Financing Affordable Housing in California
Part I in this series about the failure of Senate Bill 50, laid the groundwork for understanding underlying causes of un-affordable housing. As noted in that article, our “affordability” issues are not unique to housing nor to the State of California, and are, ironically, less acute in our major job centers than in places we generally think of as being more affordable.
In prior articles, I’ve examined why an increasing percentage of our population is having a harder time making ends meet, not just for housing but for food, education, healthcare, and everything else, and how the socioeconomic institutions that are driving these trends are leading to increasingly dire prospects for our financial markets, taxpayers, and our planet.
The data presented leads to an undeniable conclusion. If we really want to address housing affordability, we need to broaden our thinking. To focus on planning and zoning may seem obvious, but it’s precisely the wrong place to look for solutions.
Public policy by catchy soundbites is popular these days, but its “solutions” are dumbed-down to the point of being dangerous.
As H.L. Mencken once said,
“There is always an easy solution to every human problem - neat, plausible, and wrong.”
Endless bickering
The public discussion about affordable housing has become extremely difficult because it has devolved into nonsensical talking points, racist tropes, and distortion of data by state senators and high-paid housing advocates. All that is being offered to us is what I’ve termed the “madman theory” of growth, planning, and development.
But, contrary to what is politically fashionable to believe, our current “affordability” problems are predominately an income and wealth inequality problem, not a housing problem. They are a result of subsidizing investment returns at the expense of wage earners and prioritizing the interests of corporations over individuals and even local government.
This is principally driven by national and state income and revenue tax policies. The naïve deconstruction of our progressive income tax system, since the 1980s, combined with endless jerry-rigging of official inflation statistics and interest rates, since the 1990s, has contributed to the situation we are witnessing today.[1]
So long as we continue to allow financial and corporate interests to offload the burdens of their growth and their single-minded search for increased profits onto local taxpayers (the costs of schools, infrastructure maintenance, roads, public services, environmental preservation, etc.), our lack of “affordability” will only get worse.
Similarly, the more the state focuses on sucking private capital into its coffers by increasing taxes and fees to fund top-down “solutions” by inefficient, state mega-agencies, the less affordable it will be to live in California.
Today, affordable housing has little to do with planning and zoning and everything to do with addressing how to finance it by creating tools and incentives to tap private capital for public good.
-more-
