Letters: What Do You Think?

This week: Subsidies Enrich Landlords; Would Lawn Sign Thieves Steal Elections?; Suher vs. Iron Horse Workers

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Thursday, November 08, 2012

Subsidies Enrich Landlords

While reading the excellent article “No Place to Live” in the Oct.18th Advocate, I asked myself, Why are we allowing the 1 percent to impose so much suffering on our most vulnerable residents?

We now live in a state where it is possible for families to be ineligible for emergency shelter, and where the Section 8 voucher program has a waiting list 75,000 families long.

A rental subsidy is certainly welcome if you have one, but it actually helps to perpetuate the problem of landlords charging more for housing than the public can afford to pay. The housing is still unaffordable, but now the state is paying part of the unaffordable rent.

This would be okay if it was unusual for a tenant to be unable to afford the rent, but when a whole class of people find the “market” rents to be out of reach, there is something wrong with the market.

In Massachusetts, 69,000 individuals and families receive Section 8 vouchers, in addition to the 75,000 who are on the waiting list. Hundreds of thousands more are in city- or state- owned housing, or in complexes like Windfield Estates, where the landlord receives the subsidy directly. Most of the rental housing in this area is between 30 and 50 years old. Some if it is well built; most is very poorly insulated for heat and noise. The landlord’s mortgage is long since paid. The rent is set, then, not on the owner’s expenses, but on the maximum amount that the traffic will bear. After paying real estate taxes and wages, the owners skim off most of the rental proceeds to buy more housing complexes.

I researched my own landlord, Cliffside in Sunderland (which is one of the better-built complexes and whose management I like) because I already knew they were owned by Northland Investment Corporation, which owns commercial and residential properties in nine states. This includes 60 residential housing complexes and 16 commercial properties. The owners of Sugarloaf Estates, also in Sunderland, own residential complexes in 14 states from Massachusetts to Texas and California.

In my view, section 8 is not a subsidy for tenants but rather a subsidy for landlords, since it allows them to receive more for rent than the amount the renting public is able to pay. In the Five College area, another landlord enrichment subsidy is the student loan program. Like Section 8 recipients, students are paying more rent than they can actually afford.

A more sustainable approach would be to address the imbalance of power between the tenant and the landlord. I think we need to take a second look at rent controls. These were voted down in a statewide referendum in 1994, but that was before we knew about the power of the 1 percent to influence public opinion. It was also before crippling federal budget deficits made rent subsidies less affordable. And it was before the Internet put a mountain of information at our fingertips.


Would Lawn Sign Thieves Steal Elections?

Living on a street that borders the Deerfield River in Shelburne Falls, I took precautions to prepare for Hurricane Sandy. I even took in my two Elizabeth Warren, one Obama-Biden and my Vermont Yankee Evacuation signs so that the expected winds would not blow them away.

Fortunately, Sandy passed us by and I put my signs out again.

What I was not prepared for was a thief in the night who stole my two Warren and Obama signs. He, she or they must agree with the bipartisan belief that Yankee Nuclear must be shut down.

What is it that encourages a person, evidently uncomfortable (or embarrassed) to ask me directly why I am voting as I am, to skulk around after dark and steal symbols of my belief?

Is this the kind of mentality that would take any and all steps to steal an election?


Suher vs. Iron Horse Workers

It’s one thing to negotiate in a hard and serious fashion; it’s another thing altogether to refuse to negotiate and disobey and disrespect a law that was only designed to initiate a dialogue and ensure fair and equitable pay with each side reaching agreement with the other. What possible reason could Eric Suher have for taking such an anti-American stand [“Should the Iron Horse Pony Up?”, November 1, 2012]?

At least with a conviction against him by the National Labor Relations Board, there is now a public record of his actions.

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Cathy Etheridge is correct about Section 8 enriching landlords, but her analysis is incomplete, and her conclusions are therefore also incomplete.

Prior to the 1980s rental housing was suffering from disinvestment, largely because the government-subsidized low-interest mortgages and tax deductions for mortgages had siphoned off young families, the traditional markets for rental housing by making new suburban housing much more affordable. Rents in Western Mass were typically under $200 a month.

Then, with Section 8, owners of rental property could just about name their own prices, as Cathy described in her letter. The result of this was a rapid and drastic appreciation in the value of existing rental housing. Two-family homes that had been selling for $15,000 for many years were suddenly worth $150,000 or more. In addition large firms like to ones she referes to began building large numbers of new units based on the inflated rents supported by government subsidies. The subsidies have enriched landlords, as Ms. Etheridge pointed out, but they also greatly enriched both speculators and mortgage bankers, who have made millions and millions on these many mortgages. The effects on poor families are less clear.

Since, according to one public official, there are only enough subsidies for 15% of those eligible, the programs probably create more problems for poor people than they solve. It is not clear that they have made housing conditions better, since 85% of the poor are probably less-well housed than they were as a result of the programs, and housing costs are broadly higher as a portion of income that they were in the 1970s.

Perhaps the solution is a genuine review of all of these programs, including the subsidies for construction new suburban houses, to see if this is really a path to a sustainable future, or if perhaps there might be a better use of National resources than enriching landlords and bankers.

Posted by David Gaby on 11.8.12 at 16:02



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