Obama's Housing Problem

According to a Boston Globe report, Barack Obama maybe involved in a growing scandal relating to a plethora of public housing contracts in the Illinois State Senate.

The squat brick buildings of Grove Parc Plaza, in a dense neighborhood that Barack Obama represented for eight years as a state senator, hold 504 apartments subsidized by the federal government for people who can't afford to live anywhere else.

But it's not safe to live here.

About 99 of the units are vacant, many rendered uninhabitable by unfixed problems, such as collapsed roofs and fire damage. Mice scamper through the halls. Battered
mailboxes hang open. Sewage backs up into kitchen sinks. In 2006, federal inspectors graded the condition of the complex an 11 on a 100-point scale - a
score so bad the buildings now face demolition.

...

As a state senator, the presumptive Democratic presidential nominee coauthored an Illinois law creating a new pool of tax credits for developers. As a US senator, he
pressed for increased federal subsidies. And as a presidential candidate, he has
campaigned on a promise to create an Affordable Housing Trust Fund that could
give developers an estimated $500 million a year.

But a Globe review found that thousands of apartments across Chicago that had been built with local, state, and federal subsidies - including several hundred in Obama's
former district - deteriorated so completely that they were no longer habitable.

Grove Parc and several other prominent failures were developed and managed by Obama's close friends and political supporters. Those people profited from the subsidies even as many of Obama's constituents suffered. Tenants lost their homes; surrounding neighborhoods were blighted.

The report details several public housing projects in Barack Obama's district when he was a State Senator that went to high profile real estate developers. The most prominent of which was a developer by the name of Tony Rezko. Other developers are a part of his current campaign for President.

This report raises several issues. The first is the issue of housing for the poor. What to do regarding housing for those that can't afford it has been an issue for decades. In Chicago, the city created such public housing complexes as Robert Taylor, Cabrini Green, and Rockwell Gardens. The main problem was that putting all those poor folks together also put together all sorts of seedy characters and criminals. Violence became a way of life in these parts and people were shot and killed for no reason all the time.

These public housing complexes became a living terror for those law abiding folks that wound up living there. Many of the most prominent public housing complexes like Cabrini and Rockwell Gardens have recently been closed down. With crime and poverty being so out of control, the city was left with no choice.

As such, Mayor Richard M.Daley tried a different route. He tried to create private low income housing by having developers receive grants and tax credits as incentive for the private sector to build them. Of course, public or private housing didn't fix the crux of the problem. If you put folks together that can't afford housing, you are als putting together a lot of criminals and other deviants.

The second issue, the one that has Obama in its net, is that if the government is going to dole out a bunch of public money to have the private sector build properties for low income folks, the government needs to maintain strict oversight. That way the government makes sure that the money hasn't been misused. Here, Barack Obama failed miserably. According to the piece, these buildings became so dilapadated that they became unlivable. Problems include roofs caving in, bad plumbing, no heat, no air condition, among all sorts of things that folks with money just wouldn't stand for. Within the story, Obama claims not to have known about the problems. That maybe so, however it is also beside the point.

It was Obama that pushed for private developers like Rezko to build low income housing using government dollars. Many of these complexes like Grove Parc were in his district. Poor folks are the most vulnerable and thus the easiest to exploit. They are a lot less likely to complain, and thus a private developer building housing for poor folks is in a much better position to exploit them. Of course, given that Rezko and other developers are so close to Obama politically, the implication is clear. While there is no evidence that Obama was in on any corruption in this case, again it is beside the point. He failed in his duty of oversight. Whether it was due to incompetence, laziness, or corruption, the bottom line is that he failed.

Barack Obama has been on record as backing more private developers building low income housing. This may or may not be a good idea in theory. In practice, if the government is unwilling or unable to perform the proper oversight, it will fail miserably. Here, Barack Obama clearly showed that he is unwilling to do the type of follow through to make it work.

For an updated summary of all the corruption and hypocrisy that Barack Obama has committed in real estate and mortgages, please click this link.