FacebookTwitterGoogle+RedditEmail

Class Segregation and the Housing Market

There are many forms of discrimination, but one that Americans seem to have a high tolerance for is that based on class. Class discrimination is a natural outcome of capitalist ideology. That ideology, in turn, has been assimilated into American culture to the point that even the poor accept it on the assumption that they or their children might someday become rich.

Thus, unlike race and sex discrimination, that based on class has gone largely underregulated. Eventually the result is a number of embarrassing instances of abuse that become hard to ignore. That is what has happened in New York City’s housing market, as testified to by an expose on the front page of last Sunday’s (18 May 2014) New York Times real estate section.

The Situation 

Since 1943 New York City has sought to protect the income diversity of its population by classifying a percentage of its housing market as “rent-controlled” or “rent-stabilized.” There are technical differences between these statuses, but we will refer to them both as part of a regime of “rent-regulation.” Landlords and developers who provide a certain number of such “affordable housing units” (particularly rent-stabilized units) alongside of apartments renting or selling at market rates can qualify for city-or-state-subsidized low-interest loans and tax breaks. Even though the landlords and developers are thereby benefiting from publicly provided money, they still complain that the rent-regulation regime is a burden. While, with some exceptions, it does not prevent them from making a profit, it can prevent them from maximizing their profit. And that, of course, is what capitalism is supposed to let the businessperson do.

The piece in Sunday’s New York Times real estate section is all about how the landlords and developers are trying to make life unpleasant for their rent-regulated residents, who, as of 2011, have a median income of $51,000 and pay a median rent of $1,321 a month. Ultimately, as Mark Zborovsky, “a broker who sells bundles of rent-regulated apartments to investors,” put it, “his [the landlord’s] goal is to get him [the tenant] out of the apartment.” If these tenants do leave, their dwellings cease to be regulated and can be rented anew at market rates – which can be as high as $7,000 a month for a two-bedroom flat.

Some Examples

The tactic now being employed by the landlords and developers is to add amenities to existing buildings – things like roof gardens, gyms, playrooms for children, added storage areas and the like – and then prevent those tenants in rent-regulated apartments from using them. It is an interesting fact that in this game of class discrimination the doormen and other building staff become the ones charged with enforcing segregation for the owners.

The landlords and developers argue that these new amenities are “market tools” to attract high-end tenants who will pay market rates for apartments. Therefore, the amenities should be reserved for such residents. Actually, this only makes sense if you assume the potential high-end renter cares who else will be using the gym or playroom. In other words, the landlords and developers are assuming their clientele have the same class bias and resentments as themselves. Based on this assumption, some of them have gone so far as to put in separate lobbies and entrances (nicknamed “poor doors”) for those living in rent-regulated apartments. Here is how David Von Spreckelsen, the president of the development company Toll Brothers City Living puts it, “The two populations [rent-regulated and market rate payers] don’t mix at all. It really feels separate.” Of course, after Mr. Von Spreckelsen gets done segregating the two groups of tenants, his statement becomes a self-fulfilling prophecy.

The fact that the practices of Mr. Von Spreckelsen and those like him are making rent-regulated tenants feel like, as one of them put it, “a second-class citizen in my own home” seems not to matter. That is probably because, in the landlord and developer’s capitalist worldview, the tenants residing in such apartments are indeed, by definition, second-class citizens.

The Need for Regulation

Alas for Von Spreckelsen, the rent-regulated tenants are also voting citizens. There are hundreds of thousands of them in New York City, and their complaints have reached the mayor’s office and city council. Newly elected mayor Bill de Blasio had made an issue of the “dwindling availability of affordable housing” in his campaign for office, and some city council members are busy drafting legislation that would “expand the city’s anti-discrimination code to include rent-regulated tenants.”

However, one should not see this as much more than a holding action against an ongoing and successful effort by landlords and developers to erode the number of rent-regulated apartments they have to maintain. One can see it in the annual decreasing percentage of rent-controlled residences:  2002 = 2.8%; 2005 = 2.1%; 2008 = 1.9 %; 2011 = 1.8%. Those in the rent-stabilized category have fallen from 63% in 1980 to 47% in 2011. Some of this decline is the result of attrition. Those in these affordable apartments are generally an older crowd. However, perhaps more important in the long run is that the landlords and developers have the nation’s economic ideology on their side as well as a lot of money to pay out to ambitious politicians. Ultimately, New York City may well become a city gentrified for the wealthy. The poor will have nowhere else to go but the next slum over, and the middle class will be pushed out altogether, largely to the towns and suburbs of New Jersey.

