Housing for the Poor

...And at the moment one wishes to be most critical, one is stopped by admiration for this wilful, obstinate man determined to accomplish what he believes is right—even in the face of a Congress that is unfriendly to housing expenditures, and from whom he hopes to extract a tax increase...

...the bitter conflict over land re-use that rages between the divergent interests of owners, tenants, local leaders and their groups...

...American cities have no funds for solidifying their own land reserves, and the President's message offers nothing in this regard...

...Indeed, how can the private sector take over public housing developments, where regulations governing tenant selection and income limits are established by statute...

...The President's proposals include a $20 million program to provide social services to public housing tenants, and another program of unannounced size to teach nonprofit corporations how to sponsor moderate-cost housing developments...

...Despite the current enthusiasm for home ownership by the poor, no one believes that new one-family homes can be built cheaply enough for their prospective owners...

...In New York a similar program—the Limited Profit Housing Company—was widely attacked by the State Investigation Commission, which alleged, on somewhat flimsy evidence, that exorbitant fees were paid and high costs incurred in the construction of middle-income housing developments...

...It is financially generous, measured by any previous standard...

...Whatever the reason for selecting the target figure, several statements can be made about it...

...No one seems to remember that private industry has always been free to build rental housing for poor people...

...Nonetheless, of the 300,000 Federally-assisted units that the President calls for in 1968, only 75,000 would be in public housing developments...

...Right or wrong, the traditional view has been that private landlords are mean, cruel, vicious and contemptuous of their tenants...

...Most housing students welcome this rational approach...

...the paucity of assistance to redevelopment at modest rent levels—all these problems, added to the high cost of land, have limited the usefulness of the urban renewal program for moderate-cost housing...

...Similarly, the economic attraction of constructing one-family homes is that the builder gets his money when he sells the house (with the help of a large mortgage, frequently government-insured...

...Private industry would build the other two million units aided by little more than mortgage insurance from the fha, but drawing on at least one new pool of private capital funds that the President envisages...

...Was the goal picked because it represents the maximum amount of money the President can secure from Congress...

...Wage differentials in Europe between the building trades workers and other workingmen are not so steep as in this country', so that the power of these trades does not price so many other workers out of the shelter market...

...Without such a system in America, low-income housing requires implausible levels of subsidization if it is to take care of the poorest families...

...President Johnson's 1968 program, if substantially adopted by the Congress, will not overcome the great difficulties that obstruct American housing possibilities for low-income families...

...Another 90,000 units would be included in an expanded "moderate income" family program, made possible by special subsidies to lower the effective mortgage interest rate...

...yet it insists romantically on a new "involvement" of private enterprise...

...Frank Kristof of the City's Housing and Development Administration...

...His responsibility is over...

...The President also praises the "turnkey" program, an alternative to public bidding that has lately been authorized and used in several cases...

...instead, under a negotiated arrangement a private builder agrees to sell his development to the Housing Authority when he has completed it...

...First, as the President stated in his message, the figure is three times the number of such units actually started in 1967...

...Seeking to ward off further criticism, the supervising officials of this program have increased their review procedures to the point where non-bid subsidized construction is as slow and cumbersome as public letting—if not slower and more cumbersome...

...or that the Congress will make gifts of new homes to selected citizens...

...It was clear years ago that many friends of private enterprise would never be able to reconcile themselves to public ownership of homes...

...Further, a system of cash family allowances flattens the difference in family income...

...Why have America's industrialists managed to support a high standard of living in other areas, but failed so badly in the provision of shelter...

...The homogeneity of a working population not only eases the economic problem, but probably also eases the local political problem of finding sites for developments without stumbling over the inflamed wrath of homeowners...

...This, like the absence of serious color differences or language problems between tenants, simplifies the adaptation of rural families to urban and suburban housing developments...

...Compare this puny progress with the achievements of American productivity in other, less vital areas...

...Because it seems a reasonable approximation of the land available for these homes...

...This presages the management of publicly-owned developments by private real estate firms...

...Conceivably one day—after the development of a scheme of universal family allowances?the necessary subsidization will be better apportioned...

