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National Association of Realtors 11/10/89 [OIA 6270][2]
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19
4
6
THE WHITE HOUSE
WASHINGTON
November 9, 1989
MEMORANDUM FOR THE PRESIDENT
THROUGH: CHRISS WINSTON
cw
FROM:
DAN MCGROARTY Much
SUBJECT: NATIONAL ASSOCIATION OF REALTORS REMARKS
I. SUMMARY
On Friday, November 10, in Dallas, Texas, you will
address the National Association of Realtors' annual
convention. The speech is at 2:15 p.m. at the Anatole
Hotel. About 6,000 people are expected, and the speech will
be teleprompted.
II. DISCUSSION
The speech announces a set of initiatives for America's
HOPE (Homeownership and Opportunity for People Everywhere).
HOPE includes programs to help first-time homebuyers, low-
income families, and the homeless. Secretary Kemp, Director
Darman, and Roger Porter have received information copies of
these remarks.
Also announced in the speech is the linkage of the Low-
Income Housing Tax Credit to the capital gains tax cut.
###
McGroarty/Dooley
November 9, 1989
12:15 pm
[REALTORS]
PRESIDENTIAL REMARKS: NATIONAL ASSOCIATION OF REALTORS
DALLAS, TEXAS
NOVEMBER 10, 1989
2:15 P.M.
Thank you, Ira [Gribin]. I know I speak for everyone here
today when I salute you for serving so ably as President of the
National Association of Realtors. My best wishes to your
successor: Norm Flynn. // Let me recognize the man who's doing
such wonderful work, putting through the tough new reforms that
ensure that his agency serves people in need, my Secretary of
HUD, Jack Kemp. And two fine members of Congress who have
travelled down on Air Force One with me today, Senator Phil Gramm
and Dallas' own Congressman, Steve Bartlett.
[[ Ira mentioned to me this afternoon that my speech is a
special occasion for this association. // I said I was honored
-- and then Ira said "It's not often that we're addressed by
someone who lives in public housing." ]] ////
[[ The truth is, I am not a real estate wizard. When I was
elected to Congress back in 1966, we needed to make housing
arrangements up in Washington. At that time, Senator Al
Simpson's father, Milward, was retiring and moving back to
Wyoming. So I bought the Simpson place -- sight unseen -- made
the deal over the phone. When we got to Washington, there were
just two problems: we found out right away the house wasn't
2
quite big enough for the Bush family -- and we found out when we
put the place up for sale that it wasn't worth quite as much as
we paid for it. /// That's my claim to fame: I'm the only
person who ever lost money in Washington real estate in the last
20 years. /// Ira, where were you when I needed you? ]]
But few people have done more for the real estate industry
than I have. // Barbara and I have moved 28 times in our 44
years of marriage. /// Now I know what you're thinking -- what
a dream client my family would make for any realtor. /// In
fact, OMB is calculating the commissions we've paid over the
years -- measured as a percentage of the GNP. ]] ////
I came here today to lay out a comprehensive agenda to help
bring basic shelter and affordable housing within reach of
millions of Americans. I call it America's HOPE -- Homeownership
and Opportunity for People Everywhere.
But before I tell you about HOPE, I want to speak for a
moment about the single most important factor in helping millions
of Americans realize the American Dream: the economy.
Because the truth is, there's no better housing policy than a
growing economy. And we've got one. One that provides jobs,
wages and opportunities for advancement -- long-term interest
rates that open ownership opportunities to hundreds of thousands
of first-time home buyers. Because every drop in interest rates
makes it possible for more families to buy that home they want.
And I pledge that my Administration will vigorously support the
mortgage interest and property tax deductions. These deductions
3
encourage home ownership -- and are important to our overall
economic prosperity.
And all signs point to continued strength in the economy.
November marks the 84th month of economic expansion -- the
longest peacetime expansion on record. And here's one statistic
that really hits home: mortgage rates are down from almost 14%
back in November 1982 to less than 10% today. My goal is to
pursue policies that will bring them down even further.
of course, part of any responsible economic policy is
getting our fiscal house in order. // I want you to know that
my Administration is hanging tough for a responsible budget --
with real deficit reduction, no smoke and mirrors.
We don't like sequestration -- no one does. But we'll live
with it if we have to -- if it's the only way to rein in spending
and bring that deficit down to the Gramm-Rudman target. I'm
ready to sign a budget bill -- whenever Congress is ready to
strip off all the costly extras and add-ons hidden away in those
omnibus spending bills.
And I'm optimistic -- optimistic that my Administration and
the Congress can agree on a responsible budget. Optimistic that
we'll see more and more Americans prospering -- providing better
lives for their families, and looking to all of you to help them
realize their dreams.
And I know we can count on you -- just as we counted on your
strong support in helping to pass the 1988 Fair Housing Act.
Ira, that's a tribute to your leadership -- to your organization
4
and its dedication to the right of all people to be free from
discrimination and prejudice.
But more must be done, and that's where the HOPE initiative
comes in. This initiative will address the full range of housing
concerns: from shelter for the homeless to affordable housing
for low-income families -- to initiatives that open access to
expanded job opportunities, and help millions more Americans own
their own home.
Let's start right there -- with what HOPE can do for first-
time home buyers. You all know about families working to buy
that first home. Well, they deserve our help -- and they're
going to get it. I will ask Congress to enact legislation
allowing first-time buyers to draw, without penalty, on IRA
savings as a downpayment for that first home.
Our HOPE initiative also means efforts to improve low-income
housing. As you know, my Administration rejects costly new
public construction programs that, in the past, have too often
produced the housing projects that symbolize the very absence of
hope in our inner cities. There's a better way: housing
vouchers -- that let low-income families choose where they want
to live.
Our idea is to create incentives for the construction of the
housing low-income families need. That's why I'm calling on
Congress to renew the Low-Income Housing Tax Credit -- but make
it part of a package that also includes a cut in the capital
gains tax. A cut in capital gains means an increase in jobs,
5
investment and growth. I know the National Association of
Realtors has fought hard to make a capital gains cut a reality.
Well, the fight's not over. ///
But we've got to go one step further -- in those pockets of
poverty where despair has driven out hope, we've got to eliminate
the capital gains tax altogether. That's a key element in the
Enterprise Zone legislation I want to see enacted. I've called
on Congress to create at least 50 Enterprise Zones over the next
four years to help create the jobs and incomes that are the real
key to affordable housing. I hope Congress gets the message.
It's time we gave the green light to our inner city
entrepreneurs.
And HOPE can help us reverse a trend that's stunting growth
and development in low-income areas. Over nine million Americans
live in FHA-insured homes, and every year nearly half a million
first-time homebuyers use FHA to help them make their dream
affordable.
My Administration has announced major reforms to ensure that
FHA is true to its primary mission of making housing affordable
for low and moderate income families. We will change the
destructive practices which have kept FHA out of the inner cities
and distressed communities that most need its support.
And -- at all levels of government -- we've got to take a
second look at some of the well-intended housing policies that
actually decrease our housing supply. I'm talking about the
excessive rules, regulations and red tape that add unnecessarily
Jamie
Humes
6
659-8201
to the cost of housing -- by tens of thousands of dol
create perverse incentives to allow existing housing to
deteriorate. I have asked Jack Kemp to convene a Blue Ribbon
Commission to identify barriers to affordable housing -- and to
make recommendations on how these barriers can be removed. And
let me make the first recommendation right here: no city, state
or town should receive a single penny of HOPE funding until they
have identified barriers to affordable housing in their own back
yard -- and start taking steps to remove them. ///
You know, Winston Churchill once said about the buildings we
institutions
our buildings
live in, "We shape them -- thereafter, they shape us." The same
is true when it comes to low-income housing policy.
Par Frazie
That's the real centerpiece of our HOPE initiative: to
recapture the American dream of home ownership for those who have
been left behind -- through resident management and resident
ownership. It's already working: In Kenilworth-Parkside, back
in Washington, D.C. In Cochran Gardens in St. Louis. By
encouraging non-profit and resident groups, it's going to work
right here in Dallas -- at places like Rhoads Terrace under the
take-charge leadership of a welfare mother named Jessie Toles --
and all across the United States.
The results are promising: with tenants in control, we see
better maintenance, more rents paid on time, a decrease in people
on the welfare rolls. And we see something more: a sense of
pride that is the very core of any thriving community.
7
I don't know any better way to revive hope in our inner
cities than to give tenants themselves a say in running their
communities, a stake in the future and the belief that they, too,
can own a home. Because the true measure of success isn't how
many families we add to housing assistance rolls. It's how many
families move up and out -- and into the ranks of homeowners.
///
But there's more to the HOPE initiative. And now I'm
talking about people who stand in the shadows of what is
otherwise a very bright economic picture -- who live a nightmare
in the midst of the American Dream. We see them every day -- on
the streets of our cities, sleeping on steam grates, living out
of cardboard boxes. The homeless. //
For most of us, November is the time of year we start
looking forward to the holiday season: Thanksgiving, Christmas,
New Years. For the homeless, November is the time of year the
temperature starts to drop, and simply making it through the
night becomes a life and death struggle. //
Think about the children. Pretty soon, your kids will be
dreaming about Christmas toys -- that new video game or new bike
they'd like. It's different for kids on the street. I read a
story not long ago that's stuck in my mind about a little boy
without a home. Here's what he dreams about at night: "I
dreamed my Mom got her [housing assistance]," he said, "and we
got a house with a great big back yard."
8
But in the morning, for that little boy, the dream is over.
He is up at 5:30, out of a shelter and back onto the streets. ///
That's a tragedy -- because no child in America should have
to grow up on the streets. And every family in America should
have a roof over its head. ///
My Administration is going to do its part to expand
emergency shelters. We're committed to fully funding the
McKinney Act. And today, I'm asking Jack Kemp to find new ways
to put a portion of our FHA foreclosures and properties from our
failed S&Ls into the hands of non-profit groups -- groups that
are doing such wonderful work rehabilitating abandoned homes, and
fighting poverty in our inner cities.
But the real answer for the homeless -- those with mental
problems or dependent on drugs or alcohol, is shelter plus care:
shelter supplemented by the necessary support-services to get
these people the help they need to live in dignity. And that
means a partnership -- a combined federal, state and local effort
-- to supply the funding and other resources that constitute a
comprehensive solution for the hard-core homeless. And if we
care about them, we've got to take more than a one-dimensional
approach to the problem.
The key here is coordinating basic needs like shelter with
other social services -- to help the homeless get the treatment
they need to get control of their lives. To help them find and
hold down jobs. To help them regain hope -- and leave life on
the streets behind for good. ///
9
Helping the homeless. Helping low-income families find
affordable housing, decent housing. Helping more of the 80
million Americans who don't own a home join the ranks of
homeowners. Those are the aims of the HOPE initiative -- aims
well within our reach.
Think about that little boy I spoke about a moment ago.
Think about his dream -- because it's really the American Dream -
- what all of us want for ourselves and our families. ///
We must unleash the resources of the profit and non-profit
sectors, of churches and synagogues, states and localities in our
great national enterprise to assure safe, decent, and affordable
housing for all. Only then will we be able to replace
hopelessness with hope. Only then will we be able to wage war on
poverty and despair. And only then will we be able to complete
our vision of a free and prosperous America, full of opportunity
for people everywhere.
Thank you. God bless you -- and God bless the United States
of America.
# # #
es of Winston Churchill
A Time of Triumph: 1950
8119
S well try to learn from
I have only one word more to say, because interruptions have rather lengthened
he said in moving the
what I had thought of saying. Uncertainty-I address myself very much to the Prime
Minister-about the election date is harmful. Prolongation of the electioneering atmo-
sphere is not good for the country. A year has passed already in which we have lived in
that atmosphere, which can be felt here; even already it has infected our new House.
The House is not at its best when parties are so evenly balanced and on the verge of
another appeal. The increasing rigidity of party discipline deprives debate of much
set lower than
of its value as a means of influencing opinion except out of doors. All kinds of
uncertainties are created in every direction; all kinds of animosities and rancours are
fed and worked up, on both sides, I fully admit-[Hon Members: 'Oh.'] Certainly; and
I cannot think it good for the country that this should continue. The Prime Minister
deliberately tries to increase and prolong this uncertainty. He says: 'The election will
] : Will the right hon
come at the moment when I judge fit.'
in the observations I
Mrs. Braddock (Liverpool, Exchange): What did the right hon Gentleman do in
ice, forced down the
1945?
clared for a minimum
Mr. Shurmer: What would the right hon Gentleman do?
rwards the right hon
Mr. Churchill: The hon Gentleman asked what I would do. I say deliberately
imum production of
that I think that if I were with the responsibilities of the Prime Minister at this
juncture, having regard to all that is going on, I would try to limit the uncertainty as
Gentleman who speaks
much as possible. I would carefully consider whether I could not say, provided we had
'target.' There can be
the control of events, that we should not have an election until a certain date. I think
o build at the rate of
it is well worthy of consideration whether that might not be of general interest.
<actly what the Prime
[Interruption. ] I have finished. I have given the hon Member more than he deserves.
g'-how irresponsible,
Of course, it is very natural that anyone should like to feel that he can keep the rest of
of this country know
his countrymen on tenterhooks and that we are always awaiting the moment when he
1 year is a perfectly
shall give the signal. All I can say is that I am quite satisfied that the right hon
d immediate aim?
Gentleman is indulging his personal power in these matters in a manner most costly to
traordinary thing that
the community and harmful to all large enduring interests of the State.
200,000 to 300,000
ggested it. It seems to
proportion to suppose
es a year more is an
ould it be thought to
HOUSING
000,000 a year. That
November 6, 1950
perly arranged [Hon
and a reasonable time
House of Commons
ily, it should not be
the expenditure of
The hon Member for Blackley [Mr. Diamond] seemed, so far as I was able to
doing that when we
follow his argument, to be somewhat diverging from the party line in addressing
ear. It is a very small
himself to the merits of the subject. I am bound to say that it seemed to me that he
not let the House be
raised many interesting points in the course of his speech. Of course, one quite realized
nbers opposite, most
the strength of feeling behind his condemnation of vote-catching in any form. That is
; a year built for the
certainly greatly to be deplored. On the other hand, we must not forget what votes
e shall ask the House
are. Votes are the means by which the poorest people in the country and all people in
'e mismanagement of
the country can make sure that they get their vital needs attended to. [Hon Members:
'Hear, hear.'] I am very glad to begin upon a note which receives such universal
8120
Speeches of Winston Churchill
approbation because I had, after all, been led to expect that I was to undergo very
unpleasant ordeals on this day. The Prime Minister-he is not here at the moment-ex-
pressed his confidence that the Minister of Health [Mr. Bevan] would 'wipe the floor'
with me. As I have only just taken the floor and he has already exhausted his right of
speaking, I naturally feel a sensation of liberation and relief. But I cannot feel that this
prospect, or the language of the Prime Minister, did justice to the grave issue open
between the two parties and still less to the housing problem.
The suffering caused to millions of people by the want of houses throughout the
island is a tragedy, and this is on quite a different level to any clashes that may occur
across the table, or across the floor, between individual Members of the House. I think
this Debate should end, as it has largely been maintained, upon a serious note, and I
was very glad that my hon Friends on this side of the House did not allow themselves
to be provoked by taunts or abuse from an embarrassed party or a guilty Minister.
During the whole of the last Parliament the need for houses and the failure to supply
them was constantly debated, and the outlines of the controversy are familiar to us all.
It is necessary, however, to restate the salient points on the verge of an important
division. They may be summed up as follows: First, the expectations aroused by the
Government's assurances and pledges in 1945; secondly, the extraordinary shortfall in
their fulfillment; thirdly, the gravity of the position and prospects now before us; and
finally, the need and the hope of a new constructive effort. It is on these points I shall
venture to dwell tonight.
The House knows only too well the catalogue of pledges and promises which
were made to the people by the Socialist Party during the election of 1945. All were
renewed on many occasions by the responsible Ministers after they had obtained
power and were fully acquainted with official facts and figures. A few examples will
suffice-I do not wish to burden the House with them. The former Minister, Mr.
Charles Key, said on 12 October 1946:
Six million houses are needed in the next ten years. To get that figure
we shall have to build 600,000 a year, but I believe that by temporary
prefabs and things of that sort we shall be able to do it.
The present Minister of Health said on 24 May 1946:
I confidently expect that before the next election every family in Great
Britain will have a separate house.
Again, two years later, on 24 April 1948, he said:
By the next General Election the back of the housing programme will
have been broken.
