Some seven hundred and eighty-six municipalities in the United States boast of city planning commissions whose purpose, broadly defined, is to make the cities better places to live in. The mere existence of such commissions suggests that the municipal governments are conscious of deficiencies in their towns and desirous of removing them, Thanks to official city planning, we can now point with pride to civic centers with Art on axis, surrounded by monumental public buildings in the Federal Reserve style; to extensive and verdant parks; and to four-lane boulevards on which, in spite of the ever increasing volume of traffic, one may ride as fast as one can walk. There is hardly a city in America but has, as an integral part of its city planning, a zoning ordinance that seeks to stabilize and protect neighborhoods by regulating the size and type of buildings which may be erected.
If such achievements were the goal of true city planning, it could be called successful. There is no doubt that the appearance of, and movement through, our cities have been greatly improved since city planning was given official benediction. But is a city primarily something to look at, something to drive through? Is it not rather a place to live in? Can any city planning be ranked as successful that does not materially improve living conditions?
Ninety-three cities in this country have a population in excess of one hundred thousand, and the total population of these cities is about thirty-six million. To the majority of that sizeable number, urban life is increasingly unattractive. Those who can pay an “economic” rent are unable to find satisfactory quarters within reasonable distance of the center of the city. To enjoy even the most nominal amenities, they are forced to move to the edge of the city or even to the suburbs. The poor take what they can get—unsanitary, even unsafe, flats in blighted and congested areas, built up from twenty to fifty years ago and, since that time, neither rebuilt nor repaired.
Because these conditions pertain so universally and are familiar to so many millions, they are accepted as unalterable. Yet it has been stated that every family now living in New York City might have a detached house and garden within the city limits if the city could be wisely replanned. There is a goal for city planners: it is impossible to reach, of course, but if they could accomplish one tenth—one thousandth, even—of the journey, they would find themselves on the way to real city planning.
But the planning commissions have, until recently, not dared to face this, the most vital phase of their problem. They were official bodies and thus restricted, in a laissez-faire system, to activities that complied with the accepted definition of government function. Concern for the housing of the citizens was beyond their province. Even what may seem to some as their fundamentally inconsequential contributions have not been made without serious opposition. Such a now universally accepted regulation as zoning was as late as 1926 the subject of bitter controversy in the courts, carried up to the Supreme Court and there passed on, but not without three dissenting votes.
Yet if official planning commissions, whose problem it should be, have been powerless to tackle housing, that is not to say that it has been entirely neglected. To the average layman, the number and size of housing developments in the big cities, socially conceived and with the profit motive consciously soft-pedaled, might not be impressive. There are probably not fifty, housing fifty thousand persons, in the country. Yet because every one is the result of someone’s conscientious attempt to better existing conditions, that handful is extremely interesting. The vast majority have been constructed by individuals, corporations, or foundations, acting (according to their interpretation of it) in philanthropic interest and without benefit of government aid in any form. They have in the mass offered a satisfactory demonstration of the limited extent to which unsubsidized effort, however well intentioned and ably administered, can solve the urban housing problem.
It is not necessary to tabulate and analyze the results of all these experiments. Whatever the basis of approach to the problem—and it has varied from the socialism of the Amalgamated Clothing Workers to the paternalism of John D. Rockefeller, Jr.—these experiments, lumped together, make a composite picture from which each one, individually, differs only in small detail. In a brief history of one project, Sunnyside, New York, we may view in its best light the achievement of private enterprise.
In New York, in 1924, a group of prominent and civic-minded persons, led by Alexander M. Bing, formed what was known as the City Housing Corporation. Among its directors was Mrs. Roosevelt; Governor Lehman was one of the largest stockholders. Its purpose was to promote, supervise, and operate low-cost housing projects in the New York area. Its first venture, financed by the sale of stock with a return limited to six per cent, was Sunnyside. On a seventy-acre tract in Queens, at fifteen minutes by subway from Grand Central Station, the corporation proposed to erect detached houses with gardens and large open park spaces and to sell them to persons of modest means. Messrs. Henry Wright and Clarence S. Stein, who proved themselves in this and subsequent projects to be the foremost housing technicians in the country, were retained as architects. Their first move was to alter radically the existing block layouts, so to dispose their buildings that only thirty per cent of the land was covered and seventy per cent was thus saved for parks, gardens, tennis courts, baseball fields, and playgrounds. They designed simple and well-planned two-story houses, some for single families, some for two and three families. In further development of the site, apartment buildings were added. The physical layout of Sunny-side, at the time considered unorthodox, has served as a model for most subsequent housing projects and a surprising volume of commercial building as well. It is the logical application of conclusions derived from the study of two vital but seldom considered factors: first, accurate determination of the class to be housed; and second, thorough knowledge of the way of life of that class.
