by the Way . . .

It is very difficult to anticipate all of the problems you can run into when you start subsidizing things. They say that what you subsidize you get more of, but it is hard to see how that could apply to public housing. If you give people things, you clearly make them less poor, and at the borderline you should move some out of the poor category altogether, meaning less poor folks. But let’s get to the New Orleans situation.

Like many places, rent subsidies have been provided in New Orleans for people of limited legal income. For some yet unknown reason, poor people tend to shy away from the thinly populated areas of town, and to concentrate in select districts. The market often doesn’t provide enough rental properties in these areas to subsidize, so you have to build these large apartment buildings, known colloquially as “the projects” (apparently because they are government projects). And, of course, you want to build them where your prospective tenants prefer to live. Moreover, since you don’t want to give public money to the well-to-do unless there is a hurricane, you set the rents at a nominal full market rate, and then forgive some or all of it for the needy. That way those that move in that can afford it, the rich and the well off middle class, pay the full rent.

In New Orleans there was a totally unexpected result. Perhaps the nominal “full” rents were set too high, or perhaps there was a parking problem, but for some reason only poor people moved into the projects. The projects didn’t get a good balance of income levels, or even a good racial balance. As demonstrated in the June 7 post re webtroids, racial balance is highly desired by government, but tricky. As hizzoner famously explained, you have to add milk (honkies) to get chocolate milk. Even more surprising, the area around the projects developed a high crime and drug use rate. This doesn’t make sense unless you consider the absence of adequate subsidized public transportation. It seems that the wealthier type crimes are committed in offices, or at least away from home, while the poor are stuck within walking distance.

Katrina changed all that. It seems that the poor preferred areas at the lower altitudes. When all the people in the project areas were shifted to Houston, and elsewhere, the crime and drug problems were drastically reduced. Critics claimed that the crime rate in those other places went up, but in fact, the percentage increase was far less than the percentage drop in New Orleans. Even better, the cost of rent subsidies was shifted from the state and local sources to FEMA. As put by Representative Richard H. Baker, a Republican from Baton Rouge: "We finally cleaned up public housing in New Orleans. We couldn't do it. But God did."

But there is a new challenge. The various FEMA rent subsidy programs around the country are coming to an end, and people naturally want to return to the reasonable rents at their former project homes. The New Orleans officials are trying to figure out what went wrong with the original projects, and what changes need to be made to get a nice income and racial balance. “We don't need to recreate pockets of poverty," the president of the City Council, Oliver M. Thomas Jr., said. "They don't work. We want more mixed-income, working communities." So far officials have reopened less than 1,000 of the 8,000 public housing units, even though a lot of them have minimal or no damage. Unfortunately, the previous tenants are climbing the razor wire fences officials have erected to obtain time for study, and moving back in. Since this is against the law, right off you have a crime problem that you didn’t even have before.

If the officials can maintain the status quo, that is, the current status quo, not the status quo ante, the answer seems to be to upgrade the projects so the well to do will move in, keeping the percentage of prior folks to maybe 15 or 20 percent. According to the NYT, the Federal Department of Housing and Urban Development, which took control of the bankrupt local housing authority years ago, says it is continuing to assess the storm damage to the buildings. "I wish I could say everything's great, come on home," an assistant secretary, Orlando J. Cabrera, said in an interview. "But it's not great. We've got entire parts of the city that have very few services, that have questionable ability in terms of infrastructure. We have to ask the hard question: 'What would these folks do? Can we put people in there?” Mr. Cabrera said considerable federal money was available to allow private builders to redevelop public housing in such situations. The Housing Authority has begun to apply for those funds.

There has been some success. The St. Thomas Project, redeveloped and renamed “River Garden” has a much nicer balance, clearly attaining a racial and income wobtroid. “We find it has worked out, and we’re looking into doing it at a lot of the other sites” said Adonis Expose, a spokesman for the Housing Authority. To reach this new balance a few of the former tenants were invited back to a really improved situation.

Now if they can just get some time to redevelop the rest of the properties. You know what the razor wire people say: "Good fences make good neighbors."