Welcome back to the Deep Dive. It's good to be
here. I want to start today with, well, with
a bit of a mental exercise. I want you to picture
the phrase public housing. Just, you know, close
your eyes for a second, unless you're driving.
Please don't close your eyes if you're driving.
And just get an image in your head. What do you
see? Now, depending on where you're sitting right
now listening to this, that image is going to
be, well. radically different. If you're in Chicago
or maybe parts of Paris or London, you might
be picturing a crumbling concrete high rise.
Yeah, I'm thinking broken windows, maybe some
graffiti, a place that feels pretty isolated.
Exactly. A place of last resort. Right. A place
you go when you have absolutely no other options.
The bottom of the barrel. But what if you're
listening to this in Singapore or maybe Vienna?
Oh, that's a totally different picture. Your
mental image is completely different. You might
be picturing, I don't know, a manicured garden,
a high speed elevator. And honestly, you might
be thinking about your asset portfolio. And that's
the paradox we're really digging into today.
In Singapore, something like 90 percent of the
resident population lives in homes built by the
government. 90 percent. It's not a safety net
for the destitute. It's the absolute norm from
taxi drivers to CEOs. That is just how people
live. It's such a staggering contrast. How can
one two word phrase public housing mean urban
decay in one place and middle class stability?
That is the big question. And to answer it, we
have to look at how humanity has tried to solve
one of the most basic biological needs we have,
shelter. Right. But we aren't just talking about
bricks and mortar today. We're looking at something
much deeper. We're looking at social engineering.
Social engineering. I mean, that sounds a little
ominous. It can be. But think about it. When
a government decides where to build, what to
build and who gets to live there, they are. literally
engineering society. They're deciding how people
interact, how families are structured. Even how
citizens see themselves. Exactly. Are they isolated
individuals competing in a market or are they
part of a collective? The design of their homes
tells them the answer. So our mission today is
to trace this whole experiment. We're going to
go from the absolute squalor of the Industrial
Revolution through the garden cities of England.
the superblocks of the Soviet Union, all the
way to the modern voucher systems that we see
in the U .S. today. It's a global tour of how
we house ourselves and, more importantly, why
it works in some places and seems to fail so
spectacularly in others. Okay, before we fire
up the time machine, though, we probably need
to lay some ground rules. We need a definition.
When we say public housing or you hear social
housing, what are we actually talking about?
Because the terminology gets messy. It does.
At its absolute core, though, we're talking about
housing that is not purely driven by the free
market price tag. It's subsidized. It's affordable.
And it's usually owned and managed by the government,
either local or central or by nonprofits. So
the landlord is basically the state or a proxy
for the state. Usually. Yeah. But. The key differentiator,
the thing that really separates it from just,
say, renting a normal apartment, is this concept
of rationing. Rationing. OK, break that down
for me. Well, think about the private market.
How is housing rationed there? It's rationed
by your bank account. If you have the cash, you
get the keys. If you don't, you don't. Simple.
Precisely. Allocation by ability to pay. In public
housing, that logic is flipped on its head. Allocation
is usually based on administrative measures of
need. So things like means testing. Means testing,
how much you earn, how big your family is, are
you vulnerable, are you elderly. It's an attempt
to treat housing as a utility or a right rather
than just another luxury good. And just to give
people a sense of scale here, because I was honestly
surprised by this data in our research stack.
You look at the OECD, basically the Club of Wealthy
Nations, and social housing averages about 7
% of the total housing stock. That's the average,
but the average, as always, kind of hides the
real story. The range is just wild. So give us
the extremes. On the low end, you have a country
like Colombia, where it's under 1%. So statistically
negligible. It barely exists. But on the high
end... The Netherlands. I've heard this stat.
It's huge, isn't it? It's about 34%. One in every
three homes in the Netherlands is social housing.
Wow. So when we talk about this, we aren't talking
about some fringe issue. In many major cities,
this infrastructure is the backbone of urban
life. If you take it away, the city stops functioning
because the people who run the city, the nurses,
the teachers, the bus drivers, they have nowhere
to live. Okay. So we know what it is. We know
it varies wildly. Now I want to know where it
came from. Because I'm assuming, well, actually,
I shouldn't assume. Did medieval kings build
public housing? Not exactly. But it's not a strictly
modern invention either. For the real origin,
we have to make a quick stop in the 16th century.
Augsburg, Bavaria. The Fugerei. The Fugerei.
