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- [00:10]
A
Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives. Jobs, debts, incomes, our own and those of our children. I'm your host, Richard Wolf. I want to begin with the opioid overdose crisis in the United States. We hit a record in 2021. After the first half of the year, we're about set to become the first year. Once the numbers are in, 2021 will be the first year that we suffer over 100,000 opioid overdose deaths. In 2021, we recorded 92,000 opioid deaths. This is an absolute crime. The basic drugs that do this to us are called fentanyl and carfentanil. They are usually taken alone or mixed together with cocaine or methamphetamines. Young people of all groups, African Americans and native indigenous Americans are the ones most affected. It's sort of like a horrible division of labor. Covid goes after older folks, opioid overdose younger folks, and that way we kill across the board in this society. And one of the recent reports from the Commonwealth Fund makes it crystal clear what the economic aspect of all of this is. And that, of course, is profit, because we live in a profit system, and profit is what the insurance companies are in the business to earn. Health care is how they go after what they're interested in, which is profit. And so they do things which the Commonwealth Fund points out and medical professionals support, makes this opioid crisis worse, not better. I'm going to give you just two examples to show you how horrible this all is. Some insurance companies require prior authorization. You know what that means? That when a person is found to have overdosed and be near death before you can give them immediately what they obviously need, they you need to call the insurance company to get prior authorization because otherwise you may not be covered. And that means that the place to which the overdose victim is taken is hesitant to provide the care. Then there are the providers of care, but will not accept insurance they need out of pocket, which the overdosed person and his or her family can't quite manage. That these people then die, maybe saving the insurance company from having to cover what might have saved their lives. I don't even want to go there and think that, but there it is. When profit governs, you get a medical system that can't work. It didn't work for Covid, and it's not working for the opioid catastrophe that we are living through. My second economic update has to do with yet another crisis. This word crisis is now happening everywhere. We Turn a sign of a system that's falling apart, by the way, this time it's the crisis of K12 public education over the two years of the pandemic. Let me start with this. We have had a drop in the number of teachers employed in this country of 6.8%. 1 in 14 teachers is gone from our public education system. Even though the experience of the last two years with intermittent school closures, with all the upsets of the families hit by or threatened by Covid. We needed more teachers to attend to the young people's needs, to get them through, not less of them. But we didn't do it as a society. We also laid off huge numbers of school support personnel, the janitors, the food preparers, the assistants, the bus drivers, all of that. And these tend to be older workers who are already more vulnerable, who have to take kids to school or work in schools. Remember, the children in schools are often not vaccinated the way older people were. On and on. If this country ever meant all that talk about shared sacrifice, we would have taxed the billionaires to take care of the children and the teachers and the people who support public education. Instead, we did the opposite. We cheapened and worsened the situation. And then there's the inflation, another crisis. As if two years of economic depression and Covid disaster weren't enough, we're now whacking the American people with another economic failure, namely an inflation where prices are rising. And you know, a little. Employers are the ones who set prices. Employers are 1% of the American people. If that much. We allow them to set prices. And you know what they're doing?
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They're.
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They're raising them. And you know why they're doing it? It's for the same reason they do everything else, to make more profits. But they don't want to tell us that. So they make up other reasons. Here's one that's my favorite. We have to raise prices because our wages are going up. Hello. Wages are going up by 5, 5.5%. Prices are going up by 7.5%. Prices are raised whenever the employer thinks he can get away with it. Workers, for example, can't do that. They have to go to a boss to get paid more. And the boss is able to say no, or to say, I'll give you half of what you ask. Or if there's a union contract, you have to wait for the contract to be over, which can be two or three years from now. So there's no question that it has nothing to do with wages. If anything Wages are what people try to get raised to catch up, at least in part with what the inflation is doing to their standard of living. But let me give you an example of what's really going on. And my example comes from a shipping company, Maersk M A E R S K, a Danish shipping company which happens to be the largest shipper of ocean going freight in the world. Okay? Their profits quadrupled over the last year. They've had a lot of disruptions of their long overseas supply chain. But these disruptions and the price rises they were able to get away with have made this last year the most profitable ever. You may be suffering from inflation and you may see your income not even catching up with what's happening to prices, but it's making a lot of money from for big businesses who can use the inflation. Don't forget that we don't all go through this together. The final economic update for today allows me to talk about something many of you have asked me to talk about. And some of you have seen me do some national debates and TV appearances around. And that is the convoy of