e33a5b463e83434ab829f71d2671e7fc

Housing and the Marxism question

183:863941740 (Paul Lusk) — Mon, 05 Apr 2021 12:19:39 GMT

A new book puts a Marxist frame around its picture of the Merseyside Housing Co-ops. How useful is that?

Matthew Thompson’s book Reconstructing Public Housing (Liverpool University Press, 2020) considers the legacy of the Merseyside newbuild housing co-operatives. From the late nineteen seventies, groups of would-be tenants formed co-ops that chose land, appointed architects and commissioned their own new housing estates, funded by government grant for what we now call ‘social housing.’

Matthew makes great use of my thesis Citizenship and Consumption (University of Salford, 1998) with material drawn from my experience working with the inception of the new-build co-ops from 1977. He takes the story forward to today’s successor organisations, including Community Land Trusts . It is good to see this history on record. Matthew is honest about the lessons to be learnt from the past as well as the challenges of today.

Marxism?

Matthew opens with Frederick Engels’ 1873 essay on The Housing Question and connects his narrative to a Marxist account of the co-ops: their project, in this version, is to produce housing for use rather than as ‘commodity.’ This has led to a negative response to Matthew’s work from some of my former colleagues. Co-operative development was heavily opposed by Labour’s ‘hard left’ in the form of the Militant Tendency, the Marxist project which controlled Liverpool city council from 1983 to 1985. The co-ops flourished, for a few years, with the backing of the Liberals in the city, Margaret Thatcher’s government and some parts of the Labour Party hostile to Militant and to its Marxist creed.

How then to assess Matthew’s Marxist framing of his research? Engels’ essay was a critique of a solution to the ‘housing question’ advocated (said Engels) by followers of Marx’s French rival Proudhon. This solution was for all tenants of urban housing to become owner-occupiers. Engels objects on two grounds: one political, the other economic. Politically , says Engels:

In order to create the modern revolutionary class of the proletariat it was absolutely necessary to cut the umbilical cord which still bound the worker of the past to the land. … And now comes this tearful Proudhonist and bewails the driving of the workers from hearth and home as though it were a great retrogression instead of being the very first condition for their intellectual emancipation.

Economically , Engels complains, the Proudhonists depict the relationship between landlord and tenant as corresponding to that between employer and worker, and therefore another site for the expropriation of value from the worker. No, says Engels, this is a ‘leap from economic reality.’ The landlord/tenant relationship is a normal commodity transaction using the spending power the worker possesses. The site of exploitation is the capitalist place of production, where the worker is paid much less than the value of the product, and this gap is the ‘surplus value’ which accrues to the capitalist investor. There is no extraction of ‘surplus value’ in the commodity transaction known as house rent.

Militant objects

Militant captured control of the Liverpool Labour Party and then, in 1983, gained enough wards to take over the city council. The newbuild co-ops to that point had been funded by the Housing Corporation (central government) and by the city council under Liberal-Conservative control. Militant was committed to confronting government with a demand for greatly increased housing investment. It was open to them to include an option for co-op housing in this programme. After some hesitation this option was rejected and the Liverpool Labour Party adopted a policy of ‘smashing’ the co-ops.

Their objection to the co-ops was that they were an ‘elitist’ device for ‘queue-jumping’ – in other words, that the leaders and members saw themselves as superior to the wider body of tenants waiting for social housing, and allocated homes not strictly according to priority need but rather through selection reflecting community ties (albeit among those eligible for public housing, as the co-ops were mostly formed among residents of homes designated for slum clearance). There was some truth in these claims.

Our passion for the co-operative model, advocated by the 1974-79 Labour government, arose, above all, from disgust at the conditions into which state housing had fallen by the 1970s. Design of vast housing estates was gratuitously crude and insensitive to people’s taste and aspirations, build quality was poor, management was lax, record keeping sometimes non-existent, and maintenance was often appalling. Allocations policy overrode the family and community links that fostered well-being in poor neighbourhoods. The system appeared to be run primarily in the interests of the workforce, whose union representatives exercised power, through their position in the Labour Party, to influence selection of Labour council candidates. All these concerns were familiar and shared across a wide spectrum of opinion, not least in the Labour Party. The question was about solutions. We thought consumer control and choice, within a framework of public provision, would succeed. We believed that disrupting centrally planned solutions was justified, necessary and positive. For Militant and their close allies in the Labour and council bureaucracy, the answer lay in design models based on those offered by mass-market providers like Wimpey Homes, separation of public and private space, rigour in applying needs-based allocations, and a warm embrace of the unions.

