NEIGHBORHOOD GENTRIFICATION

...We face a choice: either government returns to what the conservatives think are its proper minimal functions—merely policing the apartheid for which the gentry's social theories are preparing us...

...The question is whether today's wellmeaning myopia will become tomorrow's embattled confederacy with certain middleclass neighbors who want to "take charge" in more ominous ways...

...As fateful, if less obvious, is the federal tax code's role in destroying balanced neighborhoods...

...Middleclass people know how disorienting and exhausting it can be to move by choice, the consensus reminded us...

...O'Hanlon notes that minority flight from these conditions temporarily pumps up demand in softening white markets, especially when that flight is carefully steered and exploited by block-busting brokers...

...The "moral," of course, is that the truth is the other way around...

...Had liberal government now repented its sins and become wise...

...The odds are that her vast gaps in perception concerning her lower-income neighbors will be converted to chasms of hatred more swiftly than their apartments can be converted into condominiums These transformations suggest that gentrification's impact may prove to be as much ideological as economic, that it is less likely to revitalize cities than to shape a fateful new "consensus" about their continuing fragmentation...

...Gratified by its end run around democracy, Continue endorsed Margaret Clemons, a private investigator and past Conservative party candidate for State Assembly who took the Republican line against left-Democratic Council Member Ruth Messinger.* The militant gentry's worst venom seemed reserved for middle-class whites who had helped draft the subsidy proposals...

...171 brownstone struggles, it accelerates housing inflation while trying to outrun it, and deepens housing inequities in other ways...

...White outmigration in the early years wasn't a flight from minorities and urban ills...

...Middle-class people who work with low-income residents to cushion market displacement become targets of special rage...

...169 The zealots of upscale conversion lead that ratification by promoting certain invidious conclusions about low-income neighbors...

...In Washington, meanwhile, an Administration especially solicitous of middle-class needs has given champions of our born-again neighborhoods fresh hope of banishing the subsidized housing they claim despoils the rebuilding of their kingdom and coddles their lower-income neighbors into indolence, and insolence...

...More generous indirect tax subsidies are supposed to be okay because they spur investment in new housing, relieving price and space pressures in lower-income markets as the middle class moves out of older homes, thereby benefiting everyone, as tax policies and expenditures are supposed to do...

...Marx called it commodity fetishism—an obsession with consumption styles that insinuates itself into personality when all human relationships have been plunged into the icy waters of calculation by market forces: the trappings of dignity that money can buy, such as brownstone ownership in an elegant neighborhood, become virtually the only substitutes for the dignity of life in more stable, supportive communities...

...It was a time when wisdom and policy spoke with one voice: properly subsidized housing (not high-rise "projects") was a low-income person's chance to escape the constant uprooting that ravages individuals and society...

...in front of some older Italians who've been raising their kids on these stoops since the 1930s...

...That can happen only if class lines harden and people despair of accomplishing, Horatio Alger-style, what they might do better through movements and parties...

...Gentrification is becoming a front line of the larger counterrevolution: while suburbanites aren't confronted intimately by blight and despair, and ghetto minorities have a tough time facing the bankers, brokers, and slumlords who always seem a step ahead of the storm, gentrification battles bring "society" face to face with the hideous class differences it has created...

...HAPPY DELIVERANCE for the embattled soldiers of capitalism and civilization arrived last March, when Continue was elevated after years of frustration to the high ground of public policy by no less an apostle of free enterprise than Senator Alfonse M. D'Amato...

...In other neighborhoods, yet other groups were crafting stabilization proposals to cushion market upswings...

...Even the vast majority of them who pay their rents, work hard, and send their kids well-scrubbed to school can't seem to escape the ministrations of speculators and slumlords...

...It left them feeling entitled to shape that reputation and guard it...

...Unlike direct subsidies, which reach only 1 out of 9 eligible low-income families, the right to reduce your taxes on any income spent for mortgage interest or property levies is automatic and exercised by 4 out of 5 homeowners...

...The crusading gentry would have none of it...

...And why were welfare families so desperate to move in...

...they are utilized to take old units away from the people who need them most—whether through single-family conversion of brownstones, co-op conversion of rental units, or luxury conversion of single-room occupancy residential hotels...

...Platitudes about diversity, or a serious commitment to strengthen civilization and its investments...

