The Origin of 80/20 Housing in New York City

If the real estate cowboys invading the Lower East Side in the 1980s used art to paint their economic quest in romantic hues, they also enlisted the cavalry of city government for more prosaic tasks: reclaiming the land and quelling the natives. In its housing policy, drug crackdowns, and especially in its parks strategy, the City devoted its efforts not toward providing basic services and living opportunities for existing residents but toward routing many of the locals and subsidizing opportunities for real estate development. A 1982 consultants’ report entitled An Analysis of Investment Opportunities in the East Village captured the City’s strategy precisely: “The city has now given clear signals that it is prepared to aid the return of the middle class by auctioning city-owned properties and sponsoring projects in gentrifying areas to bolster its tax base and aid the revitalization process” (Oreo Construction Services 1982).

The City’s major resource was its stock of “in rem” properties, mostly foreclosed from private landlords for nonpayment of property taxes. By the early 1980s the Department of Housing, Preservation and Development held over 200 such in rem buildings in the Lower East Side and a similar number of vacant lots. With sixteen of these properties, the Koch administration made its first significant foray into the real estate frenzy of gentrification; artists were to be the vehicle. In August 1981 HPD solicited proposals for an Artist Homeownership Program (AHOP) and the next year announced a renovation project that was to yield 120 housing units in sixteen buildings, each costing an estimated $50,000, aimed at artists earning at least $24,000. Their purpose, the Mayor proclaimed, was “to renew the strength and vitality of the community,” and five artists’ groups and two developers were selected to execute the $7 million program (Bennetts 1982).

But many in the community disagreed vigorously enough to oppose the AHOP plan. The Joint Planning Council, a coalition of more than thirty Loisaida housing and community organizations, demanded that so valuable a resource as abandoned buildings should be renovated for local consumption; city councilwoman Miriam Friedlander saw the plan as “just a front for gentrification”; “the real people who will profit from this housing are the developers who renovate it.” And indeed, the HPD Commissioner expressed the fervent hope that the project would be “a stimulus for overall neighborhood revitalization.” While supporting artists portrayed themselves as normal folks, just part of the working class, a population already largely displaced from Manhattan who deserved housing as much as anyone else, an artists’ opposition emerged — “Artists for Social Responsibility” — who opposed the use of artists to gentrify the neighborhood. HPD, the mayor and AHOP were ultimately defeated by the City Board of Estimate, which refused to provide the initial $2.4 million of public funds (Carroll 1983).

But AHOP was a warm-up for a larger auction program, as HPD prepared to leverage gentrification citywide using in rem properties. The Joint Planning Council decided to grab the initiative by proposing its own community-based plan, and in 1984 it proposed that all City-owned vacant lots and properties be used for low- and moderate-income housing and that the speculation responsible for eliminating existing low-income units be controlled. The City ignored the community plan and came back with a “cross-subsidy” program. HPD would sell City-owned properties to developers, either by auction or at appraised value, in return for an agreement by developers that a vaguely specified 20 percent of rehabilitated or newly built units would be reserved for tenants unable to afford market rates. Developers would receive a tax subsidy in return. Initially some community groups gave the program tentative support; others sought to adjust the ratio of market-rate to subsidized housing to 50:50, while others rejected the entire idea as a backdoor route to building minimal public housing.

But opposition mounted as the actual intent of the program became clear. In 1988 the City announced that the Lefrak Organization — a major national developer — would build on the Seward Park site where, in 1967, 1,800 poor people, mostly African-American and Latino, were displaced when their homes were urban renewed. They were promised the new apartments scheduled for the site, but twenty years later the renewal was yet to happen. The fee for the site was $1, and Lefrak would pay a further $1 per year for the ninety-nine-year lease. Under the plan, Lefrak would build 1,200 apartments, 400 of which would be market-rate condominiums, 640 would be rented at $800–$1,200 to “middle-income” households earning $25,000–$48,000, and the remaining 160 units would go as “moderate-income” units to those earning $15,000–$25,000. No apartments were actually earmarked for low-income people. Further, all rental units would revert to Lefrak as luxury co-ops on the open market after twenty years; Lefrak would get a thirtytwo-year tax abatement, and an overall City subsidy of $20 million. Lawyers representing several of the 1967 tenants filed a class action suit against the Lefrak condo. “Yupperincome housing in low income neighborhoods” is how one housing advocate described the plan, “and the purpose is creating hot new real-estate markets” (Glazer 1988; Reiss 1988). The project got as far as a “Memorandum of Understanding” with the City, but as the depression closed in, the folly of attaching any subsidized housing to market development became clear. Lefrak abandoned the project — but not before it became clear that the City had no intention of mandating Lefrak to build the 20 percent of subsidized units in the same neighborhood. The geographical mobility of the subsidized housing of course opened up the specter of gentrification again for those who had not already seen through the “double-cross subsidy” program, as it came to be known by community activists.

