Banks Creating Housing Squeeze Even More than Gentrification

atlantic yards before construction

Atlantic yards before construction

New Orleans   It seems like it has taken forever, but the first units of affordable housing as part of the victorious, but controversial, agreement negotiated between ACORN and Forest City Ratner to be built as part of the Atlantic Yards project, are finally coming to fruition, better late than never, thanks to the 2007-8 housing financing meltdown.

DNA Info reported:

Applications are now open for the first units of affordable housing at the Atlantic Yards Pacific Park complex. The modular tower built by Forest City Ratner Companies is the first building in the 22-acre Pacific Park development (formerly Atlantic Yards to join the city-run affordable housing lottery. The Dean Street property will contain half market-rate apartments and half affordable housing; the tower has 363 units in total.

Rents … will range from $559 per month for a studio at the lowest income requirement bracket ($20,675 to $25,400 per year for one person) to $3,012 per month for a two-bedroom at the highest income bracket (between $104,915 and $144,960 per year, depending on household size), the lottery requirements said.

As the country-and-western song goes, “that’s something to be proud of…,” but the larger issue continues to be in New York and most other cities in the US and around the world how unaffordable housing is. Ironically, as much as the delay at Atlantic Yards had to do with the meltdown in bank lending because of the housing bubble, banks are still at the heart of unaffordability.It’s not /just /gentrification, in fact, the gentrifiers are as much an effect caused by banks as they are a trigger for rising prices.

Stuart Melvin, ACORN’s head organizer in the United Kingdom, shared a piece from the New Economics Foundation with me several months ago.They noted that:

 

In advanced economies, banks’ main activity is now domestic mortgage lending. A recent study of credit in 17 countries found that the share of mortgage loans in banks’ total lending portfolios has roughly doubled over the course of the past century –from about 30% in 1900 to about 60% today.

 

This is how banks are making money everywhere, rather than through direct lending to consumers or businesses, partially because the land is a solid asset serving as collateral, meaning they can foreclose.  Where the land is scarce as it is in New York, London, San Francisco, and, well, lots of big cities, this makes each parcel more valuable and the next thing you know on the rollup, houses are costing nine times average  annual income throughout England and twenty times annual income in southeast England for example and that’s true for many other cities as well.

All of which squeezes housing developers even more, especially if they are not heavily subsidized by the government, when it comes to providing decent and affordable housing. The same level of bank profits cannot be gained compared to mortgages, so prices balloon, and the available customers who can handle the weight become smaller, and richer, until the whole bubble bursts again.

We countered this in New York through land trusts or mutual housing arrangements, but that is only partially successful. The scale of the issue is too large. Other countries and communities have tried land banks or public corporations.Unless we change our public policy around housing though this is a problem accelerating once again until it crashes against the wall, and in the meantime, low and moderate income families find themselves left with fewer and fewer affordable opportunities for decent housing.

Facebooktwittergoogle_plusredditpinterestlinkedinmail

The Paradox and Problem of Payday Lending

A customer enters a Payroll Advance location in Cincinnati. (Al Behrman / AP)

A customer enters a Payroll Advance location in Cincinnati. (Al Behrman / AP)

New Orleans  Here’s an irony that is stark, yet impossible to really appreciate or enjoy. The Atlantic billed its most recent issue as “The Money Report.” The cover article was built around the premise that almost half of the American people have trouble coming up with $400, when there is a financial bump in their road. There was another article called “Loan Shark, Inc.” which was a probing and somewhat sympathetic article about the payday lending industry that mentioned that the average payday loan is $350, about the same number repeatedly cited in “The Shame of the Middle Class,” yet of all the tales of woe from its author, there was no mention of his ever going so low as walking through the doors of a storefront payday lender or the portals of one online.

Without a word of warning or explanation, it was assumed that clearly payday lenders were all about exploited lower income families, not the presumptuous middle class. The real line of demarcation they were unwilling to draw is that even if half of the middle class finds themselves in dire straits from time to time, it’s not catastrophic since they still have other informal places to go with family and friends or selling assets or reducing their footprint, while the poor are forced into predatory fringe financing once there is no place else they can go.

