The Wall Street Journal carried a report last week that HUD wanted billions more for housing programs because a “record 5.4 million households need aid for rent.” ["Record 5.4 million households are in need of rental assistance", by Shailagh Murray, Wall Street Journal, March 28, 2000.] According to HUD “affordable housing units” decreased by 370,000 from 1991 to 1997.
As with the cries for more federal spending on education, the cries for more spending on public housing are made without any recognition of why the world`s richest country has a shortage of housing and schoolrooms. Yet it is painfully obvious that immigration is the root cause of housing shortages in many urban areas. According to HUD, among the “hardest hit” by the shortage of affordable housing are “Hispanic households.” The “worst places” to be a low-income renter are the West Coast and New York. The Washington Post recently carried articles about DC government efforts to shut down slumlord housing, noting that most of the tenants are immigrants.
When immigrants come to the US, they don`t bring housing with them. In theory, the market will generate new housing for new households. The problem with the theory is that the cost of a new home that meets modern building codes is outside the reach of working class people.
At the turn of the century, slumlords built ramshackle firetraps for the poor European immigrants flooding into New York. Teddy Roosevelt started his political career attacking these “tenements.” Today, building codes preclude the construction of “new housing” for the poor, and the stock of housing for poor working people consists almost entirely of (1) older housing abandoned by the better off and (2) government-subsidized construction. In effect, the supply of low-income housing is not determined by the demand for it from low-income people but by the demand for newer housing by higher income people.
Unless the federal government spends the entire budget surplus building new, subsidized housing, America`s homegrown working class will be forced into a fierce competition with poor immigrants for what even HUD acknowledges is a dwindling supply of affordable housing. How ironic that, as taxpayers, American workers may be forced to subsidize the American employers that replace them with lower-wage immigrant labor – by financing new schools and new housing that the poorly-paid immigrant workers cannot otherwise afford.