public housing authorities
The Eviction Economy
Poverty is not just a product of joblessness and low wages. It’s also a product of exploitation.
By Matthew Desmond

Those of us who don’t live in trailer parks or inner cities might think low-income families typically benefit from public housing or some other kind of government assistance. But the opposite is true. Three-quarters of families who qualify for housing assistance don’t get it because there simply isn’t enough to go around. This arrangement would be unthinkable with other social services that cover basic needs. What if food stamps only covered one in four families?

America stands alone among wealthy democracies in the depth and expanse of its poverty. Ask most politicians what we should do about this, and they will answer by calling for more and better jobs. Paul Ryan, the Republican speaker of the House, thinks we need to do more to “incentivize work.” Hillary Clinton, the front-runner for the Democratic presidential nomination, thinks we should raise the minimum wage. But jobs are only part of the solution because poverty is not just a product of joblessness and low wages. It is also a product of exploitation.

Throughout our history, wage gains won by workers through organized protest were quickly absorbed by rising rents. As industrial capitalists tried to put down the strikes, landlords cheered workers on. It is no different today. When incomes rise, the housing market takes its cut, which is why a two-bedroom apartment in the oil boomtown Williston, N.D., was going last year for $2,800 a month and why entire capital-rich cities like San Francisco are becoming unaffordable to the middle class. If rents rise alongside incomes, what progress is made?

Poverty is no accident, an unintended consequence from which no one benefits. Larraine’s rent money went to Tobin (also a pseudonym). A second-generation landlord, Tobin was 71, unsmiling and fit. His tenants waited tables at diners or worked as nursing assistants. Some received disability like Larraine or other forms of welfare, sometimes supplementing their checks by collecting aluminum cans.

Running one of the poorest trailer parks in the city had its challenges, like dealing with mental illness, addiction and domestic violence. Every so often, tenants wrecked their trailer the night before being evicted. Tobin had a way of dealing with that. He’d pay one of his tenants $20 to clean up the mess, then offer prospective new families the “Handyman Special,” a free mobile home as long as they paid “lot rent.” Lot rent was the same amount as rent, except the new “owners” would be responsible for maintenance. A family could move their trailer elsewhere, but in reality no one could afford to. When families fell behind in lot rent and were evicted, they inevitably left their trailer behind. Tobin would reclaim it as “abandoned property” and give it to someone else.

Tobin bought the mobile home park, 131 trailers parked on asphalt, for $2.1 million in 1995, paying off the mortgage nine years later. After reviewing Tobin’s books and expenses (property taxes, utility bills, missed payments), I estimated that he netted roughly $447,000 a year. Some of Tobin’s tenants called him “greedy,” but others called him “fair” and “a good man,” especially those he had spared from homelessness when they fell on hard times. He bailed tenants out of jail, lent money for funerals and let some missed payments slide. In a year, he also made 30 times what his tenants getting minimum wage earned.

Landlords like Tobin aren’t making money in trailer parks or ghettos in spite of their poverty but because of it. Depressed property values offer lower mortgage payments and tax bills. In poor areas of the cities, rents are lower, too — but not by much. In 2010, the average monthly rent in Milwaukee’s poorest neighborhoods was only $50 less than the citywide median.

Landlords renting to poor families can charge slightly reduced rents but, owing to far lower expenses, still command handsome profits. As a landlord with 114 inner-city units once told me, speaking of an affluent suburb near Milwaukee: “In Brookfield, I lost money. But if you do low-income, you get a steady monthly income.”

Poor families are stuck. Because they are already at the bottom of the market, they can’t get cheaper housing unless they uproot their lives, quit their jobs and leave the city. Those with eviction records are pushed into substandard private housing in high-crime neighborhoods because many landlords and public housing authorities turn them away. When poor families finally find a new place to rent, they often start off owing their landlord because they simply can’t pay the first and last month’s rent and a security deposit.