...In Brooklyn's Park Slope, similar if more modest plans were afoot in the Fifth Avenue Committee's efforts to rehabilitate small cityforeclosed buildings for moderate-income ownership and low-income rental, with financing from Aetna Life and the City...

...Since housing-subsidy advocates have faults of their own and the debates are so acrimonious and complex, moderates are tempted to leave the field...

...Soon you were either on the housing bandwagon or off...

...174 Properties foreclosed by cities should be reserved and developed as low- and moderateincome, nonprofit cooperatives, free of the vagaries of speculation and rent control battles...

...Of all federal housing outlays, 25.5 percent went to households making over $50,000, for an average monthly assist of $309 per recipient, while only 18 percent went to households earning under $10,000, for an average monthly assist of about $100...

...It seems necessary to remind the apologists that gentrification's intimate affair with blight reflects inequities far beyond the poor's control...

...Of course, more subsidies in the context of an unreformed tax code and the inflation it causes are no solution...

...By latching onto blight in areas with the greatest investment potential, newcomers reinforce the larger system of real estate credit and tax subsidy that created blight in the first place...

...by agency "dumping" of welfare families into market areas already weakened by white flight, redlining, and rent control...

...it reduces decent poverty to social invisibility broken only by the poor's power to disrupt...

...The consequent devaluation and softening of demand make rental owners milk buildings, and in no time the middle-class minority newcomers have been leap-frogged by the poverty and devastation they tried to escape...

...As times changed, the Times changed, opining that residents priced out of a booming local market will do society and themselves a favor by going quietly, rather than calling in subsidies to crash the party...

...Watching the real estate industry's exploitation of the gentry's fantasies, and their unholy alliance with conservative crusaders from D'Amato to George Gilder, we can begin to insist that the truth is otherwise, and that the most constructive solutions in housing and other areas lie with the groups and programs we've worked so hard to develop...

...A lot of folks got religion...

...Yet banks are by nature risk-averters...

...It's an incentive to put your money into housing, the more expensive the better if your income bracket's high enough...

...The battle for the bankers' attention left the suitors excruciatingly conscious of neighborhood "reputation" as the critical factor in local revitalization...

...Mini-inquisitions replace the Welcome Wagon: has the newcomer a perverse fascination with the poor, or readiness to help beat back the jungle...

...Blacks and Hispanics came north after World War II not to go on welfare but to take factory jobs vacated by white ethnics who were upgrading their careers on the GI Bill and moving to suburbia on FHA mortgages...

...They are trying to develop an empire of buildings and public funds that will enable them to pursue the socialist propaganda that will encourage hatred and economic depression," cried Frederick Baar of the Park Slope Improvement Committee (PSIC) in a letter to a local Brooklyn weekly, in reference to the Fifth Avenue Committee's subsidized home-ownership proposal...

...Driven by the myriad pressures of the urban housing market, these zealots aren't given to compassionate exploration of the hurts and hopes of people driven even harder...

...Yet those extremes grow starker in our cities each year, making some people cling all the more desperately to their narrow prerogatives within this system...

...In a pattern typical of such encounters, D'Amato first helped his once-liberal supplicants witness their new faith with a stirring catechism: • Who Made Us...

...The denial of credit in Bushwick or Harlem, regardless of an individual applicant's credit standing, meant that neither homeowners nor investors could borrow to improve their properties...

...Beginning as a benign revival of shabby tenements by young urban integrationists, the trend quickly drew promoters...

...Because of the thousands of herring that live there...

...We are self-made, by the grace of the Free Market, from which all blessings flow...

...what must it be like for poor people bulldozed or priced out of neighborhood support networks they desperately need...

...The resulting predicament for the middle-class minority family is poignant: even if it can survive income decline and mortgage discrimination and make the downpayment in a better neighborhood, its very arrival is used by some brokers to induce white owners to sell cheaply...

...172 Even when gentrification's aplogists acknowledge its excesses, they remind us contemptuously of the blighted condition of brownstone neighborhoods before their arrival...

...The problem was that the factory jobs left, too...

...Today many black and Hispanic residents of the West Side and Park Slope—areas with at least a possibility of stable economic and racial integration—have been burned out or frozen out several times...

...by inner-city projects facilitating ghettoization...

