Late Stage Socialism At The New York City Housing Authority
/Back in May 2016, I commented (in a post titled "New York's Ongoing Housing Madness") that the New York City Housing Authority (NYCHA) had "hit the inevitable terminal phase of the socialist death spiral." As described in a big report put out by NYCHA itself, there was:
[an] "accelerating financial collapse" of New York's low income public housing: $2 billion annual shortfall of rent to cover operating expenses, only partially covered by HUD subsidies, leaving a multi-hundred million dollar and growing annual deficit; $16 billion of identified and unmet capital needs, with no source of funds to pay for them; zero property tax contribution to the City; [and] hundreds of thousand of residents living on some of the world's most valuable real estate and receiving massive subsidies, yet in "poverty" with no way to escape.
But the funny thing about these socialist death spirals is that you never know how far they will have to go before they finally collapse and disappear onto the scrapheap of history. I mean, who would have thought that a North Korea or a Venezuela could possibly have gone on as long as they have? Yet there they are today, economies getting smaller every year unto the vanishing point, the people starving and desperate to escape -- and the strongmen still clinging successfully to power and undoubtedly squirreling away a few billions in European banks.
At NYCHA, another year-and-a-half on, they only sink lower and lower. But a new crisis in the last couple of weeks has caused even the intentionally ignorant New York Times to take some notice. The Times weighed in yesterday with a big editorial headlined "The City as Problem Landlord."
The recent crisis is that it has come to light via a Department of Investigations Report that the City has failed to carry out required lead paint inspections in the NYCHA apartments for at least the period 2012 to 2016. Oh, and they lied about it, falsely certifying to the feds that the inspections had been conducted.
[I]t’s not surprising that the city Housing Authority would struggle to fulfill requirements under city and federal law to check for lead-paint dangers in thousands of apartments prone to them. Still, it’s stunning that authority officials not only failed to carry out those inspections from 2012 to 2016 but also falsely told the federal Department of Housing and Urban Development that it had done so, a city Department of Investigations report found. The authority’s chairwoman, Shola Olatoye, was aware in the summer of 2016 that her agency’s certifications were false. She told Mayor Bill de Blasio at the time, but he did not make it public. It wasn’t until after the report — a year and a half after the mayor and Ms. Olatoye learned of the problem — that two executives were forced out and one demoted.
Can we maybe blame Donald Trump? Oh, wait a minute -- this all took place before Trump was President, and most of it while progressive hero Bill de Blasio was Mayor. Well, at least we can throw in a gratuitous swipe at Trump that has nothing to do with the current issue:
You might expect this from the administration in Washington, which appointed a former Trump party planner as the federal housing department’s regional supervisor, but not the administration of Mr. de Blasio (who held that regional position in the Clinton administration).
So, is this an isolated issue? Or is NYCHA facing an accelerating decline in all areas?
This is not an isolated mistake. Last year, after two children died in a fire hours after a Housing Authority worker certified that their apartment had working smoke detectors when it did not, the investigations department found that such false reporting was a widespread practice. Two years ago, a frustrated federal judge decided to appoint a special master because of the authority’s delay in curbing mold. Last year, too, Investigations Commissioner Mark Peters said his department found “a wholesale breakdown in the basic management of the elevator division” of the authority after a defective elevator killed an 84-year-old Bronx tenant.
Of course, this being the New York Times, the proposed solution is a call for more government money and an end to "cuts." They claim that "the federal government has reduced its contribution to the city's Housing Authority by $2.7 billion since 2001," but I am completely unable to verify that figure, or anything like it. What I find instead is that annual federal subsides to NYCHA have increase dramatically since the early 2000s. (Of course, the Times does not identify the baseline against which what it calls a "cut" is measured -- are they talking about an absolute reduction, or a comparison to projected increases that then were not met?) According to this report from New York's Independent Budget Office in 2003, the entire NYCHA operating budget in 2003 was only $1.4 billion, so the annual operating subsidy from HUD could not possibly have exceeded that figure. Today the (enormous) HUD subsidy to NYCHA is around $2+ billion per year (out of a total annual operating budget of about $3.2 billion). Obviously, the annual federal operating subsidy has gone up, not down, and by a lot. This is the typical socialist death spiral: more and more money buys less and less, and the problems get worse every year. Meanwhile, the Trump budget outline released earlier this year called for a cut to NYCHA of only about $35 million per year, which would be less than 2% of the annual subsidy. That set off anguished wailing all around New York subsidized housing circles.
What the Times editorial ultimately demonstrates is the poisonous incentives of socialist-model public housing. With no one having an ownership interest in the properties, the residents and bureaucrats take a completely passive approach to dealing with the challenges they face. An endless series of inevitable "crises" ensues, which are the perfect opportunity to demand more taxpayer money to cure the immediate crisis, even as the next one is inexorably developing in the shadows. The perfect illustration of the attitude comes in the last two paragraphs of the Times editorial, obviously crafted to evoke your sympathy and even outrage:
Ricarda Solorzano, who has lived in the Mill Brook Houses in the Bronx for 18 years, has lost faith. For years there has been mold in the apartment she shares with her two daughters and their two young daughters.
“They only care if you pay your money on time,” she said of the authority. “They don’t care about people.”
No way would Ms. Solorzano or any of her offspring accept any personal responsibility for dealing with the problem of mold in her apartment, or for that matter lead paint or smoke detectors or anything else. Why should she? This is socialism!