Affordable housing laws are not a solution. They are a symptom.

Affordable housing laws are not a solution. They are not even a partial solution. They are, at best, tokenism. They are a symptom.

Some people want the federal government to treat symptoms rather than problems. So:

  1. Local governments try to reduce street crime by hiring more police
  2. Some economists want the government to reduce unemployment by creating make-work, WPA-style jobs
  3. Some politicians try to increase affordable housing by passing Affordable Housing laws.

But street crime, unemployment, and lack of affordable housing are symptoms of a more fundamental problem. It is a problem that easily is cured, not with complex, convoluted laws and more government agencies.

The problem is: Lack of money.

We have discussed why street crime is merely a symptom of poverty. Areas with low, or non-existent poverty rates also have low or non-existent incidents of street crime. We have discussed why unemployment is not in itself a problem., Rather, unemployment is the face of a more fundamental problem: Lack of money.

Similarly, lack of affordable housing is a symptom of lack of money. (Those who have money never lack for affordable housing.)

On August 10, 1965, President Lyndon B. Johnson signed the Housing and Urban Development Act. The Act expanded funding for existing federal housing programs, provided rent subsidies for the elderly and disabled, assisted in the construction of more low-income housing, and provided funds for public works projects.

Four weeks later on September 9, 1965, President Johnson would go on to sign legislation that would establish the U.S. Department of Housing and Urban Development (HUD), a cabinet-level agency, to oversee the newly funded housing programs.

New York City Bans Smoking In Public Housing - Gothamist
“Improving quality of life.” Public housing projects: Crime, drugs, gangs, misery.

President Johnson thought he was solving a problem — unaffordable housing — but since that wasn’t the real problem, his “solutions” accomplished very little, for very few, and had strong, negative implications.

Although Johnson didn’t create the first public housing projects, that basic philosophy has led to drugs, crime, gangs, and misery.

In essence, Johnson had prescribed aspirin for a brain tumor.

Public housing is a form of housing tenure in which the property is usually owned by a government authority, either central or local.

Social housing is any rental housing that may be owned and managed by the state, by non-profit organizations, or by a combination of the two, usually with the aim of providing affordable housing. Social housing is generally rationed through some form of means-testing or through administrative measures of housing need.

One can regard social housing as a potential remedy for housing inequality.

That is the common, though false, belief, that public or social housing is a potential remedy for housing inequality.

Here is the brief mission statement of the federal Department of Housing and Urban Development:

“HUD’s mission is to create strong, sustainable, inclusive communities and quality affordable homes for all.

“HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination, and transform the way HUD does business.”

Today, local affordable-housing laws generally are left to state and local governments. Here, for example, is what Illinois law says:

Sec. 1. This Act may be cited as the Affordable Housing Planning and Appeal Act.
Sec. 5. Findings. The legislature finds and declares that:
(1) there exists a shortage of affordable, accessible, safe, and sanitary housing in the State;
(2) it is imperative that action be taken to assure the availability of workforce and retirement housing; and
(3) local governments in the State that do not have sufficient affordable housing are encouraged to assist in providing affordable housing opportunities to assure the health, safety, and welfare of all citizens of the State.
Sec. 10. Purpose. The purpose of this Act is to encourage counties and municipalities to incorporate affordable housing within their housing stock sufficient to meet the needs of their county or community.
Sec. 15. Definitions. As used in this Act:
“Affordable housing” means housing that has a value or cost or rental amount that is within the means of a household that may occupy moderate-income or low-income housing.
In the case of owner-occupied dwelling units, housing that is affordable means housing in which mortgage, amortization, taxes, insurance, and condominium or association fees, if any, constitute no more than 30% of the gross annual household income for a household of the size that may occupy the unit.
In the case of dwelling units for rent, housing that is affordable means housing for which the rent and utilities constitute no more than 30% of the gross annual household income for a household of the size that may occupy the unit.

As laws are wont to do, this one goes on and on, in excruciating detail, about who, what, why, when, and how, all invented by politicians who are clueless about the needs of poor people

Worse yet, all laws are generalities, that do not take into consideration the massively different needs of massively different families. It is the ultimate expression of paternalism by uninformed leaders.

My village of Wilmette, IL provides one of many examples of how difficult (impossible?) it is to provide affordable housing through legislation.

Wilmette, IL. Population: 27,087 people, 9,742 households.
Median household income in Wilmette, IL is $148,678 (compared to about $62,000 for the U.S.)
The median home price in Wilmette is $702,660, Zillow)

(There are 2 Low-Income Apartment Communities In all of Wilmette)
Gates Manor Apartments, 51 bedroom units. (Section 8 Project-Based Rental Assistance)
Shore Line Place, 44 bedroom units. (Section 202 Supportive Housing for the Elderly)

Out of 27 thousand people and nearly 10 thousand households, Wilmette has created 95 “affordable” apartments, of which half are for the elderly. Would anyone consider this a “solution to unaffordable housing”? A better description would be “tokenism.”