...This adds up to 337,500 units—for some reason not the 300,000 the President mentions when speaking in general terms...

...For the rest, he urges the nation to look to the private sector—though, as we shall see, the distinction between public and private is unclear...

...harder to build for poor large families...

...Some builders might be helped by state and municipal subsidy programs...

...Few private firms specialize in the management of low-rent properties...

...One would be right to suspect that the most homogeneous European countries?Denmark and Finland perhaps—have come closest to solving their housing problems...

...Areliance on one-family home ownership and private investment in rental property would run counter to the Northern European experience...

...But how, over the long term, will their new owners keep them from deteriorating all over again...

...Even more interesting is the President's suggestion of a "turnkey" program for the operation of publicly-owned housing...

...The Administration, like many other powerful voices in the housing movement, seeks to blur the unsuita-bility by talking blandly about "non-profit" enterprise, as though the philanthropic impulse that runs hospitals and universities could be adapted to the grubby business of owning rental developments...

...THINKING ALOUD Housing for the Poor By Roger Starr President Johnson's 1968 Housing Message, sent to the Congress on Washington's Birthday, combines all the elements that typify this best of times, this worst of times...

...In Britain, the tradition of hereditary tenure has limited land speculation with some of the same results...

...Scandinavian and German housing programs, in particular, owe their existence primarily to well-established municipal land programs...

...Nevertheless, the fact that larger sums of money may be available now will make a substantial contribution...

...In New York City, for example, the value of land suitable for Limited Profit Housing has risen more sharply since 1956 than any other single component in the cost of these structures, according to a study by Dr...

...One can never be sure who is speaking, the dustbowl frontiersman vowing to end his neighbors' suffering, or the Panhandle oilman slicking through a deal...

...The President's message, although far more generous than any of recent years in this field, makes the oldest of housing homilies painfully clear once again: It is hard to build for poor families...

...It depends realistically on vast government intervention in the housing market...

...There privately-owned, non-cooperative rental housing plays a very small role, and one-family home ownership plays no role at all...

...An increasing number today earn less than enough for the proper maintenance and operation of structures, even if the capital costs were reduced to nothing...

...Some abandoned or deteriorated homes in certain cities can be rehabilitated for low-income family ownership at a cost the government may subsidize...

...They would generally accept Johnson's statement that 26 million dwelling units must be produced in the next 10 years to keep pace with population growth and the march of obsolescence...

...It is tragic that many others who might have supported the public ownership program have been persuaded by an inadequate analysis of the housing problem, that faith in private ownership is more realistic...

...Whatever the shortcomings of public housing, it has been free of important scandal on the construction side...

...progress...

...A rent supplement program, presumably "estricted, as is the present rent supplement program, fo special developments erected by non-profit or limited-profit companies would account for 72,500 units...

...More realistic still would be an understanding of how private ownership works—and how it doesn't...

...On the contrary, like the nation's armaments and spacecraft, public housing is built by private contractors operating under the oldest form of government-private industry collaboration: competitive bids on fixed plans and specifications...

...Precisely because the costs of servicing individual tenants and of maintaining complex mechanical systems are rising precipitously, the private real estate industry seeks ways to shed these chores...

...Smaller bathrooms, exterior drains, simpler heating systems, less elaborate fire escape precautions and limited elevator use all reduce the need for expensive materials and sub-assemblies...

...Unleashing private enterprise to do what it simply cannot do, promises distraction rather than performance...

...in the provision of decent housing for low-income families...

...The least homogeneous nations (Italy, for instance, with its sharp North-South differences) are still struggling with problems quite familiar in America...

...Urban renewal is essentially a land program—intended to make central city land available through Federal subsidy for useful redevelopment...

...What is wrong with the nation's housing performance...

...If the President gets the legislation he asks for from Congress, the average annual rate of 2.6 million units will be attained gradually, with 2.35 million being built in each of the first five years of the program...

...Remarkably enough, this Presidential Housing Message opened with a numerical measure of the nation's predictable housing requirements over the next decade...

