Thursday, September 11, 2014

Housing is a human right and the market can't provide it.

by Richard Mellor
Afscme Local 444, retired

I went back to Britain during the great miners strike of 1984-85.  With the help of her US advisor, the Reaganite Thatcher, using massive police presence, crushed that strike and decimated whole communities.

I was on a picket line of about three thousand miners confronted by as many if not more police.  Walking up the lane toward the pit-head I looked to the left and there in the early morning mist were cops on horseback, the warm breath from their steeds flowing like steam in to the cold air.  It is a terrifying thing for a person on foot when a horse is used against them as a weapon.  The miners would carry marbles and throw them down as horses can’t fare too well walking on marbles.  The cops also had these vans with shields that were attached to the sides and the vans would be used to charge the strikers and then cops with batons would emerge from behind the shields.

This was a civil war alright. Workers were desperate in the cold winter and often hunted for coal themselves, including coal washed up on the beaches.  The Labor Party and I assume the NUM had soup kitchens for people to eat at as well.

Having been in a strike myself I know it’s a very difficult time. The capitalist media uses the term strike happy when workers engage in a struggle this way, the most powerful weapon wage-workers have. But withholding our labor is a serious thing, a scary thing here in the US where we rely on our jobs for health care and most of us have mortgages. In the strike at my workplace the bosses let us know pretty quickly that our medical benefits would expire in a month.

One thing was very different in Yorkshire. So many of the workers lived in council houses or public housing as we would also call it here.  Here in the US there is a great stigma about public housing, you’re trash, poor, lack the initiative and incentive to go get a job and buy a home.  But back then, until Thatcher convinced everyone they needed to be like Americans and own their homes and earn equity and all that market oriented nonsense. Many council homes were very nice, not all of them, but a lot of them. I have relatives that still live in them..

One aspect of this was that workers on strike were not threatened with losing their shelter when engaging in work stoppage, or it appeared that way to me.  When coupled with a national health system, health and shelter being somewhat covered, a great burden is lifted off the shoulders of workers going on strike.  The miners were striking for the right to work and save whole communities.  Thatcher wanted to privatize everything although the taxpayer paid for this nasty characters funeral. She helped destroy entire communities. Thatcher and the massive police presence (18,000 cops) was not the only reason the strike was defeated, the trade union hierarchy played a key role but that’s another issue.

Here in the US, owning a home is a big deal.  Society is set up to encourage it.  One huge incentive is that the interest on ones mortgage debt is a tax write off.  Interest on credit card debt used to be as well but that has long gone.  A person’s house is also a bank, a source of funds that can be drawn out through refinancing or borrowing on the equity.  This is what happened in the housing boom that led to the bubble that precipitated the Great Recession.  Trillions were pumped in to the housing market back then inflating prices and money was cheap.  In the aftermath of the recession, private equity firms like Blackstone spent hundreds of millions of dollars buying foreclosed and empty homes in order to rent them out.  This has contributed to the increase in home prices today and consequently mortgage debt is on the rise again.

It’s a life of never ending insecurity because more often than not people don’t own their home, the bankers do as witnessed by the 5 million or so foreclosures that followed the crash and the millions more who are underwater. BusinessWeek reports that the share of Americans over 65 with mortgage debt climbed from 22% in 2001 to 30% by 2011 with median loan balances doubling and now, retirement age homeowners are facing working longer and longer because of increased debt. “Sixty five percent of homeowners with mortgages are still working at age 64, compared with 54% of those without debt” BW reports.”    So people that thought they could retire face working longer to pay off the home. This is after paying hundreds of thousands in interest dollars to the moneylenders. One only needs to look at the payments in the early years and see how much of your hard earned money goes to moneylenders in the form of interest.  This is not freedom.

US society places immense pressure on people to consume and in order to consume one must have money and that money comes in the form of debt.  The working class produces more value than we receive in wages so capitalism uses debt to overcome this inability of the consumer to pay for the products labor creates. As home prices rise, people re-finance their mortgages and use that debt in the absence of savings. This works for a while until the bubble bursts as it always does.  Older Americans are in the lead when it comes to refinancing as home ownership for young people is becoming more difficult.  The US home ownership for Americans 35 and younger fell to 39.9% in the second quarter of this year, the lowest level in quarterly data in 20 years.

A friend happened to mention to me when I pointed out that private equity has been spending billions buying up homes in order to rent them out or re-sell them if market forces made it profitable, that it was a good thing as prices rise.  But it is not a good thing.  These inflated prices eventually have to be brought to earth and they also place a tremendous burden on working class families who struggle to pay the moneylender their mortgage interest. It increases the misery index.  Then it also prices other people who are trying to “own” a home out of the market.  They’d rather own than pay a landlord (rents aren’t a tax right off)

I don’t have all the detailed answers to this problem, no individual does. The main point is that housing, like food, should not be a commodity.  The idea that the market is the only way this human necessity (shelter) can be provided is very powerful here but is false.  How we provide human shelter and in what form, has to be a collective decision; it should be made by those who will use it, not by investors and developers whose sole purpose and motivation is not providing this social need, but of making profit. They could just as well be investing in dog food.  It should also be made with the safety and protection of the environment as a major component.  Of course, workers do not have the time and the structure is not there.  This too is not an accident.  The same people that control the housing industry control the workplace and society as a whole. So social issues like housing, leisure time, production of our needs, all has to be linked to the way society is organized. 

Obama and both Wall Street parties are about to embark on further military ventures as some of their former friends are getting too big for their boots. They need more money for this.  This too is about profits. They all say any force that harms Americans will be rooted out etc.   They are our great protectors.  What are they protecting? They are protecting an America where workers are finding shelter harder to come by. Where homelessness and poverty is rampant.  Where young people who are swamped with debt doing what they were told they should do, leave college but can’t find work and if they do, they earn as much or less as others with no college and no debt. Student debt is over $1 trillion and greater than credit card debt. They are taking care of us so much they want us to work in to our seventies and longer, indebted in death. We can judge a society by how it treats its senior citizens as we all hope to get there some day and things are not looking good as they are.

They are “protecting” a society in which more veterans die from suicide than combat. Where 2.4 million of its citizens are incarcerated, thousands of them spending 30 years or more in solitary confinement at any given time.  Counties in some US states are purchasing attack helicopters as they know fully well that the US working class will not tolerate this forever, will not be conned by the fear of foreign enemies and a bunch of religious fanatics forever.

There’s no escaping it; society needs new managers.

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