ObamaHut -- A Future History of Housing in America

As the pace of fundamental transformation accelerates with every “let me be clear” from our philosopher king, any histories to be written of this period should probably be written now, while the lights are still on and the power button on your computer isn’t just a cruel joke. This “quick before it freezes” philosophy extends especially to things that haven’t happened yet, since by the time they do occur many of us will be too busy quarrying limestone in Northern Minnesota to worry about much of anything else.

Accordingly, for your consideration, a telegram from the not-so-distant future about government doing to your housing what they did to your health care.

In the aftermath of the rollout and implementation of the wildly successful Affordable Healthcare Act, and as a prelude to immigration reform (unaccountably stalled in the Senate over the question of how much to compensate “undocumented students/visitors/guests” for indignities visited upon them by “law-happy zealots”) it was felt that the next economic sector that could benefit from the Obama Midas touch was housing.

Accordingly the Affordable Sustainable Housing Act (or “ObamaHut” as it came to be known) was born.

The bill, whose preamble asserted the right of every citizen to an energy efficient home at no cost (memorialized on “Green For No Green” bumper-stickers everywhere) won wide bipartisan support when Republican consultants reminded their employers of the importance of the green vote, to say nothing of the growing constituency of individuals not inclined to pay their bills or honor their debts.

Among the many provisions contained in its twenty thousand pages (condensed to this size through the judicious use of six-point type and shorthand) some of the salient points that would so arouse the watchdog media — some of them in as little as five years — included:

  • A mandate on all new houses to be 25% solar/wind powered with a sliding scale up to 75% in 2025A provision that grandfathered existing houses until they were sold or had “substantial” repairs, additions or renovation
  • An annual penalty for non-compliance equal to 5% of the appraised value of the home
  • A provision that no potential home buyer could be refused a mortgage irrespective of income or credit history
  • A provision that all associated costs of home purchasing, mortgage, insurance and tax escrow payments would be eligible for government subsidies based on income level and “other circumstances”

As this new law worked its way through the legislative process President Obama, in a breathtaking departure from precedent, went on the road to sell it with a flurry of speeches and town halls. Against a backdrop of poor people, indigents and an array of doe-eyed children, the President solemnly asserted that if you liked your home you could continue to live in it. The American people, with no reason to doubt him, took him at his word.

Perhaps the first indication of trouble came with the 50% decline in new housing starts in the the first year. It emerged that the market for over-priced homes with glass roofs and/or windmills in the front yard was softer than anticipated. This of course didn’t apply to larger homes for the very rich whose purchasers simply absorbed the associated green penalties and constructed the same “stop the trolleys” energy sinks they always had. Ditto a surprisingly large group of constituents, who appeared to have nothing much in common except Harry Reid’s direct line on their speed-dialer, who were granted waivers.

Alarming also was the wave of bankruptcies and closings of virtually any business associated with home renovation or repair, since home-owners sensibly refrained from any improvement that would void their grandfather status.  Unhappily some either didn’t realize the scope of the law — and discovered  that something as trivial as repaving the driveway had taken them off the happy path — or had no choice (when you need a new furnace, you need a new furnace). In either case, faced with large and unexpected expenses, and well outside eligibility for any subsidies, an increasing number of owners chose to sell their homes and get out while they still could.

President Obama denied, then apologized for, his previous promises and assured a nervous populace that the worst was over, America had definitely turned the corner, and he really, really meant it this time. Subsequent generations would note that no part of that speech, including the definite articles and punctuation, contained so much as an atom of truth.

Into the buyers’ market helpfully created by ObamaHut came its principal beneficiaries, those individuals who now couldn’t be refused mortgages and whose financial circumstances made them eligible for infinitesimal loan rates and reciprocally large government subsidies.

It is clear that many of this bill’s supporters really hadn’t thought through the implications of such munificence, especially who the “they” were who would pay for all this. The answer, not long coming, was delivered with cruel clarity in tax bills with rows of zero’s that resembled sticky-key typos and mortgage refinance offers that resembled nothing at all since they had all but ceased to exist.

This in turn prompted a second great wave of home sales, effectively transferring property from tax-payers to net tax-receivers. For many neighborhoods this was the beginning of a predictable death-spiral of disintegrating tax-bases and social blight more or less inevitable with the influx of a transient, largely unemployed population with little or no investment in the properties they now occupied. As an increasing number of these new owners defaulted on even their modest commitments, an obscure and completely unnoticed clause in the ObamaHut law kicked in and ownership of the property reverted to the federal government.

The ensuing flight from these neighborhoods was quite unlike any other, since the escapees had nowhere to go. There were no inexpensive homes waiting in the suburbs or small towns, or anywhere else for that matter. Those with incomes above the subsidy threshold, especially working poor and those on fixed incomes, were locked out of the home ownership market, probably forever, and obliged to throw themselves onto the rental market. This in turn created an immediate and severe shortage in rental properties, which caused rents to sky-rocket.

President Obama, immediately perceiving the problem, leaped into action and embarked on another speaking tour wherein he castigated greedy landlords and promised immediate action to regulate rents.

The very threat of more regulation effectively halted new apartment construction and prompted many rental property owners to get out of the business altogether.

President Obama, immediately perceiving the problem, leaped into action yet again and embarked on another speaking tour wherein he cited the failure of the private sector to provide reasonable housing of any kind to Americans and announced that only the federal government was big enough to take this problem on.

The big solution Obama had in mind — which seemed curiously detailed and well-advanced for something that had just occurred to him — was large blocks of government housing, built along the gray monolithic Soviet model, often built over bulldozed lots once occupied by individual dwellings. Given the density of people they could accommodate they held out the promise — at last — of truly energy efficient environments powered by glass roofs and windmills in the front yards (better referred to as people’s common squares).

Apart from periodic failures and brownouts (spawning events variously known as “The Big Chill of 2015”, “The Black Hole of 2016”, “The Heat Wave From Hell of 2017” etc.) while the government fine-tuned the technology, these efforts were judged modestly successful, by their authors. For their part government leaders let it be known that they were as upset about these glitches as anyone else and were working overtime to get them fixed. (This ultimately became a recurring part of the president’s annual message on the day formerly known as Christmas.)

Despite these speed-bumps ObamaHut was pretty much a fait accompli within a few years of it inception. Even when the environmental and energy efficiency promises failed to materialize, it didn’t matter. Nor did the fact that a new normal had been established — in direct opposition to the bill’s stated purpose — wherein rich people lived in houses and everyone else didn’t.

It didn’t matter because there was now nowhere else to go. The homes weren’t going to rebuild themselves. The housing, financing and ancillary industries weren’t going to spring up out of the ground to the strains of the 2001 theme. Politicians might run on platforms promising to spread the block-houses a little farther apart, or reduce the incidence of power outages, or even stop the windmills from decimating the bird population, but nobody seriously thought it could ever be the way it once was.

Accordingly, to thoughtful people surveying the new landscape Humpty Dumpty become more than just a nursery rhyme, and the term “ObamaHut” deeply ironic.