Gentrification on Steroids as Council Housing Turned over to London Developers

crowdLondon            The dismantling of public housing in the US has been going on for more than 30 years in major cities around the country.  The fight is often around relocation, adequate section 8 subsidies in private housing, and the percentage of units that will be replacement housing for the poor.  Listening to organizers and leaders of an effort to slowdown one of the 40 such redevelopment efforts occurring now around London, if anything, the situation seemed more out of control, if I understand even half of what I was being told.

These organizers were working in the Hendon council estates in the Borough of Barnet one of the largest of the more than 30 boroughs in London based on both square miles and population, located in the northern part of the city.  To hear the story the Council, dominated by real estate interests, has pretty much turned the estate over to a UK-based development company called Barrett Homes, lock, stock, and barrel.

Protests are ongoing and over recent weeks there have been arrests and small actions of tenants blocking deliveries and stopping work as the tension increases.  There’s a fair amount of press interest starting to emerge as various media outlets start to recognize that if they don’t hurry they’ll miss the last working family turning off the lights as they are gentrified out of the city.

In this situation the development company itself was allowed by the Council to do the governing feasibility study on the takeover and as it was related to me the numbers of dedicated units below market rate as “replacement” for existing tenants have now been unilaterally downgraded from the initial promised 30%, then down to 25% of the units now being built.  That might mean 500 units of the proposed 2000 in the new development with the shared equity owners having half and formerly unsecured tenants getting the other 250.  The harder one looks and listens, the more difficult the proposition when it comes to keeping existing tenants and leaseholders in the community rather than being boxed out by reduced prices, an accelerated market, and the impact of the Locality Act which can allow them to be moved into other boroughs.  Confused?  So are the tenants!

Much of the new development is on green space in the Hendon area and looking at the company’s promotional website for Hendon Waterside, as they call it, the market prices for purchase will be from 250,000 pounds to over a half-million pounds.

Even “leaseholders,” who are actually owners that have to be bought out are getting a raw deal.  The council and the company have set the price for their buyouts almost 100000 pounds below the market established by independent appraisers, putting these “buy in” owners behind the wild inflation in London housing and likely unable to afford anything near replacement housing.  This kind of eminent domain practice for commercial development is now anathema in the US for conservatives, but paradoxically it is the Conservatives in charge of Barnet who are forcing these “CPOs” or compulsory purchase orders, as they are called down the council flat owners’ throats.

This seems little more than gentrification on steroids and targeting public assets for private development in partnership with local governments.  I was told in fact that the Conservatives here have even managed to repeal their own conflict of interest ordinances so they could fast track these developments.  In another eviction proceeding being resisted in another council estate, several dozen young mothers are protesting being “reassigned” housing all over the UK, including Glasgow, for a developers’ plans.

Housing issues seem to be cropping up everywhere in London, and I’m scrambling to get my arms around what I’m hearing.  Organizers are hoping that they might be able to unify many of these fights into one overarching campaign to deal with so many of these high-end, anti-people developments.

Time seems to be running out the clock though.  They showed me a Mayor’s question period on YouTube a couple of months ago with Boris Johnson, who is talked about as a potential candidate for the Conservative Party for Prime Minister, when he was questioned about a landlord’s practices in Barnet.  The Labour assembly member asked a couple of seeming hypotheticals about some unethical practices by a landlord in his area and Mayor Johnson agreed that it seemed to be illegal practices ripping off the public purse as well as tenants, until the trap was sprung and the landlord in question was revealed as a Conservative Party colleague, the Mayor of Barnet, in which case London’s Mayor Johnson parried with a couple of jokes and asides, and it was clear there would be no action taken.

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Wow! We’re Not Alone in Seeing Comcast as a Bully!

London      I hit the ground in London around noon their time. Ok, that overstates it. After flying overnight from Houston, it would be more accurate to say that I stumbled out of the plane like the rest of my flying comrades to an overcast and raining day, totally different than the weather I had convinced myself that I would find. Two hours later I was in a Starbucks waiting for the ACORN London organizers and their volunteers on the doorknocking push before their first meeting.

And, here’s where it got good! The esteemed and influential media columnist for the New York Times, came out powerfully with our position that Comcast had finally showed its true self as a bully extraordinaire. Better, Carr argued, as we had, that this will encourage the FCC to look at them more closely. As the old saying goes, “hubris comes before the fall,” and finally Comcast has tripped on its own arrogance and contempt for the pubic and its customers, putting their monopolistic ambitions in the crosshairs finally. Stopping them is still dicey, but there’s real hope for serious scrutiny and the chance of victory.

But, I don’t want to go all David Cohen and start gloating or suffering from premature certainty. Let the Times’ Carr make the better case instead:

Growling by Comcast May Bring Tighter Leash

SEPT. 28, 2014

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A demonstration in Philadelphia, across from the Comcast Center, against Comcast’s bid to buy Time Warner Cable. Credit Matt Rourke/Associated Press

Comcast has a long corporate tradition of smiling and wearing beige no matter what kind of criticisms are hurled at it. That public posture is in keeping with the low-key approach favored by Brian L. Roberts, the company’s chief executive, as he seeks to take over the world. It’s worked very well so far.

But in a filing submitted to the Federal Communications Commission last week in defense of its proposed merger with Time Warner Cable, the company lashed out uncharacteristically at its critics. And David L. Cohen, Comcast’s chief lobbyist, continued the salvo in comments to reporters and in his written remarks.