Financing at Sunnyside was offered on liberal terms. A ten per cent down payment, amounting in most cases to less than a thousand dollars, secured title to a house of living room, dining room, kitchen, three bed rooms, and bath, and all communal amenities. Carrying charges ranged from eleven dollars per room per month, down. Rents in New York can be assessed only in relation to income, which is higher than elsewhere. These were low rents for New York. The judgment of the City Housing Corporation can be appreciated from the fact that, starting modestly in 1924 with homes for 128 families, they were able to build in 1925 for 227 additional families; in 1926, for 295; in 1927, for 357; and in 1928, for 224. The experiment has, it is evident, been an unqualified success.
What kind of people own these homes and rent these apartments? Are they the slum dwellers whose health, happiness, and morals are prejudiced by deplorable housing conditions? No, unfortunately, they are not. They are, to a large extent, white-collar workers whose incomes average two thousand five hundred dollars per year. If mechanics compose the largest single class, the bulk of the population is made up of office workers, tradesmen, professional men, salesmen, and government employees. The men who planned Sunnyside accomplished what they set out to do. Idealistic they were—let no one doubt that—but they were also, fortunately, realists who were thoroughly aware of the limitations imposed on their work and who cut their cloth accordingly. Other projects: those built by the Amalgamated Clothing Workers; Paul Laurence Dunbar Apartments, Thomas Garden Apartments, Rockefeller Institute Apartments, Bayonne Apartments, and Forest Hill, all built by John D. Rockefeller; the Metropolitan Life Insurance Company’s apartments; Chatham Village in Pittsburgh; Michigan Boulevard Apartments and the Marshall Field Garden Apartments in Chicago—to name only a few of the most conspicuous—present approximately the same picture. But Sunnyside, created with idealism, sagacity, and liberality, is a perfect monument to the enlightened achievement of private enterprise.
From the brief description of Sunnyside, certain conclusions can be drawn, and these conclusions will apply as well to every housing development in America built and operated by private enterprise. First, a definite technique of planning has been established. The tenants of every development find their quarters infinitely superior to anything offered by strictly commercial builders at the same price. The rooms are perhaps smaller, but apart from this their apartments compare favorably with those of Park Avenue; their houses, with those of Westchester; and as a rule the community life is definitely better. Second, the class that has benefited from these experiments is one that can afford, if it does not prefer, to live in new dwellings commercially built. The rents required to make these developments pay out, put them beyond the reach of that overwhelming majority which so desperately needs better housing.
Probably the first impulse of those who contemplate an adventure in planned housing is to “do something for the poor,” in some way to ameliorate the lot of those whose shanty dwellings are such a constant and distressing reminder of wretched conditions in our cities. They soon learn from cold figures why, under a system of rugged individualism, nothing is done for these people. Money costs too much; land costs too much; building costs too much. They are forced, with varying degrees of regret, to climb the economic scale, to plan for families whose income should not fall below two thousand dollars a year. Yet we are told that, even in lush years, eighty-six per cent of all wage earners make less than two thousand dollars a year. In the cities incomes are, of course, higher than in rural areas. But even in the cities, in the Coolidge era, surveys showed that two thousand dollars a year was well above the average income. It is obvious then that even the most modest accommodations in the housing developments are beyond the means of the majority. Excluded of course are the vagrants and the unskilled, sporadic workers; but along with them the door is shut to millions of self-respecting, hard-working people who, through whatever handicap, can not make the economic grade. To reach even a small proportion of that class with new and decent housing, some substantial paring of costs or subvention is necessary.
Building costs are admittedly high; in many trades they have more than doubled since before the war. These increases make it difficult to construct new buildings that can compete in rent with pre-war dwellings. Yet to lament this fact is futile; it is a condition not likely to change and therefore one which must be squarely faced. In any case, housing rents have not been made prohibitive by high construction costs. Analysis of constructed projects shows that by having cut building costs in half, the rents could not have been reduced much more than fifteen per cent.
The greatest obstacles have nothing to do with construction. Truly low-cost housing has been impossible because suitable land could not be found in quantity and at reasonable prices and because building loans at less than six per cent could not be made. The land problem was well-nigh insoluble; for land adaptable to a low-cost housing use was usually held in small parcels and at high prices (pegged not only by speculative hope but also by over-optimistic zoning and tax-assessed valuation). To acquire sufficient property, parcel by parcel, and, in the process, not to precipitate a real estate boom; or to find it already assembled at anything like a reasonable price, except in outlying districts, was a hope never realized. The price was always far beyond that justified by its intended use.
