“Ojalá no supiera ahora lo que no sabía antes”.

Era un verso al pasar en la balada “Against the Wind” (“Contra el viento”) de Bob Seger de 1980, una reflexión sobre la inocencia y el remordimiento. Si bien le parecía que sonaba raro y no era gramaticalmente correcto, Seger lo conservó porque a sus allegados les gustaba. Desde entonces, el verso ha inspirado a otros artistas para hacer sus propias interpretaciones. A mí me inspira como invitación a aprender, ofrece un marco de reflexión acerca de las consecuencias impensadas y nos permite imaginar cómo podríamos haber actuado de otro modo. En particular, es relevante en el contexto de la crisis nacional actual de viviendas asequibles.

Desde la Gran Depresión, durante cuatro décadas, dirigí y estudié el uso de inversiones públicas, privadas y filantrópicas para producir viviendas asequibles y ofrecer un techo decente a familias de bajos ingresos. Se debatió una gran cantidad de ideas, y muchas se implementaron. La mayoría de las que se implementaron no dieron los resultados esperados, pero todas trajeron consecuencias impensadas. ¿Qué podemos aprender de estos tropiezos del s. XX? Y, más específicamente: ¿qué estamos dispuestos a aprender?

Hace más de ocho décadas, el gobierno federal lucha para cubrir los compromisos básicos contraídos en las Leyes de Vivienda de los EE.UU. de 1937 y 1949: “una vivienda decente y un ambiente adecuado de vida para todos los estadounidenses”. Las leyes consignaban importantes subsidios para construir nuevas viviendas públicas y erradicar los asentamientos informales. Prometían nuevos empleos, ciudades modernizadas y mejores viviendas para quienes las necesitaran. Dado que las Leyes de Vivienda sugerían beneficios para todos los ciudadanos, se ganaron un amplio apoyo del público.

Cuando llegó la hora de implementar, casi todas las autoridades de vivienda pública apuntaron a ofrecer viviendas a quienes estaban en la mitad inferior de la distribución de ingresos: una decisión políticamente popular. Para mantener la disponibilidad de viviendas nuevas, se establecieron alquileres que cubrirían los costos operativos de los edificios. Pero los costos operativos aumentaban a medida que los edificios envejecían, y los alquileres crecían a la par. Hacia fines de los 60, los inquilinos de ingresos más bajos se vieron sobrepasados por los precios: pagaban más del 60 por ciento de su ingreso para seguir teniendo un techo.

El senador Edward Brooke (republicano, por Massachusetts) remedió la situación: en 1969 propuso una enmienda a las Leyes de Vivienda que limitaba los alquileres al 25 por ciento de los ingresos de los inquilinos. El gobierno federal cubría los déficits operativos con subsidios. Para obtener un alquiler reducido, los inquilinos debían declarar sus ingresos. Pronto se hizo evidente que las viviendas públicas no servían para las familias más pobres, quienes tenían las mayores necesidades de vivienda. En 1981, el Congreso actuó de nuevo: reservó las viviendas públicas para familias que ganaban la mitad de la mediana de ingresos y reservó el 40 por ciento de las unidades para familias que ganaban menos del 30 por ciento de la mediana.

El deterioro de los edificios se aceleraba. Esto se debió a que los subsidios operativos federales no cubrían gastos de capital, y los sistemas principales (calefacción, iluminación, ascensores) empezaron a fallar. La austeridad fiscal federal de los 80 agravó los problemas, porque redujo los subsidios operativos. Hacia fines de esa década, la única respuesta razonable a la crisis nacional de viviendas públicas fue la demolición generalizada.

Al mismo tiempo que disminuían los subsidios y dejaba de haber viviendas antiguas disponibles, surgió un contrarrelato, en el cual se culpaba a los propios residentes. La “cultura de la pobreza” y la “indefensión aprendida” se convirtieron en los memes dominantes. Se veía a la pobreza como una enfermedad contagiosa, más que como un síntoma. Los pobres se convirtieron en chivos expiatorios convenientes que cargaban con la responsabilidad de que se rompiera su propio techo, como si se esperara que los inquilinos, pobres o no, se responsabilizaran de mantener sus edificios. Al concentrar a los pobres en las viviendas públicas, reforzábamos los malos hábitos y transmitíamos valores que perpetuaban la pobreza a lo largo de las generaciones. Otro meme dominante de los 80 apoyó este movimiento: los peligros del gobierno grande. Este relato contaba (y cuenta) que el gobierno grande era torpe e ineficaz; el deterioro de las viviendas públicas era culpa del gobierno.

