Preventing Crisis-Waste

by Martin Harris 

Martin Harris

Once, Chicago was Hog Butcher for the World and City of the Big Shoulders (to avoid disappointment, don’t test your American-Lit student on quote provenance) and now it’s the place where high-rise apartments are deemed adequate only for the Lake-Shore Drive upper-income quintile but not for the lower (or no-) income quintile inland, which explains why such subsidized tower-apartment complexes as Robert Taylor Homes and Cabrini Green, having been built with taxpayer dollars and expert urban-sociologist advice as part of the supposed War on Poverty, have now been demolished (sociologist advice) at taxpayer expense. A new generation of sociologists now preaches that the former tenants require garden apartments or insertion-by-government into single-family neighborhoods, once-quite-nice houses readily available as the middle class (first white, now black and white) continues its flight. Chicago is now also the place where such quotes as “you never want a serious crisis to go to waste” are now provenanced.

On a much smaller scale, the same taxpayer-funded build-demolish-rebuild pattern is now playing out in Rutland, where low-rise-apartment-complex Forest Park is being replaced with low-rise-apartment complex Hickory Street Apartments, planned with expert sociologist advice as a “mixed-income” development “…designed to look more like a traditional neighborhood.” We’re told that unsubsidized units are going vacant because “…people don’t want to move in the winter,” but it’s probable that hidden subsidies are now or soon will be built into the supposedly “unsubsidized” rents, so the mixed-income image can be claimed, and it may work because –no surprise—truly unsubsidized housing in the modern Vermont is quite pricey. As various metrics have shown, the overall cost-of-stay in Vermont is quite pricey, which explains middle-class flight and a demographic re-structuring toward a two-tier economy, with upper-income quintiles at one end and lower- or no-income quintiles at the other. The top quintiles are economically based in government, financials, and information, with a fast-growing passive-income sub-sector; the lower quintiles are based in low-wage services and a set of subsidies ranging from taxes to food to (of course) housing. Even so, such advocacy groups as the D.C.-based Corporation For Enterprise Development have discerned a crisis-in-the-stats: that “16% of Vermont residents have almost no savings or assets.” Humble Scribe guess: most of these folks are also in the bottom income quintile. Further HS guess; most vote D, not R.

To prevent crisis-waste, CFED proposes multiple government fixes for “asset poverty”: taxpayer-funded programs encouraging (and subsidizing, no doubt) home ownership, higher education, micro-enterprise (the obligatory sub-reference to women-and-minorities, there) and, of course, the accumulation of savings and assets. Any self-esteeming D-majority government (as in Vermont, for example) would agree; it’s already heavily engaged in subsiding the bottom half of the two-tier economy in return, of course, for their grateful votes. And it’s already heavily engaged in subsidy-publicity, to make sure the recipients understand the expected quid pro quo in plain ballot terms. A student of recent Vermont history might reasonably speculate that Montpelier has quite consciously (applicable D-hero-FDR quote: “nothing in politics happens by accident”) and quite successfully raised the cost-of-stay in Vermont, and in return expects the grateful votes of beneficiary electoral blocs: the lower-income quintiles, the public education sector, and of course the enviro-activists, whose rewards are such accomplishments as higher costs for, say , energy, which they welcome. It’s a successful formula, based on a manufactured set of crises, not at all wasted but put to very effective use. Chicago would be envious.

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Such crisis-harvest requires political skill. After all, the last thing CFED wants is for there to be a zero percentage of the population in “asset poverty”, because, if their highly skilled intervention fully fixes the crisis, their highly-skilled intervenors would be unemployed. To prevent a crisis of income poverty for the CFED experts, the crises they identify must be made sustainable, not extinct. A really good strategy to accomplish this at the State level consists of creating a business climate so negative that commerce flees and middle-class jobs become unavailable. That way the subsidized under-class can’t be upwardly-mobile, can’t escape from “asset poverty”, has to stay in its proper place, and with proper continuing education, will gratefully deliver its votes to the subsidizers. By most surveys, Vermont is among the tops in the nation in the category of “sustainable-crisis” management, by continuously legislating for unfavorable business climate. The Golden Domers (and the Guv) will make “first” when they get rid of Vermont Yankee and power costs respond upward and more middle-class jobs leave. Of course, that won’t be a crisis. And just so at the local level. And not a new phenomenon. First Humble Scribe exposure: Addison County in the ‘70’s.

There and then, it came in the form of involvement with a local builder, a local engineer, a local bank, a State-wide advocacy group, and of course a local (but Federal-fund-based) poverty-subsidy group to enable willing members of their low-income client base to contribute their own basic construction skills and their sweat equity to house construction. The design concept called for a basic small wood-frame slab-on-grade Cape (think Levittown) on a small village lot with utilities in place, and a construction loan for the site, the slab, the materials, and for technically-skilled labor. The candidate would furnish (under supervision to insure quality) the other half of the labor requirement which makes up about 3/4 of typical total house cost, so that, at “closing” the construction loan is converted into a mortgage with about a 3/8 owner-equity element. A key component was to be an off-site-manufactured drop-in mechanical core (kitchen, bathroom, utilities) which the future owner could then frame and finish around. Professionals would hook it up. At the time, just such drop-in cores were being proposed and designed for urban walk-up apartment renovation, as cost-savers via onsite-labor-savings. In the large cities, it mostly never happened because of fierce union resistance. In Addison County it never happened either, because, as the whole project concept neared reality, sites selected, and a few eager candidates lined up, the bank acquired cold feet as the poverty-subsidy group backed off, explaining that “our clients could never accomplish such a thing”. Of course, if they did, they wouldn’t be clients any more. And that would be a crisis.