The Insidiousness of Government Solutions

Friday, August 21st, 2009

The Atlantic‘s American Murder Mystery is about the demolition of Memphis’s public-housing projects, as part of a nationwide experiment to free the poor from the destructive effects of concentrated poverty:

Memphis demolished its first project in 1997. The city gave former residents federal “Section8” rent-subsidy vouchers and encouraged them to move out to new neighborhoods. Two more waves of demolition followed over the next nine years, dispersing tens of thousands of poor people into the wider metro community.

If police departments are usually stingy with their information, housing departments are even more so. Getting addresses of Section 8 holders is difficult, because the departments want to protect the residents’ privacy…. Janikowski merged his computer map of crime patterns with Betts’s map of Section8 rentals…. the match was near-perfect… She knew right away that this would be a “hard thing to say or write.” Nobody in the antipoverty community and nobody in city leadership was going to welcome the news that the noble experiment that they’d been engaged in for the past decade had been bringing the city down, in ways they’d never expected.

This leads Erik Falkenstein to discuss the insidiousness of government “solutions”:

The idea began with Lyndon Johnson’s Kaiser Commission on Urban Housing, which mistakenly believed that the private housing market created poverty, and the ills associated with it, by making housing too expensive. Thus, by reducing housing expenses via vouchers, and spreading the poor around the community, poverty, and the social ills associated with it, would fade away. That’s the theory. It turns out, the main problem of poor people is not a lack of money, but the temperance, diligence, thrift and other bourgeois virtues needed to be good citizens and neighbors. They bring their bad habits with them, statistically.

Given that it took 40 years to document this, this means that any big policy started today, will probably not be amenable to empirical analysis in my lifetime. Less than the 70 years of communism in the Soviet Union, but same scale. That’s the big risk to big top-down ideas.

But the insidiousness comes from the way the government, from federal down to city level, hid this data for decades because they didn’t want people to discriminate against section 8 areas or their residents. This means, if they put a high concentration of people with high criminality next to your house, they didn’t want you to know, based on the assumption that the poor’s behavior was either due to a lack of housing (which section 8 addresses directly), or the ‘stereotype effect’ from people who see them as poor. But the theory was wrong, and so all those millions of people had to deal with this problem themselves, and if they asked questions in local papers, they were labeled racist, or anti-poor.

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