They want peace and quiet.

More resources for tenants means a greater ability to intervene at critical junctions when a tenant may be at risk of falling behind on rent payments. Every landlord can support a process that appeals to their humanity and their bottomline.

3. Discouraging bad actors from the market opens up space for more local landlords

One of the biggest, if perhaps abstract, benefits of universal tenant protections to small, local landlords would be the shift in the market that would transpire over time.

The vast commodifcation of the American housing market caused the Great Recession. Instead of solving that crisis by reducing the incentives to speculate on homeownership, the economy has morphed into exploiting rental housing.

Large investment companies, private equity firms, and foreign capital all compete on small-scale properties in NYC. It’s difficult information for the casual observer to find, but, particularly in neighbors facing displacement concerns, these entities are forcing out small landlords who are often local, community-connected operators (which is why I have been stressing the ‘small, local’ modifier.)

The idea that the best, highest use of capital is virtuous on its own merits doesn’t hold up when you see the practical implications of this trend in housing. In many neighborhoods across NYC, poorer residents (many of them minorities) are being replaced by wealthier (largely whiter) residents. (This is a particularly shocking reality in California as well.) Many of these properties sit vacant as investment shields or as Airbnb cash cows.

NYC is already one of the most economically stratified cities in North America. Continuing this trend (which mirrors other trends of disinvestment in public institutions and local infrastructure) is simply not sustainable. The long-term viability of the city, let alone a given neighborhood, is at risk if it is simply closed off to all but a select wealthy population.

NYC is a city of immigrants, entrepreneurs, and artists — many of them start out poor. Many of them start out renting from small, local landlords. This can not end.

I will continue to advocate for more public housing and alternative forms of ownership, but I also believe that the private market must play a central role in property management in NYC. But this must be in the form of local landlords. New Yorkers should be able to cycle into ownership and renting in their communities. As housing advocates, we must acknowledge the importance of local landlords and reach out to them as allies.

The Fight Over SB-827 Shows Why We Need a Massive National Plan for Housing — Again

The Williamsburg Houses (1938) still provides 1,630 homes for 3,121 New Yorkers. (nycarchitecture)

The Williamsburg Houses (1938) still provides 1,630 homes for 3,121 New Yorkers. (nycarchitecture)

This week in California, public hearings have begun on SB-827, the bill (which is a series of bills actually) proposed by State Senator Scott Weiner from San Francisco which calls for a radical realignment of housing policy away from single-family car-centric development to multi-family transit oriented development. It didn’t take long for it to get ugly. The battle lines for and against the bill have skewed the typical partisanship we’ve come to expect in American politics, pitting NIMBYists (homeowners, many of whom would otherwise lean progressive) against YIMBYists (a wider range of pro-market and even anti-market interests). It will absolutely get uglier.

That’s because the stakes couldn’t be higher. Along with California, the entire nation has been locked in an unprecedented affordable housing crisis and to solve it someone has to lose — big. Until that reality is faced, this crisis has no end in sight. 

The housing crisis won’t end until we stop calling it a housing crisis and start calling it what it is — a crisis of capitalism in housing. 80 years of housing policy that viewed it as a form of wealth creation has severely damaged our communities and our economy. It has racially stratified our society and left millions behind. It has ecsaserbated our climate’s instability. 

If we want to “fix” the housing crisis we need to fix capitalism. In the long run that means changing how we view — and finance, build, and use — housing. That obviously won’t happen over night. But we can start by looking at how we solved previous housing crises in the US. 

When has the market solved a previous housing crisis? Never. 

The scale and length of the current housing crisis is unique in American history, but housing shortages are not. What is also unique today is the lack of national policy initiatives to fight it. 

Many people (including many supporters of SB-827) will argue that we don’t need national policy. We justt need to unleash the free market to match supply with demand. That’s a nice idea, but we’ve tried that before.

New York City is the perfect example of what happens when you rely on the market. From 1890 to 1920 the city’s population grew from 2.5m to 5.6m due to a massive wave of immigration. The unregulated housing stock at the time was already overwhelmed and hellish (the tenement-dominated Lower East Side was the one of the densest areas on earth) but it couldn’t keep up with such a huge population increase. Even as the city physically expanded and private development sprung up further from lower Manhattan, adequate, affordable housing was hard to find the majority of the population.