Both sides thought that they would advance socialism – Militant by confronting Thatcher with an unstoppable demand for the restoration of mass council housing; ourselves by igniting demand for community control, empowering consumers and abolishing the landlord/tenant relationship. The Right’s alternative, as it developed under Thatcher and then Major, was to empower users as individual home owners or as tenants with rights of redress; competitive tendering of maintenance contracts; and shifting the rump of public housing stock to private (typically charitable) landlords, expecting over time to eliminate state ownership of rented housing. For a few years we could use Militant’s strategy to lever support for co-operatives from the national Conservative government and from Labour leaders, eager for sticks with which to beat Militant. Eventually, 35 co-ops built around 1,800 homes. They attracted much attention for a time. Visitors like HRH Prince Charles, Prime Minister Thatcher and a succession of senior Labour figures saw confirmation of their own narratives about architecture and public housing.

Commodity value

Pierre-Joseph Proudhon died long before Engels wrote The Housing Question; in calling the prescient project for mass owner-occupation ‘Proudhonist’, Engels recalled the dispute between Proudhon and Karl Marx a generation earlier, triggered by Proudhon’s refusal to endorse Marx’s political strategy. 180 years after the original split, a geographer writing a doctoral thesis finds it handy to frame his valuable narrative within the theories of one side of this debate. Is this just a harmless indulgence of academic fashion? Does it make sense to view the coops through the lens of the socialism of the century before last? Proudhon and Engels agreed that the problem was that capitalism conferred a commodity value on urban space which put it beyond the reach of wage earners, so Matthew sees the coops as solving this by removing the commodity element from land development (Proudhon’s solution, not Engels’).

This analysis disregards one fundamental fact of the landscape Matthew surveys: the land developed by the co-ops generally (not always) had no commodity value to speak of. Why so? The area of south-central Liverpool was developed in the later nineteenth century as housing for the more affluent working class, at a time when the normal tenure was private rental. After the first world war, private rents were controlled down to a level that eventually excluded any possibility of investment in the stock. Then the area was ‘red-lined’ – condemned to demolition on the basis of the self-fulfilling prophecy that it comprised ‘slums.’ So the commodity value of the homes was systematically abolished by the state. This impoverished the owner occupiers living there. Private tenants found cheap housing with strong community links (a word with the rent collector serving to find a home for a relative) but in unacceptable conditions. State investment was then the answer. The strenuously articulated demand for consumer control over the terms of that investment was the basis of the co-operative movement that Matthew analyses. The problem with the attempt to depict this in ‘Marxist’ terms is that it lets the Left off the hook. The state is (according to Marx and Engels’ Communist Manifesto ) the ‘committee for managing the common affairs of the whole bourgeoisie’ - so its huge role in reshaping the housing market, using its regulatory and financial might to bring ruin on some neighbourhoods, while enhancing the commodity value of other housing stock, is merely a response to the needs of capitalism. But in fact this drastic remodelling of the housing market was, in large measure, the outworking of the influence of nineteenth century socialist thought, not least that of Proudhon and Engels. The Left can make progress only when it gets to grips with its own history – the history, one might say, of its own crimes.

As for ‘decommodification’, Engels might be surprised to hear that a struggle by a collective working-class undertaking first to own, and then to confer value upon, parcels of worthless land is about ‘decommodification.’ Rather its interests are served (surely) by capturing and then reinvesting commodity value. Matthew shows, in his account of one well-known example, that a heroic attempt at such an approach failed because the needed governance skills were lacking. More widely the co-ops remain essentially inward-looking and conservative, unwilling to risk an expansive reinvestment strategy.