In the classic dilemma of neoliberalism, the payday lending article worried around the issue of alternatives between the devil and the deep blue sea. The polarity was presented as either payday lenders or worse, loan sharks, shysters, and gangsters. The role of government was limited only to regulation, and regulation was presented as problematic because when government stepped up to protect consumers from predatory practices, the marginal and inefficient payday lending industry shut its doors. In the USA New York and other states were given as examples of the industry fleeing when interest rates were reduced, and rather than applause there was handwringing. In Canada, where ACORN has been a dog on a bone chasing predatory lenders for over a dozen years, a 30% limit on interest rates in Quebec saw the payday people fleeing like rats on a sinking ship. ACORN has backed caps, though not that low, and industry record sharing that prevents multiple loans to one customer in the same period, as well as restrictive zoning limits in our neighborhoods among other reforms. ACORN also backs postal banking which The Atlantic gives short shrift.

Their best recommendation comes from what they admit are “more-modest reforms” in Colorado in 2010 that were achieved “by reducing the permissible fees, extending the minimum term of a loan to six months, and requiring that a loan be repayable over time, instead of coming due all at once.” Half the payday lending operations closed, but the ones that stayed open ended up with more than the average 500 annual customers and borrowers paid “42 percent less in fees,” and defaulted less “with no reduction in access to credit.” One hand clapping, I guess.

The author was right to understand that the real problem for families is desperately needing $350 with no other alternatives. Why are we wringing our hands about a predatory industry rather than stepping up and understanding that this is a collective responsibility? These are the kinds of problems that emergency assistance grants in welfare offices used to try to meet. The absence of a continued public response makes these private problems, increases hardship and inequality, locks people in a debt trap, and has led to the creation and growth of an industry where competition is irrelevant, inefficiency is rampant, and even reformers wring their hands and settle for sorry solutions.

Public welfare is exactly that, faring well for the public. When are we going to stop embracing the 19th century and start building the 21st?

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Finally an Alabama Lawsuit Fights Living Wage Preemption

WON THE MINIMUM WAGE BALLOT INITIATIVE 2.2.02New Orleans   The other day I stumbled onto a picture of a press conference in New Orleans in 2002, where our coalition of organizations was celebrating our living wage election victory on February 2nd almost fifteen years ago. We later lost what we had won solidly at the ballot box with New Orleans voters when the Louisiana Supreme Court ruled 6-3 that a law passed by the state legislature in Baton Rouge after we had qualified for the ballot, but before the vote, preempted the ability of New Orleans voters to enact a minimum wage in a state where, effectively, no minimum wage existed. We had already seen the Restaurant Association and others move similar legislation Texas and Colorado in the wake of ACORN and Local 100 ballot initiatives on living wages in the late 1990s in Houston and Denver in order to block repeat efforts along with other states like Florida. Over two decades this has been the industry strategy to block citizen efforts to use the ballot box to make change locally, when we are blocked at the federal and state level.

Now there’s a ray of hope in Alabama where lawyers and community-based organizations have called out the conservative, Republican controlled legislature for racial discrimination. The democratically elected Birmingham City Council had the courage to respond to fast food workers and a many other local organizations pleas about the inadequacy of their wages. This was not some pie-in-the-sky giveaway, but actually a fairly modest program of wage increases, much like the package that President Obama has had before Congress unsuccessfully for several years. The Council action would have raised the minimum wage to $10.10 from the present $7.25 by mid-2017 in a series of bumps. $10.10 is a long, long way from the $15 per hour that has been enacted in Seattle, New York City and Los Angeles, but it is also almost 40% higher than the piddling wage where we have been stuck for years, and that seems to have been what got the Alabama legislators’ goat. Well, that and probably a search-and-destroy party of well-heeled lobbyists raining money and mayhem all around them.

The state NAACP, Greater Birmingham Ministries, and a couple of fast food workers became the plaintiffs and enlisted a labor and civil rights lawyer to take the case and seek to block and overturn the legislature’s effort to interfere with workers’ rights in Birmingham. Their suit is plain-spoken and argues that the legislature’s action was a civil rights violation based on “racial animus” because Birmingham is 74% African-American.

The Wall Street Journal cited research from the National Employment Law Project that in the last five years “legislators in 30 states have introduced more than 100 bills that tried to repeal or weaken core wage standards at state or local levels.” In some ways that doesn’t help the Birmingham case because it illustrates how common and widespread the attack on cities and their workers are based solely on class hatred and struggle.

So, do we have a chance of winning? As long as we’re fighting, we have a chance of winning. It’s only when we stop doing so that we’ve completely lost. So, for the first time in a long time, let’s join together and chant, Roll Crimson Tide, we’re rooting for our brothers and sisters in Birmingham to win this one for all of our teams.

***

Please enjoy Bonnie Raitt’s Need You Tonight. Thanks to KABF.