It is the world's oldest social housing complex
that is still in use today. It was founded in
1521 by a man named Jacob Fugger the Rich. Jacob
the Rich. Yeah. Very subtle nickname. I like
it. Well, he earned it. He was a banker and merchant,
one of the wealthiest men in history. And he
built this beautiful walled enclave for the needy
Catholic citizens of Augsburg. And here's my
favorite detail. The rent. What was the rent
in 1521? One Rhenish guilder per year. But what
is the rent today? It's still the equivalent
of one Rhenish guilder, which is about... 0 .88
euros. Wait, wait. Under a dollar a year? Under
a dollar a year. Get out. People live there for
less than a dollar a year. They do. But, and
this is a big but, there's a catch. It wasn't
just about money. It was about moral standing.
Ah. You had to be Catholic. You had to be an
honorable citizen who had fallen on hard times.
And this is actually part of the lease. You have
to pray three times a day for the soul of the
founder, Jacob Fugger. So it's housing. But with
a side of mandatory spiritual gratitude. Exactly.
And that's a theme that comes back again and
again. The deserving poor. The idea that if they're
rich or the state give you housing, they own
a little piece of your behavior. They get to
decide if you're worthy. That is a fascinating
thread we're definitely going to pull on later.
But the fougere was an outlier, right? It wasn't
a system. It was one rich guy's project. No,
it was philanthropy. The story of modern public
housing, the kind that changes nations, really
begins with the villain of so many of our deep
dives. The Industrial Revolution. The Great Disruptor.
It's just so hard for us to really grasp the
speed of urbanization back then in the 19th century.
You had millions of people pouring from the countryside
into cities like London, Manchester, New York,
and there was literally nowhere to put them.
And the free market response to that explosion
of humanity was, well, it was a catastrophe.
It was the slum. I was reading the source material
you sent over, specifically from Henry Mayhew.
He was a journalist in London in the 1840s and
50s. And his description of Bethnal Green, honestly,
it makes you want to take a shower just reading
it. It is visceral stuff. He talks about roads
that weren't roads. They were just unmade alleys
of mud, houses built with no foundations, just
piles of bricks on the damp earth. And then there's
this phrase that just stuck with me. Lakes of
cutrifying night soil. Putrefying night soil.
Which is a very polite Victorian way of saying.
Human waste. Just sitting there in the street.
Because there were no sewers. And it wasn't just
the waste. He describes the smell of boiling
tripe, melting tallow from the candle makers,
the stench from slaughterhouses. It was a complete
sensory assault. And that's the crucial point
to understand. It wasn't just that it was ugly.
It wasn't just that rich people on the West End
didn't like the smell wafting over. It was a
biological time bomb. The disease rates were
just off the charts. Cholera, typhoid, tuberculosis.
In the old nickel slum in London, which was notorious,
the infant mortality rate was horrific. One in
four children died before their first birth.
One in four. Just try to imagine that. Every
fourth crig is empty. That reality, that sheer
scale of death, it forced a shift in thinking.
The Victorians were obsessed with laissez -faire,
leave the market alone. But they eventually realized
that the market was literally killing the workforce.
So initially, did the government step in? Not
immediately. First, you had the philanthropists
again, the model dwellings companies. George
Peabody is a famous one. Wealthy people who thought
they could build decent housing and still make
a tidy 5 % profit. 5 % philanthropy. Right. And
you had factory owners building villages for
their workers. Port Sunlight is a famous example,
built in 1888 by the Lever Brothers, the soap
kings. That makes a kind of cold logical sense.
If your workers are dying of cholera, they can't
make soap. Exactly. It was enlightened self -interest.
But they all realized charity and corporate villages
weren't enough to scale. The problem was just
too massive. So the government finally says,
fine, we'll do something. Slowly. Tentatively.
In England, you had the Housing of the Working
Classes Act of 1885. That was the legal turning
point where the state officially said. We have
an interest in this. And then in 1890, the Lennon
County Council started the Boundary Estate. Which
replaced that old nickel slum we were just talking
about. Right. They cleared the slum. I mean,
they raised it to the ground and built the world's
first large scale social housing project. It
was beautiful, actually. Arts and crafts style.
High quality. But here's the thing that I found
so interesting in the timeline. We see these
little experiments in the late 1800s. But the
real accelerator, the thing that took public
housing from a local experiment to a national
mandate, was war. World War I changed everything.