Con los programas “HOPE” que surgieron luego (Vivienda y Oportunidades para Personas en Cualquier Lugar), se reemplazaron muchos proyectos de vivienda pública por desarrollos bajos de ingresos mixtos, que en general sustituían tres unidades demolidas con una asequible. Para estimular la producción adicional de viviendas de alquiler, el gobierno federal creó el crédito fiscal para viviendas de bajos ingresos (LIHTC) en 1986. El programa ofrecía a los inversionistas privados créditos fiscales por una década a cambio de adelantos en inversiones en patrimonio (que suele ser el dinero más difícil de encontrar) para producir viviendas. Los estados controlaban cómo se asignaban los créditos, y las normativas exigían una asequibilidad a largo plazo para las viviendas.

Es importante mencionar que el programa LIHTC prometía superar las dos grandes fallas de las viviendas públicas. Al atraer inversiones privadas, las eficiencias del sector privado superarían la relación de dependencia con el ineficaz gobierno grande. Segundo, las decisiones de ubicación se delegarían a los gobiernos estatales y locales, que podrían asegurarse de que la producción de viviendas no concentraría la pobreza. Además, la competencia por los créditos fiscales reduciría el costo para los contribuyentes y, con el tiempo, el sector privado produciría viviendas asequibles sin necesitar subsidios.

Algunos expertos consideran que el programa LIHTC tuvo un éxito extraordinario. En el transcurso de tres décadas, se construyeron más de 2,5 millones de unidades de vivienda. Pero en ese período, perdimos más unidades asequibles del inventario nacional de las que se construyeron. Además, las rentabilidades prometidas del sector privado nunca se materializaron. Según el año y el mercado, el costo de producción estimado de unidades de LIHTC fue entre un 20 y un 50 por ciento superior que el de las unidades similares sin subsidios. Esto ni siquiera incluye los US$ 100 millones estimados por año para la administración del programa.

Los créditos fiscales para patrimonios de inversionistas privados llegaron a los contribuyentes en tasas de tarjeta de crédito. Y los costos aumentaron cuando el capital público estaba en el valor más barato. Durante la Gran Recesión, los créditos fiscales producían un promedio de ganancias después de impuestos del 12 al 14 por ciento para los inversionistas cuando la tasa de fondos federales era casi cero y la ganancia de Hacienda a 10 años era de cerca del 2 por ciento. El sector privado nunca dejó de depender de los subsidios. Hoy, prácticamente no hay producción de alquileres asequibles sin créditos fiscales. Por último, es decepcionante que se haya aceptado universalmente que la producción de viviendas con crédito fiscal exacerbó la concentración de la pobreza.

¿Cómo puede ser que el programa de producción de viviendas más grande de la historia de la nación, con amplio apoyo de ambos partidos, provoque tanta decepción? Hay muchas cosas de las que no sabía (y no sabíamos) antes, en 1999, en 1979 e incluso en 1949, que me gustaría no saber ahora.

Ojalá no supiera que, aunque seamos muy buenos para identificar grandes desafíos y anunciar respuestas ambiciosas, nuestro compromiso casi nunca sobrevive a los desafíos económicos. Ahora sabemos que solo construir viviendas asequibles no alcanza para ofrecer una vivienda decente y un ambiente adecuado de vida. Se necesita un modelo sostenible que mantenga los edificios, conserve la asequibilidad en el tiempo y construya donde lo necesitamos: cerca de empleos y escuelas buenos.

Ojalá no supiera que el apoyo político es efímero, y que la memoria no perdura. Garantizar que el poco subsidio que hay llegue a quienes más lo necesitan es razonable, pero solo si el subsidio se protege. Los más necesitados son políticamente débiles y es poco probable que obtengan apoyo para defender sus derechos. Y cuando intentan hacerlo, es fácil convertirlos en el chivo expiatorio.

