The Legalization of Affordable Housing

The Legalization of Affordable Housing

The legalization of affordable housing. That is what the Chicago City Council did when it voted to end the city’s ban on coach houses, basement and attic apartments, and other accessory dwelling units. While the technicalities of zoning rules seem dreadfully dull to most people, their impact can be far-reaching. The effect of the rule change will be modest, especially since it is currently only a pilot program, but it does have implications for poverty alleviation, and, perhaps more significantly, opening the door to undoing other zoning laws that have contributed to Chicago’s racist patterns of uneven economic development. 

Chicago’s uneven economic development is well known, perhaps even infamous. Relative to the rest of Chicago, the city’s southwest has several affordable housing units but no neighborhood amenities or employment opportunities. Without exaggerations, the conditions of many Chicagoans living on the southside are similar to people living in the developing world. City services are infrequent and violent crime is routine. The average life expectancy in the Englewood neighborhood is 60 years old. It is the same as people living in the Democratic Republic of the Congo. The housing is affordable in that area because no one wants to live there. As evident by the dramatic decline in population, as soon as people get the chance to leave, they take it.  

In contrast, the northeast is bursting with amenities. The area is ridiculously safe. The quality of schools is topnotch. The beauty and proximity to parks, services, and businesses are literally world-class. The life expectancy of the average Streeterville resident, who lives a mere nine miles from Englewood, is 90 years old. It is higher than the average Norwegian. Still, the housing costs in those areas are prohibitively expensive. For decades, the ability to work around those high costs by building a variety of affordable units, such as coach houses, makeshift basement and attic apartments, or multilevel affordable housing buildings, has been criminalized by the city’s zoning laws. The demand to live in those neighborhoods is understandably high, but while the demand is high, the supply of housing is low. Market logic cruelly forces the cost of an essential need into exorbitant heights. 

The contrast between Englewood and Streeterville casts doubt on both the neoliberal notion that gentrification is a solution to ghettoization and the NIMBY corollary that an area can avoid gentrifying through downzoning. Gentrification and ghettoization are not opposing phenomena. If anything, they are mutually reinforcing. Ghettoization occurs through a lack of investments in neighborhood amenities; gentrification occurs through a lack of affordable housing in neighborhoods with high amenities. A city, such as Chicago has done, can concentrate its investments in one area while also choking its housing supply through restrictive zoning laws. Inevitably this creates a bifurcated urban landscape where a fortunate few monopolize access to quality neighborhoods.  

Chicago was not always like way. While the city has always experienced economic and racial segregation, the intensity of that segregation has varied. Following the Second World War, Chicago was a middle-class city. Inequality existed, but low-income households were in the minority, and extremely high-income households were a marginal aspect of the population. Most of the population was middle-class. Partly, this middle-class majority was the result of liberal spending by the federal government. In 1937, Congress passed the Housing Act. That same year, the Chicago Housing Authority (CHA) was established. Immediately, the CHA created four major housing complexes for low-income residents mostly paid for through federal funds. The first three were all in predominantly white neighborhoods. These included the Jane Addams Houses on the near westside, the Julia C. Lathrop Homes on the northside, and Trumbull Park Homes on the southside. The last one, the Ida B. Wells Homes, was built three years later in the majority African American neighborhood of Bronzeville. 

The subsidizing of affordable units was an important, though relatively marginal, aspects of the federal government’s overall housing policy. More significantly was the Federal Housing Authority’s (FHA) promise to guarantee thirty-year mortgages. The association with America’s middle-class with homeownership is a comparatively recent occurrence. It began after the Second World War when new building technics, materials, and FHA backed lending practices instigated a housing boom. In response to the boom, private developers and landlords were forced to lower the costs of homes and rents. Homes and apartments were plentiful, and their abundance made them affordable. In such an environment, it was easy for cities like Chicago to maintain a sizeable middle-class population.

While public housing and government-backed mortgages reduced economic inequality, the programs were expected to reinforce the country’s racial hierarchy. The FHA was explicitly racist. The agency instructed banks to refuse to lend to borrowers from certain races. FHA did not want banks to lend mortgages to individuals who had a high potential to default. It was taken as a given that certain races were more creditworthy than others. FHA produced reports that ranked ethnicities based on their “beneficial effect on land values.” At the top of the list were people from English, German, Scottish, Irish, Scandinavian, and Northern Italian backgrounds. On the bottom were Russian Jews, Southern Italians, African Americans, and Mexicans.

While the FHA strongly supported segregation, but it could not actively enforce it. Hypothetically, banks could still lend to members of suspected racial groups, or, if a member of such a group happened to have enough cash on hand, that person could purchase a home outright. Even though the risk was slim, there was a constant fear among white homeowners that racial minorities could move in next door. For this reason, neighborhoods created racial covenants. As a condition of residency in a neighborhood, homeowners were prohibited from selling their homes to minorities. White homeowners—in cooperation with developers—created homeowner associations to enforce these covenants. When the United States Supreme Court ruled that racial covenants were unconstitutional in 1948, many distraught white homeowners resorted to open violence to prevent integration. In 1949 in Chicago, white residents rioted after an African American man purchased a home on 71st and St. Lawrence. 

The situation was similar with the city’s public housing projects. Initially, public housing projects were welcomed in the Chicago as long as those projects served whites communities and maintained the city’s system of neighborhood segregation. However, after the Ida B. Homes was constructed in Bronzeville, a slow panic set-in that public housing would become a tool of integration. By the early 1950s, the fear reached a boiling point. In October of 1953, a riot broke out when the CHA attempted to move African American tenants into Trumbull Park Homes. The following year, conservative white alderpersons successfully got the CHA’s first executive director, the visionary Elizabeth Wood, fired. 

