In Britain, there is a broad consensus that we are facing a housing crisis. But beyond that, there’s precious little agreement. On the right, the culprit is planning restrictions and, in particular, the notorious ‘green belts’ around major cities. Meanwhile on the left, especially in the Corbyn wing of the Labour Party, the crisis is generally blamed on foreign investors and profit hungry developers. The problem with both of these assessments is that they are largely economic and insufficiently political. A sustainable, socialist housing programme can’t be built on the simple drive to ‘build more homes’. Understanding how we ended up in this mess requires patient analysis of the different factions involved and their various interests. And so does designing a long term socialist response, which won’t just be reversed by the next Tory government.
There are some important historical lessons we can draw on here. In 1943, the Polish economist Michał Kalecki asked why, given that everyone would benefit, business leaders were so strongly opposed to Keynesian policies of full employment. Full employment would be good for workers, giving them jobs and an income. And it would also be good for businesses, providing bigger markets for their products and smoothing out the shocks caused by recessions. But, despite those potential economic gains, throughout the 1920s and 1930s, business leaders were almost unanimously opposed to full employment. Kalecki tries to unpick this paradox by examining the political consequences of those policies. It was obvious to business leaders that full employment policies would reduce their political power and their class instincts served them well. Keynesian responses to the Great Depression are a long way from 21st century housing policy. But, the lesson from Kalecki is that people’s interests are not always self-evident and that political control can be at least as important as material factors.
A cast of thousands
There are many players involved in British housing policy, each with their own divergent interests: private renters, social renters, Right-to-Buy homeowners, wealthier homeowners and landlords, Local Authorities, central Government, developers and landowners. Some of these have already been the focus of political attention, but others seem to have slipped under the radar. Forging a coalition across these different factions is important, not just for getting reforms enacted, but also for defending those gains into the future. If the goal is affordable, high-quality housing for all, then there are some groups that will never be brought on board. But, understanding the particular interests of our potential allies is going to be essential to building any sustainable coalition.
Let’s start with the various arms of the state. Historically, Local Authorities have been a crucial part of house building in Britain. The legacies of municipal socialism and the various drives to build council homes have also made them the focus for most of the political commentary on today’s crisis. Much of this has concentrated on corruption and the revolving door between developers and councils. Southwark Council in south London has become a metonym for some of the more egregious examples of this kind of behaviour. Out of 11,000 new homes being built in the area, many on the sites of recently demolished council estates, less than 4% are socially rented, far less than their target of 35%. In the meantime, council leaders have accepted expensive gifts from developers and many former councillors and council employees now work for developers. While these are serious issues, they mask two wider structural issues
First, councils depend on the votes of people already living in the areas. The new residents a Local Authority might want to house can’t vote yet. This doesn’t have to be an insurmountable barrier, but it forces us to think about where the drive for future house building needs to come from and what institutions need to be built to give those potential future residents political influence. Second, councils tend to want to keep control of the houses they build. This means that, as the political climate changes, the fate of those homes can hang in the balance. The ease with which Britain’s councils have flogged off entire estates (what’s known as ‘stock transfers’), displacing thousands of families without even a local ballot, is breathtaking. Had those homes been given to local communities, through cooperative models or community land trusts, it would have been far harder to engineer that level of social cleansing and easier to defend what councils had already invested in building. But, a desire for political control often prevented councils from protecting their achievements through different ownership models. This is something the left urgently needs to revisit – especially given the current rhetorical focus on ‘council housing’.
Central government also plays a significant role in housing. As Brett Christophers has recently explained, the pressure to privatise public land and change regulation has largely come from Whitehall. And the financial links between landowners, property firms and the Tory Party make it clear what the real source of that pressure is. But, again, there is a wider structural issue here, which is that homeowners are far more likely to be registered to vote and to actually bother walking down to the polling station to vote. This creates a certain set of incentives for politicians and shapes who they listen to, even for parties on the left.
Different groups of individuals also have very different interests when it comes to housing. Private renters want lower rents, higher standards and are generally happy for the government to fund this (for example by subsidising home improvements or boiler replacements for landlords). Social renters have similar interests but also additional concerns, often worrying about the social mix of the estates they live in or wanting means-tested rent subsidies to continue, even though that seems to have driven up rents for others who don’t meet the threshold. Those who own their homes, even relatively low-income families who bought homes under Right-to-Buy, often have opposing interests. Most obviously, they have a fundamental interest in raising house prices, even if that comes through gentrification of an area and higher rents. Easy access to cheap mortgages is also essential, even though this has been a huge part of the inflation of the financial sector over the last twenty years. For many families, particularly those with low-incomes, rising house prices have been an unexpected, and probably never to be repeated, windfall. Buying a house thirty years ago in the right area of London could literally have changed your life. And people will be reluctant to let those gains go or be forced to give some of it away in inheritance tax. Building a popular coalition out of these disparate groups will be difficult. Over the last eight years there has been a dramatic swing with 55% of people now supporting building in their local area compared to just 23% in 2010. But, relying on ideology alone without thinking about how to shape people’s long term material interests might be a risky strategy.
A socialist future?
Whatever socialist housing policy the Labour Party puts together, we need to think about what the long term political implications will be. Right-to-Buy changed the face of British homeownership and was wildly popular, creating a constituency with a material interest in defending it. Simply relying on state-led building programmes won’t be enough if the population keeps on growing, because the next government could easily decide to redirect funds to other projects. This was a fundamental problem with the last Labour government’s better policies. Funding early years interventions was a great idea, but, given that local communities didn’t own them and that the funding was centralised, it was at the whim of the next government to cancel it. Which they did. The only properly political strategy available within the Blairite model of politics was to keep winning elections forever, an unrealistic and ultimately dangerous approach.
In the context of housing, a socialist programme needs to do two things. The first is backwards looking: protect existing assets through communal, localised ownership models like Community Land Trusts, while taking advantage of current opinion to build more homes and ensure that they are also protected. There’s little point in building homes only for them to be later privatised in another wave of appropriation. But, we also need to build a constituency with an interest in forward-looking programmes. Revolutionary reforms are those that create the space for further reforms, that create an energy and momentum. As populations continue to rise, and the need for specialised housing for an aging population grows, we need to imagine socialist housing policies that will be self-propelling. Building homes for local people is generally popular and, although it can freeze out new arrivals, could be a useful impulse if it was institutionalised in some form (renters unions or community unions are some possible models). But, we should also think about tying housing and town planning to a broader attempt to reinvigorate Britain’s small towns and rebalance the national economy. We should be looking at Italy, where there have been various programmes to repopulate deserted towns, renovate old homes and build dynamic local economies, sometimes by welcoming new migrants.
None of these are the solution, but hopefully they point towards the kind of analysis that we need to formulate that solution. Without that, we’ll end up boxed into a corner, creating opposing interest groups, reactionary tendencies and a self-defeating politics.
And we still won’t have enough homes.