Wed, Jun

Housing Is Hell for Those Needing a Home... But Heaven for Wall Street Profiteers


ACCORDING TO LIZ - The homelessness endemic to Los Angeles is not due to lack of housing, but to greed. 

The Scott Weiner-promoted and Toni Atkins-pushed Senate Bills 8, 9, and 10 laid the groundwork for future profiteers, and Gavin Newsom and Karen Bass are marching right behind in the ticker tape parade for real estate exploiters, construction connivers, and tax leeches. 

How many times do those concerned for the lives of the displaced have to repeat the truth of the matter: it’s not the number of housing units that are in crisis, it’s their affordability. 

But there is a ray of hope, albeit a tad watery and weak. 

In a recent ruling in favor of the cities of Carson, Redondo Beach, Torrance, Del Mar, and Whittier, the judge excluded application of SB 9 to California’s charter cities (of which Los Angeles is one), explaining that because the state bill “does not actually require any housing unit be affordable, it is not... promoting affordable housing,” it cannot interfere with a charter city’s local control nor supersede local housing regulations. 

The judge reached three conclusions – that SB 9:

  1. is not about producing affordable housing since there is no requirement new housing be rented or sold at below market rates in return for eviscerating eliminating single-family zoning;
  2. could actually create new housing that is less affordable due to gentrification; and
  3.  is unconstitutional because the breadth of its scope unlawfully intrudes on California charter cities’ constitutional right to control land use as part of their municipal affairs 

Los Angeles is a charter city. And Los Angeles desperately needs affordable housing. Not more empty market-rate units, not destruction of our communities, not evisceration of environmental protections. 

This ruling is just a crack in the door, but one that affordable housing advocates must rush to widen. 

Especially as City Hall seems hell-bent on doubling and tripling down on the Scott Weiner/Toni Atkins model of build-baby-build at the expense of quality of life for all Angelenos. 

Especially as it comes on top of the release of an L.A. County Public Health report detailing that over half of City households spend thirty percent or more of their incomes on housing, with over a quarter of those severely housing burdened: spending over half of their income just to keep a roof over their families’ heads. 

Lack of affordable housing has become a public health issue in Los Angeles over recent decades. Homelessness and public health have become inextricably entwined for more and more of the country. American lives are on the line. 

Research by Eviction Labs, a Princeton University research institute, demonstrated a clear correlation between high rents and increased morbidity. 

While housing and healthcare should both be human rights, more than twenty percent of Californians now suffer from medical debt in addition to whatever illness or accident led to incurring it in the first place. Loving husbands are having to leave homes and children so their wives can qualify for desperately needed health benefits. 

What’s wrong with this picture? 

People also need clean air, toxin-free water, nutritious food, safety, labor rights… all those pesky items progressives keep promoting that cut into profits for the plutocracy. 

How many of us have received flyers exhorting us to vote for, donate or otherwise contribute to campaigns to house the homeless, usually with the image of a suffering street person (or one costumed and dressed for a TV show) trying to play our heartstrings? 

If housing is unaffordable for working Angelenos, how can a homeless person ever aspire to get off the streets. Plans by the Mayor and many other politicians to build the City out of its homelessness are statistically unreasonable and fiscally irresponsible. 

Costs for land and to build have escalated out of control as Wall Street and the banks butt heads with REITs and mortgage lenders to see who can make the most money. 

Housing shouldn’t be about profit. It should be a basic right for everyone to have a roof over their heads without fear of being put on the streets with the next unexpected bill, health challenge, or layoff. 

While the cost of building a basic unit in Los Angeles can often exceed $700,000 and is spiraling ever higher, the Marie Antoinette clique points out that there are a lot of existing homes priced for less – let the homeless purchase those instead. 

The trickle-down economists would like those in starter homes to buy up, leaving their low-rent abodes to the unhoused pushing to get off the street. 

Two huge problems – we are already talking about almost a third of Angelenos being housing-threatened. How could anyone other than the Antoinettes expect them to be able to pay more? 

