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Will The “Affordable Housing” Lie Ever Die?

What will it take for the government to admit that it’s utterly and inherently incapable of efficiently providing “affordable” housing?

A comprehensive investigation undertaken by The Washington Post uncovered nothing but waste and fraud and suffering for the scores of neighborhoods and tens of thousands of people who were supposed to benefit from the efforts of the Department of Housing and Urban Development (HUD).

The Post‘s reporting should come as a powerful reminder that housing, like all services, is best left to free markets; that government projects designed to provide what the market supposedly cannot encourage abuse and often make the very problems they were supposed to address worse. The newspaper’s findings are staggering:

  • Housing agencies doled out millions of dollars to troubled developers including novice builders, fledgling nonprofits and groups accused of fraud or delivering shoddy work.
  • Checks were cut even when projects were still on the drawing boards, without land, financing or permits to move forward. In fifty-five cases uncovered by The Washington Post, developers drew HUD money but left behind only barren lots.
  • Nearly one in seven of all projects investigated showed signs of significant delay. Housing agencies repeatedly failed to cancel bad deals or alert the department when projects foundered.
  • HUD has known about the problems for years yet it fails to impose more stringent requirements on local housing agencies. Even when the department learns of a botched deal, federal law makes it impossible to demand a repayment. HUD can ask local authorities to voluntarily repay, but the agency was unable to say how much money has ever been returned.

Mismanagement and corruption in supposedly benign government projects is usually treated as incidental but is in fact endemic. Whenever one person is authorized to spend another person’s money for the benefit of a third, there is little incentive to spend that money wisely. Indeed, for the sort of noble souls that public works attract, the incentive is the very opposite—to take as much money for themselves and their friends as they can get away with.

The bureaucracies that control these practices are inherently incapable of correcting their contractors and themselves and so in the name of helping the poor, millions in taxpayers’ dollars are wasted on building urban monstrosities that no one honestly wants to live in—if anything is built at all. And it’s been going on for decades.

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