The condition of the New York City’s real estate market is symptomatic of a much broader problem of class discrimination and segregation. You can see it in the wealth-based segregated nature of everything from accommodations on trains and planes to the more serious discrepancies between suburbs and inner cities. In the fields of health care and criminal justice, the wealthy go in one door and the rest of us in another. In this country exceedingly little comes to you because you are a human being, or even because you are a citizen. Almost everything you get, or don’t get, is a function of how much you can or are willing to pay.

Against this backdrop one must sadly conclude that rent-regulation is an anomaly, a policy that is at odds with American culture. It is also a window on the inhumane economic practices we have become so addicted to. Could such an addiction lead to an overdose?  And if does, will we then learn that regulation is necessary and healthy?

Lawrence Davidson is professor of history at West Chester University in West Chester PA.

More articles by:

Lawrence Davidson is professor of history at West Chester University in West Chester, PA.

Weekend Edition
July 20, 2018
Friday - Sunday
Paul Atwood
Peace or Armageddon: Take Your Pick
Paul Street
No Liberal Rallies Yet for the Children of Yemen
Nick Pemberton
The Bipartisan War on Central and South American Women
Jeffrey St. Clair
Roaming Charges: Are You Putin Me On?
Andrew Levine
Sovereignty: What Is It Good For? 
Brian Cloughley
The Trump/NATO Debacle and the Profit Motive
David Rosen
Trump’s Supreme Pick Escalates America’s War on Sex 
Melvin Goodman
Montenegro and the “Manchurian Candidate”
Salvador   Rangel
“These Are Not Our Kids”: The Racial Capitalism of Caging Children at the Border
Matthew Stevenson
Going Home Again to Trump’s America
Louis Proyect
Jeremy Corbyn, Bernie Sanders and the Dilemmas of the Left
Patrick Cockburn
Iraqi Protests: “Bad Government, Bad Roads, Bad Weather, Bad People”
Robert Fantina
Has It Really Come to This?
Russell Mokhiber
Kristin Lawless on the Corporate Takeover of the American Kitchen
John W. Whitehead
It’s All Fake: Reality TV That Masquerades as American Politics
Patrick Bobilin
In Your Period Piece, I Would be the Help
Ramzy Baroud
The Massacre of Inn Din: How Rohingya Are Lynched and Held Responsible
Robert Fisk
How Weapons Made in Bosnia Fueled Syria’s Bleak Civil War
Gary Leupp
Trump’s Helsinki Press Conference and Public Disgrace
Josh Hoxie
Our Missing $10 Trillion
Martha Rosenberg
Pharma “Screening” Is a Ploy to Seize More Patients
Basav Sen
Brett Kavanaugh Would be a Disaster for the Climate
David Lau
The Origins of Local AFT 4400: a Profile of Julie Olsen Edwards
Rohullah Naderi
The Elusive Pursuit of Peace by Afghanistan
Binoy Kampmark
Shaking Establishments: The Ocasio-Cortez Effect
John Laforge
18 Protesters Cut Into German Air Base to Protest US Nuclear Weapons Deployment
Christopher Brauchli
Trump and the Swedish Question
Chia-Chia Wang
Local Police Shouldn’t Collaborate With ICE
Paul Lyons
YouTube’s Content ID – A Case Study
Jill Richardson
Soon You Won’t be Able to Use Food Stamps at Farmers’ Markets, But That’s Not the Half of It
Kevin MacKay
Climate Change is Proving Worse Than We Imagined, So Why Aren’t We Confronting its Root Cause?
Thomas Knapp
Elections: More than Half of Americans Believe Fairy Tales are Real
Ralph Nader
Warner Slack—Doctor for the People Forever
Lee Ballinger
Soccer, Baseball and Immigration
Louis Yako
Celebrating the Wounds of Exile with Poetry
Ron Jacobs
Working Class Fiction—Not Just Surplus Value
Perry Hoberman
You Can’t Vote Out Fascism… You Have to Drive It From Power!
Robert Koehler
Guns and Racism, on the Rocks
Nyla Ali Khan
Kashmir: Implementation with Integrity and Will to Resolve
Justin Anderson
Elon Musk vs. the Media
Graham Peebles
A Time of Hope for Ethiopia
Kollibri terre Sonnenblume
Homophobia in the Service of Anti-Trumpism is Still Homophobic (Even When it’s the New York Times)
Martin Billheimer
Childhood, Ferocious Sleep
David Yearsley
The Glories of the Grammophone
Tom Clark
Gameplanning the Patriotic Retributive Attack on Montenegro
FacebookTwitterGoogle+RedditEmail