Marx and the Affordable Housing Crisis

A quarter of a million Americans work but go homeless -- and many more workers are just a few bills away from homelessness.
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    In a Friday, Jan. 11, 2013 photo, Cindy Edlund, left, and James Franklin Jr., both of whom are homeless, spend the day on a bench outside the Sarasota City Hall Friday, Jan. 11, 2013, in Sarasota, Fla. (AP Photo/Chris O'Meara)

    In a Friday, Jan. 11, 2013 photo, Cindy Edlund, left, and James Franklin Jr., both of whom are homeless, spend the day on a bench outside the Sarasota City Hall Friday, Jan. 11, 2013, in Sarasota, Fla. (AP Photo/Chris O’Meara)


    Imagine after a long, hard day at work – perhaps at an Amazon warehouse out in California’s Inland Empire, a McDonald’s in New York City, or a Walmart outside Memphis – you head home for a little rest and relaxation. After all, that’s what people do – go home at the end of the day to enjoy their off hours with family, friends, and all the comfort, safety and security that the very word ‘home’ entails.

    For far too many Americans, however, that refuge at the end of the working day – home – doesn’t exist. Or, if it does, it exists more as an abstract concept constructed out of a series of temporary dwellings cobbled together out of couch surfing with friends, the occasional stay at a homeless shelter, or even the family car. For these approximately quarter-of-a-million Americans, or about forty percent of all American homeless, full-time work does not translate into a permanent domicile in which they can rest their head at night.

    Out of a country as large as ours – some 317.3 million people at last count – a quarter of a million people who work but nonetheless go homeless does not seem, at first blush, a lot to be concerned about. They barely register as a statistic and account for much less than one percent of the population, but taken as a whole they could fill a small city. Imagine a place like Cincinnati, Ohio, St. Petersburg, Florida, or Boulder, Colorado filled entirely with people who work but yet have no place to stay at night and suddenly what seems very small becomes suddenly much larger and more human, too.

    It almost seems inconceivable that there could truly be that many people in America – enough to fill one our small cities – who work full-time but are still homeless. Yet, according to a recent report put out by the Center for American Progress, they exist. Moreover, the very fact they do points to a much larger group of people who may not be homeless as officially defined by the Federal government, but are nonetheless just a missed paycheck, unpaid medical bill, or some other domestic calamity away from being on the streets.

    Given that a quarter of all renters – who tend to be younger, poorer, and persons of color – spend at least 50-percent of their already low incomes on housing – the official definition of housing insecurity – that’s at least 23.5 million people who are but one or two problems away from homelessness. Clearly, the problem of working homelessness and near homelessness – economic insecurity on a vast scale – is a major issue and a glaring deficiency in not only the American social safety net but our system of market capitalism, too.

    Taking the second issue first, there is obviously a huge, pent-up demand for low-income housing in this country. Yet since the 1970s the ratio of low-income housing units to low-income householders has shrunk dramatically.  Then, there were 300,000 surplus low-income housing units nationwide, meaning there were more units available than those seeking them. This, not unnaturally, created a situation conducive to low rents that helped make housing at least somewhat affordable for even the poorest amongst us. Today, however, there is a deficit of 5.3 million units of affordable housing.

    This glaring shortage has many causes. Among them, most importantly, has been a decline in real wages – especially for those at the bottom – which began at about the same time as the permanent affordable housing crisis. Not surprisingly, when wages fail to keep pace with the cost of living, all else being equal, less of something will be bought – and that has often turned out to be long-term housing. In turn, lack of demand – caused by impoverishing wages – has led home builders – who care about profits not housing people – to focus their efforts on building the profitable, middle-class suburban houses, townhouses, and condominiums that fewer and fewer people could actually afford.

    Indeed, the housing bubble can in many ways be explained as a response to this low-income housing crisis amongst the nation’s working poor. Instead of providing higher wages so the poor could then afford to purchase stable housing, our economy instead financialized the problem through an immense credit bubble that allowed the working poor and the strapped lower-middle class to take on debt and housing in exchange for an increase in real wages. When that proved unsustainable – as it obviously was to any who was looking at objective facts – the system crashed.

    So, the collapse in real wages is a major long-term issue at work in the housing crisis. Another important factor is what sociologists call NIMBYism. NIMBY – short for ‘Not in My Back Yard’ – is a situation where locals often organize to protest and politically block the construction of costly infrastructure projects, environmental hazards, aesthetic eyesores, or socially undesirable development – like low-income housing – where they live. Typically, blocking tactics are most often used not by poorer cities to push through or otherwise shape development in their favor, but by politically-powerful and property-value conscious middle and upper-income suburbanites who effectively use it to protect their housing investments and local quality of life.

    While sometimes good intentioned, very often the effect of these various land-use regulations is to literally crowd out or make impossible the construction of low-income housing of the type so many desperately need. As a result, developers – through local zoning and land-use laws – are often directed by local governments to build sprawling, car-dependent communities consisting of large, single-tract homes that are far away from both jobs and public transport. This has the perverse effect of enriching and protecting the very type of development least conducive to economic affordability, efficiency, and environmental sustainability and creates and sustains a strict system of economic segregation between rich and poor.

    Finally, one should also point out that Federal policy also has a huge impact on housing affordability. As recently demonstrated by the Center on Budget Policy and Priorities, Federal housing assistance is overwhelmingly directed towards homeowners, who typically are older, whiter, and richer. By their count the Federal government provides four times as much housing aid, either directly or indirectly through tax breaks, to households making $200,000 or more than households making a combined income of $20,000 or less.

    This means that out of the $270 billion targeted by the feds to help people with housing, only $67.5 billion actually helps people in serious need – the rest is effectively wasted on much wealthier homeowners who don’t actually need the assistance, but have the political pull in Washington to keep middle and upper-income housing assistance politically sacrosanct. What’s more, since most of this assistance comes in the form of tax breaks, credits, and other invisible forms of assistance as opposed to a monthly check, it isn’t seen as assistance – or welfare in the vernacular – at all, and so doesn’t receive the social stigma that comes attached with receiving benefits from the government. Yet, by any economic definition or analysis, that’s exactly what it is – welfare, only for the rich and middle-class instead of the truly needy and working poor.

    All this should come as no surprise, of course. It’s been said that democracy as practiced in the West is little more than the organizing committee of the bourgeoisie, and in every case – from tax policy to trade policy and from local land-use laws to transport and housing policy – that seems to be the case. Corporations and the wealthy dominate every facet of our political system so thoroughly that Marx himself would be surprised by just how dominant they have become.

    The great trick of the past century has been to convince hundreds-of-millions at home and abroad through propaganda, rising living standards, divide-and-conquer culture war, and the circus of modern life that they, too, were at least nominally part of that organizing committee. Economic reality, however, indicates something very different, and the large numbers of our fellow citizens who are just a missed paycheck or two away from the streets are starting to realize that. What happens after that is anybody’s guess.

    The views expressed in this article are the author’s own and do not necessarily reflect Mint Press News’ editorial policy.


    The views expressed in this article are the author’s own and do not necessarily reflect Mint Press News editorial policy.

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