Affordable housing is never a bad idea. Or is it?

You know what’s wrong with good ideas?  They demand that we shed our preconceptions and act on a new premise.  You cannot with sincerity say, “what a great idea!” without next thinking, “we really ought to try that”.  Because of that compulsion to act, the best ideas often remain undeclared, are politely ignored, or are ridiculed outright.

Good ideas are the startling ones that we feel compelled to think about.  Unlike the comforting ideas that incrementally advance what’s already half done, , truly good ideas are a bit disturbing to most people.  You can’t get away from them.  They nag at you.  They’re tiresome, like my blog posts.

Even if a good idea is popular at first, the demands of implementation can generate so much resistance that we cut it loose, like a balloon, to float ineffectually above our heads, drifting away, always just out of reach.  So, it is with affordable housing.

Given the inherent goodness of the idea, and the immense capacity of government and industry, the failure to build adequate housing is not an implementation problem per se.  It is a lack of commitment to an idea that demands just a bit too much of everyone.  That’s what I took from the stalled initiatives described by John Gray in the Globe and Mail last week, which you can read here.

Despite all the best intentions, the Mayor’s people claim he was taking meetings on the subject but that he only got around to this file recently – too recently to show any real results yet. Under his watch, rivalries between City departments and agencies have undermined the effort.  But if he was really committed to the idea, if he was willing to expend political capital on it, if it was more than a campaign priority, it would have been a focus of the Mayor’s office sooner, and oversight would have been tighter.

Everyone can accept that more affordable housing is better than less.  But that’s not saying much, since no one, would ever contend that it’s a bad idea.  Who, other than developers and mortgage lenders, perhaps, would argue that there is too much housing, and it’s too affordable?

We’re all aware that underhoused people suffer, starting with learning deficits, higher rates of illness, lower career attainments, greater reliance on social assistance, and more frequent difficulty securing adequate housing later in life.

But is everyone aware that the economic consequences of inadequate housing are as great or greater than the cost of building and renting more affordable homes?  It might cost billions to build all the housing we require, if we could do it all at once, but most of those billions would be recovered through rents – albeit below market rents – over decades of use. Where built on public lands, those lands would still be held as valuable assets, appreciating silently all the while, available to the public in the future.  Properly managed, the increment of net cost for affordable housing on public lands is relatively slight compared with the long term costs of caring for all the social ills arising from housing shortages.

All those in favour of perpetuating the cycle of social costs resulting from under-housing or homelessness, including the avoidable tax burden for related problems, say “Aye!”

Anyone?  No one?

So why is it that we elect politicians who perpetuate these conditions for thousands of homeless or underhoused citizens, at the expense of hundreds of thousands of taxpayers, who feel financially and emotionally depleted by the problem?  And what is the cause of our politicians’ impotence when forced to confront the housing challenge?

As a voter, looking back at how this file was treated over the past two elections, I felt like I was faced with a stark choice.  On one hand, the political right prioritized tax reductions over care for our most vulnerable citizens.  This position, buttressed with winks and nods about the moral peril of rewarding poverty, I would characterize as cruel.  On the other hand, those left of centre advocated for generous social programs that depended on unworkable partnerships with senior levels of government, as if voters wouldn’t notice that all spending, by all agencies, at all levels of government, comes out of the same taxpayer’s pocket.  This, in Utopian rhetoric, tinged with liberal guilt, is easily dismissed as political and managerial incompetence.

Affordable housing is always a challenge when it is left to private industry. We all accept that the free market produces winners and losers in the competition for corporate and individual wealth.  However, when we treat the necessities of life, like shelter, air, water, health care, and food, as unregulated commodities, the loser’s losses can become unrecoverable.

It is very difficult for the losers to re-enter economic mainstream, and that’s not good for anyone. Once you’re homeless, dirty, hungry, and sick, you and your family may not have any bootstraps left by which to pull yourself up, as the saying goes.  While our social safety net reduces the severity of these perils, the multigenerational marginalization of people seems to be tolerable or even desirable to some of us.