Wilmette primarily is composed of upscale, single-family housing. Yet, the political leaders of Wilmette felt a moral (legal?) obligation to provide affordable housing for poor people.

Clearly, the Wilmette government would not pay hundreds of thousands of dollars to purchase a decent Wilmette home to shelter a poor family.

Additionally, merely residing in Wilmette is costly. The school system is costly. Taxes are costly. Upkeep is costly. Even water is costly. So if poor families even were given free houses, they couldn’t support the ongoing costs.

The solution to housing unaffordability, indeed the solution to all unaffordability by the poor, is for the federal government to give people money. The Ten Steps to Prosperity (below) provides one set of solutions.

Rather than having politicians decide what universal percentage of household income counts as “affordable housing,” let each individual and each family make that decision. A 35-year-old man, with three children, surely will have different needs and make a different decision than a 55-year-old widow living alone.

Laws are expensive. At the local level, money spent to create and enforce laws does not benefit the populace. By contrast, federal spending costs people nothing, and it can solve the real problems facing the poor.

They are poor. They are short of money. The federal government has infinite money. The solution is clear. Help people improve their own lives by simply giving them money.

We should replace “affordable housing” laws with the Ten Steps to Prosperity.

Rodger Malcolm Mitchell

Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell …………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..


The most important problems in economics involve:

  1. Monetary Sovereignty describes money creation and destruction.
  2. Gap Psychology describes the common desire to distance oneself from those “below” in any socio-economic ranking, and to come nearer those “above.” The socio-economic distance is referred to as “The Gap.”

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics. Implementation of Monetary Sovereignty and The Ten Steps To Prosperity can grow the economy and narrow the Gaps:
Ten Steps To Prosperity:

  1. Eliminate FICA
  2. Federally funded Medicare — parts A, B & D, plus long-term care — for everyone
  3. Social Security for all or a reverse income tax
  4. Free education (including post-grad) for everyone
  5. Salary for attending school
  6. Eliminate federal taxes on business
  7. Increase the standard income tax deduction, annually. 
  8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.
  9. Federal ownership of all banks
  10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.


10 thoughts on “Affordable housing laws are not a solution. They are a symptom.

  1. The problem with the system is we think we have to earn money. That’s what the elders say. But do you have to earn your life functions, all of which are automatic? Can you stop your heartbeat, digestion, etc. at will?

    Money shouldn’t be based on employment, rather on automation. We’re running out of employment for various reasons, but not life or automation. They’re a gift to ourselves and as hard as it may be to grasp, so should money.

    Money is misunderstood thanks to the way we are taught about economics and the phoney concept of scarcity. Make money accessible to all and everything you see on TV and read on the front page will mostly disappear.

    BTW, have you considered Trump and Covid 19 may be cofunctions of evolution? One visible, the other invisible, and both trying to debunk and destroy disfunctional ways and methods. I know it’s hard to see these two as anything but our enemies, but they may turn out as blessings in disguise. Time will tell.


    1. Everything affects evolution. The birth, life, and death of one mosquito affects all evolution. That’s the “butterfly effect.” Whether any single one event proves noticable, beneficial, or harmful only history can tell.

      Perhaps, Trump will provide a beneficial example for future Americans, though one might have hoped Hitler would have been example enough.


  2. Step 9 – Federal ownership of all banks is also key to affordable housing. Housing prices are based on what a bank is willing to lend. 30 or more years ago banks wouldn’t lend to you unless the cost of the mortgage (interest+principal+PMI) was less than 25% of your income; this meant housing prices were more or less indexed to income growth.

    Of course now, due to deregulation and the bundling of mortgage risk into derivatives, private banks give little consideration to buyer income & affordability and are more than willing to get people into interest only loans at 40% or 50% of their income. This willingness to continuously lend more money drives up bank profit and housing prices faster than wage growth, plus the higher interest burdens mean home owners have little disposable income to spend elsewhere in the economy.

    These loans are also collateral based, and with increasing housing prices, banks see little downside risk, especially since they know the FED will bail them out if the housing markets tank again as it did in 2008.

    Federal ownership of banks would end all of this madness and risk taking and help to stabilize the growth in housing costs.


  3. Lack of money or low wages is a valid point. Affordable housing is not fair housing. Many below & poverty level wage people, like myself, work very hard and need affordable housing are placed in impoverished areas or areas where there is no public transportation and end up paying more in gasoline to travel back and forth to work & grocery shopping that is it a lose lose proposition.
    People fail to thrive grouped in impoverished communities.
    The environment is a daily discouragement creating more stress and low self esteem.
    This is my experience and is not a blanket statement that covers the world. 😊


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