There was minimal government intervention in housing at the time — this was pure market. It was before land use, occupancy, or even fire safety regulations let alone government sponsored housing. The city did however finance rapid transit, thereby indirectly subsidizing the construction of new housing on vast tracks of cheap green development in the boroughs— yet at no point was the private market willing or able to create enough affordable housing for the growing city. Expensive slums still persisted.

It should be noted that the federal government did build public housing during the tale end of this period in other parts of the US. During World War I, a massive influx of labor around war time production put a severe burden on port and industrial cities’ housing supply, causing inflation and price spikes. (A large part of this influx was the beginning of The Great Migration, which saw over 6 million African-American families move from the rural south to the urban north and west.)

The federal government built thousands of housing units for workers — although many of them were purposefully constructed as temporary to avoid angering local real estate interests who lobbied against the effort even during wartime. The market was and never will be interested in meeting demand.

How were previous crises solved? The federal government.

The housing crisis in NYC continued even in the boom years of the 1920s and came to head during the Great Depression. Millions of Americans lost their homes (whether they owned or rented) and were forced into dangerous tenements or shantytowns known as “Hoovervilles.” The market ceased to exist in any conventional sense.

Famously, President Roosevelt was able to enact the New Deal, which was a set of legislation that radically changed the relationship between the federal government and the economy. The two housing bills of 1934 and 1937 were, ultimately, a mixed blessing.

On the positive side, the scale of the Depression obliterated the ideological arguments against intervening in the housing crisis and spawned the first wave of public housing construction across the country. In conjunction with local governments, the federal government sponsored thousands of modern, clean housing complexes — in cities and in more rural parts of the country. Millions of Americans — the majority of which were middle or working class — received access to affordable housing never seen before.

On the negative side, the New Deal legislation racially segregated public housing and in fact displaced many communities of color to build public housing for white residents.

Even more damaging in the long the run, this was the beginning of massive subsidies for single-family housing. Originally conceived as a construction industry bail-out, the Federal Housing Administration would set the precedent of backing mortgages (for whites) that evolved into Fannie Mae and Freddie Mac.

These policy decisions have shaped the physical definition of America and the social and economic destiny of all Americans. It is no stretch to say that these polices set the country on a course that would inevitably lead to our current crisis. 

This time must be different. 

It’s fascinating and heartbreaking to think about what could have been different. Had the federal government intervened with public housing sooner, at the beginning of the 20th century, would it have demonstrated its value in different, smaller scale models that could have gained more political currency? Could the federal government have intervened by creating more mass transit and denser suburbs before the advent of the automobile? Could the it have avoided the racism that doomed a large segment of Americans and cities for generations?

Could we have avoided the tragedy of building our national and personal economic prosperity on homeownership? 

These questions are important to ask because we must learn from the past if we are to truly solve this housing crisis. The short answer for all of these are yes, if we valued the public good over private interests. If we valued democratic outcomes over market outcomes. If we valued shelter before wealth. If we stopped equating the market with virtue or even basic efficiency.

It starts by learning the lessons from the fight over SB-827. Homeowner interests can not come before the public interest. Local towns can not implicitly segregate themselves through down-zoning — at least near public transit (and extend that publicly-funded highways.) Special interests can not kill the democratic process.

Next, it means avoiding the failed lessons of relying on the market with minimal regulation from the early 20th century and avoiding the failed lessons of the New Deal focus on homeownership and slum clearance as national policy goals. We need more public housing in addition to more density. This is the only way to ensure that displacement doesn’t ruin another generation of low-income families chances of mobility. 

It means addressing the bigger problems inherent in our choice to make homeownership a priority because it drives wealth creation. There is nothing wrong with promoting homeownership, but doing so by warping the true cost of it is irresponsible. We learned that during the Great Recession and then quickly forgot it. We must finally address this at the national level. 

Finally, we must address the larger errors within capitalism that have warped what a home is. We can’t allow homes to be speculated on by private equity firms, international investors, or even flipping enthusiasts. Homes are for living in, not extracting profit from. 

We can’t allow homes to be the sole or majority source of a household’s wealth. It’s no wonder that homeowners freak out about potential risks to their home values — for too many Americans their perceived value is their only economic security. That is absurd and will likely trigger another major economic crisis in the years ahead. 

The only way to do all of this is for the federal government to intervene with the resolve of a national emergency. We must push for our elected officials to make the difficult decisions and political sacrifices to ensure that Americans can find affordable housing everywhere. The stakes are clear. The costs of inaction are clear. The way forward remains unclear.