“An interesting lacuna to America’s mostly market-oriented economy is building houses. Most of the population lives in places where this activity is subject to a comprehensive regime of central planning, which states and which parcels of land can have houses built on them, what the minimum size of a parcel is, how many dwellings can be built on a given parcel (typically just one), how tall the building can be, how much yard space and parking there needs to be, etc.
Some of the regulation of house-building is about safety — electricity needs to be up to code and sewage needs to be able to be disposed in a responsible way. But most of it isn’t. There’s nothing unsafe about a 12-unit, four-floor apartment building — it’s just illegal to build one in most places. Building rows of houses that share exterior walls is a space-efficient and cost-effective means of creating single-family homes, but it’s illegal to build them in most places. Big, shiny condo towers only make sense in places where land is very expensive, but there are some parcels of very expensive land where it’s illegal to build them.
These rules profoundly shape the built environment in almost every American metropolitan area.”
“The centerpiece is simple. Take America’s biggest rental assistance program — Section 8 housing vouchers — and make it available to every family who qualifies. The current funding structure leaves out around 11 million people, simply because the pot allocated by Congress is too small. Then pair it with regulatory changes to help the housing market work better for more people. It’s the general consensus approach among top Democratic Party politicians and left-of-center policy wonks.”
“because key provisions would be eligible for budget reconciliation treatment, which would require a majority vote in the Senate instead of a supermajority, it’s the kind of thing that really might happen in 2021 if Biden won.”
“the government gives low-income people vouchers that landlords can redeem for money and lets them rent whatever kind of house someone will rent to them. Since the voucher program, when created, became Section 8 of the US Housing Act of 1937, the vouchers have come to be known as Section 8 vouchers.
The Center on Budget and Policy Priorities estimates that more than 5 million people receive help from the program.
It has various flaws, including, most notably, the widespread discrimination against voucher tenants that Stephanie Wykstra has written about for Vox. Another huge flaw is that that, unlike Medicaid or SNAP — which, at least in theory, provide benefits to everyone who meets the eligibility criteria — Section 8 is capped in the amount of money available to it by the whims of Congress. As it stands, about three-quarters of eligible people don’t get the help because there simply isn’t enough money in the pot, which is a huge missed opportunity to improve the lives of millions of Americans.
CBPP data shows that receipt of housing vouchers leads to a decline in children experiencing separation from their parents, a decline in domestic violence, a decline in food insecurity, and, most of all, a steep decline in housing instability.”
“When land is expensive and demand for housing is high, the natural market response would be to build denser structures — townhouses or mid-rise apartments or even big towers — so as to spread the land cost across more households. The origins of these zoning rules were intimately connected to now-forgotten segregation battles in the first half of the 20th century, when the Supreme Court rules essentially that cities couldn’t formally exclude Black people from certain neighborhoods but they could try to exclude all low-income people and count on economics to do the rest.
Later, redlining policies excluded Black neighborhoods from much New Deal housing assistance, depriving Black families of wealth-building opportunities and creating pockets of poverty and exclusion that persist today.
Handing out money to those in need helps the problem on one side, but breaking down the zoning barriers on the other is important as well. Biden picks up a proposal from Sen. Cory Booker and Rep. James Clyburn to require localities that benefit from Community Development Block Grants or Surface Transportation Block Grants to develop plans to change zoning rules that block development of more housing types.
While expanding vouchers is a straightforward liberal pitch, changing exclusionary zoning involves more complicated politics. Many of the most exclusionary places in America are affluent inner-ring suburbs of big coastal cities — places that these days send Democrats to Congress, but that presumably don’t want to be made to change their zoning rules. The potential good news is that, conceptually at least, liberalizing regulation is something Republicans might support.”
Policy Basics: Federal Tax Expenditures 11 18 2019. Center on Budget and Policy Priorities. https://www.cbpp.org/research/federal-tax/policy-basics-federal-tax-expenditures The biggest U.S. tax breaks Drew Desilver. 4 6 2016. Pew Research Center Estimates of Federal Tax Expenditures for Fiscal Years 2019-2023. 12 18 2019. The Joint
“Landlords may start to feel the fallout, too, specifically those who rely on that rental income to pay mortgages or utility bills. Landlords may have more resources — they own a valuable asset in real estate, after all. And the CARES Act, the $2 trillion coronavirus stimulus package passed by Congress late last month, offers landlords forbearance on federally backed mortgages during the crisis.
But forbearance is also just a postponement of payment, and many can’t kick the can down the road too far, Cunningham said. “So with landlords being unable to pay their mortgages, then you have lenders essentially not being able to pay out their investors in mortgage-backed securities, so the whole entire housing system is connected.”
That could have broader implications for the economy, as anyone who lived through the 2008 financial crisis might remember. And while many advocates say this shows exactly why the US for-profit housing system is so broken, that system also likely isn’t going to change before the next rent payment is due.
Which is why, at least for the short term, policy experts say governments need to provide more robust assistance to keep people economically stable and in their homes in the first place. Some experts suggested that housing subsidies or really just more cash would ease the financial burden, so renters don’t have to choose between paying rent and buying food.
The $2 trillion stimulus package helps, including by increasing unemployment benefits and by offering many American households one-time cash assistance, which for households making $75,000 or less per year comes out to $1,200, with additional money for kids.
But that might not be enough now, and definitely not enough a few months from now, given the unprecedented economic crisis. Cunningham said she thought Congress missed an opportunity to fully give people what they need to get through the crisis. “A $1,200 stimulus check, particularly in high-cost areas where the pandemic is most concentrated like New York City, San Francisco, Seattle, is not enough to pay the rent,” she said.”