Contrast all this-and it could be multiplied to any extent; whole budgets of
quotations are available-with the actual performances of the Socialist Government. In
ston Churchill
A Time of Triumph: 1950
8121
undergo very
1948 they had reached a total of 227,000 permanent houses. Since then, instead of
moment-ex-
getting better, things have got worse; and in 1949 the total of permanent houses was
vipe the floor'
only 198,000. These results are indeed deplorable when we consider the crying need,
ed his right of
the vehement demand and the immense subsidies now being paid, and when we com-
feel that this
pare the results with what was being done with hardly any subsidies, on a very small
ve issue open
scale, before the late war broke upon us.
The Prime Minister said in the Debate last week:
roughout the
at may occur
We consider that the 200,000 houses a year is an actual programme, a
House. I think
programme which is being carried out, and it is as nearly as possible the
S note, and I
number of good houses which can be built with the available resources of
W themselves
labour and materials.
ilty Minister.
ure to supply
I must say that I think that statement cast a chill on the party opposite. On the other
iliar to us all.
hand, it has certainly been endorsed today by the Minister of Health. He has con-
an important
firmed it and in every way associated himself with it. That is his duty, and any
bused by the
exhibition of loyalty on his part to his chief might well excite approbation even
y shortfall in
beyond the limits of the Government Bench.
efore us; and
What a strange position we find ourselves in tonight. The Conservative Party ask
points I shall
for the house building to be raised to a rate of 300,000 a year at the earliest moment.
The Prime Minister, supported by his most ardent champion, declares that 200,000 is
mises which
the most that can be done. Our demand, which represents the wish and the will of the
145. All were
nation, is dismissed in contemptuous terms and brushed aside with all sorts of asper-
ad obtained
sions on our motives. One would have thought it would have been welcome, and it
xamples will
might even have afforded a basis for common action. The prime basic fact which stares
Minister, Mr.
us in the face tonight is that building at the rate of 200,000 a year in no way solves the
problem. We do not make any progress with rehousing the people. We only keep level
with houses which are already falling or have fallen into decay. The social evils affect-
figure
ing every aspect of our life, which are connected with the present housing shortage, are
porary
now presented to us by the Government as bound to continue, so far as can be seen,
indefinitely. Sir, that situation is obviously intolerable.
Take the argument about comparing what was done in the five years after the
First World War. There is this great difference between them. The first is that after the
First World War there was no American aid. [Hon Members: 'Cheap.'] On the con-
Great
trary, a hard demand was pressed upon us for the repayment of war debts. The second
is that there was practically no destruction by bombing in the First World War.
Thirdly, the local authorities were virtually without experience of building in 1918.
This time they had all the practical experience gained by the pre-war slum clearance
and other municipal housing schemes. And finally, far more preparations were made
le will
by the war-time Government on this at the end of this war than were ever thought of
in 1917 or 1918-[Interruption] I am talking of the National Coalition Government
and, on this occasion, there are still one or two representatives of it on the Front
budgets of
Bench.
ernment. In
What stood out dramatically at the end of this war was the need to rehouse the
8122
Speeches of Winston Churchill
people after the devastation of the bombing. We all recognized it in the National
Coalition. I will read to the House what I wrote at the time to some of my col-
leagues-on 5 April 1944:
The whole of this emergency housing scheme must be viewed in rela-
tion to a ten-years' plan for the steady, full-time employment of a consid-
erably enlarged building trade for permanent houses instead of a fever for
three or four years and then a falling off. The building trade should have a
broad and steady flow giving all its members a good assurance of employ-
ment and thus encouraging piece-work.
Everyone realizes, of course, that what is given for one purpose may, to some
extent, have to be taken from others. The Government supporters naturally seek to
obtain from us a list of reductions or economies which we would make in order to use
these for electioneering purposes. That is quite natural in the unhappy conditions in
which we have lived for a year and which seem likely to continue. I have no intention
of making any piecemeal propositions. [Laughter. I have a feeling, listening to the
debates and watching hon Members opposite, that their anxious consciences find relief
in laughter. No one would grudge them any solace they can get from giggling.
Naturally, I. have no intention of making piecemeal propositions. There is no
obligation on a party in opposition, without access to Government machinery, to
produce a detailed scheme. That can only be done where they have the power to act.
But it is on such a definite, general design alone that changes of a large character of
this kind can be judged. It may well be that a general design for an increase in housing
would contain some features unpopular in themselves, but when presented in its
entirety and harmony it would be greatly in the interests of the nation and would be
generally welcomed.
In this matter of housing there are two questions: first to get the houses, and
second to allot them. Do not let us quarrel too much about the second point. Do not
let us quarrel so much about it as to prevent us from achieving the first, without which
the second would not arise. Mrs. Beeton and, I believe, her predecessors in the Cook-
ery Book, begins the recipe for jugged hare, 'First catch your hare.' One of the reasons
for the Minister of Health's failure is that he mixed up these two processes. In order to
make sure that nobody who was well-to-do could get a house, he has in fact prevented
large numbers of houses being built for the ordinary wage earners.
I listened to the speech of the right hon Gentleman tonight with sorrow, be-
cause-here I make an admission-I do not believe he is as bad as he makes himself out.
But I will say this to him. Hate is a bad guide. I have never considered myself at all a
good hater-though I recognize that from moment to moment it has added stimulus to
pugnacity. People who have been denied an opportunity in life are deeply embittered,
but the Minister of Health does not belong to that class. No man's services in the war
were accorded such a wonderful reward as he received. With the mood, and the need,
and the ruins in the country glaring at us all from day to day, and with the piling up of
arrears of house-building, could there have been a task so plain and so inspiring as that
which was offered to him? It was one which any man of vitality and vigour, in the
inston Churchill
A Time of Triumph: 1950
8123
in the National
prime of life, and gifted with abilities of a high order and Parliamentary gifts, would
ome of my col-
have embraced with joy, and gratitude to the land in which he lived. With the immense
powers at his disposal under wartime regulations and with the long five years which
have been granted to him, he might have left a mark upon the social life of the British
d in rela-
people, and rendered them a service which would have made his name at once famous
a consid-
and beloved. I cannot understand how this did not appeal to him, and how it did not
fever for
drive out all hampering passions and prejudices, the indulgence of which have led to
ild have a
the present unhappy plight that he is in.
employ-
It is not only a question of building houses-not only a question of numbers-but
the cost has risen to a point which, despite subsidies on an enormous scale, involves
rents which many of those in most need of houses cannot afford. The rents charged to
may, to some
the tenants have risen remorselessly. Before the war the average rent of a local council
turally seek to
house was 7s. a week. [Hon Members: 'No.'] In many places now £1 a week rent is
in order to use
charged. In some cases, 25s. is charged by councils.
, conditions in
Mr. Bevan rose-
re no intention
Mr. Churchill: No, I really cannot give way. [Hon Members: 'Give way.'] I do
istening to the
not want to be-[Hon Members: 'Give way.'] We can always shout each other down. I
nces find relief
do not want to be involved in a personal altercation. We gave the right hon Gentleman
gling.
a patient and courteous hearing. There is no use in having a state of rowdiness, as if
S. There is no
rowdiness paid any party. I do not want to be involved in an altercation with the right
machinery, to
hon Gentleman. However, if there is a point on which I am in error and upon which I
: power to act.
am open to correction I will gladly give way.
e character of
Mr. Bevan: I am very much obliged to the right hon Gentleman for giving way. I
ase in housing
am not anxious to engage in a personal altercation. I only want to get the facts correct.
esented in its
The right hon Gentleman has compared the net rent of a pre-war house with the gross
and would be
rent of a post-war house.
Mr. Churchill: No.
e houses, and
Mr. Bevan: Yes. As representatives of local authorities who saw me the other day
point. Do not
will confirm-and there are hon Members now sitting on both sides of the House who
vithout which
were present with the deputation-the average rentals in Great Britain upon which the
S in the Cook-
subsidies are based are rents of between 14s. and 15s., including the repair allowances,
of the reasons
as against the net-[ Interruption.] Perhaps hon Members will just listen. The rents
es. In order to
upon which subsidies are paid are net rents, and the 7s. compares with the 14s. to 15s.
act prevented
post-war rents.
Mr. Churchill: The other day the Chancellor of the Exchequer showed us how all
h sorrow, be-
the rise in the cost of living was a delusion. The Minister of Health now proceeds to
S himself out.
show us that there is no appreciable rise in rents. I am told that in some cases they
nyself at all a
have gone up to 25s. and 27s. a week, and that is clearly a level which ordinary
d stimulus to
working people cannot pay out of their wages. So much for the cost, which has
y embittered,
certainly greatly increased in housing.
es in the war
When we complain that houses have not been supplied in the necessary quanti-
and the need,
ties it is said: 'Half a loaf is better than no bread.' But half a house is not a good plan.
e piling up of
We could usefully use more two-bedroomed houses, and more small flats for old
piring as that
people enabling them to move out of their large houses to make room for families.
igour, in the
Any habitable house is better than no house at all, or a house so dear that the poorest
8124
Speeches of Winston Churchill
class, for which it is built, cannot afford to pay the rent which the local authority is
bound to charge. There are many cases of that of which we know, and the richer class
of people take the houses because those for whose needs they were specially designed
and intended are unable to reach the level of rent. It is no service to the lower income
group to offer them prizes which are beyond their reach; indeed it is a mockery.
Before the war, the size of a house was 800 square feet. The Government raised it to
1,050 square feet. That is more than the figure that rules in the United States, whose
economic position is vastly more powerful than our own, and from whom we have
received such immense assistance. The amount of space is less important than how it is
used. I am assured that there may well be scope for improved design within the existing
compass of housing.
It is necessary also, I think, for the Government to understand the peculiar
position of house-building labour. I said some time ago how a bricklayer and his mates
engaged in building a house were like people living on a raft of which they had every
day to burn a plank or two to cook their dinner. That is the feeling which is in their
minds. They ask themselves what is going to happen to them when it is finished. In the
present circumstances there is a field of employment for the house-builders unlimited
for many years except by Government decision. As I said earlier, I thought that we
should give them an assurance of a ten-years' guaranteed programme. Free from the
anxiety that their work may end with the job, they could go ahead with piece work
without fear or stint and all the incentives, including the bonus system, could apply.
Here alone might be a 20 or 25 per cent increase in the building effort. There is really
no reason why the output per man in the building trade should be lower than pre-war
or so much lower than in the United States. Make them a fair and attractive proposi-
tion and we will get surprising results, but this policy of the Prime Minister that
200,000 is the limit, endorsed by the Minister of Health-I daresay to his regret-is bad
for the rate of output-even within that limit.
There is no trade in the country which can more readily adapt itself to a static
condition than the building trade. They would like a progressive condition but they
are quite ready, after the rough time which they have had in the last generation-I have
seen it: the first to be called up for mobilization and so on and the first to be turned
off when building slackens and so on-[Interruption.] I am the author of the labour
exchanges and the first Unemployment Insurance Act. I was in these matters years
before many hon Gentlemen opposite were able to take an adult interest in them. I say
that they are quite ready, after their experiences, to settle down into a static condi-
tion.
The Government limit of 200,000 houses-it was only 175,000, as the Minister
reminded us, until this new Parliament forced the restoration of the cut-undoubtedly
has most evil and discouraging effects. How long it is to last, we cannot tell. The late
Chancellor of the Exchequer, whose absence from our councils we deeply regret and
still more the reasons for it, told us in the Budget that this limit would last for three
years. Such a limit, or anything like it, must reproduce the deterrence of efforts,
enterprise and piece-work which ruled in the days when the building trade had always
an unabsorbed tail of unemployment.
Winston Churchill
A Time of Triumph: 1950
8125
local authority is
Therefore, when I endorsed as a resolute aim of the Conservative Party the
nd the richer class
raising of the rate of building to 300,000 a year, I did not mean that to be the static
specially designed
limit. We shall thrust towards it with all our life, strength and wit, but once this figure
the lower income
gleams upon our horizon-'forward again' must be the policy and the order. So much
it is a mockery.
for the Government's policy and the Prime Minister's statement. I am sure that the
iment raised it to
Prime Minister's statement represents the rigid attitude of planners who understand
ted States, whose
only about half of what is really going on.
1 whom we have
Now I come to the question whether the proposal we make is possible and
int than how it is
practicable, or whether it is all moonshine. [Hon Members: 'Hear, hear.'] I am
ithin the existing
glad to carry Members opposite with me. I said that 100,000 houses would cost
£150,000,000 a year from an annual income of over £10,000,000,000. The Prime
and the peculiar
Minister's reply is that houses are not built with money. Money, of course, is only a
er and his mates
fairly well-known method of expressing effort and resources. I am surprised it has not
h they had every
occurred to the Prime Minister, because it has been known about in quite a lot of
which is in their
countries for quite a long time. Let us look at the additional effort and resources
; finished. In the
required. Judgment on this kind of enterprise depends on two conditions: are they so
ilders unlimited
big that they are beyond our power, and, secondly, if they are within our scope, are
thought that we
there bottlenecks which prevent them? Several constructive speeches have been made
Free from the
today. We have also made, in our own research department, a considerable examina-
with piece work
tion. My personal experience of Government machinery is considerable, and I must say
m, could apply.
that I have never seen a major task which I was more sure of as being within practical
There is really
limits. I would not fear to take responsibility for this achievement. I offer my assur-
er than pre-war
ance that it is a reasonable objective, and that, should we be called upon to exercise
ractive proposi-
power, it would receive the highest priority and the most vehement effort jointly with
e Minister that
national defence.
is regret-is bad
That is what I have to say on the proportion, but let us now look at the
bottlenecks. My hon Friend the Member for Wallasey [Mr. Marples], in his admirable
tself to a static
speech today, dealt with these details. I was very glad that with his technical
dition but they
knowledge he was able to put this subject before the House as a practical matter of
eration-I have
detail and on its merits, instead of trying to reduce it to the ordinary bang and slam on
st to be turned
one side and the other of party politics. I was sorry that my hon Friend, a private
r of the labour
Member speaking from a back bench, should have been made the victim for so
matters years
prolonged a personal attack by the Minister of Health. I really thought that the
: in them. I say
Minister would have done himself much more good-though he is the judge of that-if
a static condi-
he had devoted himself to the merits of the question, and tried to give the House the
feeling that his heart was burning to conquer in this struggle to find homes for the
as the Minister
British people. I shall not attempt to go into details. [Hon Members: 'Go on.'] If I did
-undoubtedly
so, I would trespass on the reply to this Debate.
it tell. The late
The Secretary of State for Scotland [Mr. McNeil] : If another five minutes would
ply regret and
furnish the House with any details, I should be delighted to give up that time.
1 last for three
Mr. Churchill: 8,000 million bricks were made before the war, but we are now
ice of efforts,
making a little over 6,000 million. Of this 6,000 million a little more than 3,000
de had always
million are used for the construction of the traditional brick dwelling-house. Out of
them are built about 160,000 houses. To build another 100,000 houses would need
8126
Speeches of Winston Churchill
about 2,000 million more bricks. That is well within the range of the pre-war
brick-fields. If these had not been restricted and jogged about by changes of policy,
there would be plenty of bricks. But the brick-fields are already running at 80 per cent
of their pre-war capacity, and there should be no great difficulty or delay in restoring
them to their pre-war normal output. So much for bricks.
More cement will also be needed to achieve our target, but this need present no
great problem. An extra 900,000 tons would produce 100,000 houses. The industry
already produces 10,000,000 tons, and it would be producing more if it had been
allowed to go ahead with the expansion plans it had in 1945. Next year this industry
plans to produce 10,500,000 tons. As a temporary measure, we could, if necessary,
reduce for a time the exports, which are running at a rate of 1,600,000 tons. Certainly
by the end of next year the cement industry, if not nationalized, will have caught up
with all our demands, including rearmament.
Then there is timber. We have been told that if no timber can be got from
sterling area countries like Norway, it will affect the dollar position. But here again I
am sure that the quantities and proportion would have their say. I am assured that
about £9,750,000 worth of dollars or less than half of our last year's tobacco bill,
would give all the dollars necessary to buy from Canada the extra timber. I do not
believe it would be necessary to go so far, because I am sure a good deal can be got
within the sterling area. Far greater elasticity will come from the abolition of bulk
buying by officials. Anyhow, the whole timber transaction is one well within our
compass. The improvement in the dollar exchange would more than justify such a
step. We lose at home by the higher prices for raw materials, but in the exchange we
gain, especially by the sale of tin and rubber. It may well be that we could find a
partial compensation for Britain at home in using our improved dollar position to buy
more timber, and thus help to solve the housing question.
I am asked: 'Are you for or against controls?' But what a crude and absurd way
to state the issue. Government speakers talk as if there were no middle course between
the universal regulation of a Socialist State administering all the means of production,
distribution and exchange and what they call the anarchy of the jungle. But the vast
majority of the human race dwell in the temperate zones which lie between the
burning heat of the equator and the freezing cold of the polar regions. Our belief is
that the fewer the controls the better; that the more freedom and enterprise can play
their part the more chance there is of a fertile, prosperous and progressive community.