Explain that connection for me. Because usually,
war destroys housing. How did it build it? It
all comes down to manpower. When Britain tried
to conscript soldiers for World War I, they started
processing these young men from the cities, and
the generals were just... Shocked by the physical
state of the recruits, they found that 41 % of
the conscripts were unfit to serve. 41%. Almost
half the male population. They had rickets. They
were stunted for malnutrition. They had respiratory
issues from breathing coal smoke in damp basements
their whole lives. The slums had physically degraded
the population to the point where they literally
couldn't fight a war. That's incredible. So it
wasn't benevolence. It wasn't, oh, these queer
people need nice homes. It was, we need soldiers
who can carry a rifle without collapsing. National
security is a powerful motivator. So in 1919,
right after the war, you get the Homes Fit for
Heroes campaign. The prime minister, David Lloyd
George, promised housing for the returning veterans,
and the Housing Act of 1919 compelled local councils
to provide that housing. It wasn't charity anymore.
It was about rebuilding the biological strength
of the nation. It's amazing how often social
welfare is actually just national defense in
disguise. It happens more than you think. The
interstate highway system in the U .S. was also
justified by national defense moving troops and
equipment. Now, while this is all happening in
the U .K., this big realization that the state
must build what's going on in the United States.
We usually think of the U .S. as being very late
to the party on social welfare. They were a bit
later. Yeah. And the motivation was slightly
different. The first U .S. public housing project
was Techwood Homes in Atlanta, which was dedicated
in 1935. 1935. So we are deep in the Great Depression.
We are. And FDR is trying to jumpstart the economy.
So in the U .S., public housing started largely
as a jobs program. It was about putting construction
workers back to work. And here's a distinction
we need to make really early on, because it's
going to matter a huge amount later in the story.
When we think of projects in the U .S. today,
We have a very specific demographic and economic
picture in our minds. We do. We think of concentrated
poverty. But in 1935, at Techwood Homes. In the
1930s, early U .S. public housing was often for
the working poor and even the middle class. It
was for families who had jobs but were temporarily
down on their luck because of the Depression.
And we should be honest about the other demographic
reality of 1935. It was segregated, explicitly.
Techwood Homes was for white families only. There
were other projects built for black families,
but they were separate and often unequal in funding
and quality. The key point, though, is that in
the beginning, public housing in the U .S. wasn't
seen as a warehouse for the destitute. It was
seen as a stepping stone, a temporary boost to
get you back on your feet. OK, so we have the
origins. We have the why getting rid of the night
soil, stopping cholera, building healthy soldiers
and jumpstarting the economy. Right. The need
is established. So now let's talk about the how.
Because once governments decided to build, they
had to decide what to build. And this takes us
into the world of architecture. And not just
architecture, but ideology. This is where it
gets really fun. Because the architects of the
1920s and 30s, the modernists, they didn't just
want to build apartments. They wanted to build
a new kind of human being. A new human being.
Absolutely. They believed in architectural determinism.
The idea that if you change the space a person
lives in, you change their behavior. You change
their soul. Okay, so let's look at that interwar
period. Weimar Germany, 1925 to 1930. The Bauhaus
movement is in full swing. What was the vibe
there? The reaction was against the slum. The
slum was dark, chaotic, dirty, and irrational.
So the modernists said, we will build the opposite.
Which means? Light, air, and sun. Licht, Luft,
und Son. That was the mantra. They built these
beautiful, low -rise developments, often in suburban
settings. Everything was about hygiene and efficiency.
Clean lines, white walls. And this gives us one
of the most famous examples of social engineering
inside the home, the Frankfurt kitchen. Yes.
Designed by Margaret Shidley -Hotsky, a true
pioneer. We have a diagram of this in the notes.
It looks like a modern galley kitchen. It does.
And that's because she basically invented it.
Before this, kitchens were big, messy rooms where
people ate, cooked, and washed. She applied Taylorism
to the kitchen. Taylorism. That's the scientific
management stuff, right? Like timing how long
it takes a factory worker to screw on a bolt.
Exactly the same thing. She treated the housewife
like a factory worker. She analyzed every movement.
How many steps from the stove to the sink? How
far do you have to reach for the flour? She designed
a kitchen that minimized movement to reduce fatigue.
So it wasn't just, here's a room to cook in.
It was, here is a machine for living. That was
the phrase, a machine for living. The goal was
to liberate women from household drudgery through
efficient design. It sounds incredibly modern
when you think about it. It does. But there was
another maybe darker side to this modernization.