Ojalá no supiera que gastamos decenas de millones de dólares para evaluar programas de viviendas, pero no aprendimos mucho. Contamos unidades, hicimos de cuenta que la cantidad producida es la única medida importante de impacto. Hace veinte años, una de cada cuatro familias que reunían los requisitos para recibir ayuda para la vivienda la recibían. Hoy, es una de cada cinco familias. Aunque según la creencia general los costos de vivienda que superan el 30 por ciento del ingreso son insostenibles para las familias, alrededor de la mitad de los inquilinos pagan más del 30 por ciento de su ingreso antes de impuestos para alquilar, y el 20 por ciento entrega más de la mitad de su ingreso.

¿Cuándo haremos un análisis sincero de ocho décadas de labores para dar un techo a nuestra gente? Debido a la complejidad de los desafíos en cuanto a las viviendas, es imposible aprender algo de las evaluaciones de los programas. Para aprender, debemos revelar los resultados esperados y comprometernos con ellos, compartir la lógica que guía nuestras acciones y conciliar lo que logramos en realidad con nuestras intenciones. Este es un modelo de aprendizaje que adoptamos en el Instituto Lincoln, y espero que se pueda aplicar más ampliamente a análisis de políticas en los sectores de vivienda, desarrollo comunitario y filantropía.

Ofrecer viviendas asequibles para todos no es tarea fácil. Las dolorosas verdades de ocho décadas de trabajo se ofrecen no como una acusación, sino como una invitación para aprender, y pensar y actuar de otro modo. Debemos intentar cosas nuevas y aprender de ellas. Esa innovación puede ser construir departamentos sobre bibliotecas públicas, una tendencia que exploramos en este número. Puede significar forjar asociaciones inesperadas, como están haciendo los servicios públicos y los defensores de viviendas en Seattle. Puede significar rematar derechos de desarrollo o aprovechar el valor del suelo de otro modo.

Deberíamos aspirar a las mismas ambiciones de los confiados gestores de políticas de 1949, que se comprometieron para proveer “una vivienda decente y un ambiente adecuado de vida para todos los estadounidenses”. Pero tendremos que intentar muchas cosas nuevas y aprender de nuestros errores. Y, si nos comprometemos a “buscar un techo una y otra vez”, como canta Seger en la misma canción, podríamos lograrlo.

¿Tiene un ejemplo propio de “ojalá no supiera ahora lo que no sabía antes”? ¿Una política o programa del que podríamos o deberíamos haber aprendido? Queremos destacar algunos en uno de los próximos números. Envíenos el suyo a publications@lincolninst.edu.

What is the flood mitigation potential of urban parks in Houston? Could an urban growth boundary stop sprawl in the Buffalo-Niagara region? How do zoning regulations perpetuate racial inequality and poverty in Oakland? Academics and government officials explored these and other complex questions as part of The Place Database contest. The contest challenged researchers, policy makers, academics, and public officials to use maps created in The Place Database—a data visualization tool launched in 2017 by the Lincoln Institute of Land Policy and PolicyMap—as a basis to tell a story about a place or places.

The Place Database is built on the PolicyMap platform and enables users to map a broad array of indicators from housing prices to zoning. It is designed to be easy to use for academics, local governments, the general public, and journalists, regardless of their experience with tools like ArcGIS, according to Jenna DeAngelo, associate director of international and institute wide initiatives at the Lincoln Institute. Users can search U.S. geographies and select from a list of data layers, such as aggregate transportation costs or local revenue per pupil, and data points, including brownfield sites and structurally deficient bridges. The platform can zoom down to the block group level and draws on information from sources like the U.S. Environmental Protection Agency and the U.S. Census Bureau.

In the past two years, the resource has been used in academic theses, as a tool for brokers and real estate agents, in curricula developed by the National Building Museum, and more. The most popular data layers include per capita income, median home value, and critical habitat, while the most frequently used data points have been LIHTCs, Brownfields, and FEMA floods.

The Lincoln Institute decided to host this contest to promote the tool and find out more about who was using the tool and how they were using it, DeAngelo said. It attracted over 40 submissions. A committee composed of Lincoln Institute and PolicyMap staff, a representative from the City of Cambridge GIS and Community Development departments, and a professor from Boston University reviewed the entries, selecting five winning projects and awarding $1,500 to each to develop a brief narrative using the maps that are now featured as use cases on the Lincoln Institute website.

