Carson Plan: Deregulation to Promote Affordable Housing

Remember the old Point/Counterpoint segment on CBS’s 60 Minutes?  Two political commentators, a far right conservative
and an equally lefty liberal argued the merits or lack of a current
controversial issue.  Two recent articles
in the same issue of The National Review
were reminiscent of that feature – except this was two conservatives arguing
which parts of Ben Carson’s recent performance were more meritorious. They both
had their points, and both managed to entirely overlook a singularly important
one.  

The topic was the
Secretary of Housing and Urban Development’s recently announced plan to combat
the lack of affordable housing by taking on stringent local zoning and land-use
regulations.

The centerpiece article
is written by Michael Tanner, a senior fellow at the Cato Institute. He mentions
in passing some of Carson’s “missteps and misstatements” including the infamous
$31,000 dining table. But since then, Tanner says, “Carson has quietly pushed a number
of policy initiatives that could cement his legacy as one of Trump’s most
consequential cabinet members.”

These, the
writer says, include the elimination of Community Development Block Grants,
slashing some of HUD’s bureaucratic red tape, and showing a willingness to
adjust rents in public housing to “control the department’s ballooning
expenditures.” Tanner does not mention what the New York Times called the
Secretary’s attempt to scale back federal enforcement of fair housing laws, “freezing
enforcement actions against local governments and businesses, including
Facebook, while sidelining officials who have aggressively pursued civil rights
cases.”

But now Carson has set
his sights on local zoning and land-use laws, potentially, Tanner says, helping
millions of poor Americans.  “If
successful, Carson’s efforts could be some of the biggest boosts for the poor
and disadvantaged to come out of Washington in quite some time.”  

Tanner says these local laws were born largely out of racism
but have evolved into a tool for wealthy property owners to protect their
properties.  Laws that restrict the
supply of new housing drive up the cost of owning and renting beyond the reach
of many poor Americans.  “Studies show that such regulations
add as much as 20 percent to the cost of a home in Baltimore, Boston, and
Washington, 30 percent in Los Angeles and Oakland, and an astounding 50 percent
or more in cities such as San Francisco, New York, and San Jose”.

Traditionally HUD and other agencies
respond to increases in housing costs with higher subsidies. But this policy
mostly redounds to the benefit of landlords, Tanner says, so Carson has decided
to attack what he sees as the problem at its source.  He intends to link federal housing funds to
local officials’ willingness to reduce regulations that restrict affordable
housing.  This would ensure that, “if mayors and governors continue to pander
to wealthy special interests by enacting barriers to housing construction,
Washington will no longer bail them out.

Tanner says high housing costs are
an important factor in trapping millions of households in povertypreventing geographic mobility, and that zoning continues to be an important factor in
reinforcing racial segregation.  He credits
Carson with attempting to “strike a powerful blow on behalf of the poor and
vulnerable”

The counterpoint – titled Two Cheers for Ben Carson – is written
by regular National Review contributor
Robert VerBruggen. 
He characterizes Carson’s
intentions as joining the bipartisan YIMBY movement – saying “Yes, in my back
yard” as opposed to N(ot)IMBY, and calls that movement correct on the policy
merits.

Overly aggressive
zoning and land-use regulations, VerBruggen says, do immense damage to the economy
and make it more difficult to integrate neighborhoods, both economically and
racially.  He calls Carson’s regulation
far superior to the Obama-era plan he’s trying to replace, an effort to force
metro areas to directly engineer their neighborhoods’ racial balance.

There are
even some conservative arguments for the federal government to push better
policies, he says. As a political matter, federal subsidies for affordable
housing aren’t going anywhere and it makes little sense to subsidize affordable
housing in cities that are deliberately making housing unaffordable. “Just
as we ask welfare recipients to take steps to make themselves self-sufficient,
perhaps we might ask federal grant recipients to stop obstructing the purposes
of the grants they receive.”

But he also points out that the proposed
policy has some very unconservative aspects as well.  He says essentially the national government
is taking taxpayers’ money and refusing to give it back unless those taxpayers
support the right policies at another level of government, “thus overriding the
key distinctions of American federalism. “It’s one thing if those policies are
unconstitutional; it’s another when they’re just bad or have a disparate impact
on the poor.”

What both authors neglect to note is
that zoning and land-use regulations do not come about just from racism nor to
protect the property rights of the well-to-do. 
Many of them are sensible, contributing to the public health and safety
and protecting the environment.

To starve local governments into
eliminating them might benefit builders and investors instead.  They could allow high density development in
areas without the infrastructure to support it or permit builders to infringe
on wetlands.  While the National
Association of Home Builders cites similar numbers as Tanner’s regarding the
added costs builders face from regulations, there is no guarantee that deregulation
would mean building more affordable units.  Other incentives have long led them to build
larger and fancier.  

Article source: http://www.mortgagenewsdaily.com/10232018_hud_affordable_housing.asp

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