The concrete. The towers. Ah, yes. The tower
in the park. This is the image that I think most
of us have. And it comes from one man. largely
le corbusier le corbusier the swiss french architect
who loved concrete more than perhaps anyone else
in history what was his philosophy why the towers
he hated the messy narrow streets of old cities
he called them donkey paths he wanted to bulldoze
the center of paris and build the radiant city
which was what exactly huge monolithic towers
set in vast expanses of green parkland Everything
separated. A zone for living, a zone for working,
a zone for shopping, all connected by massive
highways. It sounds nice on paper. Big towers,
lots of trees. It seduced city planners all over
the world, especially after World War II, when
Europe was in ruins and they needed to house
millions of people instantly. The tower seemed
like the most logical answer. You could stack
people up, use prefabricated concrete panels,
and build incredibly fast. This brings us to
the Soviet Union. The Khrushchevka. The Khrushchevka,
yes. If you've ever seen photos of Moscow or
East Berlin or Warsaw, you have seen these. Miles
and miles of five -story gray concrete boxes.
Why five stories? Was that an aesthetic choice?
No, no. Nothing in the Soviet Union was an aesthetic
choice. It was pure economics. Five stories was
the maximum height you could build without legally
requiring an elevator. And elevators are expensive.
And they break down. And they need maintenance.
So five stories it was. The goal was quantity
over quality. Nikita Khrushchev, the Soviet premier,
wanted to end the housing shortage. He famously
told the architects, we don't need beautiful
curves. We need square meters. Rudely practical.
But it went further than just. It was also about
destroying the old way of life. In Romania, under
the dictator Nicolae Sasescu, you had a policy
called systematization. That is a terrifying
name for a housing policy. It was as aggressive
as it sounds. They looked at the traditional
Romanian villages, little cottages, erratic streets,
gardens, and they said, this is backward. This
is peasant life. So they bulldozed entire villages
and forced the people into these new standardized
concrete blocks. So you're taking a farmer. who
is used to having a garden and chickens and a
community, and you're shoving him into a concrete
box on the fourth floor. Exactly. The idea was
to create the new socialist man, a man who lived
in a collective urban environment, who relied
on the state, not on his own plot of land or
his village. That is the ultimate social engineering.
using architecture to erase history and culture.
And it worked, in a way. By 2012, communist -era
flats still accounted for something like 37 %
of total housing in Romania. That legacy is physically
built into the landscape. So on one side, you
have the Soviet concrete blocks. But let's contract
that with the UK again, because before they went
all in on towers in the 60s, they had a very
different idea. The Garden City. Ebenezer Howard.
He was a visionary. He looked at the city and
saw overcrowding and slums. He looked at the
countryside and saw a lack of opportunity. He
said, let's combine the best of both. Town country.
Yes. He drew these famous diagrams of the three
magnets. The idea was to build these cottage
estates, places like Totterdown Fields in London.
Which just sounds lovely. Totterdown Fields.
It was meant to be. These were low density. Everyone
got their own front door. Everyone got a little
garden to grow vegetables. That seems to be the
fundamental split in public housing philosophy,
doesn't it? You stack people up to save space
and money, or you spread them out to give them
a homely feel. And that split usually comes down
to land value and cultural ideals. Look at New
Zealand, for example. New Zealand has public
housing. They have a very proud history of it.
From 1937 to the 1950s, their state housing was
almost entirely detached, single -family cottages.
That's pretty unique. Usually when you say public
housing, you think apartments. Not there. Not
then. The cultural ideal in New Zealand was the
quarter acre dream. Every man deserves his castle
and a bit of lawn. So the state tried to provide
that. They built really high quality bungalows.
In fact, they were often better built and had
more modern amenities than the private houses
of the time. OK, so we've got the history. We've
got the architectural philosophies from the machine
for living to the quarter acre dream. Now, I
want to take this global tour. Because, as we
said in the intro, the outcomes of these experiments
have just been wildly different. We're going
to see some distinct models emerge, what you
could call the universal model, the crisis model,
and the safety net model. And I want to start
with the gold standard that everyone talks about,
the one that urban planners drool over. Singapore.
Singapore is the case study that just breaks
all the Western stereotypes of public housing.
We mentioned that 90 percent homeownership rate
earlier, but I want to dig into that. How does
that even work? If it's public housing, how do
you own it? It's managed by the Housing and Development
Board or HDB. They build the flats and we're
talking high density, high rise towers, very
modern, very clean. But instead of renting them
out for life. They sell them to citizens on 99
-year leases. So you buy a 99 -year lease from
the government. Yes. And because the government
controls the land and the construction, they
can subsidize the initial sale price heavily
for first -time buyers. It acts as an asset.
You can live in it. You can sell it on the open
market after a certain period. You make a profit.
And make a profit. Or you can downgrade to a
smaller flat when you retire and cash out the
difference for your pension. So the public housing
system is actually a wealth generation engine
for the population. Exactly. It forces savings.
Every month, a portion of your salary goes into
a central provident fund, a sort of national
savings account, and you use that to pay your
mortgage. But here's the key question for me.