One of the winning projects focused on housing in St. Louis, where the majority of affordable housing funded through the federal Low-Income Housing Tax Credit (LIHTC) program is concentrated in neighborhoods with extensive blight and vacancy and related poor health outcomes. Jason Whiteley, a research analyst at the St. Louis Planning and Urban Design Agency, used The Place Database to better understand what factors, such as restrictive single-family zoning in more affluent parts of the city, have created this current geographic distribution of LIHTC developments.

“We wanted to go beyond the standard talking points about siting affordable housing and look at a more local context and see what issues might impact siting decisions,” Whitley said. “This mapping exercise allowed us to see where the LIHTCs fall against a host of variables, such as vacancy, and served as a good starting point to talk about not just LIHTCs but all the different types of affordable housing in the city.”

In the Dallas-Fort Worth region, Reza Sardari — who earned a Ph.D. from the University of Texas at Arlington and is now an analyst at Cintra, a private sector transportation infrastructure company — explored the factors that are creating increased cost-burdens for low-income families.

In his narrative, cowritten by Raha Pouladi, a planner at the city of Celina, Texas, Sardari presented maps from the Place Database highlighting census tracts where housing costs consume 27 to 30 percent of household income. He also used a data layer that illustrates the percent change in housing price index to identify zip codes that have more recently started to face affordability challenges and might benefit from early interventions to preserve affordability.

Other maps in the project illustrated the spatial mismatch between the concentration of subsidized properties in the southern sector of Dallas and the increasing growth of low-wage jobs in the northern sector of the city. The project concluded with a list of approaches, such as inclusionary zoning, community land trusts, and improved access to public transit, that would create a more even distribution of subsidized housing throughout the city.

“Combining affordability with housing price changes is a unique contribution of the Place Database,” Sardari said. “House price change is missing in other data sources. Often you have to go look in other places.” Most datasets in the Place Database are updated every year as new data becomes available, according to DeAngelo, which allows users to map changes over time.

Sardari emphasized that being able to access a range of datasets on one site is also an advantage of the tool, as researchers often have to navigate between the websites of places like the U.S. Census Bureau, Internal Revenue Service, and Environmental Protection Agency to map multiple criteria. For instance, in his analysis, Whiteley was able to access datasets from the U.S. Department of Housing and Urban Development; Valassis Lists, a direct mail marketing company that compiles vacancy data; and the City of St. Louis, without leaving The Place Database platform.

For researchers who want to do a deeper dive, the Place Database offers the option to download datasets, Sardari added.

While none of the winners told stories across multiple geographies, DeAngelo said that this capability is another strength of the Place Database: “Many tools are hyper-focused on indicators in one city or region, but The Place Database lets policy makers compare U.S. geographies in one tool, as opposed to having to look at multiple tools that might not have standard data across places.”

The tool is one among a suite of free and accessible databases the Lincoln Institute offers, including the Atlas of Urban Expansion, Fiscally Standardized Cities, the State-by-State Property Tax at a Glance Visualization Tool, and Land and Property Values in the U.S.

Emma Zehner is communications and publications editor at the Lincoln Institute of Land Policy.

Image: The relative concentration of Low-Income Housing Tax Credit developments in and around census tracts with elevated levels of vacancy in the City of St. Louis. Credit: The Place Database/Jason Whiteley, St. Louis Planning and Urban Design Agency.

Born and raised in the working-class Boston neighborhood of Dorchester, Martin J. Walsh is serving his second term as Boston’s 54th mayor, focusing on schools, affordable housing, and immigration, among many other issues. He has also become an international leader in confronting climate change and building resilience, hosting a major climate summit in 2018 and forming a coalition of mayors committed to working on renewable energy and other strategies. He has pledged to make Boston carbon-neutral by 2050, and has led Imagine Boston 2030, the first citywide comprehensive plan in half a century, as well as the Resilient Boston Harbor initiative. He made time to speak with Senior Fellow Anthony Flint to reflect on being mayor in the midst of the unfolding climate crisis.

Anthony Flint: You have been one of the most active mayors in the nation on the pressing issue of climate change. Tell us about your recent efforts to coordinate action—and how you feel about all this work being done at the local level in the absence of a federal initiative?