Money could never be borrowed at less than six per cent and little of that could be found in the days when investors were promised from ten per cent up on building loans. It is easy now to point out that those who put their money in housing are still clipping their coupons regularly while the backers of office buildings, apartment hotels, and the like, have sadly written off not only the interest but, in an appalling number of cases, the principal as well. In the Coolidge era six per cent was simply not considered sufficient return for the supposed risk involved. And yet truly low-cost housing cannot pay even a six per cent return!
Building costs can not be effectively cut and the price of land is always an uncertain quantity. The only sure means of cutting rents is to reduce interest charges. It is interesting to note that analysis of a development in Chicago made by Mr. E. H. Klaber, the present chief of the technical staff of the Housing Division, P. W. A., shows that a reduction of one per cent (from a base of six per cent) in interest charges would have the same effect on rents as if the land had cost nothing, or building costs had been reduced 14.5 per cent, or union wage scales had been cut 33.3 per cent. The effect is considerable 1
These stumbling blocks were apparent years ago. Among civic-minded persons who took housing to heart, the suspicion grew that private enterprise, operating without government aid in some form, could do nothing to remove them. In 1926 a few of them, ably supported by Governor Smith, succeeded in getting through the New York State Legislature a State Housing Law. Although hailed in some quarters as the most important social legislation of the century, it was far from being unanimously acclaimed. Owners of property adjacent to proposed developments, realtors, banks, investment houses, and individuals who held mortgages on properties that might be adversely affected by the government-aided projects, opposed it bitterly and strenuously. Every attempt to pass housing legislation through legislatures or city councils has been contested by a similar line-up of interests. In almost every case the “pro’s” have prevailed, but only over a good many dead bodies. The “con’s,” if they have not been able to kill the bills, have frequently enjoyed the equal satisfaction of emasculating them in committee.
The aid offered in New York City is briefly this: housing corporations that limit their dividends to six per cent are free from state and local taxes on buildings for a twenty-year period. In return for this concession, their rents are regulated and their operation closely supervised by a state housing board. While the indirect subsidy is not large and the impetus to housing construction inconsiderable (money for building has been for five years non-existent, whatever the inducements), this law was the envy of housing propagandists in every state. Yet their efforts to match it were in vain until 1932.
In the Federal Emergency Relief Act of 1932, someone —rumored to be Senator Wagner of New York—inserted a rider to the powers invested in Mr. Hoover’s Reconstruction Finance Corporation. The R. F. C. was authorized to loan money to states or municipalities having housing laws, for the construction of low-cost housing or for slum clearance. Immediately the lobbyists swarmed into the state capitols. Committee rooms became the battleground where “pro’s” (more rabidly “pro” than ever before) fought savagely with “con’s” (even more “con” than hitherto) for the allegiance of statesmen whose only interest in the struggle was, as always, to line up with the side controlling the most votes, Out of the many skirmishes, a small number of states, Massachusetts, Ohio, Texas, Michigan, and Illinois, to name a few, passed housing laws. These laws hadn’t many teeth nor much power (thanks to the “con’s”) but they were laws and the states thus blessed qualified for R. F. C. loans. For whatever reason, when Mr. Hoover went out of office seven months later, not a penny had been loaned. Yet the idea of Federal loans for housing was growing in favor. Even the most conservative admitted that, in financing housing to stimulate construction, the government had at least a sporting chance to retrieve its investment, whereas with most created public works it might as well throw its money down the nearest sewer.
Thus the country was prepared for Mr. Roosevelt’s positive attitude. He had, as governor of New York, four years’ experience with state housing and was known to be sympathetic towards government participation. Soon after his inauguration he set up the Housing Division of the Public Works Administration with Mr. Robert D. Kohn, past president of the American Institute of Architects and member of the advisory board of the City Housing Corporation, as its chief. On projects approved by the Housing Division, private limited-dividend corporations could borrow up to eighty-five per cent at four per cent interest, public corporations (sponsored by municipalities) were to be given seventy per cent loans and thirty per cent grants. Few cities had the authority to construct projects of the latter type but, within a few months, hundreds of plans for the former were submitted to Washington. Most of them proposed rents of from six to eight dollars per room per month. Six-dollar housing begins to reach the forgotten man. If many of these projects were unworthy attempts by specu-lators to unloacl frozen land, the majority were honestly conceived. Yet few were approved; for in spite of the liberal terms offered and the fact that the government was anxious to loan money, the old bogeys of high land cost and difficulty of assemblage handicapped the majority of projects. The P. W. A. had stressed the need of speed so that men might be put back to work. The time element ruled out the possibility of assembling small parcels of land into large tracts, even assuming that it could be done economically. But most urban land already assembled into large enough tracts lay in areas zoned for industry and was held for factory sites. Low-cost housing on such land must inevitably create new slums, not eradicate existing ones.