truckers on the Canadian U.S. border and, and in Canada that were protesting. They said a variety of things but included vaccine mandates and so forth. Here's my position because I want to make it as clear as I know I am impressed and moved when working people get together to protest things that are done to them, that hurt them, we don't have anywhere near enough of that. We'd have a different and better country if workers did this much more often. And for me, as a person on the left, supporting workers when they do that is a kind of basic commitment. I recognize that people with very different political interests than mine, the opposite of mine, also would like to see truckers or any other group of workers go in their political directions. So yes, people who are Nazis, people who are white supremacists, people on the extreme right wing have been celebrating those truckers, hoping thereby to attract their attention. I don't find that acceptable. I want to go in there and fight it, but I do not want to be on the side of a government that, that represses working people when they peacefully, which is overwhelmingly what they did protest. So here's what I would suggest is a way to approach this. If a trucker does not want to abide by a mandate to vaccinate, give him an alternative test and quarantine. And if he doesn't want to test and quarantine, then he has to go to a medical facility and he has to go to One that is not the one that people regularly go to. Because we don't want to make people suffer who are not afflicted with COVID because somebody else doesn't want to do a mandate, because that's when the freedom not to do a mandate begins to hurt other people. And we all understand that's a boundary we don't want to cross. Canada has a problem. It doesn't have, at this point, enough clinics, enough medical health facilities to accommodate people who don't want a mandate for a vac, don't want a vaccine, and don't want even to do the other things that go with it. I would like to respect those people. And you know how the truckers could do that. They could become a movement to protest that there aren't enough medical facilities in Canada, and they want them there so that those truckers, because it's a small minority, the overwhelming majority of truckers in Canada are vaccinated and have not objected. So this small number of people, let's be respectful of them. Let's provide them with an alternative, which we can. A place to go to get care if they get sick that doesn't encumber other people with other problems that are medical from going to their normal facilities. It means you have to have more facilities, which Canada needs anyway, as most Canadians already know. And imagine the support the truckers could get if they led the way for more medical facilities to solve their particular problem and to do something good for the Canadian people as a whole. There would be a way for the left that advocates for better national health insurance to combine that demand with these truckers and make a useful addition to Canadian society. Here's the irony. The right wing's anti vaccine, the right wing's anti government never solves the problem. Those truckers are not gonna have their legitimate grievances. And if I had time, I'd go into those with you. Truckers, both Canadian and American have seen their incomes and their job conditions savagely deteriorate over the last 30 to 40 years under the heading deregulation of truck traffic. That was an excuse for the big fleet owners to rip off the workers, to convert them into these little mini businesses that own their own trucks and cannot afford to compete. It's a tragedy for them. They need sympathy and understanding. Then they'll go in the direction we want with their demands and not be drawn to the other side. The left that doesn't have its own position that simply endorses wholesale government hostility to and repression of those truckers will make no friends among them. And remember, the convoy is a tiny minority. The truckers we're really talking to are the vast majority who are vaccinated and who are watching to see what happens with that convoy and who takes what position in relationship to it. We've come to the end of the first part of today's show, and as always, I want to say thank you to all of you whose support makes this possible. To learn more about all of this, go to our website, Democracy at Work, where you can see our activities, buy the books we publish and subscribe to our YouTube channel and so on. It's been a pleasure as always. Stay with us. We'll be right back. Welcome back, friends, to the second half of today's Economic update. I am very happy and proud to bring back to the microphones and our cameras Rob Robinson. He's been a guest on this program before. You've asked to have him come back, and here he is. Rob is a formerly homeless community organizer and activist based in New York City. His work focuses on changing people's fundamental relationship to land and and housing. He works with social movements around the world. He's the US Canada coordinator of International alliance of Inhabitants, an alliance of 12,000 members worldwide which supports a zero evictions platform. He lectures regularly at several universities and law schools. He is currently an adjunct professor of urbanism and in the Design and Urban Ecology program at Parsons New School University in New York City. So, first of all, Rob, thank you very much for taking the time to join us today.
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B
Thank you for the invitation.
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Good. Let's jump right in. Everything I read tells me that there is a housing crisis in the United States today. Whether you look at homelessness or the incredible increase in rents or the rising cost of housing if you're able to afford a mortgage and all the rest, it's kind of overwhelming. And I want to begin by asking, how bad is it in terms of where you sit and how you see it? Is there a storm coming of people needing housing but either being unable to get it or unable to afford or what they're required to pay for it?
