Building consensus for affordable housing

Abstract

At one time the national goal of affordable housing was a widely held consensus that led to decent housing for millions of Americans. Today, proponents of affordable housing must negotiate with diverse and sometimes hostile parties to secure project approvals. Discussions are frequently adversarial, and stalemate is too often the result. The consensus has collapsed.

If progress toward affordable housing is to be made, proponents will have to recast the way they operate within this new environment. More than new financing plans or recommendations for regulatory relief are needed. Attention must also focus on the processes by which groups address divergent interests and come to agreement. “Principled negotiation,” a form of joint problem solving, when coupled with third‐party intervention, offers a promising and effective means of dealing with this hostile environment.     

Economic shifts and the changing homeownership trajectory

Abstract

From 1980 to 1988, homeownership rates declined substantially for the first time in the postwar era. They stabilized and began to creep upward during the 1988–94 period. After presenting a long‐term perspective, this article describes and examines two of the underlying forces of this upswing—demographic aging and improved levels of affordability—as well as the impact of immigration and minority lags. Fundamental economic factors are then surveyed: national and regional housing price shifts, housing production cycles, measures of housing affordability, and employment. Several key economic parameters of the post‐recession housing market are presented as a guide to the short‐term future.

Post‐1988 homeownership rates initially rose because of an aging demography. But gradually, the new affordability became part of the dynamic. The new affordability was driven by the decade‐long slowdown and weakening of housing prices, lower post‐recession interest rates, and accelerated job creation following the period of “jobless” economic growth.     

The potential and limitations of mortgage innovation in fostering homeownership in the United States

Abstract

This article presents an empirical analysis of mortgage innovation as a vehicle to enable renters, especially those from traditionally underserved populations, to realize home‐ownership. It examines the financial and underwriting criteria of a typology of mortgage products, from those adhering to historical standards to some of today's most liberal loans, and develops synthetic models to account for all direct purchase costs. These models are calibrated using 1995 data on renter demographic and financial characteristics from the Survey of Income and Program Participation.

Compared with historical mortgages, today's more innovative loans increase the number of renters who could hypothetically qualify for homeownership by at least a million and expand potential home‐buying capacity by $300 billion. Certain policies could greatly expand the potential gains. Nevertheless, even the most aggressive innovations can play only a limited role in efforts to deliver the material benefits of homeownership to underserved populations.     

Rolling the Dice on Foreclosure Prevention: Differences Across Mortgage Servicers in Loan Modifications and Loan Cure Rates

Mortgage servicing has garnered increased attention since the foreclosure crisis. As the interface between borrowers and investors, servicers make the decision to either grant a loan modification or to foreclose. This study examines servicer loan modification practices for a national sample of delinquent subprime loans, and assesses the extent to which those practices are associated with foreclosures. The research reveals significant differences across servicers in loan cure rates, which are related to servicers’ propensity to offer loan modifications and to the level of relief offered to borrowers. The observed differences across servicers and the implications of this heterogeneity for foreclosure prevention underscore the importance of additional data, research, and policies that can increase the uniformity and transparency of servicing practices.     

Brownfield redevelopment and affordable housing: A case study of New Jersey

Abstract

A total of 779 New Jersey residents were surveyed to determine the number of people who during the next five years would be willing to move to housing built on brownfield sites that have been remediated to the extent that they pose no plausible brownfield‐related health risk to residents.

Fourteen percent of the respondents said they would be willing to move to and live in housing built on cleaned‐up brownfields. These respondents were disproportionately relatively poor and young and resided in apartments and cities, especially cities where the city government was actively promoting brownfields. These respondents also did not like their current neighborhoods, did not feel threatened by the idea of living on a cleaned‐up brownfield site, and trusted experts to advise them on the health risks involved.     

Public policy and employee ownership: Designing economic institutions for a good society

While there are many types of economic arrangements compatible with democratic institutions and smoothly functioning markets, the predominant institutional arrangement in most marked-based democracies is one where the average employee has neither a share of direct ownership nor involvement in governing the company where he works. The substance of this essay deals with recent American attempts to redesign this arrangement, focusing specifically on the employee stock ownership plan (ESOP). The way we design the ownership of our economic organizations touches issues at the heart of practical political economy. It combines the realities of practice with visions of the good society. The challenge for lawmakers, then, is to think of employee ownership not only in terms of the technical details of public policy-making but as an institutional arrangement with wide-ranging potential implications for how we see and achieve the good.     

Public policy for business and the economy Ideological dissensus,change and consensus

A substantial literature shows that ideology, often describable on a conservative-liberal spectrum, is a significant independent variable influencing the formulation of public policy. The 1960s–1990s are frequently depicted as decades of ideological tumult. However, analysis of the editorials of major publications shows that substantial agreement existed on public policy directions for business and the economy throughout most of these years. Furthermore, in some policy areas initial dissensus was followed by significant movement toward consensus. A theory presented here based on the concepts of successful market operation, market misbehavior, and market breakdown explains in large part the reasons for this long term policy consensus as well as movement from dissensus to consensus.     