...Brownstoners know that even with good educations, willingness to camp out in unfinished shells, financially helpful parents, and ability to come up with out-ofpocket money for piecemeal renovations, their sacrifice and hard work would have come to nothing without the reentry of the banks...

...Continue was on, picking up speed, while lower-income people fell off into ever more unacceptable housing, income decline, and deeper unemployment...

...The failures of liberal government lie not in having done too much but in having done the wrong things...

...The consequent decline in property values, added to existing outmigration and income decline, left milking or the torch as the only means of extracting one's investment...

...HUD has now removed itself from the West Side Urban Renewal Project, leaving the Project in the hands of the mayor and the Board of Estimate...

...Surely the gentry work hard, but the very sacrifices squeezed out of them by developers and bankers, along with the very real benefits that do accrue, accelerate displacement and the destruction of low-income housing...

...By passing themselves off as defenders of their neighborhoods, the zealots misrepresent something far more serious...

...The leaders of the protest spoke of their neighborhoods' long-neglected physical beauty—not of their long-neglected neighbors...

...New York City's pioneering programs in this area should be expanded, not precluded by quick auctions...

...Period...

...And with each monthly payment, equity and resale value are rising...

...This is a tale of urban accommodation," the New York Times rhapsodized in 1977 when Manhattan's Community Board 7 presented a balanced plan for mixed subsidized and market-rate housing in the West Side Urban Renewal Area east of Broadway, insuring at least 2,500 units for some of the 12,000 low-income families who had once lived there...

...The renovators had become astute pupils in the school of liberal government failure: they argued that disinvestment and the poor's uprooting had been hastened less by gentrification than by such liberal artifices as FHA mortgages facilitating the white exodus to suburbia...

...or government will structure new forms of nonspeculative housing investment to bring some sanity to the current chaos...

...Here, really, is the hidden rip-off of lowincome people by the middle class...

...It wasn't always so...

...indeed, urban strengths like decent schooling and union pay checks made possible a mass response to a heavily advertised public/privatesector lure to greener pastures...

...Along the way we may see such direct actions as squatters' movements like the West Side's "Operation Move-In," which brought hundreds of lowincome people back to city-owned buildings vacated years earlier for the urban renewal that Continue has blocked...

...They attacked the refusal of banks to extend credit to people like themselves, people adroitly entering blighted areas now beginning to turn, people who had taken brave risks with buckling plaster and menacing junkies, and who would dust off once-grand local parks and libraries while nursing whole blocks back to a soupcon of lost loveliness...

...Yet the zealots seem to have decided that the poor richly deserve whatever constraints oppress them, if only because their pronounced cultural differences impeded the process of neighborhood promotion...

...Industrial flight from the high taxes and payrolls responsible for those strengths was another matter...

...and without mortgage availability, they'd be hard put to sell them to new buyers...

...Yet the zealots tell us it's the latter who "suck the blood of the private sector," presumably because subsidies are direct appropriations...

...Most of all, it spawned an apocalyptic fear and hatred of subsidies...

...Even so, the new gentry couldn't see why they should have to live with the pathological damage of government's past mistakes while struggling to sink roots of their own...

...In short, serving big capital's interests means promoting displacement...

...Capping housing tax deductions at $5,000 a household, as Cushing Dolbeare proposes, or offering a flat 25 percent tax credit in place of present deductions, as the Urban League would like, certainly won't hurt the average Continue or PSIC member yet will recoup billions wasted on the truly greedy...

...Moderates who've ignored violent eviction tactics by speculators can hardly condemn squatters' movements...

...Its impact on housing conditions was harsh and inequitable...

...As housing consultant Cushing Dolbeare notes, the total cost to the federal government of all its directly assisted housing programs, from their inception in 1937 to 1980, has been less than the cost of housing-related tax deductions granted to homeowners and developers in 1980 alone...

...But they, and all progressive people, have to speak up firmly at chaotic public meetings, and tell elected officials that the zealots don't represent all tax-paying middleclass opinion...

...Surely, as long as middle-income people remain absorbed in their short-run aspirations to make neighborhood "reputation" a marketable substance while ignoring real human needs, they invite social disaster...

...exclaims the young hostess, tripping over stray sheetrock and spackling compound toward 30 members of the new block association gathered stiffly in her living room—including a few minority tenants who'd be relieved at the moment to have property values to worry about...