The co-operative approach was not sustained under the Labour government elected in 1997: its policies reinforced the principle that any social home must be let to the applicant in most need at the point of letting, effectively making illegal the long-term pre-allocation of tenancies on which the model depends. Still, the Merseyside homes the coops built remain today, sometimes patches of order amidst the chaos of inner-city decline, many still under co-operative control.

Altogether, according to the Confederation of Co-operative Housing , 200,000 homes in the UK are owned and/or managed by co-ops – under 1% of the total stock. Can the model break out of this enclave to make a more mainstream contribution to housing provision? Matthew’s thesis explores part of the answer. In my view, Marxism is not helpful to his purpose.

The view from Hales Place

Mon, 22 Mar 2021 13:14:47 GMT

What's happened to Hales Place? That's asking questions about our politics

In the 1960s, on St Stephen's Hill to the north of its small city, Canterbury council started to build 1,400 homes to meet the needs of its population.

At the same time, just across the main road, the first students arrived at the new University of Kent.

Now many homes on the Hale Place estate stand empty, and the council struggles to achieve its housing targets.

What has gone wrong?

Hales Place was once Church territory, a resort known for its fine view over the ancient city. At least two Archbishops spent their final days in a palace standing where now there is a shopping parade. Its land and buildings were seized by the state in the days of Thomas Cromwell, passing to trusted aristocrats who served the Kings and Queens. After the Restoration of King Charles II, its owners became the furtively Catholic Hales family. Late in the nineteenth century they sold it for the use of a Jesuit college providing a refuge for French aristocrats. A few decades later it came into the hands of Canterbury Council's housing department.

As designed and built, the low-rise, high density, landscaped council estate provided cheap housing for families, elderly people and people with physical disabilities. But waves of state-sponsored innovations have swept through to wreck these plans. In 1980 came the right to buy. Council tenants bought their homes at a hefty discount. After a few years they were free to sell them, and meanwhile in 1987 the rental market was deregulated. Ex-tenants sold, and their homes were snapped up for the rapidly growing market for students at the University over the road.

Within a few years, a quarter of all homes on the estate were privately-let student accommodation . A standard family house on the estate has 80 square metres of living space: just about enough, under the old Parker Morris standards, for a 5 person home with 3 or 4 bedrooms – in practice good for a family with one or two children and maybe a third on the way. Currently a house like this is on the market as a 6-bedroomed student let. Under the impact of Covid and a large supply of newer student housing, many homes are empty – over a hundred properties are currently (midway through the academic year) on Rightmove as student lets on the Hales Place estate, typically at £100 a week per bedroom. This includes furniture and bills, but let’s say the ‘6 bedroom’ student house might yield its investor £2000 in a good month – way out of the reach of an average-income working family. A working household, incidentally, would pay £150 a month council tax on top of the rent – the student house is ‘exempt’, meaning the government kindly compensates the council for tax it cannot collect from students.

Facing low demand, landlords are offering incentives like zero deposits and rent-free holidays as well as ‘bills’ included in the rent. No one really knows where the student market will go after Covid, and the much needed review of higher education in the new era of online learning and diverse pressures on public spending.

In time landlords may look to redirect the homes back to the family housing use for which they were originally intended. Homes are fifty years old and visibly distressed from decades of miserly investment in repair, so this reversion, to happen, will keep builders and decorators busy for years.

This is not about blaming students or landlords. Some of my best friends are students; they and their landlords have just been following the signals of the market. The point of this piece is to reflect on the role of the state in all this.

Since the 1960s great convulsions have swept over Hales Place, arising from successive tsunamis of planned state initiatives. A huge council estate, state-funded, results from policies pursued by both parties in mid-twentieth century. Meanwhile a great university is planned and delivered. As council ownership and management of housing falls into disrepute a popular right to buy is intended to endow the more stable households with pride in ownership – as, briefly, it does. But the right to buy turns into a right to sell , and the market attracts small investors to allocate homes to a use for which the estate was never designed – as, in another state initiative, from the same (Thatcher) government, it is ordained that half of all young adults will be educated in (mainly) residential universities. They are to live near the great productive site known as the University of Kent at Canterbury (UKC).

