Can Private Industry Abolish the Slums?
Harrington, Michael
The following article is a slightly revised version of testimony presented this fall at a hearing of the National Commission on Urban Problems. MANY WELL-INTENTIONED AMERICANS are deceiving...
...The corporate sector, as Mr...
...A private enterprise will not and cannot...
...IN SUMMARY, we know that we have to build 500,000 units of housing for the poor every year...
...To rehabilitate them successfully would mean removing half to three-quarters of the people now living there to new housing...
...There is no other way to design a new civilization...
...Yet even with this federal support through tax incentives or artificial interest rates, every one of these suggestions ends up providing housing for families with incomes well over $4,000 a year...
...Moreover, none of the proposals now being discussed come near to the required number...
...It is precisely the commercial calculus of land value that has exacerbated our crisis and can hardly solve it...
...it is a matter of the failure of the democratic imagination as well...
...We must construct more housing units than now exist...
...In this process, the private sector must play a subordinate role as the contractor for the popular will...
...The rents would be too high for, among others, the majority of Negroes in the United States...
...President Johnson this year proposed building 165,000 low-cost housing units, or 335,000 less than the White House Conference minimum...
...I specifically want to address myself to the theory that some kind of partnership between government and the private sector will solve the problem, because I believe that this theory is an illusion...
...In fact if not in theory, our postwar housing has financed segregated, white suburbs...
...All such proposals now before the country—from Senators Percy and Robert Kennedy among others—are designed to operate on a publicly supported profit principle...
...Then, and only then, can the companies and corporations contract to carry out the public will...
...The worst of our urban slums are criminally overcrowded...
...There should not be one federal cent for "new towns," either outside of the present metropolitan areas or within them, that are not designed to promote racial integration...
...The monies which Ribicoff spoke of were the $287 million budgeted for three years of the Demonstration City program...
...David Rockefeller testified with great candor before the Ribicoff Subcommittee, is concerned with making money...
...THE ISSUE RAISED here is simple: Who is going to design the "second America" President Johnson tells us we must build between now and the year 2000...
...I assume that the bloodshed in Detroit motivated the revision of this policy in August 1967...
...But the fact remains that the Kennedy and Percy proposals, if the published reports of their rent levels are correct, would not provide any housing for the poor and the almostpoor...
...This would be a wiser investment, as the Senator suggested, than the present Model Cities program...
...If past experience is any guide, the actual number constructed will come to a bit over 30,000, or a deficit of 470,000 units...
...It is one of the great postwar scandals that lavish, but discrete, subsidies have been provided for the homes of the middle class and the rich in the form of cheap, federally guaranteed credit, income tax deductions, and other genteel doles which effectively exclude everyone with incomes of less than $8,000 from the benefits...
...But we should start immediately by adopting Senator Ribicoff's proposal of last January and spend approximately a billion dollars on finding out what we want to do...
...There is obviously no simple solution to such a complex crisis...
...I believe that our present crisis allows this country a marvelous opportunity to promote racial integration...
...We cannot go on forever "demonstrating" techniques and leaving the main problem areas untouched...
...Banks, and 4 COMMENTS AND OPINIONS other business institutions, will only invest funds if they are going to get a return...
...MANY WELL-INTENTIONED AMERICANS are deceiving themselves and the public when they speak of abolishing the slums...
...Within the framework of such an "economic" approach, one builds most cheaply and profitably, while social and aesthetic considerations are secondary...
...And this is particularly important in the case of the slum poor, who have been excluded from the making of every important decision in the nation...
...We are not doing so...
...The necessity of such innovation cannot be evaded by magic schemes for "rehabilitation...
...And this points up the need for new public institutions of democratic planning...
...In market terms, business cannot be expected to go into the job of slum eradication because it is a bad risk...
...The Council of the White House Conference on Civil Rights said that the United States must build 2 million housing units a year, with at least 500,000 especially designed for the poor, if it is going to live up to its responsibilities...
...Even if the market terms are modified by federal subsidy, as in various proposals now before the nation, all the poor and the majority of Negroes would be effectively excluded from the benefits...
...For I am convinced that where decisions on public subsidy are made at high levels of expertise, there the priorities of money, rather than those of society, prevail...
...Until August of 1967, the FHA excluded blighted areas from its mortgage insurance programs on the grounds that such undertakings were "economically unsound...
...The slums can be abolished, but not in the way they suggest...
...For the basic decisions involved are not susceptible to business priorities and even hostile to them...
...Finally, the enormous undertaking I outline here clearly requires new public institutions for democratic planning...
...Now that the government has officially recognized that we must more than double the present supply of housing in the next third of a century, there is the possibility of reversing this ugly policy...
...Yet the slums are, in business terms, a bad risk...
...There is only one way of establishing the social and aesthetic values which will guide the "uneconomic" expenditure of money...
...The fundamental decisions on what America shall look like and what life in it will be like should be made by the people...
...Our postwar housing deficit is not measured in simple terms of our scandalous discrimination in fa5 COMMENTS AND OPINIONS vor of the rich and against the poor...
...Without thought of social or aesthetic consequences, we have proliferated superhighways and suburbs and made slums more miserable, employment more distant for the poor, old age more lonely for those left behind in the central city, and so on...
...but they should not determine it...
...That is through democracy...
...Nor can this problem be dealt with by providing public subsidies to private builders...
...A governmental agency can thus decide, in the name of public social priorities, to make an "uneconomic" investment of money...
...I do not say this simply out of democratic conviction or populist sentimentality...
...A number of programs have been proposed to end the scandal of inhuman housing for the poor...
...And even if some way were found to bring the private sector into the slums, it could not and should not play the leading role...
...And in the process of such a massive planning expenditure, every level of American society should be involved in the debate...
...There must, therefore, be an "uneconomic" investment of public funds motivated by considerations of social and aesthetic values rather than by a calculus of private profit...
...In arguing thus, I do not want to suggest that there is no role for the private sector...
...Moreover, the urban crisis allows the country a chance to use federal funds to promote, rather than, as has been the case until now, to thwart racial integration...
...As Mayor Lindsay's task force on urban design reported to him, beauty, charm, and history cannot compete with office buildings, and even a venerable structure like the Plaza Hotel will be torn down if present trends continue...
...Although my analysis is radical, it can be documented in the official statements of the United States government...
...Moreover, the rehabilitation formulas often take the reality of segregation as a given...
...I submit that businessmen, whatever other qualifications they have, are not competent to design a new civilization and, in any case, have no democratic right to do so...
...These are issues in the public sector of American life...
...It is just that the social and aesthetic choices— those "uneconomic" options—must be democratically planned and, because of the logic of money-making, publicly financed...
...There can be no creative federalist panacea, enlisting business in a social crusade, that will deal with this problem...
...There is certainly a need to give governmental support to the housing needs of people with incomes between $4,000 and $8,000...
...For example, Senator Robert Kennedy's approach is clearly motivated by great compassion, yet it would only provide 400,000 units over seven years through a $1.5 billion tax subsidy to private enterprise...
...It will not work...
Vol. 15 • January 1968 • No. 1