Neighborhood Opportunity and Location Affordability for Low-Income Renter Families

Abstract

We use the Location Affordability Index (LAI) and the newly developed Child Opportunity Index (COI) to assess, for the first time, the tradeoff between neighborhood opportunity and housing/transportation affordability facing low-income renter families in the 100 largest metropolitan areas. In addition to describing the opportunity/affordability relationship, we explore the level of balance between neighborhoods’ relative cost burden and their corresponding opportunity levels to determine whether children of different racial/ethnic groups are more (or less) likely to experience cost-opportunity imbalance. Our multilevel analyses show that housing affordability is largely accounted for by the neighborhood opportunity structure within each metropolitan area. The metropolitan characteristics examined account for only a small proportion of the between-metro variance in the opportunity/affordability gradient for housing, presumably because the neighborhood opportunity structure already reflects metro area factors such as fragmentation and segregation. On the other hand, transportation affordability shows a weaker association with neighborhood opportunity. The COI/LAI association is much weaker for transportation than for housing, and a large part of the variation in the transportation gradient occurs at the metropolitan area level, not the neighborhood level. Sprawl is particularly associated with transportation affordability, with lower sprawl areas having lower transportation-cost burden. We discuss the implications of the empirical findings for defining affordability in housing assistance programs. We recommend that housing policy for low-income renter families adopt an expanded notion of affordability (housing, transportation, and opportunity) and explicitly consider equity (e.g. cost-opportunity imbalance) in the implementation of this expanded affordability definition.     

Location Efficiency and Mortgage Risks for Low-Income Households

Abstract

Household energy expenditures, especially for transportation, are fairly inelastic. Their effects on low-income households may be significant, due to the potential for energy consumption to displace other types of consumption when energy prices rise. Using accessibility as a proxy for lower transportation costs, we test the hypothesis that low- and moderate-income residents are less likely default when they are located in more accessible places. We find that regional accessibility has almost no effect on risks of default, but local job diversity has moderate mitigating effect.     

When good news is scarce and bad news is good: Government responsibilities and opposition possibilities in political agenda‐setting

Recent studies have drawn attention to the political contingencies of the media's political agenda‐setting influence, finding, for instance, that issues from the media agenda are more likely to attract attention if a party enjoys ownership of the issue. Supplementing the debate on why political parties respond to news, it is argued in this article that ownership is only part of the picture and that policy responsibility, together with news tone, constitutes a stronger explanation of news politicisation. Opposition parties respond to bad news because they reflect negative developments in social problems for which the government could be held responsible. The government responds to good news that reflects positive developments in social problems because this could politicise policy success, but is also forced to react when news explicitly address government responsibility and thereby threatens its image as responsive and competent. Furthermore, it is shown that news tone and policy responsibility condition the incentive to politicise owned issues from the media agenda. Thus, opposition parties will not politicise owned issues when news is good because this could draw attention to government success, while government is unable and unwilling to prioritise owned issues when news is bad and instead is likely to make use of its ownership strengths when news is good and the pressure to respond is low. The arguments are tested on a large‐N sample of radio news stories from Denmark (2003–2004). Opposition response is measured through parliamentary questions spurred by the news stories, while government response is indicated by references to these stories in the prime minister's weekly press meeting. Results confirm the expectations, suggesting that parties care more about the tone of news stories and the type of attention they might produce, rather than what type of issues they could serve to politicise.     

Why the Electoral College is good for political science (and public choice)

While the Electoral College may not be good for the political system, it is very good for political science (and public choice). This essay documents many of the ways in which this assertion is true.     

Adjusting policy implementation frameworks for non‐pluralist conditions: A case study of Ukraine's single tax for small business

Traditional frameworks for assessing policy implementation have been developed almost exclusively in the context of market‐based, pluralist democracies. This research explores policy processes in more diverse contexts, testing the applicability of existing implementation measurement models in the socio‐political context of a post‐Soviet country. Fieldwork conducted in Ukraine examines the factors affecting implementation of the Simplified Single Tax policy and considers the impact of formal and informal institutions on policy processes and small business conditions. Results include an expanded model for assessing policy implementation in non‐pluralist conditions, an original contribution to the fields of policy, small business, and development studies. The research further contributes to the literature concerning policy transfer, policy advocacy, and tax reform in developing nations. For theoreticians, this research may inform design considerations when conducting policy research outside of a pluralist democracy. For practitioners, it may inform efforts to mitigate implementation obstacles in diverse socio‐political contexts.     

All spending is not equal: European Union public spending,policy feedback and citizens’ support for the EU

While public support is central to the problem‐solving capacity of the European Union, we know little about when and why the EU can increase its citizens’ support through spending. Extensive research finds that citizens living in countries that are net beneficiaries of the EU budget are more supportive of the EU, assuming that citizens care equally about all forms of spending. It is argued in this article, however, that the amount of spending is only part of the story. Understanding the effects of spending on support requires a consideration of how transfers are spent. Drawing on policy feedback theories in comparative politics, it is shown that support for the EU is a function of the fit between the spending area and economic need in individuals’ immediate living context. Results from a statistical analysis of EU spending on human capital, infrastructure, agriculture, energy and environmental protection in 127 EU regions over the period 2001–2011 corroborate this argument. As the EU and other international organisations become increasingly publicly contested, the organisations themselves may increasingly try to shore up public support through spending, but they will only be successful under specific conditions.     

