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The Planetizen News Brief - 8/20/09

20 August 2009 - 5:00am
Smart City Radio

The Planetizen News Brief is a weekly rundown of some of the most interesting and important news and issues of the past week.

The Planetizen News Brief airs every week on the nationally-syndicated radio program "Smart City", which is broadcast in cities across the U.S. Learn more about Smart City and listen to archived shows.

Full Transcript

The decline of the housing market, the explosion of foreclosures and the global economic recession are starting to make the American Dream of owning a home look more like the American nightmare. That’s how it’s turned out for a lot of people, who have been lured into unrealistic investments. A recent article from the Wall Street Journal looks at how government policies from the past few decades have placed homeownership high atop a pedestal of economic security. But when home loans started egging the lower middle class towards the underregulated territory of Wild West McMansionism, something was bound to go wrong. And it has. Big time. So now, the realities of what’s affordable seem to be sinking in. A recent survey from the National Foundation for Credit Counseling found that one third of respondents didn’t think they’d ever be able to afford to buy a home, and more than 40% of former homeowners didn’t think they’d ever be able to own a home again. So it seems the age of the ownership society may be starting to die down.

And the Obama Administration is looking to help make sure it does. Officials announced recently that they were planning to redirect $4.25 billion in stimulus funds to build federally-subsidized rental units. An article from the Boston Globe outlines the plan, which is estimated to put tens of thousands of rental units into the pool of available housing. In addition to building new apartments and town houses, some of the money will be used to purchase and refurbish some of the foreclosed homes that litter American cities. It’s part of a shift in ideologies within the cabinet away from the policies of George W. Bush that prioritized home ownership through attractive loan programs. This new focus is being headed by Housing and Urban Development Secretary Shaun Donovan, who hopes to revise those policies to clearly determine when homeownership just isn’t a realistic option. In addition to investing the $4.25 billion in new properties, another $4 billion will be spent on maintenance and repairs to the existing affordable housing stock. Though the administration is not explicitly against homeownership, its new policies are designed to make sure that the incentives to own a home don’t overshadow the inherent risks it has for lower income people. Given the implosion of the housing market and its tumbling values, avoiding those risks may become the new American Dream.

Stories discussed in this week's Planetizen News Brief

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Instead of demeaning so-called "third world cities", we would do well to observe, understand, and adapt such approach on a much more widescale basis.
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