The other major handicap was the difficulty of raising legitimate equity money. Although the government was ready to back these projects up to eighty-five per cent, private individuals who would round out the total with real money were few and far between. Perhaps the money was not available, perhaps potential investors imagined a risk that was not commensurable with the return offered. This is not to say that applications were thereby limited. Applicants proposed to take the equity out of fees payable by the government, out of rents, or, like rabbits, out of top hats. The sleight of hand was infinite in its variety and intricacy. It was also discouraging to those who had hoped that they were offering reasonable inducement to private enterprise.
These results served finally to convince the government that it must assume the whole burden, must assemble land and finance one hundred per cent. Early this year Secretary Ickes, who as Administrator of Public Works is also head of the Housing Division, formed the Public Works Emergency Housing Corporation whose function is to promote and supervise the construction and operation of Federal housing projects. The limited-dividend, private-corporation project was definitely abandoned. The Housing Division continues as a technical advisory board to the Corporation.
A fund of a hundred million dollars is available, and the Corporation plans to spend it in approximately thirty cities on two types of Federal projects. In those cities provided by law with a Municipal Housing Authority—that is, an appointed board which has the power to promote, construct, and operate housing projects—a thirty per cent grant on the cost of labor and materials and a loan on the rest, bearing four per cent interest, and 1.51 per cent amortization rates, is contemplated. A small minority of the cities can qualify under this heading at this time. In the others, the Corporation must take the initiative and will make a straight one hundred per cent loan with similar rates. It hopes that in time these cities will pass the necessary legislation to set up housing authorities and take over the responsibility of operation. In every case where local sponsors of projects seem to understand, first, the objectives of the housing program, and second, their local application, they will be given pretty free rein. The work is, however, so new that many have neither a complete nor very clear comprehension of it. In such instances the government is obliged to formulate the local program and guide its progress.
There has been some criticism of the slow movement to date of the housing program. It has been said that few projects have been built, little money spent, and few men put to work; all of which is, unfortunately, true. And it is also true that the program in its present phase will not move rapidly. By its very complex and experimental nature, this is inevitable. The P. W. A. is an emergency administration, and much of its success must lie in the speed with which it puts out money to buy materials and labor. But it must also be clearly understood that the majority of public works projects provide for routine construction—bridges, roads, conventional buildings, etc.—work which, once financed, is cut and dried. Housing, on the other hand, is a tricky, infinitely complicated business, with no precedent in local experience to speed its progress. Every step must be taken cautiously and with deliberation.
The Corporation is determined to spend its present appropriation in so far as possible on slum clearance projects. There are three fundamental reasons for this decision: first, such concentration attacks the worst urban housing conditions; second, it should create no competition with private enterprise, for it demolishes one unsanitary and sub-standard living unit for every one it builds; and third, it does not increase the tax payer’s burden by developing new urban subdivisions with expensive utilities. As a result of this policy the most suitable areas of operation in several cities must be ignored because of exorbitant and unjustifiable land prices; for the Federal government has no desire to exercise its right of condemnation. It will, in so far as is possible, buy its land in an open market.
To those who regard with apprehension such a decision there should be reassurance in the knowledge that until July, 1932, the United States was the only major country whose government did not take a direct and aggressive part in the housing of its poor. Disregard, if you choose, Russia, Austria, Poland, Italy, and Germany. Consider only France, Belgium, Holland, Denmark, Sweden, Norway, and, last and greatest, England. England has had government housing for thirty years, England knights her greatest authority on housing, Sir Raymond Unwin, and England, with the enthusiastic support of the Conservative Party, has lately launched the greatest and most extensive housing program in the history of the world.
The fact is that ours is a very belated and modest entry into the field of government housing. One hundred million dollars spread over the country will hardly make a ripple in the morass of city slums. Yet that expenditure can accomplish three things of supreme importance. It can give to one hundred thousand persons their first real understanding of the word “home.” It can give a measure of hope to the other millions it can not at this time house. And it can point the way to real city planning.