We also think that private management is far more economical and resourceful
than management by State officials. We are sure that the completion of the Socialist
aim of substituting State industry for every form of private industry would reduce our
standard of life and would reduce the present number of our population. In the United
States, where a capitalist competitive system prevails and where wartime regulations
were practically swept away until recently- [Hon Members: 'Ah.'] Well, there is a war
in Korea. What about that 'Ah' now? The United States have three times our
population, so, according to Government standards, they ought to be building 600,000
houses a year. They are actually building more than 1,000,000.
Now, when rearmament casts its shadow upon the world and upon our country,
Winston Churchill
A Time of Triumph: 1950
8127
e of the pre-war
there must evidently be a maintenance or even a renewal of some wartime regulations.
changes of policy,
We have agreed that the Supplies and Services Act should be renewed on an annual
ing at 80 per cent
basis, but our hope of establishing full freedom under the well-known and long-estab-
delay in restoring
lished laws of our country remains our goal. The difference between the two sides of
the House is that the Socialists aim at the maximum of controls and the Conservatives
S need present no
aim at the minimum. Both seek to progress in those opposite directions for different
ses. The industry
reasons as far as they possibly can. Can we now accept that as a summary of the
re if it had been
differences between us?
year this industry
If we apply that mood of thought to the position of the building industry at the
uld, if necessary,
present time it means that we should, of course, use the local authorities as well as the
10 tons. Certainly
private builders, and that we should only alter the system of licences step by step. The
11 have caught up
Minister of Health has suggested that under a Conservative Government a great number
of houses would be built for sale to the well-to-do by speculative builders and that few
can be got from
houses would be built to let for the ordinary man. It is our intention that, under a
But here again I
Conservative Government, the priority given to houses built by local authorities will be
am assured that
maintained. This obligation will be scrupulously honoured in our house-building
ar's tobacco bill,
programme.
timber. I do not
Mr. Bevan: In what proportion?
deal can be got
Mr. Churchill: We want the local authorities to be able to reduce their waiting
abolition of bulk
lists and to resume the process of slum clearance which was interrupted by the war.
well within our
Mr. Bevan: The right hon Gentleman has made a very important statement. In
n justify such a
what proportion would the right hon Gentleman-maintain local authority house-build-
the exchange we
ing?
we could find a
Mr. Churchill: I said that I had no intention of stating exact details. Give me the
position to buy
power and I will give you the figures. We have to indicate our principles, and I am
indicating some very clear principles. Over and above that commitment, to which we
and absurd way
are all pledged, we should expand output so as to make it possible for free enterprise
course between
and renewed impulse to build large numbers of additional houses, both for sale and to
S of production,
let. So long as the housing shortage continues, the Government must restrict the
gle. But the vast
ceiling on price or size of houses built for sale, and this must be dependent upon the
lie between the
prevailing, and sometimes upon the local, conditions. We shall take steps to prevent
ns. Our belief is
the diversion to any kind of luxury building, whether public or private, of the
terprise can play
resources of men and materials-a great deal of them is being taken for public
sive community.
building-which could be devoted to the housing of the people.
and resourceful
I listened to the speech of the noble Lady the Member for Anglesey [Lady
of the Socialist
Megan Lloyd George] [Hon Members: 'Hear, hear.'] I hope that the applause from
ould reduce our
the other side of the House will assure her of any immunities which she may be
n. In the United
seeking. I need not say that I speak as a life-long friend of her father and her family,
time regulations
but I feel that she should have verified the facts before making the statement about
11, there is a war
the Carlton Club claiming a license to rebuild the bomb-damaged premises. We have
hree times our
given up all hope of ever rebuilding the Carlton Club and no application for a license
uilding 600,000
has ever been made. The site is being disposed of. Speaking as one who lived in her
father's generation, I do not consider that prefixing the words 'I am informed that'
on our country,
relieves one of all responsibility.
8128
Speeches of Winston Churchill
Lady Megan Lloyd George: I am sorry to interrupt the right hon Gentleman, but
when I was informed that that was not the case I withdrew the statement. [Hon
Members: 'No.'] Certainly I did so.
Mr. Churchill: I was here at the time but I suffer a little from deafness and did
not realize that the charge had been withdrawn.
Lady Megan Lloyd George: I said that I was very glad that it was SO and that no
licence had been granted.
Mr. Churchill: Honour is completely satisfied on both sides. We say that the
emphasis should be placed upon new houses. In 1935 new housing absorbed 48 per
cent of the building industry's output. In 1947 the figure was only 34 per cent, and in
1948 31 per cent. We have no later figures, but I am informed-[Laughter]- must be
careful-thåt it might well be only 30 per cent today.
I think that the Government have been at once ambitious and ineffectual in their
building plans. They have dispersed, instead of concentrating, their resources. They
have been very loose in their application of principles of selection in regard to their
objectives. The need above all is to establish in this sphere, as in many others, the right
priorities. They ask, for instance, whether we would cut the new power stations. The
answer is 'No.' Without power we cannot build houses, carry out our defence
programme or expand our industrial output. But the question of whether the neces-
sary electrical supply could not be obtained with fewer bricks subtracted from the
housing programme is still open, and my hon Friend the Member for Wallasey drew
our attention to American practice on this subject, which certainly seems to deserve
study.
I am grateful for the five minutes extra which the right hon Gentleman has
granted me, and I shall draw to a conclusion the remarks I have ventured to offer to
the House. We must not let this 'wiping the floor' mood of the Prime Minister and the
Minister of Health blot out from our minds the pathos and the tragedy of the shortage
of houses. The life of the nation and the happiness and virtue of the human race are
founded upon the family and upon the home. Empire, ideologies, party struggles, class
warfare, all present their attractive temptations to the active mind, but the founda-
tions of all our health and honour lie in the home and the family.
It was John Bright who spoke of his supreme pleasure in seeing little children
playing upon the hearth. I cannot understand why this result should not be won. Let
us have less chatter and planning and scheming for future Utopias. Let us get on with
this imperative job of housing the millions who ask SO little and get so little for all
their efforts. The family requires a home and the home requires a house or, if you like
it, an 'accommodation unit'-something, at any rate, where a man has his own front
door. Outside is the great, bewildering, tumultuous world; inside, the family can plan
what is best for themselves, what it is best to aim for, what it is wisest to give up. And
in so deciding they create at once the foundation and the motive power without which
all the super-planners are only chasing shadows. Where does the family start? It starts
with a young man falling in love with a girl. No superior alternative has yet been
found! Look at the number of couples whom the statistics show either cannot get
married because they cannot get a house to live in, or have to live with their parents,
Winston Churchill
A Time of Triumph: 1950
8129
on Gentleman, but
or jam up in the sort of collectivist squalor of Communist lands. I see that a judge in
statement. [Hon
Plymouth said the housing shortage was the principal cause of divorces. Then what of
the health? There is no doubt that tuberculosis thrives on bad housing conditions. In
1 deafness and did
Scotland it has actually gone up since the war. Then comes the sharp issue of children
not having a home they love, or a family circle which commands their loyalty, and of
vas so and that no
the many forms of consequential juvenile misconduct of which we read.
The Minister of Health cannot brush all this aside and escape from this Debate
We say that the
without incurring blame and condemnation outside for not having offered us a
absorbed 48 per
constructive statement and words of encouragement. All his critics will not be on one
4 per cent, and in
side of the House. I have a number of quotations, some very moving, from speeches
ghter] must be
made last week from the Benches opposite, one particularly from the hon Member for
Kirkdale [Mr. Keenan] who said:
effectual in their
resources. They
What is the good of having fine schools or even fine hospitals if there is
n regard to their
no home in which the children can rest?
I believe in bedrooms before
others, the right
schoolrooms
It is certainly a fact that not all building-trade workers
wer stations. The
who are capable of house-building are engaged on house-building.
out our defence
ether the neces-
It astounds me that the House has not rallied to this proposal which we make and
tracted from the
resolved that it shall be carried into effect by every priority to other issues except
r Wallasey drew
self-preservation.
eems to deserve
But, sir, you may be sure that the nation will not endure this mismanagement
and misdirection much longer. They will not agree to a system of British life and
Gentleman has
society which means that no progress is being made to overtake the housing arrears,
ured to offer to
that as many houses are falling into decay every year as are being built, that slum
Minister and the
clearance is static like all the rest of it, that all the personal stresses now endured by
of the shortage
hard-working couples are to continue, and that even to raise these issues in the House
human race are
of Commons is to incur the insulting charge of vote-catching and partisanship.
, struggles, class
Early last week there came across my mind some lines about our island life
out the founda-
which Charles Masterman used to repeat to me. Oddly enough, while I was seeking to
verify the quotation it was used in the House by the hon Member for Oldham West
3 little children
[Mr. Leslie Hale]. The poet and the teacher, as he was-William Watson-speaking of
lot be won. Let
the hard social conditions of the life of the people, asked:
: us get on with
Is there no room for victories here,
so little for all
No fields for deeds of fame?
= or, if you like
But I have found another verse of William Watson, which I remembered at the same
his own front
time:
family can plan
The England of my heart is she,
o give up. And
Long hoped, and long deferred,
without which
That ever promises to be,
start? It starts
And ever breaks her word.
has yet been
Why should she always break her word to those who love her so well and defend her
her cannot get
safety and honour with their lives? Now is the time, here is the occasion, and this
I their parents,
housing issue is the deed to sweep that hard reproach away.
THE WHITE HOUSE
WASHINGTON
November 8, 1989
MEMORANDUM FOR ROGER B. PORTER
FROM:
LARRY LINDSEY 4/k
SUBJECT:
National Association of Realtors Speech
p. 2
The empirical support for the claim that a 1.5 percentage
point drop in interest rates means an additional 670,000
home purchases is extremely weak. More significantly,
it could be read as more homes being constructed; we have
had a 1.5 percentage point drop since March and housing
starts have fallen.
I suggest that instead, we use some less precise figure,
such as: "thousands more American families can buy a home
each time interest rates fall".
p. 2
Use 84 months instead of 7th full year, it sounds more
impressive. Or, say that next month will mark the start
of the 8th year.
Also, there are a number of good news points to make on
housing. Some of them include:
Housing Starts have never stayed this high for this long in
history. The typical "housing cycle" used to be 4 to 5 years.
Housing affordability is holding up well. The index stood at
RR
104.7 in September. That's up about 25 percent since the
recovery began in 1983 and up more than 50 percent since the
high interest rate days of the late 1970s and early 1980s.
There are two keys to affordability and both are moving in
the right direction.
-
Real Income has been growing since 1982. Between 1973
and 1981, the real income of the median family declined
9 percent. By 1987, we'd made up for that decline and
last year and again this year, we hit new records in real
income.
-2-
-
Interest Rates are way down. Fixed rate mortgages
(FHMLC) are now in single digits -- 9.8 percent. Long
term interest rates are down 150 basis points since
March.
p. 4 to end:
It is a serious mistake to announce the HOPE initiative
before the details have been agreed to among the relevant
agencies. Even if the word is used, details should be
kept for a time when they have been worked out.
p. 4:
Specifically, points on which there is no interagency
agreement should not be raised. THERE IS NO INTERAGENCY
AGREEMENT ON ALLOWING FIRST TIME HOMEBUYERS TO USE THERE
IRA MONEY. This completely short circuits the policy
process.
p. 4:
The expectations created about the amount of money we
are going to spend on the Federal Housing Finance Board
are SO far above where we will go in the budget that we
will produce gales of laughter when the budget is
submitted. Don't hook the President into this.
p. 5:
The linkage between the Low Income Housing Tax Credit
and the capital gains tax is clever, but again, nobody
has signed off on it. In fact, Treasury testified
against extending the Low Income Housing Tax Credit.
p. 6:
Greenlining is clever rhetoric, but if you know what
policies lie behind it, you'd never get the President to
agree to it.
p. 8:
I am not aware that we have "directed the FHA to set
aside 10% of its foreclosed housing for lease to homeless
groups". Why not just direct them to set aside units,
rather than creating a performance standard that we do
not feel confident can be met. It is not clear that
homeless groups have the capacity to absorb anywhere near
10 percent of foreclosed units, particularly in
distressed areas such as Texas.
On the "points of light" front, the President should
challenge the realtors to use their knowledge about real
estate and real estate transactions to help facilitate
this process.
p. 8:
It is simply untrue that any substantial number of
homeless men and women and hold down full-time jobs can't
afford housing. This is a falsehood that the
-3-
President should not make credible by repeating. The
following sentences provide the necessary caveats, but
the sentence can be taken out of context and used for
all kinds of mischief. Preferable would be a sentence
linking affordability and our strategy of improving
purchasing power through vouchers and certificates rather
than build new public housing.
p. 8:
I also suggest removing the word "just" in the second
sentence. Homelessness isn't a matter of too little
shelter space. A possible reformulation: talking in
terms of it being "time to move our struggle against
homelessness beyond beds in shelters."
Otherwise, the statements about homelessness present the
President as being thoughtful and responsive to the issue of
homelessness and should bring kudos for a willingness to be frank
about the issue.
Rhoads Terrace
South Dallas Roard
Reg Council Ren Ugm+
Kenilworth /Parkside
Jessie Todales Pres. 1989 Section Voucher 8 . housing
(toles)
housing assistance
only lat
home
mgr Helen Washington mkg
June this your
214/421 - 2/4/2019
lease Junk
cars
hus
DALLAS MOUSING MUIN
ICL NO.
214 520 0402 NUV 02,09 10.04 20.01
DALLAS
HOUSING AUTHORITY
November 2, 1989
The Honorable George Bush
President - United States
Executive Office of the President
1600 Pennsylvania Avenue, N.W.
Washington, D.C. 20500
Dear President Bush:
I would like to take this opportunity to introduce myself. My name
is Alphonso Jackson and I am the Executive Director of the Dallas
Housing Authority. As a public official, my philosophy for
assisting low and moderate income families is parallel with yours
and Secretary Jack Kemp. I believe that one of the keys to self-
sufficiency for low-income persons is to allow them to have control
over their lives and destiny.
As an administrator of low-income housing programs, I have always
involved residents in the decision-making process. I have had the
unique experience of working with perhaps the two most successful
resident leaders and resident management corporations in the
country, Bertha Gilkey of Cochran Gardens in St. Louis and Kimi
Gray of Kenilworh/Parkside in Washington D.C. As executive
director of these two public housing agencies, I spent A
considerable amount of time supporting and believing in the self-
sufficiency philosophy which emanates from the resident management
concept. I was indeed pleased to be the first executive director
of a public housing authority in the country to submit an
application for homeownership for the residents of
Kenilworth/Parkside Housing Development. Now as the Executive
Director of the Dallas Housing Authority, I am working with other
community leaders to promote, support and encourage resident
management in our city.
2525 Lucas Drive, Dallas, Texas 75219, (214) 526-8581
DALLAS MOUSING muin
ICL NO.
214 JZO 0402 NUV 02103 10.00 r.v2
My commitment and support of resident management has been
demonstrated over the past years and it can be substantiated by
resident leaders and resident advocates like Robert L. Woodson,
President of the National Center for Neighborhood Enterprise.
My philosophy of self-sufficiency and support of programs promoted
by your Administration has not made me a very popular individual
amongst my colleagues and the Afro-American community in general.
As a Afro-American public official, I am often criticized for
espousing Republican ideas. However, I remind my critics it does
not matter if good ideas and programs are Republican or Democratic,
the only thing that matters is helping low-moderate income people
move into the mainstream of our society.
I commend you on your efforts to help the American society win the
War on Poverty. I firmly believe while the War on Poverty was
initiated by Democrats, your Administration has been moving in the
best direction to address social ills that years of federal funding
have yet to resolve.
I would be indeed honored if I could be invited to visit with you
at the White House. I realize that you may receive many requests
from public officials asking for an appointment on your schedule
and I also realize my request may seem very presumptuous, but I am
certain we both could gain some important insights into helping
low-moderate income people by discussing this matter further.
I will look forward to hearing from you in the near future. If you
are in need of references, I am certain that Senator John Danforth
and Congressman Steve Bartlett would be more than pleased to speak
on my behalf.