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B
So, Rick, I'd respond to that by saying there's been an ongoing storm. We've always had a housing crisis in this country, and particularly amongst people who were in the lower economic scale. It's been a challenge for people of color to achieve a mortgage, to achieve housing. And I think there is somewhat a myth behind housing that still exists in this country and is a big part of the problem, and that is housing is the way to Wealth. Owning a home is the way to wealth. I think what we've seen, Covid, has exacerbated an ongoing issue and has really pushed to the forefront the number of people that are underwater. And by that I mean 50% or more of their income goes towards securing housing. It's an ongoing problem, and it's a problem that we haven't been able to find a solution for.
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You know, it's remarkable listening to you. One of the most successful housing stories in the modern world is the story of Vienna, Austria, where half of the housing in that city is public, either publicly owned rental housing or publicly subsidized. Half is private, half is public. But because of the enormous power of the public, they shape the rents anybody can get because everybody has an option to go to a public housing. And in the public housing, there's a rule in the law, you cannot be charged for rent more than between 20 and 25% of your income. And that is not violated. And what that means is they don't have the problem you just identified here in the United States. Is there anything going on in this country now to try to deal, for example, with the inordinate cost of housing for people at a time of rising rents and an inflation? I mean, it really is overwhelming. But is anything going on that might begin to address this?
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So I think many of us, people like myself, activists, some policymakers, and even some legislatures are looking at that Vienna model. We know that public housing, which we've had in this country, which came as a result of the Depression, was the way to give people a decent, affordable and dignified place to live. But our government has been stepping back from that responsibility. We need our government to take that responsibility back on again. Social housing works, public housing works. We have the models all around the world now. There are some cities that are pushing models. I think the biggest problem of Ulrich is the commodification of land and housing. Until we can remove land from a market system, that's the only way that we're going to be able to maintain the cost of housing. So what do I mean by that? There are different models. There's community land trust is probably the predominant model right now, removing it, giving a community land in perpetuity for 99 years. And on top of that, you build mutual or cooperative housing. We've seen models work, but we don't have enough of them. And we don't have enough of them because of this belief that the market is going to solve all of our problems when we know it can't.
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Again, it always blows my mind. People don't want to face the fact that if you allow a capitalist enterprise to enter and do something, what you're inviting is an enterprise that tells you they don't hide it. We're in this business to make money. We're in this business to have a profit on our bottom line. And by bottom line, they mean that's our number one goal. Okay? That means they're not in there to provide housing for human beings. That as part of a community's commitment to one another, they're not there for that. They're not even claiming to be there for that. You have the people who defend them saying, well, by some magic, we're supposed to believe that if it's good for profits, well, it's good for everybody. But we know very well that we've had a profit driven housing system. And yet you have to tell us what you're just now telling us. All right?
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And I think the big part of that, Rick, is the narratives, the prevailing narratives that housing is the way to wealth. And so many people in society believe that, right? So me as an African American, knowing the history of struggle for people of color, when I go into an African American community and say housing no longer is the way to wealth, that's an old narrative that we have to change. People look at me and they've absorbed these narratives so deeply, you can't tell them otherwise. And I agree with you. Capitalism has told you there's no compassion in capitalism. But when I get in front of people, they ask me why? Why did they do this to me? Because it's all about greed. They want to satisfy their own needs. They don't care about you. And I. I think a big part of this is education. I've been blessed to be surrounded by theorists, Marxists, anti capitalist theorists that have helped shape the way I think about housing. But it is hard to get a big section of the society to think about that. I do think there's a shift. Things are changing, things are getting better. But it is a narrative that we have to keep. We have to keep pushing out and recreating new narratives, which is why I actually became an activist. I was like, okay, I'm not believing that same thing around homelessness. I'm formerly homeless, as you read my bio, to open it up. And people will give you these reasons why people are homeless. Well, none of those reasons fit me. That's the prevailing narrative. Then I need to change that narrative, right? I'm different than what you're presenting, right? And I think that's a big part of this. We have to find a way to educate the masses and really get them to understand this.
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A
Well, I want to pick up on one point you made. It seems to me, and please correct me if I've got this wrong, that in many ways, African Americans were the last ones that were able finally, at least in some numbers, to become homeowners, to buy a home, to get a mortgage from a bank and all of that. And then we watched in the aftermath of the so called Great Recession of 2008 and 9 that these last ones to get it were the first ones in massive ways to. To lose their homes. How has the housing crisis of the country impacted in particular the African American community?
