Fred Schnaubelt

Asinine Housing Policy--Myths of Rich & Poor                                                                                               “From each according to ability, to each according to need.”                                      San Diego City Council May 20, 2003  Published by The San Diego Daily Transcript June 17, 2003

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Stupid! Ridiculous! Idiotic!  These are just a few of the words (with expletives deleted) used by knowledgeable people to describe the city's asinine “Affordable Housing Program. This is the council's latest policy to take money from people who earn it and give it to people who haven’t earned it.  “Lucky Duckies” is the name the Wall Street Journal gives people who benefit when government plays Robin Hood. The new council policy requires builders to sell 10% of their new homes to low-income households or pay a fine up to $2.50 a square foot ($5,000 for a 2,000 foot home) for each home they build. Most builders being rational--unlike the young utopians on the city council--will opt to pay the fines rather than discount their homes up to $100,000. Despite the fairytale title, this policy will make all housing, new and used, less affordable. The city council has its own development arm and knows it’s impossible to build housing as cheaply as this sham ordinance requires. It's obvious that if government could create real wealth, it wouldn't need to tax the private sector. It would merely leverage its $130 million housing budget to build evermore non-profit housing for all supplicants, year after year. But even with no profit the city cannot match the private sector, which provides over 90% of all affordable housing. This is the dirty little secret the news media prefers to keep secret and cover-up! People, who don’t work or have no income, when compared to all people higher up the economic ladder who receive regular wage increases, see the gap between themselves and others growing. Duh! And, so what? Most people though they may start out poor don't remain poor all their lives (Harry Potter author and millionaire J.K Rowling, was once on welfare). As people become better educated and increase their work skills, they move up the economic ladder.    Mentally challenged people say the inequality gap is growing--the rich are getting richer and the poor getting poorer (despite overwhelming evidence to the contrary). They believe it's the city council's responsibility to close the gap. How does the council justify its redistribution of wealth? The only consistent explanation offered is median income households cannot afford median priced "new" homes. Since virtually 100% of all new homes are sold to ready and willing buyers, the only criterion by which the council's action can be justified -- is simple envy.   Just who are the Lucky Duckies? The U.S. Census reports that in San Diego 20% of adults don't have a high school diploma, mostly high school dropouts. Nearly 13% cannot speak English. People who neither speak the language nor have a basic education are bound to receive low wages. So according to the city council, if you lack discipline, don't study, and don't learn English, you get to leapfrog ahead of those who have worked, studied, and learned English. As my Mom would say, what a bass ackwards policy! Myths of Rich and Poor In reality, people who do not qualify for a median priced home today are largely in a transitory stage of their work career, and may qualify next year as studies by the California Employment Development Department, Federal Reserve Bank of Dallas, U.S. Treasury Department, and University of Michigan have confirmed. (Go to http://www.google.com--I’m Feeling Lucky, and type in “By Our Own Bootstraps”) The University of Michigan's Panel Survey on Income Dynamics, for instance, shows that only 5% of people in the bottom quintile in 1975 were still in the bottom quintile in 1991. Incredibly, only one-half of one percent was in the bottom quintile for every year of the 15-year study. Even more amazing, three out of 10 of the lowest income earners in 1975 moved into the top quintile by 1991. California’s EDD study of 187,000 workers during 1988-2000, and numerous other studies, shows that people move up and down the income ladder and that while the rich are getting richer, the poor are getting richer at an even faster pace. What a nightmare for the Housing Commission to annually invade privacies, examine tax returns, and under the ordinance try to kick out occupants as 95% over time are no longer low-income. The city council (excepting Mayor Murphy and Councilman Madaffer) hates rental owners. While landlords are prohibited by law from retaliatory evictions against tenants, there's nothing that prohibits retaliatory acts against landlords by the city council (ostensibly due to the illegal behavior of less than 1% of landlords). The Affordable Housing Ordinance (requiring 10% of new rental units be provided to people who can’t afford "new" apartments), together with the proposed Just Cause Eviction Ordinance, is squarely aimed at punishing all landlords. What have rental owners done to deserve this? According to the U.S. Census, landlords collect a median rent of $761 per month. The alternative is to buy a home, for which the median house payment is $1,541--more than double the median rent. (Incidentally, $761 is less than the target rents under the housing ordinance of $778 and $876 for one and two-bedroom units).  What a joke! Apartments offer a place to live for young married couples getting started, those saving for down payments on a home, those with limited incomes, and for many seniors in retirement. It's the people who honestly provide affordable housing (without cooking the books like the city does), the city council is punishing. Incredible!   From each according to ability, to each according to need, despite what 45% of adults (and politicians) in a poll think, isn't in the U.S. Constitution. It's an ideology that historically has harmed millions of people. It will also harm San Diego. Dinesh D'Souza writes of his brother in India badly wanting to migrate to the U.S., "He wants to live in a country where the poor people are fat."  Wait 'till he hears they're also entitled to brand new homes! By Fred Schnaubelt Fred Schnaubelt 2728 Adams Avenue San Diego, Ca. 92116 (619) 280-2082

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