Respectfully,
Albhonso Jackson
Enclosure
ARJ/lmh
Parker Banzhoff
McGroarty/Dooley
November 7, 1989
8:00 am
[REALTORS]
PRESIDENTIAL REMARKS: NATIONAL ASSOCIATION OF REALTORS
DALLAS, TEXAS
NOVEMBER 10, 1989
2:15 P.M.
audience front now
Kemp, Austin Fitts 1
Norm Flynn (new)
[Introductory remarks.] Thank you, Ira [Griben] -- the very
able President of the National Association of Realtors. And let
me say hello to two fine members of Congress who have travelled
Blount
down to Dallas today, Representatives Bill Thomas and Claudine
Schneider Gramm, Cong. Steve Bartlett (AF1)
[[ Ira mentioned to me on my way in this afternoon that my
speech is a special occasion for this association. // I said I
was honored -- and then Ira said "It's not often that we're
addressed by someone who lives in public housing." ]] ////
[[ The truth is, I am not a real estate wizard. When I was
Barbaro
book
elected to Congress back in 1966, we needed to make housing
arrangements up in Washington. At that time, Senator Al
Bush simply Rodditf Donniey 144
Simpson's father, Millward, was retiring and moving back to
Lookingtoner Looking
Wyoming. So I bought the Simpson place -- sight unseen -- made
pale
the deal over the phone. When we got to Washington, there were
just two problems: we found out right away the house wasn't
quite big enough for the Bush family -- and we found out when we
put the place up for sale that it wasn't worth quite as much as
we paid for it. /// That's my claim to fame: I'm the only
2
person who ever lost money in Washington real estate in the last
20 years. /// Ira, where were you when I needed you? ]]
But few people have done more for the real estate industry
than I have. // Barbara and I have moved 28 times in our 44
Mrs.Bush
years of marriage. /// Now I know what you're thinking -- what
a dream client my family would make for any realtor. /// In
fact, OMB is calculating the commissions we've paid over the
years -- measured as a percentage of the GNP. ]] ////
I came here today to lay out a set of housing initiatives --
a comprehensive plan to bring basic shelter and affordable
housing within reach of every American.
But before I outline my housing proposals, I want to speak
for a moment about the single most important factor in helping
millions of Americans realize the American Dream: the economy.
Because the truth is, there's no better housing policy than
a strong economy. One that provides jobs and opportunities for
advancement -- interest rates that open ownership opportunities
to hundreds of thousands of first-time home buyers. And I know
pricey
just how important interest rates are when it comes to home
Mc Weshen
500,000
buying: a 1 1/2 point drop means an additional 670,000 families
able to purchase that home they want.
Nate 472 Homeluwo
And all signs point to continued strength in the economy.
November marks the seventh full year of economic expansion -- the
CEA
longest peacetime expansion in our nation's history.
CEA
CEA
Unemployment is lower now than at any point since the early 70s.
And here's one statistic that has to please all of you: during
3
CEA
this expansion, home mortgage rates are down from 13.8% back in
November, 1982 to less than 10% -- 9.8% -- today.
All of us know that the way to keep this expansion alive is
to stick with the pro-growth policies that set it in motion --
the policies that provide the private sector room to do what only
it can do: create prosperity and higher standards of living.
Of course, part of any reasonable economic policy is getting
our fiscal house in order. // I want you to know that my
Administration is hanging tough for a responsible budget -- with
real deficit reduction, no smoke and mirrors.
We don't like sequestration -- no one does. But we'll live
with it if we have to -- if it's the only way to rein in spending
and bring that deficit down to the Gramm-Rudman target. I'm
ready to sign a budget bill -- whenever Congress is ready to
strip off all the expensive extras and add-ons hidden away in
OMB
those omnibus spending bills. A responsible budget is one of the
best signals the government can send for the sake of continued
growth.
And I'm optimistic -- optimistic that this economic
That
expansion will continue. Hopeful my Administration and the
Congress -- with the help of members like Bill and Claudine --
can agree on a responsible budget. Hopeful that we'll see more
and more Americans prospering -- providing better lives for their
families, and looking to all of you to help them realize their
dreams.
4
Today, as I told you a few moments ago, I've chosen this
occasion to announce a wide-ranging set of housing initiatives I
ant
call Project Hope -- an initiative that stands for Homeownership
and Opportunity for People Everywhere.
Project HOPE addresses the full range of housing concerns:
from shelter for the homeless to affordable housing for low-
income families -- to initiatives that will help millions more
Americans achieve the American Dream: owning their own home.
Let's start with what Project HOPE will do for first-time
home buyers. You know first-hand about families working hard to
buy that first home -- families whose savings are no match for
skyrocketing prices. First-time buyers deserve our help -- and
they're going to get it. I will ask Congress to enact
legislation allowing first-time buyers -- or their parents -- to
draw without penalty on IRA savings as a downpayment for that
first home.
And we've got to expand the home-buying base -- bring more
low-income families into the ranks of homeowners. I will earmark
funds from the Federal Housing Financing Board, to be used for
mortgage rate buy-downs to make homeowning an option for more
low-income families.
Now, I know you've all seen the news on new housing starts.
It's time for all levels of government to take a second look at
some of the well-intended housing policies that actually decrease
our housing supply. I'm talking about the excessive rules,
regulations and red tape that add unnecessarily to the cost of
5
housing -- tens of thousands of dollars in some cases -- or
create perverse incentives to allow existing housing to
deteriorate.
I have asked my very able Secretary of HUD, Jack Kemp, to
HUD
convene a Blue Ribbon Commission to identify barriers to
affordable housing and to make recommendations on how those
barriers can be removed. And let me make the first
recommendation myself: no city, state or town should receive a
single cent of Project HOPE funds until they have identified
thave
XX
barriers to affordable housing -- and devise a plan to remove
them. ///
Project HOPE also means initiatives to improve low-income
housing. Let me say right away that my Administration rejects
costly new construction programs that in the past have too often
produced the housing projects that symbolize the very absence of
hope in our inner cities. This Administration remains 100%
OMB
behind housing vouchers that let poor people choose for
themselves where they wish to live.
Our challenge is to create incentives that maintain the low-
income housing we need. I will ask Congress to renew the Low-
Income Housing Tax Credit -- on one condition: that the Low-
OMB
Income Housing Tax Credit is part of a package that includes a
cut in the capital gains tax. I know the National Association of
regaffs
Realtors has fought hard to make a capital gains cut a reality.
Well, the fight's not over. We're going to keep up the fight for
6
one simple reason: because a cut in capital gains is good for
growth. ///
And Project HOPE can help us reverse a trend that's stunting
some of the growth and development that would otherwise take
place in low-income areas. Too many poverty-stricken areas have
simply been redlined -- ruled too risky for lending. I am asking
the Federal Housing Authority to work with neighborhood non-
profit groups to identify responsible credit risks in poor areas,
and open a flow of credit into low and moderate income housing.
The time has come to replace the redline with a greenline -- to
color these inner-city neighborhoods green for growth.
But the real centerpiece of our plan for public housing is
resident management and, yes, resident ownership. That's the
idea behind our HOPE Grants initiative. It's already working:
In Kenilworth-Parkside, back in Washington, D.C. In Cochran
Uphored
Gardens in St. Louis. And it's going to work right here -- at
the nation's second-largest public housing project in West
Dallas.
And the results are promising: with tenants in control, we
alphoneo
see better maintenance, more rents paid on time, a decrease in
people on the welfare roles as job opportunities emerge. And we
see something more: a sense of pride that is the very core of
any thriving community.
I hope these successes are only the beginning -- of a
nationwide shift towards tenant control, and ultimately towards
tenant ownership. I don't know any better way to revive hope in
7
our inner cities than to give tenants a say in running their
communities, and a stake in the future: the hope that they, too,
can own a home. //
That's worth remembering. Because the true measure of
success isn't how many families we add to housing assistance
roles. It's how many families move up and out -- into middle-
class status, and into the ranks of homeowners. ///
Project HOPE can make a difference for millions of Americans
who want to buy a home -- or who simply want to provide their
families decent housing and better hopes for the future. But
there are other people out there we've got to help. People who
stand in the shadows of what is otherwise a very bright economic
picture -- who live a nightmare in the midst of the American
Dream. We see them every day ---- on the streets of our cities,
sleeping on steam grates, living out of cardboard boxes. The
homeless. //
Back in June, I went up to Covenant House in New York. I
met children there who've been out on the street for 4 or 5 years
-- from the time they were 12 and 13 years old. /// We can't
begin to imagine the horrors they go through.
For all of us, November is the time of year we start looking
forward to the holiday season: Thanksgiving, Christmas, New
Years. For the homeless, November is the time of year the
temperature starts to drop, and simply making it through the
night becomes a life and death struggle. // Homelessness is a
tragedy -- and Project HOPE won't be complete unless it reaches
8
out to help the homeless. // Because no child in America should
have to grow up on the streets. And no family in America should
lack a roof over its head. ///
Now, my Administration is going to do its part to expand
emergency shelters. We're committed to fully funding the
McKinney Act. We're directing the FHA to set aside 10% of its
foreclosed housing for lease to homeless groups. And today, I
want to announce that -- as part of the savings and loans
recovery program -- I will make certain that a portion of the
properties from failed S&Ls be put to public use as facilities
for the homeless.
But we can't begin to eliminate homelessness -- to really
get at the root of the problem -- until we understand the various
reasons that lead to life on the streets. Homelessness isn't
just a matter of too little shelter space. There are the working
homeless, men and women -- some with children -- who hold down a
job, but still can't afford a home. But they are only a fraction
of the many homeless men and women who are literally incapable of
HUD
caring for themselves. And if we care about them, we've got to
take more than a one-dimensional approach to the problem.
The fact is this: Two-thirds of the homeless out on our
HUD
streets suffer from drug dependency or mental illness. For these
men and women, shelter alone is not enough. Homelessness is just
one symptom of the larger problems that prevent them from caring
for themselves.
9
The answer for the homeless who are mentally ill or addicted
to drugs is shelter plus: shelter supplemented by the necessary
support-services to get these people the help they need to live
in dignity. And that means a partnership -- a combined federal,
state and local effort -- to supply the funding and other
resources that constitute a comprehensive solution for the hard-
core homeless.
The key here is coordinating basic needs like shelter with
other social services -- to help the homeless get the treatment
they need to get control of their lives. To help them find and
hold down jobs. To help them manage a home. To help them regain
hope -- and leave life on the streets behind for good. ///
Helping the homeless. Helping low-income families find
affordable housing, decent housing. Helping more of the 80
million Americans who don't own a home join the ranks of
homeowners. Those are the aims of Project HOPE. Aims I hope
hope I can count on you to support. Aims in keeping with the
American Dream. ///
Thank you. God bless you -- and God bless the United States
of America.
# # #
salt washouses hate
Coddington
Correnant Hoo - 2/+under
Micheline Dir, Covenant House
(212/613-0300
212/730-2270
"throwaway kids"
1400 kids a night
prostitutes +drug addicts
THE WHITE HOUSE
WASHINGTON
November 8, 1989
MEMORANDUM FOR GOVERNOR SUNUNU
FROM: David Demarest
Chriss Winston
SUBJECT: National Association of Realtors Speech
The following are a list of policy questions remaining concerning
the speech.
1. Secretary Kemp would like the following added to the speech:
"I also want to pledge my Administration to vigorous support
+
of the mortgage interest and property tax deductions. These
deductions encourage homeownership, and are important to our
overall economic prosperity."
He would also like the President to announce, what he terms
in his comments as, "a new initiative to fund service-supported
2
housing for the homeless who are mentally impaired or are
substance abusers." "
He also has inserted the figure of $6.8 billion as the cost
of the HOPE initiative in a paragraph to be added at the end of
the speech.
2. Roger Porter, Treasury and OMB object to allowing parents of
3
first-time home buyers to withdraw, without penalty, their IRA
savings as a down payment for their children's first home.
3. Porter argues that we do not have the authority to earmark
4
-
funds from the Federal Housing Financing Board to be used for
mortgage rate buy-downs to make home owning an option for more
low income families.
4. Porter also argues that no agreement has been reached to set
I
aside 10 percent of foreclosed housing from the FHA stock for
5
homeless groups. He recommends the following language:
"We're directing the FHA to make its foreclosed housing more
accessible to the homeless."
5. OMB and Treasury wants to delete any reference to directing
that, as part of the savings and loans recovery program, a
certain portion of the properties from failed S&L's will be put
to public use as facilities for the homeless.
in -
National Association of Home Builders
15th and M Streets. N.W. Washington, D.C. 20005
Telex 89-2600 (202) 822-0200
FACSIMILE TRANSMITTAL COVER SHEET
DATE: 11.8.89
TO: Peggy Dadey
SENDER : David Crowe
DEPT. : Housing Policy
RECEIVER'S FAX. (PHONE) NUMBER :
r
,456 82186218
NUMBER OF PAGES FOLLOWING COVER SHEET :
COMMENTS :
NAHB FAX NUMBER : (202)822-0559
FOR ASSISTANCE WITH FACSIMILE, PLEASE CONTACT SENDER ON NUMBER
AND/OR EXTENSION INDICATED ABOVE.
T
1111
Note To Peggy Dooley:
I have enclosed the article describing how mortgage interest rates
affect buying. After the article was published, we found a more
accurate estimate of purchasers as a percentage of all households.
Hence, the copy I am sending includes a penned in change. The
500,000 estimate we gave you on the phone is 1.5 times the total
of 68,000 and 280,000. Please call if you have any questions.
David Crowe
822-0383
N
20/00/11
I.I.J
TOM
Mortgage Interest Rates and Housing Affordability
David Crowe
Affordability is a hot topic in hous-
(which excludes homes built on owner's
ment, the standard rules provide a gauge
ing discussions today. The issue touches
property). the proportion using
of affordability and an indicator of the
many aspects of housing costs: land
mortgages was 91% in both 1985 and
potential sales reduction when interest
development restrictions, hard costs of
1987.
rates rise.
construction, down payment require-
At higher interest rates, the monthly
ments, and monthly mortgage payment
payment required on a given mortgage
levels. Aside from the size of the
amount is higher, but the monthly
Rate Changes Affect the
mortgage, the largest determinant of
mortgage payment is not quite propor-
Median Buyer
monthly payments is the mortgage inter-
tional to the interest rate. Monthly
estrate. Increases in mortgage rates affect
The number of households affected
mortgage payments include both prin-
affordability by increasing the monthly
cipal and interest. As the interest rate
by an interest rate change depends upon
cash costs of owning. Prospective buyers
increases, the principal payment for the
the size of the change and the shape of the
either fail to qualify at the higher rate or
initial months declines. An increase in the
income distribution. Figures 1 and 2
are unwilling to increase the share of their
show the income distribution of all
interest rate on a 30-year loan from 8% to
income going to housing. Estimates of
households and owner households in
9% does not cause an increase in the
the number of buyers lost as rates in-
monthly payment of 1/8 or 12.5%. The
1987. Respective median incomes are
crease depend on a complex array of
actual increase is only 9.7%. At higher
$25,985 and $31,903. The distributions
factors-level of interest rates, income
reflect the concentration of households in
interest rate levels, however, the amount
and house price distributions, mortgage
of principal included in the initial month-
the $20,000 to $50,000 income range
underwriting standards, and demo-
ly payment becomes very small and the
(43% of all households and 46% of owner
graphic changes. The number of
change in payments becomes very close
households) as well as the skewed con-
households that fail qualification as rates
centration of households at the lower end.
to the change in interest rates. Table 1
increase is a much larger number than the
shows the monthly payment for principal
A $100,000 home loan is typical on
number who fail to purchase. Only about
and interest for a $100,000 loan for 30
8% of all owner households bought
years at different interest rates. In ad-
Table 1
Mortgage Payments on
within a given year and more than half of
dition to principal and interest,
purchasers' payment-to-income ratios
$100,000 Loan
monthly mortgage payments fre-
are below the standard underwriting
quently include escrow payments for
Monthly
maximums. This article shows what
property taxes and hazard insurance,
Payment
changes in mortgage rates mean to affor-
and even when those expenses are not
(Principal &
dability.
subject to escrow they are considered
Mortgage
Interest
as part of the payment burden in
Rate
Only)
Difference
mortgage underwriting.
9.0%
$ 804.62
The Mortgage Interest
Both borrowers and lenders are
9.5
840.85
$ 36.23
Rate Affects Most Buyers
deterred from entering into a loan
10.0
877.57
36.72
Most owners use a mortgage to pur-
agreement when rates increase. From
10.5
914.74
37.17
chase their home. The 1985 American
the lender's standpoint, if mortgage
11.0
952.32
37.58
Housing Survey (AHS) reports 81% of
payments are too high relative to
11.5
990.29
37.97
new home (built in previous 4 years)
borrowers' incomes, the risk of
12.0
1028.61
38.32
owners had a mortgage on their home.
default increases. As a result, lenders
12.5
1067.26
38.65
Among all who bought new or existing
impose limits on the acceptable pay-
ment-to-income ratio.
13.0
1106.20
38.94
homes within the previous 12 months, the
13.5
1145.41
39.21
AHS reported that 81% obtained a
Purchasers with at least a 10%
downpayment usually qualify for a
14.0
1184.87
39.46
mortgage to purchase their home. The
Census Bureau's Survey of New Homes
maximum 28% payment-to-income
14.5
1224.56
39.68
(C25 series) similarly shows that 81% of
ratio (FNMA and FHLMC standard).