Facebooktwittergoogle_plusredditpinterestlinkedinmail

Obama is Wrong about Social Movements and Activists

 “The value of social movements and activism is to get you at the table,” Mr. Obama said at a meeting with young people in London. Credit Stephen Crowley/The New York Times

“The value of social movements and activism is to get you at the table,” Mr. Obama said at a meeting with young people in London. Credit Stephen Crowley/The New York Times

New Orleans   President Obama is on his farewell tour. Speaking to a young, university audience in London while trying to drum up some support for Britain to stay in the European Union, he offered what has to be seen as totally gratuitous advice to them – and of course all of the rest of us – about what he sees as the proper, underline “proper,” role for social movements and activists. And, not surprisingly, he is totally wrong, but here was what he had to offer:

“The value of social movements and activism is to get you at the table, get you in the room, and then to start trying to figure out how is this problem going to be solved. You then have a responsibility to prepare an agenda that is achievable, that can institutionalize the changes you seek, and to engage the other side, and occasionally to take half a loaf that will advance the gains that you seek, understanding that there’s going to be more work to do, but this is what is achievable at this moment.”

In the New York Times story about his remarks, they predictably added that something that they felt, equally gratuitously, would help give an extra dose of credibility or street cred to the President of the United States, arguably – and temporarily – one of the powerful people in the world. They offered that,

Mr. Obama began his career as a community organizer working on local initiatives in poor neighborhoods in Chicago. Sometimes, he said, solving a problem means accepting a series of partial solutions.

Now, certainly if you are a big whoop, or the biggest whoop of them all you, want the rowdies out there to get the message that if you lean down from your perch and deign to listen to them for a hot minute, they are supposed to understand that they are supposed to behave, thank you, and then go and shut the heck up. But, as Obama surely must really know, regardless of the claptrap he’s selling right now, the role of social movements, and many activists, is exactly the opposite. The role of social movements in fact is to speak “truth to power,” not to make the deals and settle for the incremental changes, but to chant, “more, more, more,” keep the heat on that continues to create the pressure and push to create the space for the deal-makers to do their thing to get closer and closer to the mark, and not stop until the job is done.

Obama knows from his time in Chicago that an organization has to accept “half a loaf” frequently to deliver to its members. Good organizations get more, and weaker organizations get less, but it’s a social movement’s job to continue to raise the banner for truth, justice, and the whole loaf. There’s a different between seeking power and putting on the pressure. The Alinsky tradition, that Obama shared, was always uncomfortable with social movements because they were too easily appeased by applause, rather than being thankful that social movements enlarged the space to allow organizations to win even greater victories. Sadly, but once again not surprisingly, Obama knew this seven years ago when he challenged activists to push him – and the country – if they wanted more change, but now that he’s more worried about his past legacy, than his future accomplishments, he sitting too comfortably on the throne.

It’s worth respecting his position, but for the sake of all of us working for change, when it comes to social movements, we need to adamantly decline to follow his advice.

Facebooktwittergoogle_plusredditpinterestlinkedinmail

UK’s Unite is Another Case Study of the Difficulty of Union Transformation

005-15-reasonsNew Orleans    Unite is the largest union in the United Kingdom with almost 1.4 million members launched a brave and exciting experiment four years ago to organize the unorganized. In this case it was not the unorganized who were workers, but the unorganized in communities. They established Unite Community with minimal dues (50 pence or about 75 cents per month), hired or assigned ten organizers, one to each region of the union, and set about building local chapters around a host of self-directed issues. Now, four years later, they have about 10,000 members, more or less, in over 100 branches around the country, so perhaps it’s time for a good look, and luckily they allowed University of Leeds professor, labor expert, and community activist, Jane Holgate, a front row seat and access to their process and people to evaluate, academically, their progress.

Professor Holgate’s analysis is tentative and still a work-in-progress that she is sharing with colleagues and graciously allowed me to also take a peek, having been an advocate and organizer of many of these union-community amalgamations. Even tip-toeing around her early conclusions, being a cheerleader for Unite’s efforts for better or worse, and not wanting to step on Professor Holgate’s toes, her work, when it is finished, is going to be something organizers, and, perhaps even more importantly, union leaders will want to read and study closely if they are serious not just about community organizing, but the duty of transforming unions to meet the difficult challenges for our organizations in the 21st century.