...Both Continue and PSIC circulated thousands of leaflets identifying the subsidies with "crime" and misrepresenting the proposals as more "projects...

...The subsidy recipients "suck the blood of the private sector," snarls one renovator from Boston: "they make war on civilization...

...A free-enterprise mythology that reserves all honor for personal initiative while leaving social consequences to an Invisible Hand makes it as difficult as it is necessary to explain these matters...

...Our heroine is seriously over her head, of course...

...And when that craving to "pass" is deepened by minority experience, be it the pit of the Holocaust or the reception accorded one's black skin in a gentrifying neighborhood, the need to prove oneself to one's adopted elite never ends, not even with prosperity...

...It became an inflationary, luxury-oriented juggernaut that raised the stakes of homeowners while gobbling up low-income rental units for overpriced co-ops and weakening the building power of limited federal subsidies...

...Their antisubsidy furor legitimates an accelerating urban spiral of inequity and fear upon which gentrification has curiously come to depend...

...They want them out...

...Liberals and bureaucrats made them, by contravening market forces in a misguided "war" on what the false prophets told them was Poverty, but which we swear unto you is really Opportunity...

...Crime soared...

...Who Made the Poor...

...Driving through once-lovely Crown Heights, surveying the 173 black faces amidst the devastation, she muses, "You can say either, 'Look what these animals have done to the neighborhood,' or 'Look how people are trying to survive amidst the conditions in which they find themselves.' " Those who blame the victims of blight and uprooting remind Justa of an old Jewish joke: "Rabbi, why is the sea so salty...

...Where electoral contests have been turned into referenda on subsidized housing, as in Continue's challenge of Council Member Messinger, people ought to turn out to defeat the zealots resoundingly...

...The craving for those substitute trappings, and the semblance of "acceptance" they bring, cripples concern for the dilemmas and experiences of those cast out of the market altogether...

...For even though a renovator's scramble to stay in place often brings out the heroic strengths of early * Senator D'Amato's pressure on Housing Secretary Pierce was finally offset by the City late last year...

...They imply that the poor were to blame...

...Job-seeking minorities, last hired and first fired, bore the brunt of this rent gap...

...The remaining rental stock is bid up too high for people who can barely afford their present rent, let alone make co-op downpayments...

...But the essence of gentrification is the opposite: not only will tax deductions build no additional units...

...Because, along with declining real income, redlining was devastating their old neighborhoods...

...They threaten the zealots, because they uphold the possibility of an economy and a society in which the zealots' desperate scramble might not have to be made, in which the extremes of heroic escape from the gutter and pathetic immersion in it would dissolve...

...Attack us with their crime, filth, and projects—insult us by giving neighboring property we've made valuable to people who've done nothing to earn it and won't even maintain it—and you'll drive out the only hope of revenue and stability the City has...

...Learning that one of the young professionals has been living on the block for ten years, the hostess trumpets, "You're really one of the pioneers...

...Even as it recoils from them, it winds up entrenching itself behind them and in effect ratifying them...

...Before her first year is out, our hostess will probably have to take a stand...

...By assuring high-income families they will not be outnumbered [the Times noted] the plan should make these sites attractive to people who have the choice to move elsewhere...

...And to be fair, the newcomers' dilemma is profound...

...The war for new homeowners' loyalties is all out, its Donnybrook every proposal for housing subsidies—no matter how modest or enlightened— developed by community groups with broader constituencies...

...For years we've been told that the emphasis on aspirations and intangibles at the expense of the "real world" is the problem of the left...

...Without apology, the West Side's Committee of Neighbors to Insure a Normal Urban Environment (Continue) sued the federal and city governments in 1971 and again in 1979 over one of the low-income urban renewal sites, 170 charging literally that the poor are hazardous to the environment under the terms of required environmental impact statements...

...THEY GOT DOWN TO BUSINESS: D'Amato had Ronald Reagan's Housing and Urban Development Secretary Samuel Pierce (himself a middleclass black resident of the West Side) delay long-expected concurrence with the urban renewal plan, developed by the community board over months of laborious compromise, supported by all local elected officials, passed unanimously by New York City's Board of Estimate, and sustained against Continue in all the courts...

...It leant a fevered, boosterish quality to yearly local housing tours...

...Continue may bring suit...