15.0
1264.44
39.89
new homes completed in 1985 were
Lower downpayments push the al-
15.5
1304.52
40.07
financed with a mortgage, and that 82%
lowable payment-to-income ratio
16.0
1344.76
40.24
of all new homes completed in 1987 were
down to 25%. Although many buyers
16.5
1385.15
40.39
mortgaged. Of the homes built for sale
choose to devote a smaller portion of
17.0
1425.68
40.53
their incomes to the mortgage pay-
May 1989
7
E
cause of increased interest rates must
Figure
1 Income Distribution: 1987 Population Survey
come at the sacrifice of some other con-
sumption or savings. First-time buyers
Households (Thousands)
6
already spend 1% to 3% larger portion of
income on housing than repurchasers,
5
and are therefore less able to opt for a
higher payment.
4
A second option is to reduce the
3
Owner Households
mortgage amount by a higher down pay-
ment. To keep monthly payments the
All Households
same when interest rates increase from
2
10.5 to 11.5 on a median new home re-
I
quires an additional $7,670
downpayment, a 31% increase. For a
0
median existing home, the increase in
10000
20000
30000
40000
50000
GOODO
75000
downpayment would have to be $5,442,
Income
also a 31% increase. The median loan-to-
a $125,000 home, the approximate
rise in interest rates because the total
value ratio for recent movers (moved
median new home price in February
number of homes sold is about four times
within past year) in 1985 was 76%, sug-
1989. The 1985 AHS reports that median
as large as the number of newly-built
gesting some home buyers do have
property taxes were 1% of value. That
homes and also because the likely pur-
additional resources to draw upon. But,
translates into $104 per month for taxes.
chasers of existing homes fall within the
like increasing the payment-to-income,
Monthly hazard insurance is assumed to
"thicker" part of the household income
an increase in downpayment means the
be $23 for our example. Hence, a month-
distribution. The 1987 median existing
household's savings or expenditure for
ly mortgage payment on $100,000 at
home price was $85,600 which would
some other durable (furniture, car, etc.)
10.5% for 30 years is $1,042. Using a
imply a $68,500 mortgage with a 20%
would have to be postponed or reduced.
maximum payment-to-income ratio of
downpayment. Qualifying income at
First-time buyers are most distinctive
28%, the minimum income necessary to
10.5% is $30,900. If rates rise to 11.5%,
from other buyers with respect to
qualify for $100,000 home loan is
qualifying income increases from
downpayments. Almost two-thirds put
$44,657.
$30,900 to $34,114, which encompasses.
down less than 20% whereas only 43%
A percentage point increase in
3.6 million households. About
of
all
of repurchasers put down less than 20%.
mortgage rates to 11.5% increases the
households at the $34,000 income level
A third option is to purchase a less
minimum required income to $47,870.
buy existing homes in a year, implying
expensive home. To keep mortgage pay-
About 2.8 million households have in-
about 780,000 would be affected by a
ments at the same level when rates
comes that fall into the range from
percentage point increase.
increase from 10.5% to 11.5%, a buyer
$44,657 to $47,870 and would become
would have to reduce his purchase of the
income ineligible to purchase a newly-
February 1989 median new home priced
built median-priced house. Not all
Buyers Have Options
at $125,000 to a $115,000 home, almost
households, however, are likely to buy
Prospective buyers have four pos-
an 8% reduction. The median existing
homes. About 2.5% of households at that
sible responses to an interest rate
home buyer would have to find a home
income level would have purchased a
increase. First, a family can spend a larger
for $86,000, 8% less than the actual
newly-built home in a typical year. Thus,
portion of its income on housing. Only
median. Finding a less expensive home
among all those who normally would
buyers considering a mortgage smaller
concentrates the buying pressure on
have bought new homes, 68,000 home
than the maximum for which they could
fewer homes making it even more dif-
buyers would not be able to qualify at the
qualify have this option. Many buyers do
ficult to find a suitably priced home.
higher interest rate.
spend less than the standard, but that is
The fourth option is not to purchase.
These estimates refer to purchasers
often a choice made to allow for other
Move-up buyers may be the first to
of newly-built homes only. A larger num-
spending. Increasing the proportion of
choose this option when rates rise since
ber of all home buyers are affected by a
income spent on mortgage payments be-
their plans to move can often be
postponed. However, first-time home
Number of Households Affected By One Percentage Point
buyers also choose this option because
Increase in Mortgage Rate
the other options or even combinations of
Newly
Existing
options are not feasible. While pur-
Built Homes
Homes
chasers may not be near the underwriting
Fail Income Qualification
2,800,000
3,600,000
maximums, many prefer lower propor-
Unlikely to Purchase
68,000
80,000
tions on their own,
8
Housing Economics
to
TC:11
UNITED STATES DEPARTMENT OF
COMMERCE
BUREAU OF
THE
NEWS
CENSUS
WASHINGTON, D.C. 20230
Dean Crist.
Bureau of the Census
For Release 8:30 A.M. EDT, October 18, 1989
David Fondeller
(301) 763-5731
CB89-163
Erica Annarella
(301) 763-7842
Sherwin Weinstock
(301) 763-7842
HOUSING STARTS AND BUILDING PERMITS IN SEPTEMBER 1989
Privately Owned Housing Starts
Privately owned housing starts in September were at a seasonally adjusted annual rate of 1,263,000 compared with the
revised August rate of 1,332,000, according to estimates reported today by the U.S. Commerce Department's Bureau of the
Census. The September 1989 estimate is 14 percent below the September 1988 figure of 1,463,000.
Single-family housing starts in September 1989 were at #1. rate of 971,000 compared with the August figure of 992,000.
The September rate for units in buildings with five units or more was 241,000 compared with the August figure of
287,000. The September rate for units in buildings with two to four units was 51,000.
During the first 9 months of this year, 1,075,200 housing units were started compared with 1,145,800 units for the same
period in 1988. This is a decrease of 6 percent.
Building Permits
The seasonally adjusted annual rate of housing units authorized by building permits in September was 1,296,000, 2
percent below the revised August rate of 1,328,000 and 9 percent below the September 1988 rate of 1,432,000.
Single-family authorizations in September were at a rate of 938,000 compared with the August figure of 927,000.
Authorizations of units in buildings with five units or more were at a rate of 297,000, 8 percent below the August
figure of 324,000. The September rate of permit-authorized units in buildings with two to four units was 61,000.
During the first 9 months of this year, 1,034,600 housing units were authorized by building permits compared with
1,120,200 units for the same period in 1988. This is a decrease of 8 percent.
Mobile Home Shipments
Statistics on mobile home shipments, which lag by 1 month, appear in the Current Construction Reports, series C20. In
August, manufacturers' shipments of mobile homes were at a seasonally adjusted annual rate of 194,000, 9 percent above
the July rate of 178,000. The August 1988 rate was 223,000. Before seasonal adjustment, total shipments in August 1989
were 19,400.
The next press release is scheduled to be issued on November 17, 1989, at 8:30 A.M. EST.
EXPLANATORY NOTES
In interpreting changes in the statistics in this release, note that month-to-month changes in seasonally adjusted
statistics often show movements which may be irregular. It may take 3 months to establish an underlying trend for total
starts, mobile home shipments and building permit authorizations.
Except for those on mobile home shipments, the statistics in this release are estimated from sample surveys and are
subject to sampling variability as well as errors of response and nonreporting, Estimated average relative standard
errors of the data are shown in the tables. For month-to-month comparisons, the range of the 90-percent confidence
interval is +7 percentage points from the estimated change for total housing starts and +7 percentage points for
single-family housing starts. For the year-to-date total of housing starts, the range of the 90-percent confidence
interval is +1 percentage point from the estimated change. For building persits, the ranges for month-to-month
comparisons are ±1 percentage point for the total and +1 percentage point for single-family; for the year-to-date total,
the range is +1 percentage point. When the range of the confidence interval contains zero, it is unclear whether there
is an increase or decrease: that 18, the change is not statistically significant. The April Current Construction
Reports, C20-89-4, includes explanations of confidence intervals and sampling variability. On the average, the
preliminary U.S. total housing starts and building permit estimates are revised about plus or minus 1 percent. This
does not include the revisions made when new seasonal factors are computed. Statistics on mobile home shipments are
compiled from manufacturers' reports to the National Conference of States on Building Codes and Standards (NCSBCS).
This press release also is available on the date of issue through the Census Bureau's on-line information
service -- CENDATA. The on-line version of the press release can be read from a terminal screen, printed on- or
off-line, or copied to a computer file for future use, The Cendata Staff at the Bureau of the Census
*
(301/763-2074) can provide content information and general guidance. For a brochure, write to CENDATA, DUSD,
Bureau of the Census, Washington, D.C. 20233.
Table 1. New Privately Owned Housing Units Started
(Thousands of units. Detail may not add to total because of rounding)
in structures with-
Period
Total
3 and 4
5 units
Northeast
Midwest
South
West
, unit
2 units
units
or more
1a. Seasonally adjusted annual rate
1988 - September
1,463
1,039
62
362
206
258
576
423
-
October
1,532
1,136
63
333
198
273
582
479
November
1,367
1,138
68
361
219
275
613.
460
December
1,577
1,141
65
371
201
343
609
424
1989 - January
1,678
1,199
66
413
293
313
642
430
February
1,465
1,029
62
374
224
273
572
396
March
1,409
981
50
378
160
308
552
389
April
1,343
1,029
62
252
207
274
526
336
May
1,308
977
42
289
176
244
513
375
June
1,406
972
55
379
168
242
552
444
July(r)
1,420
1,026
57
337
189
274
531
426
August(r)
1,332
992
53
287
145
238
565
386
SEPTEMBER(p)
1,263
971
51
241
170
243
477
373
Average relative standard error (%)
3
3
11
8
9
7
5
4
1b. Not seasonally adjusted
1987
1,620.5
1,146.4
27.8
37.5
408.7
269.0
297.9
633.9
419.8
1988
1,488.1
1,081.3
23.4
35.4
348.0
235.3
274.0
574.9
403.9
Average relative standard error (%)
1
1
6
4
1
2
1
2
1
1988 First 9 months
1,145.8
836.8
17.6
26.6
264.8
187.5
210.0
443.4
305.0
1989 First 9 months
1,075.2
787.3
16.2
26.0
245.6
141.5
202.3
423.9
307.5
Average relative standard error (%)
1
1
7
4
2
2
2
2
1
1988 - September
131.1
91.7
2.4
2.7
34.4
19.6
26.0
49.7
35.8
October
135.1
97.7
2.1
3.5
31.8
18.4
26.4
49.8
40.5
November
113.0
81.2
1.9
3.2
26.7
17.9
20.1
43.9
31.2
December
94.2
65.7
1.8
2.2
24.5
11.5
17.6
37.9
27.2
1989 - January
100.1
69.9
1.9
2.8
25.6
15.3
11.5
45.4
28.0
February
85.8
59.3
1.3
2.4
22.9
8.8
10.5
39.2
27.3
March
117.8
83.5
1.7
2.6
29.9
12.2
22.5
49.5
33.6
April
129.4
100.4
2.4
3.5
23.2
19.9
25.3
52.0
32.2
May
131.7
101.4
1.6
2.4
26.4
17.5
27.7
50.2
36.4
June
143.2
100.3
1.8
3.55.3
37.7430
17.9
28.4
52.2
44.6
July(r)
134.7
98.0
2.1
3.35.4
31.3367
19.6
29.3
46.0
39.8
August(r)
122.9
91.6
1.4
3.85.2 1.739
26,131.3
15.0
23.7
49.4
34.8
SEPTEMBER(p)
109.5
83.0
2.2
15.4
23.4
40.1
30.7
Average relative standard error (%)
3
3
12
14
8
9
7
5
4
PPreliminary.
Revised.
2 Less than 50 units or less than 0.5 percent.
Average relative standard error (Avg. RSE): Annual-Avg. RSE for the last 2 years: Year to Date-Avg. RSE for the current period and the same period last year;
Monthly-Avg. RSE for the latest 6 month period (January-June or July-December).
Table 2. Privately Owned Housing Units Authorized by Building Permits in Permit-Issuing Places
(Thousands of units. Detail may not add to total because of rounding)
in structures with-
Period
Total
3 and 4
5 units
Northeast
Midwest
South
West
1 unit
2 units
units
or more
2a. Sessonally adjusted annual rate (17,000 permit-issuing places)
1988 - September
1,432
980
74
378
188
256
544
444
October
1,526
1,029
81
416
217
262
569
478
November
1,508
1,027
77
404
200
249
575
484
December
1,518
1,058
75
385
200
346
545
427
1989 January
1,486
1,052
75
359
229
290
563
404
February
1,403
989
88
326
204
286
522
391
March
1,230
870
72
288
182
251
446
351
April
1,334
954
71
309
201
258
506
369
May
1,347
905
65
377
179
245
528
395
June
1,308
874
66
368
177
234
506
391
July
1,281
906
73
302
160
232
478
411
August(r)
1,328
927
77
324
174
263
517
374
SEPTEMBER(p)
1,296
938
61
297
168
246
499
383
Average relative standard error (96)
1
1
5
1
3
2
1
1
2b. Not sessonally adjusted (17,000 permit-issuing places)
1987
1,534.8
1,024.4
40.8
48.5
421.1
271.8
282.3
574.7
406.0
1988
1,455.6
993.8
35.0
40.7
386.1
230.2
266.3
543.5
415.6
Average relative standard error (%)
(X)
(X)
(X)
(X)
(X)
(X)
(X)
(X)
(X)
1988 First 9 months
1,120.2
775.7
26.3
31.0
287.2
182.6
203.8
418.6
315.3
1989 First 9 months
1,034.6
728.9
24,6
29.9
251.1
142.4
195.3
394.6
302.4
Average relative standard error (%)
1
1
2
5
1
3
1
1
1
1988 - September
127.9
85.1
3.2
3.5
36.0
18.4
25.3
46.1
38.0
October
124.0
82.9
3.7
3.5
33.9
19.1
23.6
44.2
37.1
November
110.0
71.8
2.6
3.2
32.5
14.9
18.8
42.4
33.9
December
101.4
63.4
2.5
3.0
32.5
13.6
20.1
38.3
29.4
1989 January
88.9
61.3
2.2
2.2
23.2
11.4
11.2.
39.9
26.4
February
86.4
59.5
2.2
3.5
21.2
9.8
12.5
37.7
26.4
March
116.1
84.1
3.0
3.6
25.4
15.4
21.2
45.0
34.5
April
121.5
89.0
3.0
6.0 3.0
26.4
18.7
25.3
44.4
33.1
May
133.9
94.3
3.0
6.4
3.4
33.2
18.7
26.6
49.7
39.0
June
135.5
92,5
2.8
6.4 3.8
42136.3
18.7
25.5
50.5
40.8
July
108.8
79.3
2.7
6.1 3.4
21,523.4
14.4
21.8
37.9
34.7
August(r)
125.3
89.1
2.9
71 4.2
16229.1
17.2
26.7
46.9
34.5
32.00
SEPTEMBER(p)
110.1
78.1
2.6
5 2.7
26.7
15.5
22.9
40.2
31.5
Average relative standard error (%)
1
1
3
8
1
3
2
1
1
2c. Not started at end of period-not sessonally adjusted (17,000 permit-issuing places)
1988 September
154.9
82.8
9.6
62.5
33.0
14.8
65.3
41.9
1989 - July(r)
148.5
79.6
8.7
60.2
30.8
15.6
62.4
39.7
August(r)
156.0
85.1
8.9
61.9
33.0
19.2
63.7
40.1
SEPTEMBER(p)
160.7
87.0
9.3
64.4
34.0
19.9
66.0
41.0
Average relative standard error (%)
3
4
20
4
9
7
5
7
See footnotes below table 1.