Is it just for the poor? No. And that is the
secret sauce. Public housing in Singapore ranges
from small studio units all the way up to what
they call executive condominiums. Executive condominiums.
That sounds fancy. They are. They have swimming
pools, gyms, tennis courts, all the amenities
you'd find in private luxury developments. Because
the system is universal or near universal, there
is absolutely no stigma. Right. Living in an
HDB flat doesn't mean you failed. It means you
live in Singapore. That's the aha moment for
me. If everyone lives in public housing, then
public housing just because housing, the adjective
disappears. It de -stigmatizes the safety net
by making the safety net the entire floor. And
it allows for some pretty direct social integration.
The government actually has quotas, the ethnic
integration policy. They ensure that different
ethnic groups, Chinese, Malay, Indian, are mixed
within the blocks to prevent ethnic enclaves
from forming. That is social engineering in its
most direct form. you will live together. And
largely, it has worked to create social cohesion
in a very diverse nation. Okay, now let's hop
over to Hong Kong, also high density, also a
huge public housing sector. Yes, nearly half
the population in Hong Kong lives in public housing,
either rental or through various ownership schemes.
But the origin story here is very specific. It
wasn't a planned top -down vision like Singapore.
It was a disaster. The fire. The Shek Kip May
fire of 1953. happened there? Well, you have
to imagine 1953 Hong Kong. You had this massive
influx of refugees from mainland China after
the communist revolution. They were living in
squatter settlements, these incredibly dense
shanty towns of wooden shacks built on the hillsides.
Very dangerous. Bitter boxes. Literally. On Christmas
night 1953, a fire swept through the Shek Kip
May settlement and left 50 ,000 people homeless
overnight. 50 ,000 in one night. That's a small
city. Overnight. The British colonial government
realized they couldn't just leave 50 ,000 people
on the street. It was a crisis response. They
had to act. So they built these massive resettlement
estates, and they built them fast. What did these
first buildings look like? They were incredibly
basic. They were called the Mark I buildings.
Seven -story, H -shaped blocks. No elevators.
No private bathrooms. You had communal latrines
and washing areas down the hall. Families of
five or six people lived in tiny cubicles, maybe
120 square feet. So it was just shelter, bare
bones survival. It was survival. But from that
crisis, the program grew and evolved. Today,
Hong Kong public housing is much more sophisticated,
but it remains a crucial lifeline in one of the
most expensive real estate markets on earth.
Without it, the city would completely collapse.
So Singapore was a planned nation building exercise
and Hong Kong was a crisis response that became
permanent. In many ways, yes. Now. Yeah. We have
to talk about the United States, KC, the safety
net model. And the stigma model. Why is it so
different? Why didn't we get HDBs in Chicago
or New York? Why did public housing in the U
.S. become so synonymous with failure? It comes
down to a fundamental philosophical difference.
In Singapore, housing is seen as infrastructure,
like a road or a power grid. In the U .S., housing
is seen as a commodity. And commodities are for
selling. For profit. Exactly. And this is where
the lobbying comes in. We talked about how early
U .S. projects were for the working class. But
the private real estate builders and lobbyists,
the National Association of Real Estate Boards,
were terrified of the government competing with
them. They didn't want the government building
nice houses for the middle class because then
who would buy their houses? Precisely. Don't
steal our customers. So they lobbied Congress
hard to ensure that public housing was legally
restricted to the poorest of the poor. to make
sure it was only a safety net, not a competitor.
So they basically engineered the failure from
the start. In a way, yes. And then there's the
not in my backyard aspect. White communities,
especially in the suburbs, systematically blocked
public housing from being built in their neighborhoods.
So public housing was forced into already low
income areas, often designated as slum clearance
zones, which usually meant. bulldozing existing
black neighborhoods. So you concentrate the poorest
people in the poorest areas and then over time
you cut off the funding for maintenance. Precisely.
And we can't ignore the racial component. As
the white working class moved to the suburbs
after World War II, aided by government -backed
mortgages that were often explicitly denied to
black families through redlining, the demographics
of public housing shifted dramatically. It became
predominantly inhabited by impoverished single
-parent households and communities of color.
And then the narrative kicks in. The projects.
Right. The narrative of crime, drugs and failure.
And it became a self -fulfilling prophecy because
when you concentrate poverty and remove opportunity,
social problems explode, which then led to these
punitive policy responses like the one strike
your outlaw in 1996. This is the Clinton era
law, part of the big crime bill. Yes. It enabled
housing authorities to evict an entire family
for criminal activity, even if you were just
tried. not convicted, even if it was a family
member or a guest who committed the crime, not
the tenant themselves. Wait, work me through
that. If I'm a grandmother living in public housing
and my grandson comes to visit and gets caught
with drugs outside the building. You can be evicted.
