HUD in the Ben Carson years
President Donald Trump’s choice of retired neurosurgeon Dr. Ben Carson to head the Department of Housing and Urban Development (HUD) may very well be the most confusing Cabinet appointment of recent years. His predecessors both had extensive backgrounds in housing policy; Shaun Donovan ran New York City’s affordable-housing programs for four years, and Julian Castro dealt with affordability and housing quality on a daily basis as Mayor of San Antonio, one of America’s largest cities. By contrast, Carson has never held a government position, and his own spokesman admitted that he lacks the experience typically expected of a cabinet secretary. Nevertheless, he seems almost certain to be confirmed by the Senate.
Unfortunately for HUD, the inexperienced Carson will take office at a time when the department’s mission is more important than ever. Housing issues have fallen from the headlines in recent years, as the subprime mortgage buildup that precipitated the Great Recession of 2008 recedes into memory. But a crisis of affordability has taken its place. Economic activity in the United States is increasingly concentrated into a few metropolitan areas. Consequently, housing prices and rent have soared in job-rich sections such as the Amtrak corridor, North Texas and the Bay Area, while large swathes of the upper Midwest and the South have affordable housing, but few jobs for those who move to take advantage of it. The burden of the affordability crisis has fallen most heavily upon the lower-income Americans whom HUD is supposed to serve. Despite recent growth, mean household income is still not growing as quickly as rent. As a result, the Center on Budget and Priorities’ Douglas Rice estimated late last year that HUD’s budget for housing vouchers would need to increase by almost $19 billion just to keep up with demand.
If his confirmation and previous statements on federal housing policy are any indication, Dr. Carson is unlikely to advance this goal. He previously described the Obama administration’s efforts to enforce the Fair Housing Act, which prohibits discrimination in housing receiving HUD funding, as “social engineering”, and described government spending of the type overseen by HUD as “America’s incurable disease” in a 2014 op-ed for the Washington Times. To be sure, the secretary-designate appears to have given some thought to the direction he would like HUD to take. He stated that he was open to partnering with private organizations and taking a “holistic” approach to housing access. Carson’s tenure may be a golden opportunity for HUD’s Moving to Work Demonstration, which allows public housing authorities to experiment with new ways of providing housing assistance. Researchers from the Urban Institute recently explained how partnerships with school districts may allow children living in HUD or other public or voucher housing to catch up to their peers in the classroom. Private charities have been also been able to work with housing authorities under Moving to Work. In short, the program dovetails closely with Carson’s approach to housing policy.
But MTW has its limitations. While the program may be able to help children in areas of concentrated poverty, ending such a concentration will require further funding. The housing affordability crisis has created a literal gap between poor and affluent students, as few working-class parents can afford to move into areas with high economic activity and strong school districts. Researchers have long warned that this gap holds students back. But closing it would require increased federal funding. Currently, housing voucher amounts are calculated based on housing prices for metropolitan areas as a whole. As a result, a minimum-wage workers seeking to move into a better neighborhood may find that her voucher will not cover the higher rent. As a result, she will be forced to seek cheaper housing in a less desirable neighborhood, and her children will be sent to a poorer school. In order to break this cycle of concentrated poverty, HUD recently pioneered a program to tie voucher amounts to neighborhood costs, rather than overall metropolitan areas. But this idea is expensive, making it unlikely that Dr. Carson will expand it to other voucher holders. The Trump administration will hardly mark the end of HUD, as Dr. Carson voiced opposition to scrapping HUD subsidies altogether during his confirmation hearing. But at a time when the American housing market is rushing forward, a department stuck in neutral is unlikely to be helpful to cash-strapped renters and homeowners. Housing affordability is unlikely to improve under the Trump administration.