TOTAL P. 8
Housing Starts
NEW PRIVATELY OWNED HOUSING UNITS STARTED
(Thousands of Units)
U.S. TOTAL
1 UNIT
2-4 UNITS
5+ UNITS MULTIFAMILY
NORTHEAST
MIDWEST
SOUTH
WEST
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
1979
1745
1194
122
429
551
178
349
748
1980
470
1292
852
109
330
440
125
1981
218
643
306
1084
705
91
288
379
117
1982
165
562
240
1062
663
80
320
400
117
1983
149
591
205
1703
1067
113
522
635
168
218
935
1984
382
1749
1084
121
544
665
204
1985
243
866
436
1742
1072
93
576
669
252
240
1986
782
468
1806
1180
84
542
625
293
295
733
1987
483
1621
1146
65
409
474
269
298
634
1988
420
1488
1081
59
348
407
235
274
575
404
SEASONALLY ADJUSTED ANNUAL RATE
1985
SEP
1676
1020
90
566
656
244
234
720
478
OCT
1834
1160
79
595
674
316
254
803
461
NOV
1698
1040
79
579
658
239
215
792
452
DEC
1942
1123
86
733
819
284
275
895
1986
488
JAN
1972
1270
100
602
702
322
286
898
FEB
466
1848
1143
102
603
705
338
280
747
483
MAR
1876
1180
79
617
696
285
316
782
493
APR
1933
1197
80
656
736
310
349
761
513
MAY
1854
1228
83
543
626
274
252
799
JUN
529
1847
1221
76
550
626
286
294
768
JUL
499
1782
1153
80
549
629
272
325
712
473
AUG
1807
1194
86
527
613
330
311
708
SEP
458
1687
1137
64
486
550
295
269
698
425
OCT
1681
1126
84
471
555
281
263
683
454
NOV
1623
1113
71
439
510
271
271
610
471
DEC
1833
1227
111
495
606
312
1987
365
615
541
JAN
1840
1269
78
493
571
339
443
614
444
FEB
1787
1273
71
443
514
270
359
663
495
MAR
1715
1187
83
445
528
284
344
622
465
APR
1622
1197
64
361
425
266
296
661
399
MAY
1607
1131
66
410
476
299
300
625
383
JUN
1583
1083
81
419
500
254
287
604
438
JUL
1592
1147
62
383
445
272
249
636
435
AUG
1587
1111
58
418
476
255
281
636
415
SEP
1685
1225
49
411
460
261
306
702
416
OCT
1535
1097
69
369
438
267
252
617
399
NOV
1659
1121
51
487
438
264
335
640
420
DEC
1391
1036
50
305
350
219
264
573
335
1988
JAN
1391
1021
53
317
370
330
223
460
378
FEB
1511
1095
58
358
416
300
256
594
361
MAR
1528
1169
57
302
359
284
261
574
409
APR
1576
1087
58
431
489
260
344
595
377
MAY
1392
1001
53
338
391
202
267
562
361
JUN
1463
1088
62
313
375
238
262
585
378
JUL
1478
1067
50
361
411
255
283
566
374
AUG
1459
1076
59
324
383
217
239
573
430
SEP
1463
1039
62
362
424
206
258
576
423
OCT
1532
1136
63
333
396
198
273
582
479
NOV
1567
1138
68
361
429
219
275
613
460
DEC
1577
1141
65
371
436
201
343
609
424
1989
JAN
1678
1199
66
413
479
293
313
642
430
FEB
1465
1029
62
374
436
224
273
572
396
MAR
1409
981
50
378
428
160
308
552
389
APR
1343
1029
62
252
314
207
274
526
336
MAY
1308
977
42
289
331
176
244
513
375
JUN
1406
972
55
379
434
168
242
552
444
JUL
1420
1026
57
337
394
189
274
531
426
AUG
1332
992
53
287
340
145
236
565
386
SEP
1263
971
51
241
292
170
243
477
373
SOURCE: Bureau of the Census, Construction Reports, Series C20, Housing Starts.
McGroarty/Dooley
November 8, 1989
3:00 pm
[REALTORS]
PRESIDENTIAL REMARKS: NATIONAL ASSOCIATION OF REALTORS
DALLAS, TEXAS
NOVEMBER 10, 1989
2:15 P.M.
Thank you, Ira [Gribin]. I know I speak for everyone here
today when I salute you for serving so ably as President of the
National Association of Realtors. My best wishes to your
successor, seated down in front here: Norm Flynn. And let me
recognize the man who's doing such wonderful work as Secretary of
HUD, Jack Kemp, and two fine members of Congress who have
travelled down on Air force One with me today, Senator Phil Gramm
and Dallas' own Congressman, Steve Bartlett.
X
[[ Ira mentioned to me on my way in this afternoon that my
speech is a special occasion for this association. // I said I
was honored -- and then Ira said "It's not often that we're
addressed by someone who lives in public housing." ]] ////
[[ The truth is, I am not a real estate wizard. When I was
elected to Congress back in 1966, we needed to make housing
arrangements up in Washington. At that time, Senator Al
Simpson's father, Milward, was retiring and moving back to
Wyoming. So I bought the Simpson place -- sight unseen -- made
the deal over the phone. When we got to Washington, there were
just two problems: we found out right away the house wasn't
quite big enough for the Bush family --- and we found out when we
2
put the place up for sale that it wasn't worth quite as much as
we paid for it. /// That's my claim to fame: I'm the only
person who ever lost money in Washington real estate in the last
20 years. /// Ira, where were you when I needed you? ]]
But few people have done more for the real estate industry
than I have. // Barbara and I have moved 28 times in our 44
years of marriage. /// Now I know what you're thinking -- what
a dream client my family would make for any realtor. /// In
fact, OMB is calculating the commissions we've paid over the
years -- measured as a percentage of the GNP. ]] ////
I came here today to lay out a comprehensive plan to bring
basic shelter and affordable housing within reach of millions of
Americans. I call it Project HOPE -- Homeownership and
Opportunity for People Everywhere.
But before I tell you about Project HOPE, I want to speak
for a moment about the single most important factor in helping
millions of Americans realize the American Dream: the economy.
Because the truth is, there's no better housing policy than
a strong economy. One that provides jobs and opportunities for
advancement -- interest rates that open ownership opportunities
to hundreds of thousands of first-time home buyers. That's
crucial -- because a 1 1/2 point drop means an additional half
million families able to purchase that home they want.
And all signs point to continued strength in the economy.
November marks the seventh full year of economic expansion -- the
longest peacetime expansion in our nation's history.
3
Unemployment is lower now than at any point since the early 70s.
And here's one statistic that has to please all of you: home
mortgage rates are down from almost 14% back in November, 1982 to
less than 10% today.
All of us know that the way to keep this expansion alive is
to stick with the pro-growth policies that set it in motion --
the policies that allow the private sector to do its work: to
create prosperity and higher standards of living.
Of course, part of any reasonable economic policy is getting
our fiscal house in order. // I want you to know that my
Administration is hanging tough for a responsible budget -- with
real deficit reduction, no smoke and mirrors.
We don't like sequestration -- no one does. But we'll live
with it if we have to -- if it's the only way to rein in spending
and bring that deficit down to the Gramm-Rudman target. I'm
ready to sign a budget bill -- whenever Congress is ready to
strip off all the costly extras and add-ons hidden away in those
omnibus spending bills. A responsible budget is one of the best
signals the government can send for the sake of continued growth.
And I'm optimistic -- optimistic that my Administration and
the Congress -- with the help of members like Phil and Steve --
can agree on a responsible budget. Optimistic that we'll see
more and more Americans prospering -- providing better lives for
their families, and looking to all of you to help them realize
their dreams.
4
That's where Project HOPE comes in. These initiatives
address the full range of housing concerns: from shelter for the
homeless to affordable housing for low-income families -- to
initiatives that will help millions more Americans own their own
home.
Let's start right there -- with what Project HOPE can do for
first-time home buyers. You know first-hand about families
working hard to buy that first home -- families whose savings are
no match for skyrocketing prices. First-time buyers deserve our
help -- and they're going to get it. I will ask Congress to
enact legislation allowing first-time buyers -- or their parents
-- to draw without penalty on IRA savings as a downpayment for
that first home.
And we've got to expand the home-buying base -- bring more
low-income families into the ranks of homeowners. I will earmark
funds from the Federal Housing Financing Board, to be used for
mortgage rate buy-downs to make homeowning an option for more
low-income families.
And Project HOPE means initiatives to improve low-income
housing. Let me say right away that my Administration rejects
costly new construction programs that, in the past, have too
often produced the housing projects that symbolize the very
absence of hope in our inner cities. This Administration remains
100% behind housing vouchers that let low-income families choose
for themselves where they wish to live.
5
Our challenge is to create incentives that maintain the low-
income housing we need. I will ask Congress to renew the Low-
Income Housing Tax Credit -- on one condition: that the Low-
Income Housing Tax Credit is part of a package that includes a
cut in the capital gains tax. I know the National Association of
Realtors has fought hard to make a capital gains cut a reality.
Well, the fight's not over. We're going to continue to push hard
for one simple reason: because a cut in capital gains is good
for growth. ///
And Project HOPE can help us reverse a trend that's stunting
some of the growth and development that would otherwise take
place in low-income areas. Too many poverty-stricken areas have
simply been redlined -- ruled too risky for lending. I am asking
the Federal Housing Authority to work with neighborhood non-
profit groups to open a new flow of credit for low and moderate
income housing. The time has come to replace the redline with a
greenline -- to color these inner-city neighborhoods green for
growth.
And there's another way we can enlist growth in the battle
to improve living conditions in low-income areas. I'm talking
about Enterprise Zones. I've called on Congress to create at
least 50 Enterprise Zones over the next four years. Phil and
Steve: I hope you'll take this message back to your friends on
the Hill, because it's time we gave the green light to the urban
entrepreneur.
6
Indianj whome,
You know, Winston Churchill once said about the homes we
build, "We shape it -- and thereafter, it shapes us." The same
is true when it comes to low-income housing policy.
That's why Project HOPE includes initiatives to expand
resident management and, yes, resident ownership. That's the
idea behind our HOPE Grants initiative. It's already working:
In Kenilworth-Parkside, back in Washington, D.C. In Cochran
Alphoneo
Gardens in St. Louis. And it's going to work right here -- at
3600
the nation's second-largest public housing project in West Dallas units
-- and all across the United States.
George Loving
Twiners Court
Elmer Scott
Rhodes Terrace
Edrar Ward
The results are promising: with tenants in control, we see
(Olphoned
better maintenance, more rents paid on time, a decrease in people
on the welfare rolls as job opportunities emerge. And we see
something more: a sense of pride that is the very core of any
thriving community.
I don't know any better way to revive hope in our inner
cities than to give tenants a say in running their communities, a
stake in the future and the hope that they, too, can own a home.
Because the true measure of success isn't how many families we
add to housing assistance roles. It's how many families move up
and out -- and into the ranks of homeowners. ///
Project HOPE can make a difference for millions of Americans
who want to buy a home -- or who simply want to provide their
families decent housing and better hopes for the future. But
there are other people out there we've got to help. People who
stand in the shadows of what is otherwise a very bright economic
7
picture -- who live a nightmare in the midst of the American
Dream. We see them every day -- on the streets of our cities,
sleeping on steam grates, living out of cardboard boxes. The
homeless. //
For all of us, November is the time of year we start looking
forward to the holiday season: Thanksgiving, Christmas, New
Years. For the homeless, November is the time of year the
temperature starts to drop, and simply making it through the
night becomes a life and death struggle. //
Think about the children. Pretty soon, your kids will be
dreaming about Christmas toys -- that new video game or new bike
they'd like. It's different for kids on the street. I read a
story not long ago that's stuck in my mind about a little boy
Dan
without a home. Here's what he dreams about at night: "I
dreamed my Mom got her Section 8, and we got a house with a great
big back yard.'
But in the morning, the dream is over. That little boy is
up at 5:30, out of a shelter and back onto the streets. ///
That's a tragedy -- because no child in America should have
to grow up on the streets. And every family in America should
have a roof over its head. ///
My Administration is going to do its part to expand
emergency shelters. We're committed to fully funding the
McKinney Act. We're directing the FHA to set aside 10% of its
foreclosed housing for lease to homeless groups. And today, I
want to announce that -- as part of the savings and loans
8
recovery program -- I will make certain that a portion of the
properties from failed S&Ls be put to public use as facilities
for the homeless.
But we can't begin to eliminate homelessness -- to really
get at the root of the problem -- until we understand the various
reasons that lead to life on the streets. Homelessness isn't
just a matter of too little shelter space. There are the working
homeless, men and women -- some with children -- who hold down a
HUD
job, but still can't afford a home. But they are only a fraction
of the many homeless men and women who are literally incapable of
caring for themselves. And if we care about them, we've got to
take more than a one-dimensional approach to the problem.
The fact is this: Two-thirds of the homeless out on our
HUD
streets suffer from drug dependency or mental illness. For these
men and women, shelter alone is not enough. Homelessness is just
one symptom of the larger problems that prevent them from caring
for themselves.
The answer for the homeless who are mentally ill or addicted
to drugs is shelter plus: shelter supplemented by the necessary
support-services to get these people the help they need to live
in dignity. And that means a partnership -- a combined federal,
state and local effort -- to supply the funding and other
resources that constitute a comprehensive solution for the hard-
core homeless.
The key here is coordinating basic needs like shelter with
other social services -- to help the homeless get the treatment
9
they need to get control of their lives. To help them find and
hold down jobs. To help them regain hope -- and leave life on
the streets behind for good. ///
Helping the homeless. Helping low-income families find
affordable housing, decent housing. Helping more of the 80
million Americans who don't own a home join the ranks of
Dan
homeowners. Those are the aims of Project HOPE -- aims well
within our reach.
Think about that little boy I spoke about a moment ago.
Think about his dream -- because it's really the American Dream -
- what all of us want for ourselves and our families. ///
Thank you. God bless you -- and God bless the United States
of America.
# # #
NATIONAL AFFAIRS
CHILDREN
OF THE
UNDERCLASS
A neighborhood where even boyish
play has ominous undertones
elix and his friends are hanging out at 19th and
F
Susquehanna, waiting for something. Every-
body knows Felix: at 17, he runs one of the
more successful crack franchises in north
Philadelphia. Today, a rainy Saturday, Felix is
wearing a black baseball cap and an expen-
sive-looking black raincoat. He is scowling: anyone can
see he's taking care of business. Thirty minutes go by
before Silk comes up the block. Silk is carrying an um-
brella, and he looks nervous. Felix and his friends meet
Silk in the middle of the intersection. There is a sud-
den argument, and two of Felix's friends hit Silk with a
flurry of quick body punches. Silk's umbrella goes flying
and he falls to the rain-slick pavement; he lies there,
defenseless and unresisting. "I TOLD you not to
mess with my MONEY!" Felix yells, standing over Silk.
This story was reported by Vern E. Smith, Howard Manly
and David L. Gonzalez. It was written by Tom Morganthau.
16 NEWSWEEK : SEPTEMBER 11, 1989
NEWSWEEK : SEPTEMBER 11, 1989 17
PHOTOGRAPHS BY LESTER SLOAN-NEWSWEEK
P7
is
PHYS ED
GILLESPIE
NA PERAY R
Then he and his friends saunter away. A
sell it and a curse on those who use it.
low-income residents. The 2100 block of
message has been delivered, and everyone
Unlike heroin, crack is widely used by
North 19th Street, where Miss Nee lives,
on the block will hear it.
women. That fact alone has disastrous con-
includes a church, a vest-pocket city park
sequences for low-income families. If sin-
and 34 brick row houses. Many are owned
It is late afternoon when Miss Nee
gle-parent households have contributed to
by the Philadelphia Housing Authority
comes home with the clothes for her fos-
the intractability of poverty in the past, no-
and rented to low-income tenants. The resi-
ter child Joe: two pairs of shorts and two
parent households may be poverty's ap-
dents take part in a neighborhood crime-
T shirts, bought at the secondhand store
palling future. And crack is a catastrophe
watch program, and a clear majority want
for less than $5. "I just didn't want him to
for the young. It has touched off an explo-
no part of drugs or drug dealing. Jewel
have to put up with people talking about
sive increase in birth defects and an epi-
Williams, the unofficial mayor of the Sus-
him," she says. "You know how kids are. If
demic of child abuse and parental neglect.
quehanna Avenue area, has been fighting
you don't look just right, they're going to
Its profits, in neighborhoods where the
for his neighborhood for years. He has
make fun of you." It's a slow afternoon in
standard of living is very low, have led or
more than once considered pulling out.
midsummer, oppressively hot on North
forced thousands of inner-city youngsters
"But every time I get ready to pack up and
19th Street. Down the block, near Susque-
into hard-core crime, and many others into
leave I think, 'How can I escape this?" he
hanna Avenue, three teenagers are shoot-
addictions from which they may never re-
says. "I've got to do something for these
ing craps in the doorway of Craig's Laun-
cover. It has bankrupted parental author-
babies, for these kids. Somebody's got to
dromat. Toddlers race up and down the
ity and it is destroying the fraying social
save the ones that are salvageable."
sidewalk, playing noisy baby games, and
fabric of inner-city neighborhoods all over
Partners in austerity, Miss Nee and her
older kids are lining up at Jewel's Store,
the United States.
kids make do on food stamps and $474 a
around the corner on Susquehanna, for
Miss Nee and her neighbors are under
month from the government. There is gov-
flavored water ice. Up on Diamond Street,
siege every day, but they have by no means
ernment-surplus rice, plenty of spaghetti
at the other end of the block, a group of
surrendered to crack. The neighborhood,
and sometimes a little meat; the meat man,
men nurse 40-ounce bottles of beer called
just west of Temple University and only 15
who drives through the neighborhood in
4-0s in brown paper bags.
blocks from Philadelphia's glossy down-
his car once a week, sells to regular custom-
Miss Nee's house stands near the north
town, is a mixture of middle-income and
ers like Miss Nee on credit. Until this year,
end of the block, on the west side of 19th
Street. Owned by the Philadelphia Hous-
ing Authority, it is flanked on both sides
In north Philly, a rising sense that
by boarded-up buildings and it is almost
children are at risk as never before
barren inside. Officially, at
least, Miss Nee, Joe, Kita
and Yvonne are the only
occupants, although on any
given night Miss Nee, who
is well known for her open-
door policy, plays hostess
for up to a dozen neighbor-
hood kids. Miss Nee-Gene-
va Leaks, 52-has been
rearing children all of her
life. She raised her younger
brothers and sisters and five
kids of her own-and if she
now takes no sass from Joe,
Yvonne and Kita, she clear-
ly understands their need
for mothering. Joe Rutling
14, and he has been living
with Miss Nee for slightly
more than a year. Okita
(Kita) Allen, 15, moved in
four years ago. Yvonne Wil-
liams, who is 14, has been in
Miss Nee's care since she
was 5 years old. None is re-
lated to Miss Nee by blood
or marriage.
