I remain hopeful that no matter how old you get you can continue to learn. It’s with that in mind that I should begin this article by noting that a number of our regular readers have chided me in the past for being too optimistic when it comes to the lengths that the current administration might go in reformatting America’s hard drive. I can think of several recent examples where I essentially dismissed the concerns of some of the commentariat, invoking a few different variations of, I’m not that concerned. They couldn’t seriously get away with that.
Allow me to take this opportunity to apologize. I was obviously wrong. It would seem that when it comes to the Obama administration, there probably aren’t any limits. I realized this when I saw an actual, Not The Onion article at The Hill describing a new initiative being unveiled by Barack Obama’s Department of Housing and Urban Development. They want to incentivise the “diversification” wealthier neighborhoods.
The Obama administration is moving forward with regulations designed to help diversify America’s wealthier neighborhoods, drawing fire from critics who decry the proposal as executive overreach in search of an “unrealistic utopia.”
A final Department of Housing and Urban Development (HUD) rule due out this month is aimed at ending decades of deep-rooted segregation around the country.
The regulations would use grant money as an incentive for communities to build affordable housing in more affluent areas while also taking steps to upgrade poorer areas with better schools, parks, libraries, grocery stores and transportation routes as part of a gentrification of those communities.
“HUD is working with communities across the country to fulfill the promise of equal opportunity for all,” a HUD spokeswoman said. “The proposed policy seeks to break down barriers to access to opportunity in communities supported by HUD funds.”
It’s a tough sell for some conservatives. Among them is Rep. Paul Gosar (R-Ariz.), who argued that the administration “shouldn’t be holding hostage grant monies aimed at community improvement based on its unrealistic utopian ideas of what every community should resemble.”
Normally I would assume this was the script to a bad movie being cranked out in the run up to the next election. I mean… they can’t be serious, right? But in fact they are. Now, to be clear, this doesn’t sound like a “mandate” in the sense that the feds will be coming in with bulldozers and shovels, knocking down single family homes and piling up towers of “affordable housing” in the empty plots while the displaced homeowners look on from their Obama Relocation Camp rail cars. (Well… not yet, anyway.) But plenty of communities – even formerly prosperous ones – are facing hard financial times and the prospect of a nice payday from Uncle Sam can sway a lot of minds on local city councils.
Grabbing on to that apple may carry a price, though. How would it impact the local economies, particularly in the real estate market? Our colleague Leon Wolf at Red State has some thoughts to share.
I am all in favor of the diversification of America. However, that is not what this policy will achieve or is designed to achieve. This is designed flat out to punish rich people for being rich and the ultimate result of this program may very well be the decimation of the real estate sector of the market. The plan essentially has two parts – the first is to spend money on improving poor neighborhoods by adding schools, libraries, etc. The second, however, seeks to move “affordable” (i.e., lower quality) houses directly into affluent neighborhoods.
The first part of this plan is likely to largely be a waste of money (if history is any indicator) but is otherwise harmless. The second, however, will have devastating economic and social effects. It is no secret to anyone at this point that a large part of what drives real estate cost is the quality of surrounding property. Wedging lower cost housing into expensive neighborhoods will not result in more minorities living in expensive neighborhoods – it will instead result in there being no such thing as an expensive neighborhood anymore.
Leon focuses on the economic fallout and it’s not a consequence to be dismissed. But on the cultural and political fronts there are other concerns to be addressed. The Eternal Race Card crowd will be quick to grab on to any objections raised to this scheme and begin the chant which says, you just don’t want black folks moving into your tidy white gated communities, you racists! And to be completely fair, taking only a brief glance at the unrest going on on some of the larger cities these days, there’s probably some concerns to be raised in terms of throwing gas on that particular fire. But the underlying reality is found in the difference between neighborhoods comprised of primarily single family homes and ones with predominantly rental properties. While it obviously doesn’t apply to everyone on either side, rental areas tend to be less well maintained. When you don’t own the property, you’re less likely to invest a lot of your time and money in caring for it. (This is the same as the common lore about how often people put high test gas in a rental car.)
When a community begins to suffer economically and rental properties creep into the single family housing areas, the general appeal of the neighborhood goes down and the property values follow. Increasing concerns over rising crime rates are generally not far behind. This isn’t some fictional theory out of a KKK handbook… I’ve watched it happen first hand myself. And it happens even in areas where the renters are primarily white or in more affluent minority communities as well. It’s not race dependent. This is just economic reality.
If I might humbly offer a bit of advice to the White House, this is the wrong approach. Offering incentives to ship large numbers of people out of impoverished communities and into more prosperous ones doesn’t change the people. It only changes the community. If you want to raise up the standard of living in areas afflicted with poverty, start with some leadership. Empower those working to effect positive change, emphasizing greater focus on the community, the churches and the family. Make the communities safer. Rather than tearing down the police, help law enforcement create an atmosphere where residents feel safe in investing in their homes and opening businesses without fear of being looted. Let them hire more people from the neighborhood. Help the parents feel that their kids are walking to school through a safe neighborhood, not a war zone. The best public empowerment program in the world is still a job. Push struggling communities up from the grass roots rather than shipping them out without addressing the underlying problems. This is likely a generational change and I don’t expect Barack Obama to snap his fingers and make it happen overnight, but he could take the lead and start the process today.
As to this plan for “reverse gentrification” under discussion, is this something we should worry about? HUD cant really do this, can they? There was a time (as recently as… last week) when I would have dismissed such a possibility as the fever swamp dreams of the paranoid, as I noted at the top of this article. Well… it turns out I was wrong. Welcome to the fourth quarter of the Obama administration. There are no limits and this is the new reality. Not only could it happen, it probably will.