At a fundamental level a look at Unite’s experiment with Unite Community and community organizing is an example of the organizing principle I’ve often argued that “the beginnings prejudice the ends” in organizing. Professor Holgate makes the case, as she has in her past work that a union has to be clear about its purpose. She invokes earlier work that positions a union’s identity between market, class, and society that synthesizes its ideology accordingly and informs its internal and external practice. It seems simple and obvious to say, before a union – or any organization – can transform itself, it has to understand who and what it is and what it is trying to do, but that doesn’t understate the importance. Furthermore without an operating consensus on these issues that aligns leadership and staff, especially in the complex bureaucracy of large organizations, the success of any new project, particularly one that would be historically unique and potentially transformative, would be difficult to achieve.

Having met with Unite’s leadership and staff on this project, I would say that they have found real utility in Unite Community, but it has been grafted to the union as an appendage, rather than integrated fully, thereby lessening its value immensely and leaving its future somewhat confused and uncertain. Professor Holgate finds this separation of the community project from the basic worker organizing operation equally stunting, and makes a more important point from her closer perspective that the inability to fully integrate the membership of Unite Community with the larger Unite membership has been critical. Though she is not ready to say this yet, a reader would conclude that this problem could be terminal to the project, and at the least means that even if the community efforts were successful and continued robustly, they would not be transformative in terms of the union’s identify, practice, or future.

Normally, I would say, none of this is fatal, and that Unite – and other unions – might learn tons from this work and allow it to be another building block in the critical transformation that has to happen. Unfortunately, Holgate anticipates my Pollyannaish hope here by noting, too starkly for me to avoid, that the separation of Unite Community from the rest of the organization, means that there has also been little “learning,” as she calls it, throughout the union. Sadly, I’ve reflected similarly on how much we have learned as organizers from work we have done with Walmart, hotel workers, and labor-community alliances in the past, and how we have often failed to effectively communicate the lessons or have them stick sufficiently to influence leaders and organizers later, so, what can I say, but here’s hoping. We have no choice, but to try and try again, lest these organizations all die on our watch.

JS59491253

Facebooktwittergoogle_plusredditpinterestlinkedinmail

The Big Mac Tactical Dilemma

france_eurodisney_04.14.16_sm001_0

Action at France’s Eurodisney

New Orleans   For the fourth year there was a tactical “strike” at McDonald’s stores. Organizers claimed there were actions of one sort or another in 300 cities around the country. Much of the action was wrapped up in the slogan, Fight for $15, pointing out the inability of workers to live on McDonald’s wages.

In the United States, caring about this issue, it was hard to find the heartbeat nationally. Not a word was printed in The New York Times or Wall Street Journal on the mid-April actions. A French researcher working as a post-doc with the Kennedy Center in Berlin on a 2-yearlong study of the Fight for $15 movement met with me while in New Orleans, and was mystified that he could not find any notice of the action so that he could attend. There were no notices on the coffeehouse bulletin board. It took a couple of emails and calls, to locate any call to action. The local papers were silent for days about anything happening. When something finally appeared in the Sunday paper, days later, it was one of those “for the fourth year” protestors chanted in a local McDonald’s and tried to get workers to leave the counter to strike without success.

Talking to organizers of ACORN’s affiliate in France, there were vivid reports of huge actions in Grenoble, Rennes, and Paris. In each location stores and streets were blocked and the business was shut down for hours. The protests engaged students, unionists, and community organizations and were dramatic and militant. There was no pretense of workers’ striking, but straightforward protests aimed at McDonald’s wages and working conditions.

The picture in the paper, when it finally appeared in New Orleans, featured the back end of a straggling march down Canal Street in the center of town. Whether in New Orleans or elsewhere, it seemed to be a “tree falling that no one heard.”

The tactical dilemma is common: repetition blunts the impact, no matter how initially successful. In France, there was a newness. In the US, the action has become stale. That is not to say that it was irrelevant and unnecessary. Something has to be done. We have to maintain the pressure and the campaign. The challenge now is how to both keep the flame alive and exerting heat under McDonald’s, and with the actions seeming more rote and attracting less attention, there is a feeling of being stuck in a rut. Believing that workers in any real numbers will leave work to join protests at random stores might project strength, if it shut the store down, but in ones and twos and nones, it projects weakness more than strength. It underlines the fear and desperation of the workers, but to the public and in the mouths of company spokespeople it translates as lack of support.

The campaign has been wildly successful in lifting up the need to raise the wages of workers. Even Walmart has had to spend billions to bump up the pay scales. Now the organizing problem is how we can couple the pressure for more pay with the understanding that it requires workplace organization as the engine that delivers that result. We need solid tactics and strategies to build that bridge, but in any case we may need something new next year to keep the drive alive.

Facebooktwittergoogle_plusredditpinterestlinkedinmail