Marty Walsh: We hosted our first climate summit, and we’ve been working with mayors across America. I was elected as the North American co-chair for C40 prior to President Trump pulling out of the Paris climate accord. We’ve been working with Mayor [Eric] Garcetti in Los Angeles and other mayors to make sure that cities recommitted themselves to the Paris climate agreement. This is such an important issue for the country and for Boston, and it’s so important to have engagement and leadership. It’s unfortunate that we haven’t had a [federal] partner in the last few years. But we’re going to continue to take on the challenges and continue to think about the next generation. What I’m hoping is that ultimately we will have a federal partner, and [when that time comes] we won’t be starting at zero.

AF: Turning first to mitigation: what are the most important ways that cities can help reduce carbon emissions? Should cities require the retrofitting of older buildings, for example, to make them more energy efficient?

MW: We have a program called Renew Boston Trust, identifying energy savings in city-owned buildings. It’s important to be sure we start in our own backyard. We have 14 buildings underway for retrofits—libraries, community centers, police and fire stations. Secondly, we’re looking at electrifying some of our vehicles. The third piece is looking at retrofitting and new construction, making sure all new construction is built to higher performance standards with fewer carbon emissions. Ultimately, as we think about reducing carbon emissions, we are looking at 85,000 buildings in our city . . . if we want to hit net zero carbon by 2050, we’ll have to retrofit those buildings, large and small. Then there’s transportation—getting our transportation system to be cleaner and greener. Even if we had a strong national policy, it’s ultimately the cities that will have to carry out the reductions.

AF: Even if we stopped all carbon emissions tomorrow, the planet will still have to manage significant sea level rise, flooding, volatile weather, wildfires, and more, because of inexorably rising temperatures. What are the most promising efforts here and around the country in building resilience?

MW: For Boston and East Coast cities and oceanfront property, our Resilient Boston Harbor plan lays out some good strategies. We have 47 miles of shoreline, and rivers that run through and border our city. We’ve looked at [the 2012 Atlantic hurricane] Superstorm Sandy and at what happened in Houston [due to Hurricane Harvey in 2017], in terms of protecting people in major flooding events. We have one big plan for the harbor, but there are other neighborhoods where we have to make sure we’re prepared. We’re doing planning studies in all of these areas [under the Climate Ready Boston initiative] to deal with sea-level rise. They eventually become one environmental plan.

It is a public safety matter. It’s about quality of life and the future of our city. In the past, mayors have focused on economic development and transportation and education. Today, climate change, resilience, and preparedness are part of the conversation in ways they weren’t 25 years ago. 

AF: At the Lincoln Institute, we’re big believers in working with nature through blue and green infrastructure—and coming up with new ways to pay for it. Are you also a fan of this approach, which the Dutch and others have developed?

MW: Resilient Boston Harbor is really a green infrastructure plan. One project that speaks to that is Martin’s Park, named for Martin Richard [the youngest victim of the 2013 Boston Marathon bombing]. We raised parts of the park to prevent flood pathways, and installed mini piles and vegetated beds reinforced with stone to prevent erosion at higher tides. We’re looking at doing something like that throughout the inner harbor. We’re spending $2 million at Joe Moakley Park, which is the start of major flood pathways to several neighborhoods . . . we’re trying to cut back on as much flood-related property damage and disruption of people’s lives as possible. Berms and other barriers can help keep the water out . . . but there are opportunities to let the water through and not let it build up, in a major storm event.

AF: In addition to new taxes that have been proposed, would you support a value capture arrangement where the private sector contributes more to these kinds of massive public investments? 

MW: On top of private investment—which we’re going to need more of—we are working with philanthropic organizations, to see if some philanthropic dollars can go into these kinds of projects. In our budget this year, we’re dedicating 10 percent in capital budget to resilience. We’re also looking at taking some dedicated revenue and putting it into resilience. For example, we raised fines and penalties for parking violations. That will go right back into transportation and resilience, including things like raising streets up. That’s a start. Over time, we’ll dedicate more of our budget to this. At some point hopefully, the federal government will invest. Right now, they are paying millions and millions for disaster relief. Rather than coming in after an event and a tragedy happens, I would hope that they will want to make investments on the front end.

AF: Given projections that large swaths of Boston will be underwater later this century, can you reflect on a personal level about this threat to the city you currently lead? How would you inspire more urgency to address this problem?