And, once on the street, people’s problems compound and few have the initiative to push for anything other than the next meal, the next bottle of booze, the next hit to numb their pain. 

So why build more unaffordable housing? Could it be the profits it affords real estate developers, construction firms, Wall Street speculators, and the politicians they bribe or brainwash? 

And who has to pay to build it? Ordinary taxpayers. 

Who subsidizes the rent? Ordinary taxpayers. 

Who gets to pay for services – those for the housing and for the unhoused? Ordinary taxpayers. 

Who else profits? 

Those who subdivide lots and cram multiple units into single family neighborhoods, disrupting infrastructure and services that were never contemplated by City Planning. 

The multiple layers of consultants advising on how to leverage the most out of a rigged system – on the taxpayers’ dime, of course. 

The slumlords, also reveling in Wall Street profiteering and managing to make more by stiffing tenants on basic maintenance and safety needs, shaking down others with monetized evictions and applications, and shelling out uncounted millions in marketing and blandishments to elected officials to shut down even the most minimal of regulations. 

As AIDS Healthcare Foundation President Michael Weinstein put it in a recent editorial: 

“The adaptive reuse of older buildings is the low-hanging fruit that can house the most people in the least amount of time. We are awash in under-utilized hotels, office buildings, retail spaces, public buildings, and more. One former Motel 6 in Costa Mesa is being converted into nearly 90 units of affordable housing, and that’s just one motel. 

“In addition, we need a moratorium on converting low-income housing units into condominiums or other uses.” 

He goes on to say something to which our Mayor and Councilmembers should pay close – very close – attention: 

“Unaffordable rents aren’t just a humanitarian crisis; they are an economic disaster. Half a million people have fled the state in recent years, leaving an even greater burden on the rest of us. And California is not a competitive place to attract new businesses.” 

It has been almost 45 years since America's elite embraced Reaganomics with its fantasy of trickle-down economics, and what does the country have to show for it? A few obscenely wealthy corporate honchos hiding in gated communities and too many homeless, dispossessed and camping on our streets. 

While on Wall Street, investor interest in the housing sector continues to soar along with home values, despite the disastrous collapse of the economy driven by a similar greed less than twenty years ago. 

Private equity firms notorious for gutting companies and making off with a quick profit at the expense of the American middle-class working men and women, have expanded their avariciousness into the housing sector, bundling apartment buildings and single-family rentals into asset packages for capital gain. All too often removing the aggravation of catering to tenant demands out of the equation by removing the tenants. 

Institutional investor control of single-family homes is escalating exponentially and, if left unchecked, could command sway over half of all such housing within the decade. 

After Senators Manchin and Sinema trashed Biden’s Build Back Better Act which would have invested over $170 billion in affordable housing, benefits in housing have primarily gone to the industries that profit off its lack. 

And ultimately keeping it that way in order to leverage better returns on investments. 

In a panel discussion in Los Angeles in April, Senator Bernie Sanders of Vermont, and Representatives Pramila Jayapal and Ro Khanna of Washington and California, respectively, called for the U.S. housing crisis to be moved to the top of the Democratic Party agenda. 

As Jake Johnson wrote in a Common Dreams article: 

“Growing corporate ownership of the nation's housing stock has been disastrous for tenants already squeezed by other elevated living costs. The experiences of tenants across the U.S. and empirical research have shown that private-equity landlords are more likely to jack up rent (sometimes with the help of profit-maximizing algorithms), skimp on basic maintenance, and aggressively pursue evictions.” 

It is not so difficult to imagine what our cities and towns will look like if this crisis continues unabated: an American version of Rafah with the glittering skyline of Manhattan on some distant, unattainable shore.

(Liz Amsden is a contributor to CityWatch and an activist from Northeast Los Angeles with opinions on much of what goes on in our lives. She has written extensively on the City's budget and services as well as her many other interests and passions.  In her real life she works on budgets for film and television where fiction can rarely be as strange as the truth of living in today's world.)