Crises, crises, everywhere? So many, we can barely keep track of them all. So many, those "du jour" crowd out others, until the merry-go-round changes what's in front of us.
Today I revisit the housing "crisis," thanks to two bits that recently crossed my consciousness.
First was this short (66 second) video that reviews the differences between housing in San Francisco and Austin, two cities with similar populations (809K and 980K). Housing prices in the City By The Bay keep going up, while those in Bat City are going down. San Francisco lost 62K residents from 2020-2023, but has been fairly flat the last couple. Austin, on the other hand, saw its population inch upward these last four years.
Why the disparity between population trend and home price trend? As the video notes, bureaucracy. It's much easier to build new residential units in Austin, government-wise, so Austin added 32K units in 2024, vs 6K in San Francisco.
I'm sure you're shocked, shocked! to learn that the housing crisis is due, at least in part, to big government. I'd digress into the prime culprit that is rent control, but I've already covered that many times, including here. I've covered the government's culpability before, including here, but there's one new-to-me aspect of this crisis that needs highlighting.
Especially given that Trump's Presidency has reopened discussions about whether some government agencies should even exist.
The reflexive response from the contrarians is a presumption that a government agency dedicated to a particular issue is Doing Good, and that things like funding gay operas in South America are outliers in broadly Good-For-The-People efforts. Such naïveté would be charming if it were not so frustrating and obstructionist.
Behold, the new-to-me bit, from of all places Jacobin Magazine: A reminder that government's efforts at urban renewal and at helping the poor destroyed* more housing units than those efforts created.
The reality was that urban renewal resulted in the demolition of hundreds of thousands of units of low-cost housing that were deemed obsolete and not worth keeping around. It resulted in massive displacement of people of color in central cities across the United States. It was so associated with the displacement of blacks that James Baldwin memorably called it the “Negro removal program.” You saw it being deployed in neighborhoods that were primarily inhabited by very low-income people but people of color as well. It ended up demolishing more housing than it built, and it ended up generating a significant amount of political resistance after about ten or fifteen years from residents of these neighborhoods who saw the track record of urban renewal in other cities and realized that this was endangering their living in the central cities and their ability to remain in communities that they valued. -- Edward Goetz
Economist Martin Anderson pointed this out back in 1962, in his book The Federal Bulldozer, and we should not consider it a coincidence that minority populations started the transition from economic ascent and strong nuclear family to permanent underclass status and fractured families around the same time (a special hat tip to LBJ's Great Society, which bears much of the blame).
Unfortunately, the Jacobins and other socialistic types still cling to the notion that public housing can be done right. The reality of decades of government-built housing is dismal. Half a century ago, urban planners designed housing projects with the goal of fostering a sense of community. Tightly clustered apartments ringed large common spaces that were supposed to promote interaction and friendliness. Instead, those common spaces became danger zones, controlled by the worst elements of society, residents huddled in their apartments, and those who had the means moved away. Projects, a grand experiment in behavior modification, proved to be a disaster that trapped and institutionalized many in poverty, and never produced the "community" they were meant to.
Real estate professionals know that those big projects are investment dead zones, offering little or no potential, so stagnation and decay remain the norm there.
The solution to the housing crisis is simple: Get government out of the way:
Transition away from rent controls and rent stabilizations.
Pare back building code requirements, focusing on keeping those related to safety while removing those related to non-safety matters.
Loosen zoning restrictions that hamper redevelopment and conversion of moribund manufacturing locales.
Convert public housing projects to private ownership, and get government out of that business. Jack Kemp proposed selling public housing units to their occupants for a dollar a piece.
Two things stand in the way: Ignorance and activism. Combined, they are a formidable obstacle to doing what works, in favor of preserving what shallow thinkers believe works and do-gooders believe should be done. Facts, empirical evidence, and basic logic have no place at their table, of course.
Which is why the "crisis" will persist in places like San Francisco, and why those pockets of crisis will be cited as proof of a national problem.
Milton Friedman, in this vid, believed that Agriculture, Commerce, Education, Energy, Interior, Labor, Transportation, half of Health and Human Services, and, germanely, Housing and Urban Development (HUD) should be abolished. He noted that HUD has done an enormous amount of harm, citing its destruction of "parts of cities under the rubric of eliminating slums." Or, perhaps "slums" - government is really cavalier about declaring poor-but-functional neighborhoods "blighted" when it wants the land people's homes sit on.
Argentina's libertarian President Javier Milei set out to trim his nation's ministry count from 18 to 9. America has 15 executive departments, and we could do just fine with a similar paring. Government's utterly abysmal track records at housing should make eliminating HUD a layup if people actually cared about improving housing in America. The persistent idea that problems can only be solved by government coupled with the countless vested interests that rely on Other People's Money stand in the way, so if we are to overcome that, we must continue to hammer home the damage that the do-gooders have done across the decades.
I shudder at the thought of the types of people drawn to work at HUD.
Darn Skippy! Every “public housing” I have worked on in the past or drive by currently is a hot mess of folks that have abandoned effort to succeed and appear to have given in to a minimal level of sustainability. Same thing at many reservations I’ve traveled thru as well. They don’t get that feeling of worthiness living free or low cost at and not striving to advance in a career. It’s truly keeping people down.