MW: That’s our job. Our job is to govern in the present day, and manage all the day-to-day operations, but our job is also to lay down the foundation of what our city looks like in the future. The infrastructure that we build out will be here for the next 50 to 60 years. The Resilient Boston Harbor plan is [designed] to deal with sea-level rise 40 or 50 years from now. We’re building all of that with the expectation of preserving and protecting the residents of the city. I would hope that when I’m not here as mayor anymore, the next mayor will come in and will want to invest as well. This is the legacy of the city—I wouldn’t say it’s necessarily my legacy—to look back years from now, for residents to look back and be grateful for the investments and the time that leaders took in 2017 and 2018 and 2019.

I don’t think as a country we’re where we need to be. The Dutch and other European countries are farther ahead. So we’re playing catch-up. We’re not waiting for the next generation to try to solve this problem.

Photographs in order of appearance

Boston Mayor Marty Walsh speaks at the annual Mayor’s Greenovate Awards, which recognize climate and sustainability leaders in the community. Credit: John Wilcox, courtesy of City of Boston Mayor’s Office.

Mayor Walsh addresses a crowd of protesters at City Hall during the September 2019 youth climate strike. Credit: Jeremiah Robinson, courtesy of City of Boston Mayor’s Office. 

“Wish I didn’t know now what I didn’t know then.” 

It was a throwaway line in Bob Seger’s 1980 ballad “Against the Wind,” a reflection on innocence and regret. Although he felt the line sounded odd and thought it was grammatically incorrect, Seger kept it in because the people around him liked it. The line has since inspired other artists to offer their own interpretations. It inspires me as an invitation to learn, providing a frame for reflection on unintended consequences and letting us imagine how we might have done things differently. It’s particularly apt in the context of our current national affordable housing crisis.  

For four decades I directed and studied the use of public, private, and philanthropic funding to produce affordable housing and provide decent shelter for low-income families since the Great Depression. Lots of big ideas were discussed, many of them implemented. Most of those implemented did not deliver the expected results, but they all delivered unintended consequences. What can we learn from these 20th-century missteps—and more to the point, what are we willing to learn?  

The federal government has struggled for more than eight decades to meet the basic commitments it made in the U.S. Housing Acts of 1937 and 1949: “a decent home and a suitable living environment for all Americans.” The acts committed significant subsidies to build new public housing and eradicate slums. They promised new jobs, modernized cities, and better housing for those who needed it. Because the Housing Acts proposed to benefit all Americans, they attracted broad public support.

When implementation time came, most public housing authorities aimed to provide housing for those in the lower half of the income distribution—a politically popular decision. To maintain the new housing stock, rents were set to cover buildings’ operating expenses. But as the buildings aged, operating expenses increased, and rents increased along with them. By the late 1960s, lower income tenants were getting priced out—paying upwards of 60 percent of their income to keep a roof over their heads.

Senator Edward Brooke (R-MA) remedied the situation by sponsoring an amendment to the Housing Acts in 1969, which capped rents at 25 percent of tenants’ incomes. The federal government covered operating shortfalls with subsidies. For reduced rents to be set, tenants had to disclose their incomes. It soon became apparent that public housing was not serving the poorest families with the greatest housing needs. In 1981, Congress acted again, reserving public housing for families earning half of the median income and reserving 40 percent of the units for families earning less than 30 percent of the median.  

The deterioration of the buildings was accelerating. This was because federal operating subsidies did not cover capital expenses and major systems (heating, lighting, elevators) began to fail. The federal fiscal austerity of the 1980s compounded problems by reducing operating subsidies. By the end of the decade the only reasonable response to the national crisis in public housing was widespread demolition.  

As the subsidies declined and our aging housing stock failed, a counternarrative emerged through which the residents themselves were blamed. The “culture of poverty” and “learned helplessness” became dominant memes. Poverty was viewed as a communicable disease rather than a symptom. The poor became convenient scapegoats bearing responsibility for the failure of their own shelter, as if any renters, poor or not, are expected to take responsibility for maintenance of their buildings. By concentrating the poor in public housing, we reinforced bad habits and transmitted values that perpetuated poverty across generations. This was supported by another dominant meme of the 1980s—the perils of big government. Big government was sloppy and inefficient, this narrative went (and still goes); the decline of public housing was the government’s fault.  

