Wednesday, January 09, 2013
The Obama administration now proposes to spend millions more on handouts, despite ample evidence of their perverse effects.
Shaun Donovan, secretary of the Department of Housing and Urban Development, says, "The single most important thing HUD does is provide rental assistance to America's most vulnerable families -- and the Obama administration is proposing bold steps to meet their needs." They always propose "bold steps."
In this case, HUD wants to spend millions more to renew Section 8 housing vouchers that help poor people pay rent.
The Section 8 program ballooned during the '90s to "solve" a previous government failure: crime-ridden public housing. Rent vouchers allow the feds to disperse tenants from failed projects into private residencies. There, poor people would learn good habits from middle-class people.
It was a reasonable idea. But, as always, there were unintended consequences.
"On paper, Section 8 seems like it should be successful," says Donald Gobin, a Section 8 landlord in New Hampshire. "But unless tenants have some unusual fire in their belly, the program hinders upward mobility."
Gobin complains that his tenants are allowed to use Section 8 subsidies for an unlimited amount of time. There is no work requirement. Recipients can become comfortably dependent on government assistance.
In Gobin's over 30 years of renting to Section 8 tenants, he has seen only one break free of the program. Most recipients stay on Section 8 their entire lives. They use it as a permanent crutch.
Government's rules kill the incentive to succeed.
Section 8 handouts are meant to be generous enough that tenants may afford a home defined by HUD as decent, safe and sanitary. In its wisdom, the bureaucracy has ruled that "decent, safe and sanitary" may require subsidies as high as $2,200 per month. But because of that, Section 8 tenants often get to live in nicer places than those who pay their own way.
Kevin Spaulding is an MIT graduate in Boston who works long hours as an engineer, and struggles to cover his rent and student loans. Yet all around him, he says, he sees people who don't work but live better than he does.
"It doesn't seem right," he says. "I work very hard but can only afford a lower-end apartment. There are nonworking people on my street who live in better places than I do because they are on Section 8."
Spaulding understands why his neighbors don't look for jobs. The subsidies are attractive -- they cover 70 to 100 percent of rent and utilities. If Section 8 recipients accumulate money or start to make more, they lose their subsidy.
"Is there a real incentive for the tenants to go to work? No!" says Gobin. "They have a relatively nice house and do not have to pay for it."
Once people are reliant on Section 8 assistance, many do everything in their power to keep it. Some game the system by working under the table so that they do not lose the subsidy. One of Gobin's lifetime Section 8 tenants started a cooking website. She made considerable money from it, so she went to great lengths to hide the site from her case manager, running it under a different name.
"Here's a lady that could definitely work. She actually showed me how to get benefits and play the system," says Gobin.
Although Section 8 adds to our debt while encouraging people to stay dependent, it isn't going away. HUD says it will continue to "make quality housing possible for every American."
Despite $20 billion spent on the program last year, demand for more rental assistance remains strong. There is a long waitlist to receive Section 8 housing in every state. In New York City alone, 120,000 families wait.
Some are truly needy, but many recipients of income transfers are far from poor.
America will soon be $17 trillion in debt, and our biggest federal expense is income transfers. They are justified on the grounds that some of that helps the needy. But we don't help the needy by encouraging dependency.
Government grows. Dependency grows.
John Stossel is host of "Stossel" on the Fox Business Network. He's the author of "No They Can't: Why Government Fails, but Individuals Succeed." To find out more about John Stossel, visit his site at http://www.johnstossel.com
COPYRIGHT 2012 BY JFS PRODUCTIONS INC.
DISTRIBUTED BY CREATORS.COM
See Other Political Commentary
See Other Commentary by John Stossel
Views expressed in this column are those of the author, not those of Rasmussen Reports. Comments about this content should be directed to the author or syndicate.
Rasmussen Reports is a media company specializing in the collection, publication and distribution of public opinion information.
We conduct public opinion polls on a variety of topics to inform our audience on events in the news and other topics of interest. To ensure editorial control and independence, we pay for the polls ourselves and generate revenue through the sale of subscriptions, sponsorships, and advertising. Nightly polling on politics, business and lifestyle topics provides the content to update the Rasmussen Reports web site many times each day. If it's in the news, it's in our polls. Additionally, the data drives a daily update newsletter and various media outlets across the country.
Some information, including the Rasmussen Reports daily Presidential Tracking Poll and commentaries are available for free to the general public. Subscriptions are available for $4.95 a month or 34.95 a year that provide subscribers with exclusive access to more than 20 stories per week on upcoming elections, consumer confidence, and issues that affect us all. For those who are really into the numbers, Platinum Members can review demographic crosstabs and a full history of our data.
To learn more about our methodology, click here.