By the late 1950s, the spasmodic violence against integration had become exhausting. Resentful white residential might have wanted to carry on the battle in the streets, but the business community and politicians were becoming annoyed. Fortunately for them, zoning presented a solution. At the time, forecasters were predicting a population explosion in Chicago. Prognosticators expected the city to grow to 4 million people by 1980. The anxiety that increased density would lead to de facto integration encouraged a new set of building requirements to remake the city. Under Mayor Richard J. Daley’s parental guidance, the city council passed the 1957 Planned Development ordinance. The new rules concentrated growth in the downtown area, leading to the creation of luxurious high-rises and skyscrapers, while severely restricting residential buildings in the neighborhoods. Neighborhood residential building heights were restricted to four-stories—essentially ending large apartment buildings and public housing projects—and coach houses, basement and attic apartments, and other accessory dwelling units were made illegal. In contrast, single-family homes were given “right of way” access, meaning they could be built with few regulations. Effectively, the American fetish for the single-family home, with an individualized and privatized lawn, garage, and space for an individual automobile—what the urban historian Robert Fishman refers to as a “bourgeois utopia”—became codified in Chicago.       

Even after the new zoning regulations, the campaign against any form of housing that could integrate the city—either economically or racially—continued. Community groups in the wealthy neighborhoods of Lakeview, Lincoln Park, Uptown, and Edgewater advocated for further downzoning. Rhetorically, these groups wailed against the “bigness” of high-rises and the need to protect the nebulous concept of “neighborhood character,” but the argument were always dubious. Fear of “bigness” never seemed to consider the environmental impact of sprawl, and the arguments for “neighborhood character” always seemed directed at modestly priced units. As an example, in the 1970s, an aggressive campaign was launched against four-plus-one apartment buildings. Four-plus-ones were hardly high-rises. These were four-story residential apartment buildings built atop a parking garage. Still, they were ferociously attacked by downzoning advocates. Dan Crowe, leader of the organization South East Lake View Neighborhoods, accused four-plus-ones of being “blighting time bombs.” Soon, four-plus-one apartment buildings were zoned out of existence. 

At the same time the city’s zoning laws were becoming more labyrinthian, investments in poor neighborhoods were becoming more austere. By Nixon’s second term, the federal government had essentially given up on funding urban development. By the late 1980s, intoxicated by the neoliberal turn within the Democratic Party, Mayor Richard M. Daley’s adopted a plan to destroy Chicago’s public housing projects. While Daley promised to replace them with smaller mixed-income units, the rebuilding process proved to be slow and incomplete. Over the same period, Daley gave ample support for the Loop and its surrounding areas. He expanded parks, beautified streets, oversaw the creation of Millennium Park, and converted of Navy Pier into a tourist destination. He also launched a Tax Incremental Financing (TIFs) bonanza that created an oblique system of neighborhood subsidies while simultaneously cutting off funds to regular city services. The changes tremendously increased the property values of residents of those living near the Loop but did almost nothing for those in the southwest. Ideologically aligned with Daley, Mayor Rahm Emanuel naturally followed suit. He oversaw a building boom in luxury apartments in the city’s downtown core but did nearly nothing to encourage the construction of affordable housing units. He did nothing for underserved neighborhoods, and when he would pay attention to them, it was to oversee a cruel and chaotic school closing policy which further drained the areas of resources.  

The legalization of affordable housing in Chicago is necessary to undo the city’s uneven economic development, but it is far from sufficient. The debate between market-orientated neoliberals who want to blast through all zoning regulations and NIMBY residents who reflexively block any project with transparently absurd arguments distracts from a more meaningful and nuanced discussion that Chicagoans should be having. While neoliberalism and NIMBYism appear antagonistic, they share a common bond of austerity politics. The difference is in style and emphasis. 

Neoliberalism insists that the most efficient way to ensure access to housing is through uninhibited market mechanisms. In this erroneous understanding, housing is somehow detached from neighborhoods. Increasing the housing supply will inevitably reduce its cost, but a reduction in housing costs means little to neighborhoods that have been abandoned through years of ghettoization. That abandonment can only be overcome through active investments in urban amenities—including jobs, schools, parks, and city services—by public institutions. That is something the market cannot provide. Indeed, quality neighborhoods were most accessible in the United States when the government took an active role in providing them to the population. 

Similarly, the NIMBY cry to downzone everything in the fear that growth will cause a loss in “neighborhood character” treats quality neighborhoods as a scarce resource. For NIMBYs, the scarcity is so intense that only a select few—the already privileged—can have access to them. A cursory reflection on the reality that restricting the housing supply for a popular area will inevitably mean that property values—and with it rents—will increase for that area exposes the materialist interest undergirding “neighborhood character” arguments. Furthermore, the wallowing of NIMBY proclamations never seems to question the “character” of a neighborhood, if it is actually worth protecting, and, in the case of Chicago, if such “character” is a mere mask for hiding the ugly face of racial and class animus. Undeniably, that is what it has been.     

The only way out of the tired debate between neoliberalism and NIMBYism is to promote the legalization of affordable housing and robust public spending on historically neglected areas. That is the only way to turn the tide on Chicago’s uneven economic development. It is a goal that many Chicagoans would no doubt like to achieve. Unfortunately, just not the ones living in expensive homes tucked away in the nice northeast neighborhoods. For them, the double selfishness—taxes should be spent on my neighborhoods while no one else should be allowed to live here—is the automatic refrain.