The whole family can lose their apartment. That
is incredibly harsh. It increased the policing
and surveillance of these communities. It turned
housing complexes into quasi -penal environments.
You aren't really a resident. You're a suspect.
And then came the demolitions, the Hope Six program.
Hope Six is one of the most controversial chapters
in this story. It started in 1993. The stated
goal was revitalization. Let's tear down these
crumbling superblocks like Cabrini -Green and
build nice new mixed income communities. It sounds
good on paper. But there's always a but. The
big but was that they repealed the one for one
replacement rule. OK, explain that. The rule
used to be. If you demolish one public housing
unit, you must build one new one to replace it,
to keep the total number of affordable units
stable. Hope Six got rid of that. They argued
that the old buildings were too dense, so they
demolished high -density towers and built lower
-density townhouses. Which means, just simple
math, fewer units. Exactly. The result was that
far more units were demolished than were built.
This led to the mass displacement of residents.
The people who lived in the towers often couldn't
afford or didn't qualify for the new mixed -income
units, so they were pushed out, often given vouchers,
and sent into the private market to fend for
themselves. It sounds like revitalization was
just code for removal. For many critics, yes.
It was about dispersing poverty and reclaiming
a valuable inner -city land rather than actually
solving the problem of housing for the poor.
Okay, let's look for a bright spot before I get
too depressed. Let's go to Finland. because they
seem to have a policy that is actually working.
Finland is a fascinating counterexample. They
adopted a housing first policy. Housing first.
What does that imply? In many countries, the
model is what you'd call the staircase. To get
public housing or shelter, you have to jump through
all these hoops. You have to be sober. You have
to be in a treatment program. You have to have
a job. You have to earn the housing. Right. Fix
yourself, then we'll give you a room. Finland
flipped it completely. They said you can't fix
yourself if you're sleeping under a bridge. It's
impossible to treat addiction or mental health
issues when you don't know where you're sleeping
tonight. So they give you the key first, no questions
asked. The priority is unconditional permanent
housing. You get the key to a small, self -contained
apartment, no conditions on sobriety. Then, once
you are housed and stable, the sports services
health, addiction treatment, job counseling come
to you. And the results. Homelessness in Finland
reduced by 35 % between 2008 and 2019. It is
one of the only countries in Europe where homelessness
is significantly going down. And they found it's
actually cheaper. Cheaper. It costs less to provide
someone with an apartment and support services
than it does to pay for the repeated emergency
room visits, police interventions and jail stays
that come with chronic homelessness. That is
incredible. It just challenges that whole puritanical
idea that you have to deserve help. It just says
housing is a prerequisite for functioning. Correct.
It treats housing as infrastructure for human
life. Not a reward for good behavior. I love
that. Infrastructure for human life. Now, we've
done the big global heavy hitters, but I want
to zoom in on some regional textures because
the devil is always in the details. Let's talk
about South Africa. South Africa is such a unique
case because they are dealing with the specific
brutal legacy of apartheid. Where the National
Party only built for whites. Correct. For 40
years, the state actively prevented non -white
residents from having adequate housing. They
were forced into townships on the edge of cities.
So when the ANC took over in 1994, they had this
massive structural backlog. But they also have
a constitution that explicitly guarantees the
right to housing, right? They do. Section 26
of their constitution. It says everyone has the
right to have access to adequate housing. And
to their credit, the post -apartheid government
launched these huge programs, the RDP, the Reconstruction.
development program and later breaking new ground.
I've seen photos of the RDP houses. They're these
small standalone brick houses. They built over
three and a half million of them. It's a huge
achievement in terms of raw numbers. 3 .5 million.
That is massive. It is. But there's always a
but. The main criticism has been about location.
Location, location, location. Exactly. Land in
the city centers, near the jobs, near the businesses,
is incredibly expensive. So to build 3 .5 million
homes cheaply, the government bought cheap land
on the periphery, far, far from the city. So
you get a house, but you have a three -hour commute
on a crowded minibus taxi to get to work. If
you can even afford the fare, it reinforces the
spatial segregation of apartheid, even if the
intent is totally different. You own the house,
but you're still excluded from the formal economy.
But we should also note South Africa provides
free basic services to the poor. Right. The first
six kiloliters of water and 50 kilowatt hours
of electricity per month are free for indigent
households. That's a really specific, tangible
safety net. It is. It acknowledges that having
a house is useless if you can't afford to turn
the lights on or have running water. What about
Brazil? I feel like I've heard a similar story
there with the location problem. Very similar.