In the “HOPE” programs that followed—Homeownership and Opportunity for People Everywhere—many public housing projects were replaced with low-rise, mixed-income developments, typically replacing one affordable unit for three that were demolished. To stimulate additional rental housing production, the federal government created the low-income housing tax credit (LIHTC) in 1986. The program offered private investors a decade’s worth of tax credits in exchange for upfront equity investments—typically the hardest money to find—for housing production. States had authority over how to allocate the credits, and regulations mandated long-term affordability of the housing.

Importantly, the LIHTC program promised to overcome the two biggest failings of public housing. By attracting private investment, the efficiencies of the private sector would overcome dependence on inefficient big government. Second, location decisions could be delegated to state and local governments who could ensure that the housing production did not concentrate poverty. Moreover, competition for the tax credits would reduce their cost to taxpayers and eventually, the private sector would produce affordable housing without the need for subsidies.  

Some pundits consider the LIHTC program extraordinarily successful. Over three decades, more than 2.5 million units of housing were built. But through that period, we lost more affordable units from the national housing stock than we produced. Moreover, the promised private sector cost efficiencies never materialized. Depending on the year and the market, production of LIHTC units was estimated to cost 20 to 50 percent more than similar unsubsidized units. This does not even count the estimated $100 million spent annually to administer the program. 

Tax credits for equity from private investors came at credit card rates to taxpayers. And the costs went up when public capital was cheapest. During the Great Recession, tax credits were yielding average after-tax returns of 12 to 14 percent to investors when the federal funds rate was near zero and the 10-year Treasury yield was around 2 percent. The private sector never was weaned from subsidy dependence. Today, virtually no affordable rental production happens without tax credits. Finally, disappointingly, it is universally accepted that the production of tax credit housing exacerbated the concentration of poverty.  

How can the largest housing production program in the history of the nation, with broad bipartisan support, produce such disappointment? There are a lot of things I wish I didn’t know now that I (and we) didn’t know then—in 1999, in 1979, even in 1949.  

I wish I didn’t know that as good as we are at identifying big challenges and announcing ambitious responses, our commitment rarely survives economic challenges. We know now that simply building affordable housing is not sufficient for providing a decent home and a suitable living environment. One needs a sustainable model that maintains the buildings and preserves their affordability over time and builds where we need to—close to good jobs and schools.  

I wish I didn’t know that political support is evanescent, and memories are short. Ensuring that scarce subsidy reaches those who need it most is reasonable, but only if the subsidy is protected. The neediest are politically weak and not likely to marshal support to defend their entitlements. And when they try, they are easy to scapegoat.  

I wish I didn’t know that we spent tens of millions of dollars evaluating housing programs, but we haven’t learned very much. We counted units, acting as if the number produced is the only important measure of impact. Twenty years ago, one in four families who qualified for housing assistance received it. Today, it is one in five families. While the general wisdom says housing costs that exceed 30 percent of income are unsustainable for families, about half of renters pay more than 30 percent of their pretax income for rent, with 20 percent handing over more than half of their income.  

When do we take an honest reckoning of eight decades of effort to shelter our people? The complexity of housing challenges makes it impossible to learn anything from program evaluations. To learn, we need to reveal and commit to our intended outcomes, share the logic guiding our actions, and reconcile what we actually accomplish with our intentions. This is a learning model that we’ve embraced at the Lincoln Institute and I hope it can be applied more broadly to policy analysis in housing, community development, and philanthropy.  

Providing affordable housing for all is no easy task. The painful truths of eight decades of work are offered not as an indictment, but as an invitation to learn, and to think and act differently. We need to try new things and learn from them. That innovation might take the form of building apartments above public libraries, a trend we explore in this issue. It might mean forging unexpected partnerships, as public utilities and housing advocates are doing in Seattle. It might mean auctioning development rights or otherwise leveraging land value.  

We should aspire to the same ambition of the confident policymakers of 1949, committing to provide “a decent home and a suitable living environment for all Americans.” But we’ll need to try a lot of new things and learn from our mistakes. And if we commit to “searching for shelter again and again,” as Seger sings later in the same song, we just might get it done. 

Have your own example of “wish I didn’t know now what I didn’t know then”? A policy or program we could have, or should have, learned from? We hope to spotlight a few in an upcoming issue—send yours to publications@lincolninst.edu.

George W. McCarthy is the President and CEO of the Lincoln Institute of Land Policy.