[Note]: This was not a diary I had planned for today
The Bush Administration jumped on Katrina as an opportunity to advance their privatization agenda, with two major targets: public schools and public housing. As Open Left's focus on education has shown (see Jeff's regular Sunday "Left Ed" diaries at 4 PM), Obama's education agenda has actually expanded Bush's attack on public education. Now, as David Kaib highlights in quick hits, Obama is attack public housing as well.
There is a need for money to invest in public housing, and it would have been a perfect fit within a decently-conceived stimulus package. But of course, there wasn't room for it because of all the tax cuts and its deliberate small size. So now, privatization is the answer, as if the private housing market hadn't already done enough damage to last the rest of the century. David links to a Dkos diary by George Lakoff. "Below the Radar: HUD is Trying to Privatize and Mortgage Off All of America's Public Housing" which begins thus:
The Obama Administration's move to the right is about to give conservatives a victory they could not have anticipated, even under Bush. HUD, under Obama, submitted legislation called PETRA to Congress that would result in the privatization of all public housing in America.
The new owners would charge ten percent above market rates to impoverished tenants, money that would be mostly paid by the US government (you and me, the taxpayers). To maintain the property, the new owners would take out a mortgage for building repair and maintenance (like a home equity loan), with no cap on interest rates.
With rents set above market rates, the mortgage risk would be attractive to banks. Either they make a huge profit on the mortgages paid for by the government. Or if the government lowers what it will pay for rents, the property goes into foreclosure. The banks get it and can sell it off to developers.
Sooner or later, the housing budget will be cut back and such foreclosures will happen. The structure of the proposal and the realities of Washington make it a virtual certainty.
The banks and developers make a fortune, with the taxpayers paying for it. The public loses its public housing property. The impoverished tenants lose their apartments, or have their rents go way up if they are forced into the private market. Homelessness increases. Government gets smaller. The banks and developers win. It is a Bank Bonanza! The poor and the public lose.
And a precedent is set. The government can privatize any public property: Schools, libraries, national parks, federal buildings - just as has begun to happen in California, where the right-wing governor has started to auction off state property and has even suggested selling off the Supreme Court building.
The rich will get richer, the poor and public get poorer. And the very idea of the public good withers.
And Lakoff quotes from PETRA the statement that bill's intent is to:
provide the opportunity for public housing agencies and private owners to convert from current forms of rental assistance under a variety of programs to long-term, property-based contracts that will enhance market-based discipline and enable owners to sustain operations and leverage private financing to address immediate and long-term capital needs and implement energy-efficiency improvements.
The Los Angeles Coalition to End Hunger and Homelessness (LACEHH) has a blog with a fact sheet, and a 2-part sign-on letter to Housing Secretary Donovan (Part 1, Part 2). In its "background" section, the fact sheet explains:
-Public Housing is owned and operated by the government, namely the local Public Housing Authority (PHA) through a contract with HUD.
- Public Housing Authorities have been lobbying for 100% disposition of Public Housing. As a result, HUD approved requests for several cities to completely eliminate their Public Housing stock. As a result, the City of Atlanta, GA and the City of San Diego, CA have completely eliminated their public housing stock.
- HUD estimates a $24 billion funding shortfall for capital improvements on Public Housing. Although Congress did provide $4 billion in stimulus money in FY2010 for Public Housing capital improvements, this is just a small amount needed according to their estimates.
- Based on their powerpoint, HUD anticipates leveraging $7.5 billion in one year from private banks and other private funding under the Transforming Rental Assistance Program.
And in its "Solutions" section it says:
- The obvious solution to fixing up Public Housing is to provide funding directly through appropriations. It makes more sense for this to be a jobs program which would put contractors and skilled tenants to work through a direct appropriation, rather than paying interest to banks for decades and jeoporadizing our public housing stock.
- Congress appropriated $4 billion in stimulus funds this year for Public Housing capital improvements. If Congress committed to an additional $4 billion for 5 more years, we would have the funding necessary to make these improvements.
In addition to linking to LACEHH's blog, Lakoff's diary concludes with the following plea and contact information:
Stop PETRA. This is urgent. There is a hearing next Tuesday, May 25, before the House Financial Services Committee and the Subcommittee on Housing, organized by Rep. Maxine Waters. Phone: 202-225-2201. Fax: 202-225-7854.
To write to the committee:
http://financialservices.house.gov/...
While Rand Paul, Glenn Beck and the Tea Baggers spread their loony-tune libertatian ideology that has never worked anywhere in the world, the Obama Administration is hard at work trying to implement the "pragmatic" version, with greater professionalism and a much lower profile than the Bush Administration could ever have managed. It's our job to stop them dead in their tracks.
Maxine Waters is not a woman to be trifled with. This is a fight we can win if we can draw enough attention to it. Please help spread the word.
