[OPE-L:5361] Re: Re: Re: Re: Re: the bursting bubble and the U.S. working class

From: Gerald_A_Levy (Gerald_A_Levy@email.msn.com)
Date: Thu Apr 19 2001 - 09:35:40 EDT

In this post I want to consider one dimension of
the upcoming crisis --  a housing crisis for the U.S.
working class.

The growth of indebtedness by the working class,
due in part to increasing credit card debt,  and the
loss of savings, due in part to losses incurred on 
the stock market -- together with an increase in the
size of the industrial reserve army that will 
accompany the crisis -- must manifest itself in part,
imo, as a housing crisis for the working class.

Let's consider possible scenarios:

1)  Workers are unable to pay back mortgage
loans and lose their homes (whether those are
houses or condominiums, etc.) when banks
foreclose. Relatedly, cities might take over their
homes if they are unable to pay property taxes
on their houses.

2) Workers are unable to pay their rent on
apartments or buildings owned by landlords and
real estate companies and are eventually evicted.

3)  Workers are unable to pay rent on publicly-
owned apartment buildings and are evicted.

In all three of the above cases, one probable
outcome for a substantial number of workers
is to move in with  relatives and/or friends. In
cities where rents have been increasing this can
be already observed as a long-term trend. 
Sometimes these individuals without housing of
their own but living as "guests"  in other people's
homes are referred to as the "disguised homeless":
i.e. individuals who are homeless but don't show
up in official statistics on the homeless.  For both 
the individuals who have lost their housing and 
now share living space with others and for the 
others who previously occupied housing which 
was occupied by less individuals, the result is the 
same: a decrease in the customary standard of
living of the working class. 

Some workers don't have relatives and/or friends
that are in a position where they can take them 
in, and they become (officially) homeless.

Since most cities in the US mercilessly harass
the homeless, this is an option that has serious
risks. The alternative provided by some cities
-- the shelter system -- is often more dangerous
than living on the street with increased risk of
robbery, rape, and disease (such as TB). In the
Northern part of the US, it is not unheard of for
homeless individuals to freeze to death during 
the winter. 

What then are the alternatives (to moving in with
friends and/or relatives or being homeless whether
on the street or in homeless shelters)?

a) increased expenditure by the government
on public housing. Due to the current political
climate in the US, I view this as the least likely
alternative.  If it were to happen, it would surely
require a massive upsurge by the working-class
demanding housing: "Housing is a right". Even if
such a movement eventually leads to the 
construction of new public housing, it is highly 
doubtful, imo, that the quantity of new public
housing would satisfy the housing requirements 
of  the working-class poor. Moreover, even if it
were to happen, there would surely be a 
significant time lag due to the time required for 

b) the organized labor movement and community
organizations could organize an "uneviction
movement".  Unevictions can take place when 
the police are prevented physically from carrying
out an eviction or when after an eviction the
 former residents are immediately moved back
 into their old housing. This is a tactic which has
had limited success in some countries and cities,
but it requires a high degree of dedication, 
militancy, and solidarity. I don't expect this to
be a possibility in most cities and regions in the
US in the immediate future.

c) Squatting. This itself can take different forms.
In the US in recent years, it has primarily meant 
moving into abandoned buildings (generally owned
by cities for non-payment of taxes).  Or,
a group of individuals can [illegally] occupy land
that they could then build their own shelters on 
(which are generally make-shift and non-
permanent). In either case, these could be 
organized as collectives or co-operatives. In just
about all cases in the US,  squatting has met fierce
resistance from the state and banks and real
estate developers. In some cities, especially NYC,
there have been massive confrontations when the 
police attempt to evict squatters. The one "bright
spot" [!] here might be that the crisis will so 
depress real estate values in some communities that
these forces will not be as strident and immediate
in moving against these communities. [On the
other hand, when the "boom" follows and real
estate prices go up, watch out!]. For obvious
reasons, then, squatting entails very heavy risks,
including imprisonment and/or loss of all valuables.

Taken together, I guess I have painted a pretty
bleak picture, huh? 

A working class radicalization is, of course, a
possible consequence of the crisis. If that happens
-- and of course there is no guarantee that it
will happen in the immediate future -- then possible
options for the working-class that seem unlikely
under present circumstances may become more

Am I being too "pessimistic" above or do you
believe that it is a "realistic" assessment of the
current situation?

Of course, the above critically depends on the
assumption that the US economy will descend
into a severe "slump".  It might not. Or, even
if there is a slump, it might not be as severe as
predicted by Steve K and others. Is the US 
economy at the edge of a cliff or will there be
a relatively minor short-term "adjustment"?

In solidarity, Jerry

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