...So the tax code dictates that early pioneers and small landlords in a "gentrifying" neighborhood will be joined by developers and promoters, some of whom engage in arson and thuggery to empty whole blocks for conversion...

...As housing analyst Rolf Goetze illustrated in the January 1981 issue of Working Papers, even a modest $30,000 co-op with a 20 percent downpayment ($6,000) and $500 monthly costs really comes to only $367 a month after tax deductions for a family making around $25,000...

...For owners, by contrast, property is appreciating, and when it's sold the profits may be largely tax free...

...The point is that even were tenant behavior exquisitely "civilized," the flying wedge of blight would continue...

...By the time the City gave its formal approval to the West Side plan, hostility to subsidized housing in privately marketable areas had reached such a pitch that Continue's Eugene Halpern could tell a reporter, in a vulgar appropriation of the Holocaust, that he and his members were sick and tired of being "the human lampshades of subsidy...

...and hence their blindness to the violence of speculators who send poor tenants packing on cold winter nights...

...for all who come into the marketplace with willing hands and open hearts shall be saved...

...Surely more low-income people had been thrown out of their homes by the final predatory stages of disinvestment, like milking and arson, than by upscale rehabilitation and its conceits...

...winning credit entails sustained and assiduous promotion of the neighborhood, in which enormous credibility is attached to the subjective preferences and fears of potential middle-class investors...

...ironically, we give away millions to high-income people who can deduct most of the cost of local property taxes from their federal returns anyway...

...Hence their inability to respond warmly to real dignity, wherever it is found across class lines, without fear of degrading themselves...

...But she's determined to take charge of her confusing new environment and, with professional skills and "can-do" bravura, she probably will...

...That put a stop to the easy credit investors had used to finance the routine resale of buildings from their right hands to their left (under dummy corporate ownerships) for tax deduction purposes...

...But what hurt housing even more, O'Hanlon argues, was the banks' withdrawal of credit from whole minority neighborhoods...

...Such solutions, of course, require political organizing that goes beyond litigation and logrolling...

...Fran Justa of Park Slope's Fifth Avenue Committee sees it differently...

...WHATEVER IT MAY have been at first, gentrification is now one of the saltiest currents in the ocean...

...New taxes on deliberately inflationary paper resales, as the one passed by the District of Columbia, would produce more revenue and reduce speculation...

...As the new militants marched on the mayor's residence at Gracie Mansion in 1980 to demand that the plan be killed, inflation and real estate conversions marched up Columbus Avenue, reinforcing the crusaders' view of reality...

...After all, the militant gentry declared, we're recreating the tax base from which the poor's housing comes...

...The zealots may think of living on welfare and playing bingo with one's shelter allowance as a kind of holiday, rather than the imprisonment it surely is, because they are caught bitterly in a kind of imprisonment of their own, more constraining than the "mortgage-poverty" homeowners willingly complain about...

...Now that the City of New York, for example, turns out to have been losing 20 white people an hour for the past ten years, some of those involved in the contrary whitening of its brownstone neighborhoods are pressing their demands with an urgency and self-importance that surprises even wizened politicians and bureaucrats accustomed to the clamor of neighborhood groups...

...Why not turn working families' rental apartments into overpriced shoe-box co-ops, when the tax code makes it so tempting for upscale people to buy them as a hedge against inflation...

...This in turn entails a clash of cultures even when low-income people cannot be accused of crime or disruption...

...In a fascinating doctoral thesis for CUNY's Department of Environmental Psychology, Timothy O'Hanlon first cites Columbia urban planner Peter Marcuse's discovery that the median rental household income in New York City fell a whopping 26 percent in the years 1969-77, while rents rose an average of 20 percent, consuming almost a third of income by the decade's end...

...We find the answer less in any threat the poor pose than in the pressures the zealots themselves experience...

...But why the venom and near-hysteria of those who ride it, who have time and market forces on their side...

...It has taken a long time for good sense to make itself heard above the din...

...Because these landlords couldn't finance the sales under redlining, they now had to get from the rent roll what had previously come from inflated resale and the consequent renewed depreciation allowances and capital gains...

...To squeeze the rent roll, they had to cut building maintenance and seek welfare tenants, whose shelter allowances at the time were allowed to exceed regulated rent ceilings...

...Municipal property tax give-aways for luxury rehabilitation, however, as New York City's J-51 program, should be restricted...