Fulfilling Manuel Castells’ analysis of ‘the urban’, the city becomes the site not of production but of ‘collective consumption’ – in an unplanned consequence of well-made plans, Hales Place estate was repurposed to become the dwelling place of the university’s customers. Their purchasing power is largely driven by state-sponsored ‘loans’ which are repayable only if the students earn enough money to ‘repay’ their loan through taxes (which many won't).

Meanwhile the state’s own once-cherished plans for families to bring up children in secure homes in a reasonably pleasant environment are left accidentally abandoned. Instead, for a generation or two, politics answers the deceptively alluring calls of mass supplies of graduate labour, enriched ex-council tenants and small investors putting their savings into property.

What is to blame – capitalism or socialism? Maybe both, a bit. More interesting is to understand the weird new hybrid: the high spending ‘social market’ state, its immense powers of intervention placed at the service of successive and competing waves of political fantasy.

The truth about the housing crisis

Fri, 28 Aug 2020 19:36:00 GMT

The truth about the housing crisis*

We all know about the UK’s ‘housing crisis’ and its result: owner-occupation is increasingly out of reach of the young, so rising generations rely on private rental. More then one household in five now rents privately, with a mean age of 40, compared with a mean age of 57 among owner-occupiers. More and more young working parents rely on one-year rental contracts to secure a home in which to raise a family. They are in the ‘squeezed middle’: the poorer may access social housing, the richer home ownership, those in the middle go into the private rented sector.

The usual explanation for the problem is a ‘shortage’ of housing, so the solution is to build more homes, and the planning system is blamed for restricting this. But this is plainly wrong. In the mid-1960s, Great Britain had 16.5 million dwellings and a population of 51.3 million – one home for every 3.1 people. Fifty years later there were nearly 28 million dwellings for a population of 64 million – one home for every 2.3 people. During the same period, house prices grew from around three times mean annual earnings to around seven times that figure.

The plain fact is that net growth in the housing stock greatly exceeded the growth of population in this period, but prices more than doubled in terms of real affordability for a working-age buyer.

Why? Doesn’t this defy the iron law of economics – that price is determined by supply and demand? The problem here is a common confusion of housing stock with housing supply. The supply of housing for a purchaser in the market is not the total stock: it is the portion being offered by sellers. Roughly 5% of the stock is available at any time for sale or rent - and much of this is offered by people who wish to move and so are both sellers and buyers in the market. New buyers without these assets – notably the young – are bidding for just a tiny fraction of the total housing stock.

What about the rest of the stock? A little over 60% is owner-occupied, mostly by people who bought when prices were far below what they are today. More than half are now debt-free. Owner occupiers who have a mortgage pay half what renters do for housing, expressed as a proportion of their income. So, unsurprisingly, owner occupiers are four times as likely as renters to under-occupy their homes. One home in three belongs to a debt-free owner-occupier, but this part of the stock houses just one adult in six. Much of our stock accommodates owners who do not pay the market price for what they consume and lack incentive to ‘downsize.’ Market pressure is displaced onto the young. The political clout of the home-owning majority – and the vested interests that lead opinion - mean the true picture is largely undiscussed. Private landlords, planners and overseas investors become handy scapegoats.

I have no wish to encourage more scapegoating, or inflame inter-generational conflict, or applaud nimbyish hostility to building. We just need an honest discussion about how to rebalance our broken housing market, and what will happen next if we fail. Building is part of the solution, but it will not achieve much unless we use our stock much more efficiently. Since the late nineteen-fifties, governments have treated housing as a tax-sheltered safe haven for personal capital. A solution probably involves shifting taxation onto assets and away from income. The economic answers are not difficult. Politics is much harder. Until there is a serious attempt to inform electors, the work cannot start.

*This blog was published by Hertford College, Oxford in August 2020. Click here to view the original publication.

The icing on the gay cake and other older blogs

183:863941740 (Paul Lusk) — Wed, 01 Jan 2020 14:34:23 GMT

On the gay cake, what went wrong with Maycare, the persecution of Tim Farron, and more ...

Older blogs on the Ashers bakery 'gay cake' case, why Tim Farron's own colleagues hung him out to dry, how Care lost May an election, and more.