Watching Comcast’s ballistic response to opponents of its $45 billion takeover bid was a bit like watching a campaign debate go off the rails. The front-runner, ahead by 20 points, is besieged by ankle-biters who suggest he is a lout and a bully. He finally loses it and goes off on his opponents in a fury, generally acting like, well, a bully.

That’s one way to make a big lead go away.

In baring its teeth, Comcast sought to show that the companies now opposing the deal were using public interest arguments to advance private business agendas. It said these companies had privately sought $5 billion in concessions from Comcast before going public with their opposition.

In a thick document bristling with arguments on its own behalf, Comcast used quite a bit of ink and hot rhetoric on those who would lay it low, saying in part: “The significance of this extortion lies in not just the sheer audacity of some of the demands, but also the fact that each of the entities making the ‘ask’ has all but conceded that if its individual business interests are met, then it has no concern whatsoever about the state of the industry, supposed market power going forward, or harm to consumers, competitors, or new entrants.”

Gee, Comcast, don’t sugarcoat it. Say what you really mean.

The word extortion is usually applied to guys with names like Nicky who wear bad suits and crack their knuckles a lot. If this is how the company acts in the wooing stage, imagine how charming it will be once it actually gets what it wants.

The company named names, plenty of them: Netflix, for complaining about interconnection plans it freely negotiated with Comcast; Discovery, for asking for sweetheart carriage deals before its current contract is even up; and Dish, for whining about enhanced competition.

Its opponents were surprised by Comcast’s ferocity — and overjoyed. An air of inevitability has been hanging over the merger since it was announced in February — Comcast has a legion of allies in Washington, and a formidable advocate in Mr. Cohen — but the opposition that has built up in the ensuing months seems to have driven the company around the bend.

Comcast executives are offended. They genuinely believe that it will take a company of its scale and growing technological innovation to deliver the next generation of programming and data services.

Opponents of the merger are convinced that granting a beefed-up Comcast dominion over much of the country’s broadband would stifle innovation and tilt the field in unhealthy ways.

Both sides believe they hold the key to a consumer-friendly, high-functioning Internet.

Right.

What is actually going on is both more basic and more interesting. Programmers are worried that if Comcast takes over Time Warner Cable, it will have the leverage to dictate prices. Web-based services like Netflix foresee a giant that will extract significant fees for providing high-speed performance.

Comcast, which agreed to all manner of regulation to complete its acquisition of NBCUniversal in 2011, does not want to hand out so many bonbons to other players that the proposed merger becomes noneconomic. There is no breakup fee on the deal and Comcast could still walk, especially if it feels that a merger would lead to the regulation of broadband access as if it were a public utility.

Opponents are trying to enlarge the merger debate to include the broader issues of net neutrality and monopoly control, and there are signs that these efforts are gaining traction in significant places. On Sept. 4, Tom Wheeler, the chairman of the F.C.C., surprised many, including Comcast, when he said in a speech that in terms of broadband that can support streaming on multiple devices, 82 percent of Americans have only one choice in providers.

Regardless of motive, the issues raised in the filings are hugely important and won’t be brushed aside by bombast or counterattack.

From the start, Comcast has sought to frame the debate more narrowly, portraying it as the merger of two cable operators that do not compete, which is sort of true and sort of beside the point. The future, as anyone with a router could tell you, is all about broadband; a merged Time Warner Cable and Comcast would control more than 35 percent of the broadband market with easy access to far more households and would be the dominant presence in 16 of the 20 largest cities in the country.

Comcast is aggrieved that the people it has seen across the negotiating table — with their hands out — cocked a gun after they didn’t get what they wanted, but in terms of the public debate, Comcast is at a disadvantage.

From the consumer perspective, Netflix provides a wide array of programming for $8 a month, and Discovery delivers abundant reality programming along with lots of furry and furious animals. Comcast is the cable guy with the drooping pants, the one who collects money for everyone else by issuing big, fat monthly bills — and then sends much of it right back out the door to programmers.

A senior executive at Comcast agreed that its aggressive response was “uncharacteristic,” but said, “Enough was enough.” This executive spoke on the condition of anonymity to discuss internal strategy.

“The increases that these companies are looking for in exchange for not opposing the deal are exorbitant,” the executive said. “Programmers don’t expect to get called out on this stuff, but the industry is reaching a breaking point, and we needed to stand up for ourselves.”

It sounded sincere and very likely is, but going on the attack is probably not good strategy. Comcast has always combined its political might with restraint of tongue, a brutally effective combination that it has temporarily abandoned. In reminding the F.C.C. to scrutinize motives behind the arguments it will hear as it weighs whether to approve or challenge the deal, Comcast seemed defensive and frantic.

I remain unconvinced that giving Comcast a bigger footprint is good public policy, but I understand its frustration. No one, even big, powerful companies, likes being ganged up on by opponents whose own motives are open to suspicion, but their response could create more problems than it’s worth.

When I was young and stupid, my friends and I tried to cut through a yard full of turkeys just for the thrill of it. The turkeys surrounded us and immediately began hitting us with their wings, protesting the intrusion. My farm-raised pal cautioned me just to ignore it, but after a while I couldn’t stand it anymore and gave one a nice swift kick.

And that’s when the trouble really started.

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