Miss Nee's neighborhood
is in serious trouble, and the
reason is crack cocaine.
Crack is more than just the
latest drug to hit the Ameri-
can underclass. Since its
appearance on inner-city
streets three to five years
ago, it has proven to be an
illicit bonanza for those who
Miss Nee supplemented her income by
ta Williams, who says chil-
taking her charges over to New Jersey
dren "get on her nerves,"
to do daywork in the blueberry fields.
has been hospitalized sever-
The work was hard-all day in the sun at
al times for nervous break-
the minimum wage-but they needed the
downs. She says her doctor
money and she wanted to teach the kids
has prescribed Thorazine,
the value of a dollar. "What you get," Miss
a powerful antipsychotic
Nee likes to say, "is what you sweat for."
drug, for her problems, but
Last spring, however, the social worker
admits she rarely takes it.
discovered that Yvonne's brother had
"Yeah, I drink," she says,
earned $69 for two days' work in a packing
"but so does everybody."
plant: under welfare rules, that amount
Yvonne says her mother
was deducted from Miss Nee's food-stamp
"was having problems" and
allotment. "They say, "Try to get your kids
couldn't take care of the
a summer job'," Miss Nee says now, "but
family. "I used to cry a lot,"
I'm not taking no chances."
she says. "I still love her,
Yvonne, Kita and Joe treat Miss Nee
even though she can't take
with respect and a hint of wariness: she is a
care of us. I love my mother
tough lady, but she is the rock of stability in
and Nee equally."
their young lives. All three have seen their
Kita, still tomboyish in
families fall apart in recent years, and
her jeans, is pregnant at
for practical purposes they are Miss Nee's
the age of 15-"babies hav-
kids now. Yvonne, whose four brothers and
ing babies," people on the
three sisters are scattered among different
block say, shaking their
relatives and foster homes across the city,
heads. Kita is laconic about
sees her father only occasionally; she sees
her pregnancy-"it just
her mother, Alberta Williams, somewhat
came about," she shrugs—
more often. "She goes off on her own a lot,"
but Miss Nee says Kita want-
Yvonne says of her mother. "Sometimes
ed the child. "Kita knows
she walks in the streets by herself." Alber-
how to raise kids," Miss Nee
says. "She's going to be a
Miss Nee is tough-but she is a rock
very good mother. She's
of stability for Yvonne, Kita and Joe
been cooking since she was 5
years old, and she took care
of her two brothers." Kita's
On any given night, Miss Nee's
brothers now live with their
grandmother, and her fam-
house may be filled by up to a
ily has ceased to exist. Her
dozen neighborhood kids. She
father was killed in a gang
feud before she was born,
has a reputation for never
and though Kita will not
talk about it much, her
turning a needy child away.
mother has a history of co-
caine abuse. "I was a junk-
ie," Kita's mother, Cookie Allen, says. "I
and then" and that he thinks about his
was selling drugs out of my house." Allen
mother "all the time." He likes Miss Nee
says she has been homeless since her family
and he's grateful for her help, but he has
broke up two years ago. Asked about her
come to hate the neighborhood. "I see how
relationship with Kita, Allen says "that's
it is here," he says tonelessly. "It's evil."
none of your-ing business."
Joe Rutling doesn't talk about his family
They call it "clocking" in north Philadel-
much either. His father has been in trouble
phia, and it has nothing to do with punch-
with the law and his mother is down in
ing a time clock. Clocking means getting a
Virginia, getting away from whatever hap-
pack of cocaine from somebody like Felix,
pened in Philadelphia. When his mother
then standing on a street corner to hand off
asked him if he wanted to move in with
caps of crack to the pipers and users who
Miss Nee last year, Joe saw his chance and
drift by. The rules are well established:
took it. He's a quiet kid who does well in
don't let the police catch you holding too
school, and he keeps a certain distance
much cocaine, don't use it yourself and
from the other teenagers on the block. Joe
don't stiff the dealer when it comes time to
sees the devastation crack has brought to
pay up. (That was Silk's mistake.) The
north Philadelphia, and he is adamantly
clockers are all juveniles, and one of them,
opposed to drugs. "I taught myself that
a boy named Bobby, is only 10 years old.
drugs were bad," he says firmly. "Some-
Some of them wear tiny gold charms that
times, when people start talking about
look like miniature watch faces-a dealer's
drugs, I just leave. It's hard to tell people
trademark, which is probably where the
that stuff is bad for you-they don't listen."
term clocking came from. Everyone on
Joe says his father talks to him "every now
19th Street knows about clocking, and
NEWSWEEK SEPTEMBER 11, 1989 19
NATIONAL AFFAIRS
many of the boys do it. "It's messed up
clock, work on the corner.' And they think
ed me to come around and visit him, but I
around here," says Kevin Abbott, who is 14.
that's the way out, they think it's cool. So
told him no because he had all those drugs
"You can buy about anything for $5."
automatically, they grab hold to it-it's
on him. I knew something was wrong. I
"It's about subliminal seduction," says
fast money, you know what I'm sayin? So
could feel it." He called that night from jail,
Pimpin' Sam. Pimpin' Sam is in his mid-
they're hooked to the drug-dealing life-
she says, busted on his first time out
20s-a heroin user, but one of many north
style. They think it's cool to wear gold and
clocking.
Philadelphia addicts who has shifted to
name-brand stuff, not being aware that
speedballing, injecting a combination of
they should be trying to get their
Miss Doris Jackson-frail, arthritic and
heroin and cocaine. Sam went to college for
education.
spirited-has lived on 19th Street for 50
a while, and he uses high-powered terms
"My generation, what we were instilled
years, and she is a pillar of the community.
like "subliminal seduction" to explain the
on was morals, values and respect," Sam
"Don't you care about yourself?" she says
basic appeal of clocking, which is money.
says. "If I disrespected your mother, she
to the kids, shaking her cane. "Don't you
"It's like the sneaker commercials on TV
would beat me, and when I got home my
know your body is a temple?" Neighbors
that say they can make you run faster and
mother would beat me, too. Respect
laugh about the time Miss Doris marveled
jump higher," he says. "The kids all want
played a bigger part. Now the new genera-
that a newborn child was SO small. "Don't
them. But basically, they all come from
tion-what's being cool to them is being a
you know she's a crack baby, Miss Doris?"
single-parent homes. Some of the parents
hustler. It's got a lot to do with TV,
someone said. "Don't you know nothing?"
are on welfare, others work. You got, say,
parents, babies having babies. When
Early one morning Miss Doris got up to
10 hungry kids that are willing to sell drugs
you're young, you're gonna do what your
investigate loud voices on the street outside
all night and all day to get some Adidases or
parents do, [and] if your mother is on the
her house. It was Felix and his friends.
some other name-brand stuff. This is the
pipe, you're going to be on the pipe." He
"You know you ain't supposed to do what
only way they're going to get it.
hobbles away on crutches-Sam got his
you're doing," Miss Doris said.
"The dealer takes advantage of that, you
leg broken recently in some mysterious
"What am I doing, Miss Doris?" Felix
understand what I'm sayin? He flashes the
street-corner dispute-heading for the
said, grinning.
money in their face and says, 'You can have
shooting gallery they call the Chateau
"Do you really want me to say it?"
this, you can have that. All you got to do is
Luzerne. As he walks up Susquehanna
she asked.
Avenue, two boys coming
"No, Miss Doris," Felix said.
the other way take care to
"All right, now you know you done
give him plenty of room.
wrong," Miss Doris said, satisfied.
"Aww, Miss Doris," Felix said, retreat-
Like any poet, Kevin
ing toward the avenue.
Abbott writes about what
he knows best. This is
Almost everyone on the block has had
his rap song about north
some kind of confrontation with the clock-
Philadelphia.
ers and pipers who infest the neighbor-
"I grew up in a neighbor-
hood. The Rev. Al Blasingame, who makes
hood drug-infested.
a brave stand for the straight and narrow
All these situations, only
at Faith Tabernacle Baptist Church just
once arrested.
across Susquehanna Avenue, had his mo-
I saw my people fall and
ment last spring when someone broke into
rise, rise and fall
the church and stole the telephone, some
In this short life I've seen
hand tools and his prized pastoral vest-
it all.
ments. Furious, the Reverend Al offered a
I saw my people selling
$50 reward for information and got a tip
smoke, and they're sniffing
that he ought to check out the clientele at
It was like a dream, but
a crack house half a block away. Enlist-
the dream was drifting.
ing Jewel Williams as a backup, Blasin-
So if you're not doing
game marched across the street to the
drugs, raise your hand.
crack house and, to the amazement of those
'Cause you will be reward-
inside, kicked in the door. "I'm going to
ed LIFE in the end."
get my stuff back or I'm going to throw
each one of you out the window!" he said.
A girl on the block is talk-
"I'll give you three days to get my stuff
ing about her boyfriend. On
back or you can prepare to go to war. Do
Mother's Day, she says, her
you understand what I'm saying? I want
boyfriend wanted to buy his
my cape back."
Jewel Williams is ombudsman for a
mother a present, but he
The telephone and the hand tools were
neighborhood in serious trouble
had no money. So he decided
returned within the day-but the missing
to sell some powder. "I told
cape, which is what really got the Reverend
'How can I escape this?' he
him that if he wanted to be
Al going, turned out to be at the dry clean-
with me, he couldn't be in-
er's. Only then did Blasingame realize
says. "I've got to do something
volved with no drugs," she
what he had done. "There were four of
says. "He didn't have to do
them," he says now. "They could have
for these babies, for these
it. He never had any prob-
killed me."
lems. He was getting good
The crack house, one of the many city-
kids. Somebody's got to save the
grades in school. But he was
owned abandoned buildings on the block,
ones that are salvageable.'
trying to be like the big boys.
suffered a mysterious fire a few weeks later.
Earlier in the day, he want-
Whoever did it was kind enough to warn the
20 NEWSWEEK SEPTEMBER 11, 1989
4 saw my people fall and rise, rise and
seling and emergency food supplies, all on a
fall, in this short life I've seen it all'
shoestring budget. The common denomina-
tor is saving kids. "While we were out fix-
ing up houses," Jewel says, "we found out it
dopers and the next-door neighbors that it
venience store on Susquehanna Avenue,
was our youth that was deteriorating." He
would be wise to go somewhere else that
and he is president of the Susquehanna
estimates that at least 5,000 children un-
night, and the fire broke out after midnight.
Neighborhood Advisory Council, a city-
der the age of 14 live within the NAC
A crowd gathered quickly, though it was
funded uplift agency that maintains a
boundaries, many of them with surrogate
more than a few minutes before anyone
scruffy set of offices down the avenue from
mothers like Miss Nee.
called 911. The building, already stripped of
his store. By night Jewel is a campus police
One shelf in the NAC office is filled with
its plumbing and wiring, was gutted SO com-
officer at Temple University and he has a
boxes of infant formula for emergency
pletely that even the crackheads were
license to carry a pistol, a Smith & Wesson
cases. "We have families who are going
forced to move on. "Spiritual justice was
automatic. It is always there, holstered on
hungry because the mother or father is on
done," one of the neighbors says.
his right hip, a symbol of his status as pro-
crack," he says. "They spend the money on
tector and ombudsman for the neighbor-
drugs and then come here begging for food.
Torching the building made little differ-
hood. Jewel is married with three children
Most of the crack mothers drop their babies
ence to the neighborhood. There are three
of his own, and his wife, Bernice, thinks he
off on the grandmother. Then we get the
other crack houses within easy walking
spends too much time on the block. "My
grandmother calling us for milk to feed the
distance and kids are still clocking along
wife gives me hell sometimes because I
newborns." In one case, he says, a woman
Susquehanna Avenue. The lookouts lit-
spend more time with other kids than I do
addict locked up her children in the house
tle boys, some as young as 6-yell warnings
my own," he says.
while she went out for drugs. "The kids were
as the police drive by, and the clockers run
But Jewel, convinced that "we've lost
in there for two days," he says. "Their Pam-
away through a maze of alleys. Like Viet-
three generations already," is determined
pers had maggots in them. When you see
nam, the Philadelphia drug war is a war
to do all he can. The Neighborhood Adviso-
something like that you say to yourself,
with no front line: crack's real damage is
ry Council, called "the NAC," started out
'Stop worrying about the 18-year-olds
within the family.
as a campaign against blighted housing.
who re getting high and start paying atten-
No one knows it better than Jewel Wil-
But crack's arrival in the north Philadel-
tion to the little kids and the babies'."
liams. Jewel is 32-stocky, muscular, per-
phia ghetto has changed everything, and
He could start with Lucas and Bobby.
petually alert, an omnipresent figure in
Jewel and his staff of three now provide
Bobby is a big kid who looks much older
the neighborhood. He owns the tiny con-
recreation programs, summer jobs, coun-
than his real age, which is 10. His mother,
22 NEWSWEEK SEPTEMBER 11, 1989
NATIONAL AFFAIRS
so addicted that she is slowly becoming
way I'm trying to teach her, put it that way,
sucking on a joint at 10, 11 or 12. Before
emaciated, spent the welfare checks on
and I don't want to see her follow in my
they know it, they don't want the weed.
crack, and Bobby and his sister lived in an
footsteps."
They've got to get that charge. So they go
abandoned house with no electricity and no
and buy a cap and then they're hooked up.
running water. When Bobby's grandmoth-
There is a girl in the neighborhood who
They'll take anything and make a pipe out
er bought him clothes, his mother sold
knows about another crack-house arson.
of it-a tin can, a broken car antenna."
them to get more crack. Finally Bobby
The girl's mother was an addict, and she
Kevin Abbott, the neighborhood poet, says
went to a dealer he knew and began clock-
sold and used crack in the home. The family
younger addicts "know what's happening,
ing on Susquehanna Avenue, hanging out
was in chaos and the children were going
but they just don't care."
all night until his pack of "nickel powders"
hungry. The girl tried to stop her mother's
was sold. "His mother don't care, as long as
drug abuse many times and failed. Finally
Five years ago a no-name north Philadel-
he's giving her some," says Lucas, who is
the girl said, "IfI can't get the drugs out of
phia welterweight named Kevin Howard
15. Lucas's mother is a crack addict, too. "I
the house, I can make it so no one gets drugs
stunned the boxing world by decking Sugar
talk to her every day," he says. "IfI tell her
here." The girl burned down the family's
Ray Leonard in what was supposed to be an
to leave it alone, she'll stop for about three
house. She was 12 years old.
easy bout. Leonard survived, winning the
weeks, then go behind my back." When he
fight in a ninth-round TKO, but Howard
grows up and gets a job, Lucas says, "I'm
Children in this neighborhood are so ex-
became an instant hero for the homeboys on
gonna take her to a rehab place where she
posed to drugs that teachers at the Head
the block-another Smokin' Joe Frazier,
can get herself back together, and then I'm
Start school at 18th and Diamond streets
the pride of black Philadelphia. "Just like
going to take her far, far away and let her
have begun teaching their students about
I'm talking with you, I was talking with
live by herself. I love her."
crack before they begin the usual pre-read-
Sugar," Howard says now. "We had lunch
ing program. "They can identify crack caps
together, we had dinner together, we went
It's not the kids, Renee Johnson says, it's
and vials as young as 4," says one teacher.
out together. He said to me, "There's some-
the parents. "If the mother's sitting there
"We've had to adjust our entire approach to
thing about you I like. You ain't like all the
selling [crack], what's that telling the
what's important to these children."
other fighters. You ain't talking about kill-
child? If the son's out there selling it and
Grade-school kids are introduced to co-
ing me or knocking my eye out.' I said, 'It's
the mother's sitting there holding it, what
caine along with marijuana. "It's called a
not like that. This is a business. But believe
good is that gonna do? The mothers
turbocharge," Jewel Williams says. "They
this: if there's a fight, I'm going to try to take
know the kids are making money, and
think turbo is not addicting, so they start
your ass out.' mean, showed no fear."
they're getting some of the money so
Howard lost it all in a
they're happy." The kids aren't bad, she
Jean Hobson says crack has hurt the
blur of fast living. His last
says, "they just don't have no discipline.
neighborhood more tban heroin did
fight was three years ago,
They figure if their mother's doing it, hell, I
and he was knocked out in
can go do it, too. That's why I watch the ones
whose mothers are on drugs. I sit there and
'Little kids are starting-kids
the seventh round. Today,
he lives in a dilapidated row
wonder, what're y'all thinking about?"