But periodically a limit is reached, and housing has been identified as a critical factor.  Think of how quickly Toronto’s downtown streets filled with bodies after the Provincial government closed mental health wards and emptied hospital beds under Mike Harris.  Suddenly bankers had to run steeplechase over beggars on heating grates, balancing their lattes and Blackberries (it was the ‘90’s after all). Suddenly the consequence of uncaring social policy became evident to all, not just the victims.

That’s why we always talk about it – affordable housing is a good idea.  It’s also why we don’t attack the problem with much vigor.  It’s too good an idea; if we really commit to making change, face to face, during elections, we risk being discounted as lefty firebrands with no common sense.

You see the scary trap that politicians are sidestepping here:  If you say what you want to do, AND you say that you’re going to do it, you’re pretty much expected to say how you’re going to do it, and, worse, are then compelled to actually do it.  Despite endless talking, there hasn’t been much doing since the federal and provincial governments backed out of responsibility for housing in the ‘90’s, and very little take-up of the slack by the City.

It would have been in the mid-90’s that the Mike Harris Tories killed the coop housing program, for example, which had saved or created thousands of affordable housing units according to a loan and funding formula that restored buildings and put tenants in charge.  They were like non-equity condo corporations except that they helped meet the social housing needs of government and offered only rental, not ownership.  Think of the happy, stable, enduring Crombie Co-ops on the Esplanade as an example you can read about here, opened in 1979 , or the Broadview Housing Co-op formed in 1994, viewable here.  Between that time, when the Province ended its leadership on affordable housing, and the present day, the only municipal initiative of significant scale was the makeover of Regent Park during David Miller’s mayoralty.  Otherwise the City’s social housing inventory has shrunk through disrepair and divestment, the Toronto Community Housing Corporation crushed by a massive capital repair backlog and chronic operating problems.

It’s hard to explain the feeble City response to its affordable housing challenge except in terms of cruelty or incompetence.  The Mike Harris Tories forced the amalgamation of GTA municipalities and made Mel Lastman the first mega-Mayor of the new City of Toronto.  Mel thought that he had a good record on housing because, as he famously proclaimed, there were no homeless people in the former City of North York, where he’d presided for many years.  Sadly, before the ink could dry on that quote, a homeless woman was found frozen stiff in a North York bus shelter.  Even more sadly, Mel Lastman was elected anyway.  (humorous side note: The homeless tend to be underrepresented at election time because it's harder to get a ballot without an address.  This holds doubly true if you're both homeless and dead.)

It wasn’t always this way. As early as 1913, the City of Toronto had formed its own housing corporation and had developed its first two properties.  The Toronto Housing Company, as it was called, built and operated rental units on Bain Street in Riverdale and on Spruce Street in Cabbagetown.  Both were successful, both remain successful, and both are operated today as non-profit coops.

The difference between then and today is that municipal leadership stood up and said it was a priority, said it could be done, and did it.  It didn’t solve the whole problem, nor in some ways did the Toronto Housing Company as effective as intended, but it nevertheless demonstrated municipal leadership.

Flash forward 105 years, and witness Mayor Tory declaring affordable housing to be the focus of his 2018 campaign.  He’s vowed to form a task force and to lobby the federal government extra hard.  Like most of his predecessors, he was explicit about budgeting no new funds, nor to lead on the actual construction of anything, but of course he was running unopposed when he assembled this weak platform.

When you expect to win by acclamation, you don’t need to have good ideas.  You need to have inoffensive and unthreatening ideas.  Who doesn’t like the sound of affordable housing? And what politician doesn’t want credit for recognizing a problem without responsibility for proposing a serious solution? After the grinding failure of his transit commitments four years ago, it must be like a dream to wax eloquent about the need for affordable housing without any real expectation of result.

Jennifer Keesmaat spoiled his cakewalk with one simple suggestion:  If affordable housing is a problem in the City of Toronto, why not use the City’s assets and resources to build 10,000 new units a year for 10 years? Remember the scary political trap I described before; if you state the problem AND you suggest a solution, you are pretty much committed to action.  Now Tory has to back away from the issue or risk getting snared along with her.

Keesmaat’s idea of doing something – anything – is threatening enough to Tory, but it’s made worse by an eminently practical suggestion.  Start with surplus property the City already holds in its $17 billion real estate portfolio and you escape 10-20% of the developer’s cost.

