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A New Golden Age of HUD Hokum 
by James Bovard

The Trump administration effectively condemned the downtown Washington, D.C., headquarters of the Department of Housing and Urban Development (HUD), portraying it as unfit for federal workers. HUD Secretary Scott Turner announced: “It is time to turn the page on the Weaver Building and relocate to a new headquarters that prioritizes the well-being of HUD employees and properly reflects the passion and excellence of our team.”

HUD posted a video exposing the ramshackle condition of its existing headquarters in D.C. and touting its new much fancier offices in Alexandria, Virginia. The video took its title from Secretary Turner’s promise of “The New Golden Age of HUD.”

And if you believe HUD will have a Golden Age, I have some bridge in Brooklyn I will sell you at a fire sale price.

The Trump administration is seeking to sell HUD headquarters of the Department of Housing, which Secretary Turner says is “the ugliest building in D.C.” The Trump administration talked of terminating half of HUD’s staffs but fell far short of their lofty goal.

LBJ’s Great Society

HUD has vexed America since the launch of Lyndon Johnson’s Great Society. Irving Welfeld, a long-time HUD employee, noted in a 1992 book: “When the urban riots of the late sixties occurred, it was more than coincidental that in many cities the centers of the disturbances were in public housing projects.” The National Journal reported in 1971, “The Federal Housing Administration … is financing the collapse of large residential areas of the center cities.” In 1973, President Richard M. Nixon bemoaned: “All across America, the federal government has become the biggest slumlord in history.” In 1975, the Chicago Tribune howled: “No natural disaster on record has caused destruction on the scale of the government’s housing programs.” In 1976, Detroit City Council president (and future U.S. senator) Carl Levin denounced the agency as “Hurricane HUD” for ravaging the Motor City with reckless subsidized mortgages with stratospheric default rates. June Ridgway of the Detroit Board of Assessors declared, “HUD has cost every citizen in Detroit 20 percent on his house,” due to a general decline in residential property values. By decimating housing values, government housing policies effectively destroyed much of the life savings of the average Detroit family.

HUD in Laredo

Jacob Hornberger, the president and founder of the Future of Freedom Foundation, gave HUD a black eye in Texas in the late 1970s. After Hornberger bought his first home in a new subdivision in Laredo, HUD announced it would build a new housing project right next to the subdivision to “relocate poor people from the poorest parts of Laredo … to mix with ‘the rich’ and provide them with the incentive to become ‘rich’ themselves.” But most all the homeowners in the new subdivision had themselves grown up poor and had just purchased new homes that were their biggest asset. Public housing projects were notorious for spawning crime and lowering nearby property values. At the time of the HUD announcement, Hornberger relates, “I had discovered libertarianism and understood that the worst thing that could ever be done for the poor was to have the government try to eliminate poverty.” Hornberger took the lead in organizing protests against the HUD project, testifying locally and even placing an ad in the Washington Post.

Hornberger notes in his memoir My Passion for Liberty, “We carried out a very public protest with signs at the Alamo informing people of HUD’s tyrannical conduct.” Hornberger received an invitation from the chairman of the House Committee on Banking, Currency, and Housing to testify on the controversy; he accepted the invite but was ghosted on Capitol Hill, hearing nothing back. Even though 99 percent of the homeowners in the projects were Mexican-Americans, the advocates of the HUD project hurled the nastiest epitaphs you can ever imagine about how opponents of the project hated the poor and were a bunch of racial bigots.

HUD won that battle and built that project — the same way it trounced local opposition almost everywhere in the nation. Because HUD was a federal agency, it never had any liability for the damage it inflicted on homeowners and neighborhoods across the land.

A poster child for failed government

HUD Secretary Henry Cisneros admitted to Congress in June 1993: “HUD has in many cases exacerbated the declining quality of life in America.” During the 1990s, I spent many days at HUD headquarters investigating boondoggles. HUD was overstocked with the most depressed employees you would ever meet outside of a group therapy session in a city jail. After I wrote a Wall Street Journal piece headlined, “Clinton’s Wrecking Ball for Suburbs,” HUD Secretary Cisneros denounced me for “unfortunate stereotyping of assisted-housing residents.” But two years later, Vice President Al Gore denounced HUD-financed public housing projects: “These crime-infested monuments to a failed policy are killing the neighborhoods around them.”

Andrew Cuomo, former New York governor and Bill Clinton’s last HUD Secretary, admitted in 1998 that HUD had been “the poster child for failed government.” The following year, the Washington Post confirmed that verdict: “For three decades, HUD has been a notorious symbol of welfare-state government run amok, better known for sweetheart deals, wasteful programs, and bad management than for improving the lives of the poor.” But Cuomo triumphally claimed to have fixed HUD and turned it into a model agency. In late 2000, Cuomo boasted, “We installed 89 computer kiosks in 47 states that allow people to get information about HUD services and products at the touch of a screen, 24 hours a day.” That’s almost as good as not wasting tax dollars, right?

Cuomo took a victory lap, bragging that “if you can fix HUD, you can fix any government agency.” He blathered: “We married the progressive values of Thomas Jefferson, Bobby Kennedy, Martin Luther King Jr., and Mario Cuomo with the [endless federal spending] means of the New Millennium.” HUD Inspector General Susan Gaffney declared that Cuomo’s constant reform initiatives “had a crippling effect on many of HUD’s ongoing operations.” Gaffney warned in 2000: “Vacant, boarded-up HUD-owned homes have a negative effect on neighborhoods, and the negative effect magnifies the longer the properties remain in HUD’s inventory.”