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It has impacted them deeply. As you said, they bought into the narrative, they bought homes. Let's say you bought a home in the late 1990s, then all of a sudden, here comes this 2008 economic crisis and all the equity you built up was suddenly sucked out. And don't forget, we have a history in this country of things like redlining, predatory lending. So there were a lot of those folks who were given mortgages that would probably set them up to fail unbeknownst to them. And just because we don't have maps and banks with red lines along them anymore doesn't mean the person can't go on a computer screen and get the same type of information, right? Technology a little bit different. We didn't have computers back when redlining was predominant and red lines were up on the wall, but they have computer maps right now. So they're interviewing a prospective tenant or a client to take a mortgage, and he's looking at a computer screen. Oh, you're from East New York, Brooklyn. I got to give you a predatory loan, Right. So you set the person up to fail. But I think we saw in a very clear way that that equity was taken away from folks after 2008, 2009. And I think what the big mistake that a lot of us have made, including activists and organizers, is fighting for principal reduction on mortgages that will give you some immediate relief. And the big argument was reduce my principal to the actual value of my house now, because since the financial crisis, it's not worth 300,000 anymore, it's worth 200,000. Banks can create those situations that benefit themselves anytime they want. So if you fight for principal reduction, they give it to you, and they gave it to you pretty easy after 2008, which means they can regenerate another crisis anytime they want. We need to understand that. We need to change that fundamental relationship that we have with land and housing. And as a market commodity, it doesn't work for a lot of us. We need to understand that. And we need to understand the meaning of that in a city like New York. And I see that beautiful building sitting behind you. Air rights are for sale. And that tells you how bad commodification is. If you want to go up $500 a square foot, you can go up as high as you want. It is really insane. And what is happening with the market will never solve our problems. It'll only dig us in deeper holes. And I think to wrap this up neatly, you asked a question at one point about Vienna where he says, the government says you should only pay about 20 to 25% of your income for housing. Our government says 30%, but I led you to say that 40. There are many people in this country that take 50% of their income for housing. They're underwater. Right? They're buried by this process.
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You know, I can add, just because I'm an economist, I can add another dimension that people should be alerted to. Private equity funds and hedge funds have been moving into the housing business in a big way for at least 10 or 15 years now, buying up houses that are being foreclosed by banks on people who can't maintain their mortgages, and then reorganizing them as rental properties. Which means that for folks, it's never been more true than now, what you said, they've got to break their narrative. Because what they're now doing without knowing it, is if you're a homeowner of a private single or two family house, you have a new competitor. You don't just have other people like you that have houses. You have an enormous investor backed by huge, big banks that are heavily invested, and they can drop the price for six months. They'll survive, you won't. And they'll then buy your house from you at a depressed price. And that's what capitalists have always done to one another.
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B
And.
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And that's what those guys are gonna be doing in the years ahead. And makes it even more true what you said. Okay.
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B
And a little bit of Rick I'd like to name and shame, Blackstone Equity Partners leads that parade. Right? They own the most housing in the world. Right. And they do it just for that, for real estate Investment Trust, for REITs. So, you know, let's name and shame whenever we can.
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Absolutely. All right, last question. And we're really running out of time in that terrible fire in Baltimore a few weeks ago. One of the statistics that jumped out at me was the fact that the fire commissioner there said that the fire happened in an abandoned building and that there were 15,000 abandoned buildings in Baltimore, or at least in that section of Baltimore. Is there a way to repurpose abandoned buildings to so as to create public housing at a much lower cost?
- [27:34]
B
Argument I've been making and others like me have been making for years. I came from a group in New York called Picture the Homeless, which actually did a vacant property count in 2006 and again in 2011 and found that there was enough vacant property in New York City to create apartments for the 50,000 people that were in shelter every night. So it's thinking outside of the box, a reinvestment of the money. New York City spends $1.2 billion a year to temporarily house people in shelters. I think cities like Baltimore have the same problem. Maybe not to that degree, but yes, I totally agree with you. There needs to be thinking outside of the box. How can we take these vacant spaces and create permanent new housing to New York's credit hotels that have closed since COVID There are big conversations happening now at a pretty high level to turn those vacant hotels and purchase those from the hotel owners to turn them into apartments. We really need to push these types of ideas.
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Rob, as always, we've come to the end of our time. I want to thank you enormously for sharing what you have to say. The housing crisis is an enormous kind of hatchet sitting over this whole country without people being willing to face it. Thank you again very much and you thank to all of my viewers and listeners. I hope you learned from today's program and as always, I look forward to speaking with you again next week.