Unless we come up with guaranteed income and in turn figure out ways to both eliminate the social service safety net while using less people to work thanks to robots and drones that will hence also eliminate the need for people and end that traffic problem.
Well what it will also do is eliminate the need for affordable housing that perplexing cities across America when it comes to finding homes for housing workers in the same cities people work in. Well that technology is on the way and soon people will be superfluous.
The debate about the tax cuts center on many issues that target the wealthiest and in turn decimate the social safety nets but below are two stories on two ends of the spectrum.
America's homeless population rises for the first time since the Great Recession
Exclusive: a new government study finds 553,742 people were homeless on a single night this year, as advocates lament a crisis that shows no sign of abating
Alastair Gee in San Francisco
Wednesday 6 December 2017 0
America’s homeless population has risen this year for the first time since the Great Recession, propelled by the housing crisis afflicting the west coast, according to a new federal study.
The study has found that 553,742 people were homeless on a single night this year, a 0.7% increase over last year. It suggests that despite a fizzy stock market and a burgeoning gross domestic product, the poorest Americans are still struggling to meet their most basic needs.
“The improved economy is a good thing, but it does put pressure on the rental market, which does put pressure on the poorest Angelenos,” said Peter Lynn, head of the Los Angeles homelessness agency. The most dramatic spike in the nation was in his region, where a record 55,000 people were counted. “Clearly we have an outsize effect on the national homelessness picture.”
Ben Carson, secretary of the Department of Housing and Urban Development, which produced the report, said in a statement: “This is not a federal problem – it’s everybody’s problem.”
Officials are due to announce the results on Wednesday morning.
Advocates who have witnessed the homelessness crisis unfold since it emerged in the early 1980s are grimly astonished by its persistence.
“I never in a million years thought that it would drag on for three decades with no end in sight,” said Bob Erlenbusch, who began working in Los Angeles in 1984.
The government mandates that cities and regions perform a homeless street count every two years, when volunteers fan out everywhere from frozen parks in Anchorage to palm-lined streets in Beverly Hills and enumerate people by hand. Those numbers are combined with the total staying in shelters and temporary housing. The tally is considered a crucial indicator of broad trends, but owing to the difficulties involved it is also widely regarded as an undercount.
“I’m surprised that [the numbers are] not going up faster than what that’s showing,” said John Parvensky, president of the Colorado Coalition for the Homeless.
There was an increase of 4.1% in New York. In the west, Seattle, Portland, San Diego, Sacramento and Oakland all reported surges of varying sizes. Most of the increase across the country is driven by people living in doorways, tents and RVs as opposed to in shelters. People of color are dramatically overrepresented: African Americans make up over one-third of the number.
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In one sense the prevalence of homelessness seems odd, because the national poverty rate has fallen to around the same level as before the recession. Yet homelessness is linked to economic growth. In some of the nation’s more desirable major cities, housing is rapidly appreciating to a point where it is out of reach for lower earners.
Median hourly wages in the US have barely budged for decades, from $16.74 in 1973 to $17.86 in 2016, in terms of 2016 dollars, according to the Economic Policy Institute. But in New York, for instance, the hourly wage required to comfortably rent a one-bedroom is $27.29. In Los Angeles, it is $22.98.
Vacancy rates in these cities are low, and construction of new homes is lagging. The state of California estimates that 180,000 new housing units are needed each year in order to keep up with population growth. Over the last decade, however, there was an annual average of less than 80,000 units, because developers often face a long review process and local opposition.
A vibrant state economy hasn’t “translated into a quality of life improvement for a lot of Californians”, said Sara Kimberlin, a senior analyst at the California Budget and Policy Center. When housing costs are taken into account, California has the highest poverty rate in the nation, at 20.4%.
Observers say that the federal government’s response to homelessness is lackluster.
Two decades ago, Erlenbusch said, he and colleagues “sat around the table and said, ‘We’re done in five years, it’s obvious what the answer is: affordable housing.’” But government investment in low-income homes has lagged since it was slashed during the Reagan administration, and today most people on the cusp of homelessness do not receive government rental assistance. Indeed, the government spends twice as much on a housing tax break for the wealthiest Americans, and the tax reforms under review by Congress would deal a further blow to affordable-housing funding if enacted.
