Budget Cuts Endangering Innovative Housing Program

[NATO AIR]

This is a shame, but not surprising in the environment we're in now.

http://www.tnr.com/doc.mhtml?i=20050523&s=trb052305

Losing Hope
by Jonathan Cohn

Post date 05.12.05 | Issue date 05.23.05 E-mail this article

ot so long ago in a political galaxy that only seems far away, George W. Bush declared that he was a "compassionate conservative." The term would come to have various meanings, but one of its clear implications was that Bush cared deeply for poor people and would embrace innovative ways of helping them--particularly those initiatives that relied more on the private sector than the government.

If true, then a new public housing development in Boston would seem to be what he had in mind. For more than 60 years, several hundred people lived in Maverick Gardens Housing Project--a neglected, boxy set of buildings typical of the housing projects constructed across the United States after World War II. Owned and operated by the Boston Housing Authority, the old development seemed to breed crime and indolence--trapping the poor in concentrated pockets of poverty rather than helping them up the socioeconomic ladder, thereby evoking the worst stereotypes of big-government liberalism.

Today, bulldozers are turning Maverick Gardens into mounds of brick, rubble, and shredded ironwork. Most of the residents have moved across the street to the new Maverick Landing, which offers apartments in a colorful townhouse-style building, individual backyards, plus some spectacular views of the downtown skyline that lies across the harbor. While Maverick Gardens was limited to the poor, Maverick Landing is a mixedincome development, with 20 percent of the units set aside for renters who will pay market rates to the private developer that built the project. The Boston Housing Authority remains nominally in charge, but it leaves day-to-day management to a partnership between the developer and a tenants' association. In 15 years, the association will have the right to buy the buildings from the developer; in the meantime, residents can apply for federal subsidies that would allow them to buy their individual units.

If this sounds like a conservative's idea of what public housing should look like, that's because it is. New Maverick is a product of the Hope VI federal housing program, an initiative whose intellectual lineage traces back, in part, to Jack Kemp, the former Republican vice presidential candidate who was secretary of housing and urban development under President George H.W. Bush. Kemp believed the way to save public housing was to make residents more responsible for their own communities by giving them incentives to take control and offering them a financial stake in the projects' success. And that's exactly what Hope VI does: Rather than having government do the heavy lifting of razing old projects and building new ones, Washington merely puts up seed money. It's up to the tenants of the old projects, working with local housing authorities, to apply for that money. They can't get it until they've lined up a private developer and put together a convincing plan for managing resident services like security or after-school activities. Hope VI flourished under the Clinton administration--which, despite its liberal reputation, was no fan of old-style public housing. And today, its most ardent defenders include Republicans like Senator Kit Bond, who believes the program has done wonders in his home state of Missouri.

But guess which very important Republican doesn't like the program? Bush. His proposed budgets have tried to eliminate the program for two years running. Although Congress hasn't let him do that yet, he has already pushed down funding to a mere quarter of what it was at the height of the Clinton administration's investment.

This effort to destroy Hope VI is of a piece with another head-scratching Bush administration initiative that targets the Section 8 program. Section 8 gives public housing residents vouchers that they can apply toward rent in the suburbs or anywhere else they can find a willing landlord. This, too, would seem compatible with the Bush worldview. (It's a voucher program, after all.) But, in previous budgets, Bush tried to reduce its funding. This year, he has proposed making it a block grant, a move many critics believe is merely a more subtle attempt to cut it.

The administration explains its position by arguing that Hope VI has not worked, pointing out (correctly) that construction on many projects lags. But, while some cities have indeed done a lousy job of implementing the program, early signs suggest that cities like Boston are making it work. And, while the delays are indeed frustrating, they also reflect an original schedule that was overly optimistic, failing to account for the logistical and political complications inherent in trying to build affordable housing while simultaneously tearing down the existing stock. (Indeed, probably the biggest problem with Hope VI is one that the left typically raises: It destroys more units than it creates, leaving some residents out in the cold.)

Another argument you hear from the right is that, by segregating housing stock from the private market, Hope VI depresses local property values, retarding development in ways that ultimately hurt the poor more than forcing them to find housing on their own. But the very opposite may be happening in East Boston. The Maverick construction seems to have fueled a redevelopment wave all along the waterfront, where new luxury condominiums are displacing long-abandoned warehouses.

In any event, if Bush's real concern were that programs like Hope VI or Section 8 aren't doing enough to help people obtain affordable housing, then he would presumably reinvest the money saved through his cuts in more effective programs. But there's no sign of that. In fact, according to analysis by the Center on Budget and Policy Priorities, Bush's most recent budget proposals called for cutting the overall housing budget by between $1 billion and $4 billion next year (depending on how you count the different pieces, some of which would be shifted between Cabinet departments).

The best explanation for the Bush administration's housing proposals is sheer political expediency. Eager to show he could be tough on domestic spending, Bush decided to pick on politically weak programs that have only the poor as their constituency. (If public housing somehow subsidized the pharmaceutical industry, then, surely, funding would be less scarce.) Once upon a time, Republicans like Jack Kemp showed that compassionate conservatism isn't always a cynical ploy. Today, President Bush shows that, oftentimes, it still is.

Jonathan Cohn is a senior editor at TNR. He is currently writing a book on the U.S. health-care system.