The program is called Minha Casa Minha Vida.
My House, My Life, launched in 2009. Billions
of dollars, millions of homes, but again, heavily
criticized for being built in these massive,
isolated developments far from city centers with
poor infrastructure. It seems like we keep running
into this problem. We can build the box, but
we can't seem to put the box in the right place.
Because the right place is expensive. And unless
the government is willing to fight the market
for that land like Singapore does, the poor get
pushed to the edge. Okay, let's swing back to
Europe for a moment. Vienna. You mentioned Red
Vienna earlier. This seems to be a cult favorite
among urban planners. Oh, urban planners absolutely
love Vienna. And for good reason. The Gemeindebau.
These are the large residential complexes built
by the Social Democratic Party starting in the
1920s. Places like the Karl Marxhof. Right. Karl
Marxhof is enormous. It's over a kilometer long.
But what's interesting is that these aren't just
projects. They are culturally significant monuments.
They have statues, arches, beautiful courtyards.
They don't look cheap. No. They were designed
to be palaces for the workers. They had kindergartens,
laundries, libraries, and clinics built right
into the complex. The idea was... to elevate
the status of the worker, to give them dignity.
And because of that quality in history, I assume
the stigma is different. There is very little
stigma. About 60 % of Vienna's population lives
in subsidized housing of some kind. Middle class
people live there, doctors, artists. It's just
a normal, even desirable place to be. It proves
that public housing doesn't have to be ugly or
austere. It's a choice. And finally, Japan. We
talked about the Danchi in the outline. The Danchi.
These are large clusters of apartment buildings
built in the 50s and 60s during Japan's post
-war economic boom. What's fascinating here is
the cultural shift they enabled. Before the war,
Japan was largely multi -generational households.
Everyone living with grandma and grandpa in a
traditional, often wooden house. Right. The Donshi
introduced the salaryman lifestyle, the nuclear
family, mom, dad, two kids, in a modern apartment
with a dining kitchen, a gas stove, refrigerator.
It literally reshaped the Japanese family structure.
And a unique feature I saw in the notes, no key
money. Yes. If you've ever tried to rent in Japan,
you know about key money. It's a mandatory gift
to the landlord, often two months rent that you
never get back, plus renewal fees every two years.
That sounds painful. It is. But the U .R. or
urban renaissance public housing doesn't charge
key money and doesn't charge renewal fees. So
for many people, it's a huge financial relief.
It sets a standard that keeps the private market
in check to some degree. OK, so we've done the
tour. We've seen the palaces of Vienna and the
high rises of Singapore. But now we have to talk
about the shift. Because since the 1970s and
80s, the vibe has changed. We move from the heroic
era of building massive projects to, well, something
else entirely, the neoliberal turn. Unpack that
for us. What does that mean in terms of housing?
Essentially, governments in the West, particularly
the US and UK, started saying, maybe the state
shouldn't be the landlord. Maybe the market can
do this better. They moved away from building
public housing to subsidizing private rentals.
And this gives us the voucher system in the U
.S., Section 8. Correct. It's tenant -based assistance.
Instead of the government building a tower and
putting you in it, they give you a voucher that
pays for a chunk of your rent in the private
market. And the theory is choice. The theory
is you can take that voucher and move anywhere.
You can leave the poor neighborhood and move
to the suburbs, get your kids into better schools.
That's the theory. In reality... It's much more
complicated. First, there's a huge supply problem.
There are massive wait times for these vouchers.
In some cities, the wait list is closed for years.
You literally can't even get on the list. And
if you're one of the lucky ones who gets one.
Then you face landlord acceptance. In many places,
landlords simply refuse to accept vouchers. They'll
find some other reason to deny your application.
Or the vouchers don't cover enough rent to get
you into a good neighborhood anyway. So you have
a ticket to a better life. but no one will take
it. Exactly. So people end up using the vouchers
in the same poor neighborhoods they were trying
to leave. And many studies have shown that residents
actually prefer to stay near their support systems,
their families, their churches, which are often
in those neighborhoods. So the voucher program
often fails to create the social and economic
integration it promised. And in the UK, this
shift took a different form. The right to buy.
This was the Margaret Thatcher era revolution.
The government allowed council tenants to buy
their homes at a significant discount. Which,
on the surface, sounds like a great deal for
the tenant. Hey, you can own this house you've
been renting for 50 % off. For that generation
of tenants, it was the deal of a lifetime. It
created a huge wave of working class homeowners.