Localities are left to improvise solutions. Los Angelenos voted to tax themselves to provide billions in funding. Tiny-home villages have taken root in Oregon and Washington state (though a plan to erect them in Silicon Valley was met recently by angry residents chanting “build a wall” to keep homeless residents out). Hawaii is pursuing the idea of authorized tent encampments.
Reflecting on the new count results, another long-time homeless expert, Washington DC social worker Julie Turner, spoke ruefully of her optimism of 30 years ago. Back then, homelessness in America seemed like it was only temporary.
“I thought that I was going to work myself out of a job.”
Joel Rubenzahl is not the kind of person who seems in need of government housing assistance.
He lives by himself in a four-bedroom home that he bought for $923,500 in 2000, in a genteel area of Berkeley, California. After 45 years in the business of building low-income housing, he’s semi-retired and quietly prosperous thanks to some sound investments. Yet every year, Rubenzahl, 71, can count on a generous tax break that mostly only goes to wealthier homeowners, reducing the tax he owes by thousands of dollars.
How does he feel about it? “Terrible,” he said.
This is because the US government spends more than twice as much subsidizing the tax break for affluent homeowners, who would most likely be able to afford their homes anyway, as it does on helping the poorest families pay rent and avoid homelessness – $60.1bn versus $29.9bn in 2015. As Congress tackles tax reform, advocates and economists of all political stripes are appealing for the tax break to be addressed, but the chances of that are uncertain.
“My whole career,” Rubenzahl said, “I’ve tried to provide quality affordable housing for as low-income people as I could reach, but it’s not nearly enough.” Meanwhile, the buyers he sees moving in all around him could lose their subsidies “and it won’t hurt them”.
A new study by Apartment List, a rental aggregator, shows that over half of high-income households claim the tax benefit, called the mortgage interest deduction (MID) because it reduces a filer’s taxable income by the amount of interest they owe on their mortgage. More than $10bn goes to households with incomes in the top 1%.
More expensive properties mean a larger deduction, so homeowners in pricey coastal regions – including Silicon Valley, San Francisco and surrounding towns such as Berkeley, and southern Connecticut – lead the country in the amount they are rewarded by the government, with subsidies of about $3,500 per household.
By comparison, only one in four Americans in need of rental housing actually receive it. In fact, the rental-assistance system – which is called Section 8 and generally covers costs that exceed 30% of someone’s income – is so overburdened that until recently, the city of Los Angeles had declined to even accept new applications for a voucher for a staggering 13 years, and New York’s waitlist has been closed since 2009. When Los Angeles finally started accepting new applications again, for only two weeks in October, almost 200,000 people applied for only 20,000 spots on the waitlist.
Indeed, in none of the country’s 25 largest cities do low-income residents receive more than half of the money that goes on housing benefits. This despite the fact that stable housing has been linked to improved educational outcomes, health and psychological wellbeing. Mostly, the cash goes to the well off.
“I think it’s totally misplaced priorities,” said Steven Bourassa, an MID expert and the director of the School of Urban and Regional Planning at Florida Atlantic University. “I think some people probably think that some people are not deserving of that kind of assistance,” he added. “Personally, I find it hard to explain.”
The MID has been touted as a way to encourage homeownership. In reality, research has shown it has a limited effect on homeownership rates.
“It doesn’t help people go from being renters to being homeowners,” Bourassa said. “What it does do is it encourages some people who are already owners to buy larger houses than they already would.”
Criticism of the MID comes from all corners. Ilya Somin, a George Mason University law professor who describes his politics as libertarian, said that economists and scholars “across the political spectrum” would agree with the sentiments he expressed in a recent column – that it is “bad policy”.
And yet despite efforts over the years to reform it, Somin said, “every time, this particular sacred cow has resisted being slaughtered”.
There are amendments that could curtail usage of the MID in the current House and Senate tax bills, most significantly in the House version. If the amendments make it through Congress, housing advocates say the money that is recouped should be invested in low-income housing rather than anything else.
“The House takes a good and historic first step in being willing to directly reform the MID, but taking those savings and using them to pay for further tax breaks for the wealthiest corporations and individuals is a complete nonstarter,” said Diane Yentel, president and CEO of the National Low Income Housing Coalition.
In Berkeley, Rubenzahl acknowledges the odd position he is in.
“I definitely feel conflicted about it,” he said. But “the tax code is the tax code, and nobody wants to pay more taxes.”