She hasn’t outlined the rest of her proposal yet, but once you start thinking in this direction, the next thing the City might do to develop more affordable housing is relieve itself of development charges.  Although development charges pay for services such as schools and roads, it’s better that these are accounted for in the budgets where the costs are actually incurred, rather than stacking the affordable housing budget unnecessarily.  Services to those in need of affordable housing never have a full tax offset in any case, so this isn’t really foregone revenue. The decision not to pay itself development charges could reduce the average unit cost by a further 20% if the City was the developer. You can read more about that here.

If the City demonstrated this kind of leadership, the senior levels of government might be persuaded to make some of their idle GTA lands available for affordable housing too.  Perhaps they could be acquired under long term leases to avoid the political toxicity of diverting capital or land to the City of Toronto’s poor.  Then, by raising the self-imposed debt limit of City Council, it might be possible to borrow at the best government interest rates and extend the amortization period to recover building costs, at reduced rents, over the long term.  Who knows what’s possible when you start with 35-40% reduction in construction and financing costs, relative to private sector developers struggling with higher land costs, development charges, and financing costs?

But we know what’s possible if we don’t declare what our objective is.  Nothing.  No one wastes any time imagining the ways and means of creating affordable housing until someone goes beyond recognition of the problem and ventures a solution, as Keesmaat has done.

I was having drinks with a couple of really, really smart real estate executives.  They shared an article about Vienna’s approach to affordable housing, which has worked for a very long time, to the satisfaction of everyone... except perhaps real estate developers. You can see why here.

In purpose and practice, it sounds Utopian by comparison with the stricken Toronto housing market, yet it works so well, it underpins The Economist’s recent ranking of Vienna as the most liveable city in the world.  Despite this, when they spoke about Keesmaat’s proposal, they were dismissive. It was too ambitious, too aggressive, too nanny state-ish…

To my ear, it sounded like they thought that it was too good an idea.  Although they were both decades younger than I am, and both were intensely curious and iconoclastic, they were reluctant to let go of received wisdom.

Keesmaat’s idea was disturbing precisely because it called for action on a new premise.  She has said that if no one else will build affordable housing for Toronto, Toronto can build it.  I thought about Vienna, and how someone must have declared many years ago that everyone needs and deserves somewhere to live, and that it was worth dedicating a share of collective wealth to avoid the scourge of under housing and homelessness.  It had to said, and once said, it had to be acted on, and then, in the goodness of time, by trial and error, their good intentions were realized.  But it had to start by stating the goal and committing to action.

We find solutions and enact them when we get serious about a problem.  Tory wasn’t serious.  Keesmaat is. And how unattainable is her goal when government owns sufficient land, can borrow at the best interest rates, can wait longer than private developers to recover its investment, and at the end of the buildings’ useful lives, still owns the land beneath, which has been appreciating all the while?  Is it really inconceivable that a large amount of good quality housing can be built with all these advantages, and priced 30-40% below the commercial equivalent in the “affordable” bracket?

Anyone who says it’s unimaginable is either unwilling to join in the effort or truly lacks sufficient imagination to be making decisions about our future.  Or, worse, they’re comfortable with things as they are, with a growing and permanent underclass driven from the core of the city into squalid and overcrowded conditions, faced with a dire choice between shelters and other necessities, or utterly without a roof over their heads.  There are 200,000 people on waiting lists for TCHC units, and thousands more on the brink of homelessness, dependent on shelters or sleeping on the streets.  Then there are tens of thousands more who simply can’t earn enough money to afford a decent space anywhere close to where they work.   Who can’t imagine a better city than this?

Elsewhere I’ve said how glad I am that Keesmaat is in the race.  At this critical point in the City’s history, with a hostile provincial Premier, with infrastructure in disrepair, and with an understated housing crisis, I want someone with a planning perspective taking on these 20-50 year challenges, not a reactive politician thinking in four-year election cycles.  My choice is no longer limited to the incompetence and cruelty that has perpetuated this crisis for decades.  I now have the option to vote for a vision, for a resolve, for a commitment to action.

This reckless commitment to action will probably make Keesmaat’s campaign more difficult, but for anyone who cares about what happens after election day, it’s nice to have a choice. 

1 Response

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