Elections as instruments for punishing bad representatives and selecting good ones

Many theories of democracy point out that voters make their choices based on two goals: the retrospective assessment of incumbents and the prospective choice between incumbents and challengers. Do voters react to malfeasance on the part of their elected representatives? If they abandon corrupt incumbents, are they able to select more virtuous replacements? In this paper, we assess the effects of corruption on voter loyalty and, conversely, of voter defection on subsequent malfeasance. We examine these relationships with data drawn from 169 elections across 72 countries. Our results show that malfeasance does indeed provoke voter defection, but that electoral volatility is not followed by lower levels of perceived corruption. We conclude by discussing the appropriate interpretation of our results, the future research they suggest, and their meaning for related, emerging literatures.     

Support for behavioral nudges versus alternative policy instruments and their perceived fairness and efficacy

An extensive debate has emerged in recent years about the relative merits of behavioral policy instruments (nudges) aimed at changing individual behavior without coercion. In this article, we examine public support for non-deliberative nudges and deliberative nudges and compare them to attitudes toward top-down regulation and free choice/libertarian options. We also examine whether support for both types of nudges is associated with perceptions of fairness and efficacy. We test these expectations with a survey experiment with 1706 UK adult respondents (representative of the population on age, gender, and location) in two policy areas (retirement savings and carbon offsets for airline passengers). We find higher levels of public support for both nudge policy options compared to top-down regulation. Support for nudges is associated with the perceived fairness of nudges more than their efficacy.     

Coal and nuclear technologies: creating a false dichotomy for American energy policy

The American electric utility industry is entering a moment of transition. Once viewed as a stable and secure consortium of publicly regulated monopolies that produce and distribute electricity, the industry has weathered market restructuring only to face the ever-present risk of natural disasters, price fluctuations, terrorist attacks, and blackouts. This paper uses five criteria—technical feasibility, cost, negative externalities, reliability, and security—to evaluate the broad portfolio of energy technologies available to American electricity policymakers. Upon close inspection, energy efficiency practices, renewable energy systems, and small-scale distributed generation technologies appear to offer many advantages over large and centralized nuclear and fossil fueled generators. Contrary to the mimetic commentary produced by the media, these three approaches would present policymakers a superior alternative for curbing electricity demand, minimizing the risk of fuel interruptions and shortages, helping improve the fragile transmission network, and reducing environmental harm     

Design determinism,post-meltdown: urban planners and the search for policy relevance

This commentary explores the roles of planning and urban design in contemporary US urbanization following the global financial crisis in Fall 2008. We focus on the tendency to discuss the planning profession in recovery metaphors – a perspective that has been emphasized in establishing how the profession's past and future relevance may be asserted. In the recent past the planning profession has sought to recover its standing and policy relevance through its contributions to real estate development. In doing so, the profession has gravitated toward design and determinism in order to satisfy pluralist demands within the loosely regulated political economy of neoliberal urban growth. But while design determinism offered numerous practical advantages to the planning profession for the short term, it also served to preclude the profession from engaging with social justice, the social construction of place, and civil society.     

Civil society activism,strategic alignment and international public policy making for spectrum

Academic work has noted a growth in the prominence of civil society in international political-economic life, yet the conditions under which such civil society presence is developed, the ways in which it is manifest and their implications are still incompletely understood. The recent international policy debate on the allocation of spectrum provides a useful case for research aiming to close this gap in knowledge and is the focus of this article. It provides evidence of a significant – though ultimately highly contingent – civil society presence in the spectrum debate. It explains this through the construction of a framework of international civil society strategic alignment. This is used to illustrate and explain the conditions that allowed civil society to articulate its voice and the means through which and how this was achieved. The article contributes to the literature on civil society activism in communications by illustrating both its capacity for action – but also the highly significant limitations placed on it – in utilizing strategic alignment to engage in international public policy making debates.     

Explaining variation in coalition agreements: The electoral and policy motivations for drafting agreements

This article explores the question of why coalition partners negotiate and publish coalition agreements before entering into a cabinet and why the content of these agreements varies so widely. Some scholars suggest that coalition partners draft agreements for electoral purposes, while others suggest that coalition agreements can be used to commit to policy negotiations. Although both sides of the debate have uncovered supportive evidence, the literature remains in disagreement. This article provides new organisation of previous work on agreements and develops two alternative theoretical arguments about the crafting of coalition agreements. It is argued here that coalition partners consider both electoral and policy motivations during the drafting of agreements and that the dominance of one of these motivations is conditional on the degree of issue saliency and division between partners. Empirical support is found for the theoretical argument that coalition partners include low saliency issues in the coalition agreement on policy dimensions on which they are less divided, and that coalition partners include high saliency issues in the coalition agreement on policy dimensions on which they are more divided.