Cuomo also boasted of “creating a new social compact.” Exhibit A was streamlining the Federal Housing Administration by “consolidating 81 field offices into four homeownership centers. Through automated underwriting, we reduced the time needed to process a loan from weeks to a just a matter of days.” Cuomo also championed subprime mortgages, helping pave the way for the 2007+ housing collapse that ravaged the net worth of black and Hispanic households. “The implosion of the subprime lending market has left a scar on the finances of black Americans — one that not only has wiped out a generation of economic progress but could leave them at a financial disadvantage for decades,” the Washington Post noted in 2012. The median net worth for Hispanic households declined by 66 percent between 2005 and 2009. In a 2004 Barron’s op-ed, I described federal mortgage policies, programs, and mandates as “wrecking ball benevolence” — a phrase that was quoted in a 2017 federal appeals court opinion. In 2006, the leftist Village Voice labeled HUD as America’s worst landlord.

Scandal, corruption, and crime

Gross negligence has always been HUD’s standard operating procedure. Almost every effort that HUD launched to directly finance home building turned into a scandal of biblical proportions from the 1960s onward. At a 2011 congressional hearing, current and former inspector generals recounted story after story of HUD being clueless about where its money went.

HUD’s Section 8 rental subsidies are notorious for scattering crime across cities and suburbs. At least 30 people were killed at Section 8 residences in Chicago during the first half of 2016. The Chicago Sun-Times and Chicago-based Better Government Association “matched the addresses of Section 8 housing in Chicago against the city’s online crime database” and found that for the first six months of 2016, “police responded to reported crimes — from thefts to homicides — at 7,379 addresses where at least one voucher-holder lived.”

A HUD-financed study found that Section 8 relocations had “tripled the rate of arrests for property crimes” among boys who moved to new locales. In Houston, male Section 8 recipients are twice as likely to commit violent crimes as people with similar backgrounds and incomes who did not receive housing vouchers. A Texas A&M University analysis attributed the “increase in arrests for violent crime” to “the additional funds and leisure time available to voucher recipients that can be used to commit crimes.” The analysis noted: “Moving to a better neighborhood … could increase crime by providing easier and wealthier targets.” Russell Vought, Trump’s Office of Management & Budget chief, derided Section 8 because it “brings with it crime, decreased property values, and results in dependency and subsidized irresponsibility.”

In 2015, riots erupted in Baltimore, and HUD didn’t receive the credit it deserved for paving the path to that looting epidemic. Federal housing subsidies have long destabilized Baltimore neighborhoods and helped create a culture of violence with impunity. Baltimore’s housing projects, like those in many other cities, became cornucopias of crime. One 202-unit sprawling Baltimore subsidized housing project was known as “Murder Mall.” In the 1990s, the Baltimore Housing Authority began collecting lavish HUD subsidies to demolish public housing projects. But critics complained that HUD was merely replacing “vertical ghettos with horizontal ones.”

Baltimore was among the first cities targeted for using Section 8 vouchers to disperse public housing residents. Almost 10 percent of Baltimoreans were placed on the federal housing dole. Ed Rutkowski, head of a community development corporation in one marginal Baltimore neighborhood, labeled Section 8 “a catalyst in neighborhood deterioration and ghetto expansion” in 2003. Reckless federal mortgage lending also bludgeoned the city. In the late 1990s, more than 20 percent of FHA mortgages in some Baltimore neighborhoods were in default — leading one activist to label Baltimore “the foreclosure capital of the world.” The feds continued massive negligent mortgage lending in Baltimore after that crisis, helping saddle Maryland with the highest foreclosure rate in the nation by 2014.

Social injustice

When Congress created HUD in 1965, it was supposed to bring social justice to American cities. But Sandra Thompson, Biden’s Federal Housing Finance Agency chief, testified to Congress in 2022 that the racial homeownership gap “is higher today than when the Fair Housing Act [of 1968] was passed.” The Biden administration sought to “fix” that problem with a new mandate to punish mortgage borrowers with good credit ratings by forcing them to subsidize borrowers with shaky records of paying their bills. But “No Deadbeats Left Behind” is a poor maxim for mortgage policies.

Secretary Turner says that HUD’s focus is on “creating a workplace that reflects the values of efficiency, accountability and purpose.” But no one in the Trump administration has a Midas touch that can turn bureaucratic crap into public service gold.

A real Golden Age

HUD’s faltering headquarters could be far more valuable for a symbolic gesture than for a real-estate payout. Trump should take a page from the most dramatic housing intervention of the last 60 years. In 1954, St. Louis opened one of the nation’s largest public-housing projects, with 33 high-rise apartment buildings. But the Pruitt-Igoe project soon became hopelessly marred by crime and vandalism. The 1972 film footage of the entire project being demolished should have been required viewing in every high school civics class in the nation.

A heavily publicized demolition of HUD headquarters would provide a more valuable lesson for Americans than any sale price the faltering building would fetch. For sixty years, HUD reaped massive congressional appropriations regardless of the havoc it sowed. Razing HUD would remind all federal agencies that failure has consequences. And seeing HUD headquarters topple down would gratify everyone who wants to drain the D.C. swamp and everyone whose home value or neighborhood was blighted by HUD.

Rather than a “golden age of HUD,” we need a new Golden Age of Freedom. Moving HUD bureaucrats to a different building is not the same as ceasing the ravaging of homeowners and neighborhoods from sea to shining sea. Abolishing federal agencies and radically reducing the sway of Uncle Sam across the land are vital steps toward a new Golden Age.