6, 8 years old,' she says. 'They
house and spends his days
One reason Renee thinks about the kids
shuffling around the neigh-
so much is that she is a crack user, too-and
she has a 13-year-old daughter, a beautiful
get the thrill and then they're
borhood with a broken-
down shopping cart looking
girl named Kaneesha. Renee says a boy-
hooked. [The dealers] use
for salvageable trash. "He
friend turned her on to crack several years
used to be a bad dude," one
ago and that she became a closet addict.
them to carry drugs.'
of the neighborhood boys
"She's never seen me do it. I used to go to
work, come home and go straight to the
room. I would never go outside until I
came down," she says. Renee's mother per-
suaded her to enter a residential drug-
treatment program in upstate Pennsylva-
nia, but the stay there did not end her
addiction. Now, she says, the thought that
Kaneesha might try drugs is forcing her to
try to set a better example. "What if Kanee-
sha was to smoke a joint? What could I say?
What right would I have to say anything
about her when I do it? It made me really
slow down," Renee says.
Kaneesha is going to summer school this
year, and she has an afternoon summer job
as well. She thinks she wants to be a nurse,
but she dreams of becoming a model. Re-
nee, watching and worrying for any sign of
involvement in drugs, thinks about getting
family counseling or sending Kaneesha to
Baltimore to live with her uncle. "Kanee-
sha can't understand why I stay on her the
way Ido," she says. "But I don't want her to
go through the same things I went through
when I was coming up. I wasn't taught the
NEWSWEEK SEPTEMBER 11, 1989 23
says. "But now, Kevin is like, 'Can I have a
When families fall apart, children
quarter or something?"
"It doesn't make me feel good to know
take refuge wherever they can
what I'm doing out here in the streets and
know that kids still look up to me," How-
dealer. "We absolutely have to target the
them from the drug trade and the drug-
ard says. "The No. 1 thing I tell them
real young kids," says Philadelphia Police
related crime that is all around them. But
is, 'Don't let nobody influence you into
Commissioner Willie Williams, a veteran
the beat cops are not optimistic. "Can this
something wrong' It's not only 'caine,
of the Double Deuce. "Completely educate
neighborhood be brought back?" one offi-
it's alcohol, too. It's marijuana. These
them about drugs, sex and how to protect
cer asks rhetorically. "No. We lost this
things are a downfall. I'm talking from
themselves from family members leading
generation."
experience."
them to drugs."
Howard, who is only 28, says it would be
With the city hall in a perennial budget
Police veterans and longtime residents
"best for me to get out of the neighborhood
crunch, street manpower is already
so I can stay on top." He still thinks he will
are nostalgic about the good old days of
stretched thin. That means cops like Brax-
be "the spoiler of the '90s."
heroin, PCP and gang wars-nothing,
ton and Ziernicki spend their shifts jump-
they say, compares with the social conse-
ing from one radio call to another-investi-
"Man up!" the lookouts shout as plain-
quences of crack. "I've been through pot,
gating burglaries, chasing clockers down
clothes officers Jeff Ziernicki and Harold
white lady and blue lady [forms of synthet-
the alleys, handling domestic disputes.
Braxton creep up Susquehanna Avenue in
ic heroin], and I can't go through this
Check day, when the welfare checks arrive,
much more," says Jean Hobson, who has
their boxy blue Plymouth. Braxton and
brings an avalanche of 911 calls for drug
Ziernicki work the Double Deuce-the
lived in north Philly for 40 years. "I'd
and alcohol emergencies; because crack
rather see gang warfare come back. Now
22nd police district, one of the busiest in
abusers tend to be wired and hyperactive,
Philadelphia. Some 60,000 people live with-
you don't have protection from nothing or
even routine family arguments can erupt in
in the 22nd's two square miles, and police
nobody. When they get on that stuff, they
violence. The reports of missing and aban-
work there is a never-ending round of nar-
don't know their own mother." Hobson,
doned children start the following day,
cotics enforcement and domestic disputes
like Geneva Leaks, is famous in the neigh-
when relatives and neighbors realize that
that often involve crack. Drug arrests for
borhood for rescuing unwanted children,
the toddlers next door have no one to look
adults and juveniles are sharply up in the
and she is shaken by the fact that younger
after them. "We have to be marriage coun-
and younger children are being drawn
past two years; last year the 22nd district
selors, taxi drivers, referees, babysitters-
into dealing and using crack. "The little
seized drugs, cars and cash totaling nearly
everything," says Jeanette Barnes, a vic-
$2 million. The cops see the social causes—
kids are starting-kids 6, 8 years old," she
tim-assistance officer for the 22nd.
the accelerating breakdown of the family,
says. "They get the thrill and then they're
Capt. Al Lewis, the 22nd district com-
the lack of positive role models and econom-
hooked. [Dealers] use them to carry drugs,
mander, is trying to promote community-
because the man ain't gonna bother them.
ic opportunity for youth-but they see the
action projects like offering reading classes
pure viciousness, too. In one case, a year and
They're kids-kids you never thought
at the station house. He is also well aware
a half ago, two brothers 9 and 12 were mur-
would be caught up in this," she says. "My
that residents of the Double Deuce "desire
dered when their mother, who was an ad-
God, they were such good kids."
nothing less than people in middle-class
dict, stole the stash they were holding for a
neighborhoods," which means protecting
The names Felix, Silk, Bobby and Lucas used in this
article are pseudonyms.
24 NEWSWEEK SEPTEMBER 11, 1989
not very humm
McGroarty/Dooley
November 6, 1989
1:30 pm
[REALTORS]
PRESIDENTIAL REMARKS: NATIONAL ASSOCIATION OF REALTORS
DALLAS, TEXAS
NOVEMBER 10, 1989
2:15 P.M.
[Introductory remarks.] Thank you, Ira [Griben] -- the very
able President of the National Association of Realtors. And let
me say hello to two fine members of Congress who have travelled
down to Dallas today, Representatives Bill Thomas and Claudine
Schneider.
[[ Ira mentioned to me on my way in this afternoon that my
speech is a special occasion for this association. // I said I
was honored -- and then Ira said "It's not often that we're
addressed by someone who lives in public housing." ]] ////
[[ The truth is, I am not a real estate wizard. When I was
elected to Congress back in 1966, we needed to make housing
arrangements up in Washington. At that time, Senator Al
Simpson's father, Millward, was retiring and moving back to
Wyoming. So I bought the Simpson place -- sight unseen -- made
the deal over the phone. When we got to Washington, there were
just two problems: we found out right away the house wasn't
quite big enough for the Bush family -- and we found out when we
put the place up for sale that it wasn't worth quite as much as
we paid for it. /// That's my claim to fame: I'm the only
2
person who ever lost money in Washington real estate in the last
20 years. /// Ira, where were you when I needed you? ]]
But few people have done more for the real estate industry
than I have. // Barbara and I have moved 29 times in our 44
years of marriage. /// Now I know what you're thinking -- what
a dream client my family would make for any realtor. /// In
fact, OMB is calculating the commissions we've paid over the
years -- measured as a percentage of the GNP. ]] ////
I came here today to lay out a set of housing initiatives --
a comprehensive plan to bring basic shelter and affordable
housing within reach of every American.
But before I outline my housing proposals, I want to speak
for a moment about the single most important factor in helping
millions of Americans realize the American Dream: the economy.
Because the truth is, the best housing policy is a strong
economy. One that provides jobs and opportunities for
advancement -- interest rates that open ownership opportunities
to hundreds of thousands of first-time home buyers. And I know
just how important interest rates are when it comes to home
buying: a 1 1/2 point drop means an additional 670,000 families
being
able to purchase that home they want.
And all signs point to continued strength in the economy.
November marks the seventh full year of economic expansion -- the
longest peacetime expansion in our nation's history.
Unemployment is lower now than at any point since the early 70s.
19/82 - negashame mortzage rate aug.
15.14%
Seat
Oct 89
Halmoot X3
1
10.23%
Nov. 1982 - 13.8%
28%, 2 21/4
1st wk Nov 1989 9.8%
5100,000 -
mthly payment from
1100 830
mg 70
Doug 5147 Holzig
Nov. 1982
3
And here's one statistic that has to please all of you: during
this expansion, home mortgage rates are down by one-quarter.
All of us know that the way to keep this expansion alive is
to stick with the pro-growth policies that set it in motion --
the policies that provide the private sector room to do what only
it can do: create prosperity and higher standards of living.
Of course, part of any reasonable economic policy is getting
our fiscal house in order. // I want you to know that my
Administration is hanging tough for a responsible budget -- with
real deficit reduction, no smoke and mirrors.
We don't like sequestration -- no one does. But we'll live
with it if we have to -- if it's the only way to rein in spending
and bring that deficit down to the Gramm-Rudman target. There is
an alternative -- whenever Congress is ready to strip off all the
expensive extras and add-ons hidden away in those omnibus
spending bills. A responsible budget is one of the best signals
the government can send for the sake of continued growth.
optimistic optimistic
And I'm hopeful -- hopeful that this economic expansion will
continue. Hopeful my Administration and the Congress -- with the
help of members like Bill and Claudine -- can agree on a
responsible budget. Hopeful that we'll see more and more
Americans prospering -- providing better lives for their
families, and looking to all of you to help them realize their
dreams.
Today, as I told you a few moments ago, I've chosen this
occasion to announce a wide-ranging set of housing initiatives I
4
call Project Hope -- an initiative that stands for Homeownership
and Opportunity for People Everywhere.
Project HOPE addresses the full range of housing concerns --
to
from shelter for the homeless and affordable housing for low-
income families, to initiatives that will help millions more
Americans achieve the American Dream: owning their own home.
Let me start with low-income housing. And let me say right
away that my Administration rejects costly new construction
programs that in the past have too often produced the housing
projects that symbolize the very absence of hope in our inner
cities. This Administration remains 100% behind housing vouchers
that let poor people choose for themselves where they wish to
?
live.
Our challenge is to create incentives that maintain an
adequate stock of low-income housing. As part of a larger pro-
growth package, I will ask Congress to renew the Low-Income
of
Housing Tax Credit to extend incentives for the construction low-
income rental units.
And it's time we reverse a trend that's stunting some of the
growth and development that would otherwise take place in low-
income areas. Too many poverty-stricken areas have simply been
redlined -- ruled too risky for lending. I am asking the Federal
Housing Authority to work with neighborhood non-profit groups to
identify responsible credit risks in poor areas, and open a flow
of credit into low and moderate income housing. The time has
5
come to replace the redline with a greenline -- to color these
inner-city neighborhoods green for growth.
But the real centerpiece of our plan for public housing is
resident management and, yes, resident ownership. That's the
idea behind our HOPE Grants initiative. It's already working:
In Kenilworth-Parkside, back in Washington, D.C. In Cochran
Gardens in St. Louis. And it's going to work right here in
Dallas -- at the nation's second-largest public housing project
in West Dallas. One of the reasons why it's going to work is, a
fellow named Alphonso Jackson head of the Dallas Housing
Authority one of the architects of those resident management
programs in Washington and St. Louis.
And the results are promising: with tenants in control, we
see better maintenance, more rents paid on time, a decrease in
people on the welfare roles as job opportunities emerge. And we
see something more: a sense of pride that is the very core of
any thriving community.
I hope these successes are only the beginning -- of a
nationwide shift towards tenant control, and ultimately towards
tenant ownership. There isn't a better way to revive hope in our
inner cities than to give tenants a say in running their
communities, and a stake in the future: the hope that they, too,
can own a home. //
That's worth remembering. Because the true measure of
success isn't how many families we add to housing assistance
6
roles. It's how many families move up and out -- into middle-
class status, and into the ranks of homeowners.
Point
That's why Project HOPE includes initiatives to aid first-
time buyers -- whose savings are often no match for skyrocketing
home prices. I will ask Congress to enact legislation allowing
first-time buyers -- or their parents -- to draw without penalty
on IRA savings as a downpayment for that first home.
And we've got to expand the home-buying base -- bring more
low-income families into the ranks of homeowners. I will earmark
funds from the Federal Housing Financing Board, to be used for
mortgage rate buy-downs to make homeowning an option for more
low-income families.
Finally, it's time for all levels of government to take a
second look at some of the well-intended housing policies that
actually decrease our housing stock. I'm talking about the
excessive rules, regulations and red tape that add unnecessarily
to the cost of housing -- tens of thousands of dollars in some
cases -- or create perverse incentives to allow existing housing
to deteriorate.
I have asked Secretary Kemp to convene a Blue Ribbon
Commission to identify barriers to affordable housing and to make
recommendations on how those barriers can be removed. And let me
make the first recommendation myself: no city, state or town
should receive a single cent of Project HOPE funds until they
have identified barriers to affordable housing -- and devise a
plan to remove them. ///
no child
7
in no fundy america
I think Project HOPE can make a difference for millions of
Americans who want to buy a home -- or who want to provide their
families whent housing and better hopes for the future. But
there are other people out there we've got to help, Americans who
good
stand in the shadows of what is otherwise a very bright economic
picture -- who live a nightmare in the midst of the American
Dream. We see them every day -- on the streets of our cities,
sleeping on steam grates, living out of a cardboard box. ey
The
homeless. //
For all of us here today, November is the time of year we
start looking forward to the holiday season: Thanksgiving,
Christmas, New Years. For the homeless, November is the time of
year the temperature starts to drop, and simply making it through
the night becomes a life and death struggle. // Homelessness is
a tragedy -- and Project HOPE won't be complete unless it helps
the homeless. //
But we can't begin to eliminate homelessness -- to really
get at the root of the problem -- until we understand the various
reasons that lead to life on the streets. Homelessness isn't
just a matter of too little shelter space. There are the working
homeless, men and women -- some with children -- who hold down a
job, but don't earn enough to put a roof over their heads. But
they are only a fraction of the many homeless men and women who
are literally incapable of caring for themselves. And if we care
about them, we've got to take more than a one-dimensional
approach to the problem.
8
The fact is this: Two-thirds of the homeless out on our
streets suffer from drug dependency or mental illness. For these
men and women, shelter alone is not enough. Homelessness is just
one symptom of the larger problems that prevent them from caring
for themselves.
The answer for the homeless who are mentally ill or addicted
to drugs is shelter plus: shelter supplemented by the necessary
support-services to get these people the help they need to live
in dignity -- and to get started on the road back to the kind of
normal lives we take for granted. And that means a partnership -
- a combined federal, state and local effort -- to supply the
funding and other resources that constitute a comprehensive
solution for the hard-core homeless.
The key here -- and the aim of Project HOPE's initiatives
for the homeless -- is coordinating basic needs like shelter with
other social services -- to help the homeless get the treatment
they need to get control of their lives. To help them find and
hold down jobs. To help them manage a home. To help them regain
hope -- and leave life on the streets behind for good.
My Administration is going to do its part. We're committed
to fully funding the McKinney Act. We're directing the FHA to
set aside 10% of its foreclosed housing for lease to homeless
groups. And today, I want to announce that -- as part of the
savings and loans recovery program -- I will make certain that a
portion of the properties from failed S&Ls be put to public use
as facilities for the homeless.
9
But Washington hasn't cornered the market on solutions to
the problem of homelessness. Nor have state and local
governments. We can't afford to overlook the fact that some of
the most innovative -- and compassionate -- efforts to aid the
homeless begin with individuals and institutions in the private
sector. With men and women like you.
I've heard about what the National Association of Realtors
is doing -- about the state and local chapters running food
kitchens and mental health clinics. About the fund raisers and
donation drives you stage -- like the house raffles back in
Fredericksburg, Virginia with all the proceeds going to help the
homeless. Let me tell you: what you're doing helps make a
difference where it matters most -- in the communities where you
work and live.
Today, I want to call on you to keep it up -- to build on
what you're already doing, and to enlist others in your
communities in this worthy cause. And I hope I can count on you
to support the overall aims of Project HOPE -- to work with me to
ensure that all Americans enjoy adequate housing and the hope of
homeownership.
Thank you. God bless you -- and God bless the United States
of America.
# # #