It was a political masterstroke. It bought a
lot of loyalty. But here comes the long -term
hangover. The councils were often restricted
from using the money they got from the sales
to build new social housing. So you sold off
the best stock. the nice houses with gardens,
and you didn't replace them. So the total stock
of affordable housing just shrinks and shrinks.
Drastically. And the remaining stock is the stuff
no one wanted to buy, the difficult to maintain
tower blocks. So social housing became even more
residualized, more concentrated with the most
vulnerable people. And I've heard that many of
those homes that were sold off are now back on
the rental market. That's the cruel irony. Something
like 40 % of ex -council flats in London are
now owned by private landlords who rent them
out at full market rates, often back to the local
council who has to pay that market rate to house
homeless families. So the state sold the house
cheap? And now rent it back expensive. That's
madness. It's a massive drain on the public purse
now. It was a short -term asset transfer that
created a huge long -term liability. And we're
seeing similar privatization trends in Eastern
Europe too, right? Yes. After the fall of communism,
countries like Romania privatized everything.
Home ownership hit 99 .9%. Which sounds like
a statistic from a utopia. Everyone owns a home.
But it's a trap because you have low -income
owners living in these aging concrete blocks.
Those blocks built in the 60s and 70s that need
massive repairs, new roofs, elevators, insulation.
And if everyone in the building is low income,
nobody can afford to fix the roof. Exactly. The
homeowner associations are either dysfunctional
or broke. So you have a crumbling infrastructure
that no one has the money or the will to fix.
It's privatization without the capital to maintain
the assets. And then there's the modern phenomenon
of gentrification and this idea of social mix.
We talked about hopes, but this is. happening
in Europe too. France is an interesting battleground
here. They have a law, the SRU law, that requires
towns to have 20%, now raised to 25 % in some
areas, of social housing to force a social mix.
So rich towns are legally required to build housing
for poorer people. That's the mandate. Many resist
it. They choose to pay fines instead. But the
goal is to break up the ghettos. However, in
the UK, this drive for mixed developments has
led to the infamous poor doors. Oh God, the poor
doors. Explain this concept because it sounds
like something from a dystopian novel. It happens
when a private developer builds a luxury condo,
but to get planning permission, the city forces
them to include some affordable units in the
same building. Okay. That sounds good so far.
But the developer doesn't want the affordable
tenants mixing with the luxury tenants. So they
build a separate entrance, usually around the
back near the garbage bins. So you live in the
same building, but you can't use the marble lobby.
You can't use the lobby. You can't use the concierge.
You can't use the gym. Even if the gym is literally
on your floor, your key fob won't open the door.
It's structural segregation. It's an architectural
wall inside the building. It is. It highlights
the stigma perfectly. You can live here. But
don't pretend you're one of us. And in Vietnam,
those old coup tuptail blocks we mentioned earlier,
the ones from the communist era. They're becoming
dilapidated. And because the land they sit on
is now incredibly valuable real estate in booming
cities like Hanoi, they're being targeted for
demolition. The low -income residents are pushed
out to make way for high -income high -rises.
It's the global story of gentrification. The
poor hold the land until it becomes valuable,
and then they are moved. So we've gone from the
fougere, where you pay rent with prayer, to the
superblock, from homes for heroes to vouchers
and now to poor doors. It's been quite a journey,
hasn't it? So what does this all mean? When we
look at this global tour, all these different
systems, what's the big takeaway? I think the
big takeaway is that public housing is a mirror.
It reflects the government's priorities and society's
values. Is housing a commodity to be traded for
profit or is it a human right to be guaranteed?
And if you answer right. you get the Singapore
model or the Finland model. You get universality.
And if you answer commodity, you get the safety
net model. You get stigma. You get a system designed
only for those who have failed in the market.
And that stigma is just so hard to wash off.
It is. And here's a final provocative thought
for our listeners to chew on. Hit us. In many
places like Australia and the UK, we're seeing
the public stock being sold off or transferred
to nonprofits just to avoid the maintenance costs.
The state is trying to exit the game. But if
the state steps out of the housing game entirely,
what happens when the market fails the most vulnerable?
We are moving toward a world where the future
of public housing might be no housing at all.
Just a financial transaction. A voucher that
bounces. Is the future of public housing just
a Venmo payment from the government that isn't
enough to cover the rent? That's the danger.
If housing becomes purely a financial asset,
then those without assets don't just lose a home.
They lose their place in the city. They lose
their citizenship in a way. A sobering thought
to end on. Housing isn't just walls and a roof.
It's about who belongs. Precisely. Thanks for
diving deep with us today. This is a big one.
A foundational one. See you next time.