Homeownership has long been part of the American dream. Once regarded as taboo, federal influence in this sector has grown over the years. Today, over 400,000 New Yorkers reside in 344 public housing developments around the five boroughs. However, the history of our public housing policies was variable, to say the least.
Prior to 1933, the provision of shelter by the government was nonexistent—this was solely an individual’s business. In fact, the idea of subsidizing housing units was regarded as socialistic and the United States government preferred a hands-off policy. The closest the United States had ever come to public housing was in 1918 when Congress allocated $110 million to two programs for housing war workers. But with intentions far from helping the poor, the houses were soon sold to private developers and the government was, once again, out of the housing business. The Great Depression in 1929, however, fundamentally shifted the American Government’s attitude towards intervention in the housing market.
The Great Depression had an immense impact on the housing industry and the homeowner. With astronomical declines in construction of residential property, expenditures on home repairs and a never-before-seen rate of foreclosure, the housing market was headed towards complete collapse. It was evident that a safety net was necessary as other sectors of the economy were subsequently suffering. In 1931, President Hoover proposed a federal housing policy that centered around amortized mortgages, low interest rates and reduced costs. Although the government realized it had to intervene, Hoover’s policy proved to be inconsequential because the government still relied on private capital initiative.
Real changes were beginning to take form when Franklin D. Roosevelt entered office in 1933. Both the Home Owners Loan Corporation (HOLC) and Federal Housing Administration (FHA) had lasting impacts on public housing. Their negative attitudes towards city living and subjective “systematize” rating methods did little more than measure ethnic and racial worth. As housing was back on the rise in 1936 and it became cheaper to buy than to rent, the HOLC and FHA gave suburban areas higher grades and urban life deteriorated as middle-class constituents moved out of cities. Homogeneous, suburban neighborhoods were given higher ratings and were given loans more easily, even though “residents of poorer sections generally maintained a better pay-back record than did their more affluent cousins.”
It was not until the civil rights movement that people began to see the redlining practices of the FHA. Jackson makes it clear that lasting damage was done to the housing market and, more specifically, urban life, calling it “the supreme indignity.” While the history of public housing in America may have been far from effective, public housing is now a very important part of society. During an internship last semester, a majority of my work was related to low-income public housing for New York City residents. As a life-long Staten Island resident surrounded by one-family homes, I never knew just how many people rely on public housing. There is definitely room for improvement in certain policies, but public housing in urban neighborhoods has come a long way.