...Some of this insistent self-questioning pervades the President's message to Congress, and in response he has come up with a simple "realistic" answer: Low-income families lack decent housing because private industry is not now providing it...

...The total interior floor space per family is considerably less in Europe than appears acceptable in the United States...

...The President is not alone, though, in believing that the experience of home ownership helps to stabilize the character of underprivileged Americans...

...An interest subsidy, to enable lowincome families to buy their own homes, would provide 100,000 units...

...It does not exercise this freedom only because building for the poor is about as promising an enterprise as peddling rosaries at Gros-singer's...

...But its good start does not mean "turnkey" will still be on the track after newspapers realize that it offers a guaranteed bailout to a private builder, with a non-competitive rate of profit based on costs that are difficult to determine accurately...

...Yet the political and human difficulties that spring up from the attempted re-use of land on which people are living...

...Like the majority of current rhetoricians, the President probably thought he was being most realistic precisely when he sounded most romantic...

...One hopes that time will not be wasted in attempting to use private enterprise for a part of the program—the ownership and operation of low-income rental developments—to which it is at present not suited...

...second, it is not likely to be achieved...

...Why does Europe have a much better record than the U.S...

...If private enterprise is to own rental homes for the poor, it will have to be subsidized on a scale which is thus far politically unthinkable...

...yet it is not generous enough for the present need...

...The television industry, starting from scratch only 20 years ago, has equipped just about every American family (including those on welfare) with at least one TV set...

...Third, lower European technological expectations make tolerable a meaner standard of interior space in working class or lower-middle-class dwellings...

...It is impossible to tell how the goal of 300,000 housing units for low-income families was selected...

...the most humanely operated low-income rental apartments not in public hands are far more likely to be small buildings with resident owners...

...Turnkey" describes a government-private industry relationship in which there are neither fixed plans and specifications nor public bidding...

...A second major difference between Europe and America results from the wage structures in the countries where housing programs have been successful...

...But the cities are given no instrument with which they can control the rise in price of vacant land, or use the rise for public benefit...

...starts, however, only 300,000 would be low-income housing aided by the Federal government through one form of subsidy or another...

...Or because 300,000 is the largest number that can realistically be cranked through the city government and Department of Housing and Urban Development approval mills in one year's time...

...Would "turnkey" satisfy the sense of propriety...

...One prime consideration is the American insistence on a free market in urban land, and the lack of a national policy to keep the price of that land low for public purposes...

...Four other factors that distinguish America from Europe in the housing field are far more important than the alleged underactivity of the private sector in slowing down U.S...

...In urging increased dependence on the private sector, the President cannot mean that public housing is constructed without private participation...

...In the meantime, government ownership seems to provide the most nearly satisfactory answer to the urban low-rent housing problem—a fact that is not refuted because some public housing developments are outright failures, and many, if not most, are architecturally disappointing...

...Of 1968 Roger Starr, author of The Living End: The City and its Critics, is the Executive Director of the Citizens' Housing and Planning Council of New York, Inc...

...over the long run, this might be a wiser investment...

...More and more residential buildings are being built as cooperatives or condominiums, which give the entrepreneur a capital gain when they are sold and also free him from the operating difficulties that follow occupancy...

...Yet there is little evidence that private real estate firms have some special competence for dealing with low-income tenants...

...First reports praise the speed and flexibility of this procedure...

...third, even if it is achieved and sustained over a long period, 20 years would pass before the nation's 6 million substandard housing units were replaced, and then only in the unlikely event that no further units deteriorated to the point of substandardness during that time...

...and hardest to build for the poorest large families with the most destructive habits...

...The President then made an effort to tailor his 1968 legislative request to one-tenth of the 10-year need...

...Why should the poor be asked to cut down their day-to-day living expenses in order to protect an investment in real estate...

...Increasingly, too, builder-investors are concentrating on office building construction and ownership because commercial tenants complain less than housewives and never go on rent strikes, unless they happen to go broke...

...Fourth, the smaller size of European countries minimizes the distinction between rural and urban living...

...It is too bad that some money cannot be spent to teach public housing authorities to do their job better...