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Neil Smith, The New Urban Frontier (London/New York: Routledge, 1996) 22-23.

On Yuppies and Gentrification

At the recent Tompkins Square Park 25th Police-Riot Reunion, a number of horrendous bands played over a three-day period. One of them was
David Peel and the Lower East Side.

These guys are definitely a novelty act. They’ve been around, in one form or another, for almost half a century. The only reason I’m writing about them is because they have a song called “Die Yuppie Scum”, that they played at the police-riot commemoration. “Die Yuppie Scum” was a slogan, if you will, that was spray painted on just about every surface in the “East Village” during the 1980s. It was the frustrated attempt by those with the propensity to spray paint onto things to vent their wrath at the most visible appearance of the changes taking place around them. However, the connection between yuppies (“or in more sober terms … the ‘new middle class'”) and gentrification is a spurious one:

The patterns of consumption associated with the new middle class, including patterns of housing consumption, are presumed to result from the higher incomes and the greater spending power of this group. In short, we would expect that the emergence of a new middle class would result in an increase in the aggregate share of income earned by this social stratum – an identifiable redistribution of income toward the centre. …

But when we examine income distribution over the past several decades, the pattern is not so simple. Far from suggesting a redistribution of income, the aggregate data present a picture of remarkable stability overlain with cyclical fluctuation. Despite postwar economic growth, the poorest 20 percent of the US population did not earn a significantly greater proportion of the social pie and nor did the richest 20 percent have to relinquish its half of the pie. If there is any fluctuation from this stable distribution of income, it suggests rather that the minimal democratization of incomes that pertained into the mid-1970s was significantly reversed by the 1980s. By the 1990s, the disparity between rich and poor was greater than at any time in the last quarter-century. As regards a new middle class, presumably located in the third and fourth quintiles, their numbers remained very stable through the 1970s but actually fell significantly beginning in 1982. Far from suggesting the rise of a new middle class, the 1980s, which witnessed the most intense gentrification, would seem to have corresponded with an actual shrinking of the new middle class.¹

Share of aggregate household income in the US, 1967–1992


US Department of Commerce, Bureau of the Census 1993. Money Income of Households, Families, and Persons in the United States: 1992. Series P60-184.

It doesn’t make for catchy song lyrics, but there you are. Some people have made this their mantra, so it would be hard for them to give it up now. And of course, today you can even wear your contumely!

So here is David Peel and The Lower East Side performing “Die Yuppie Scum” at the TSP25APRR. I found the link to this video on another blog. (I commented that David Peel was the white Wesley Willis, but the comment was rejected by the blog owner!) It starts out sounding like “Gloria” but then goes into the Wesley Willis sound. I will spare you having to listen to the entire thing. If you want to though, click on the YouTube icon and you can watch it on YouTube.

 
Wesley Willis (1963 – 2003):

 
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¹Neil Smith, The New Urban Frontier (London/New York: Routledge, 1996) pp. 96-97.

Tompkins Square Park 25th Police-Riot Reunion

Today is the 25th anniversary of the Tompkins Square Park police riot.

©2012 Andrew Lichtenstein

I’m not going to recount the details of the riot. The wikipedia article linked to above is not the best, but it will suffice.

I didn’t live in this neighborhood when the riot occurred. I lived in Washington Heights then, but I used to hang out down here with a friend of mine. Anything that was going on, we tried to make it to. Being in the park was an act of solidarity with the homeless encampment there, and with the larger goal of supporting housing as a human right.

All these years later, it probably doesn’t matter that I wasn’t there, unless I was fated to have been beaten up that night, in which case it’s a good thing I wasn’t there! Besides, I was already souring on the so-called anarchists. After the park was closed in 1991, they disappeared and haven’t been seen since. I’m sure the ones from that night have all gone on to work for their local Ron Paul campaigns, but the ones who adopt anarchism today still think they’re the first to discover that the police respond to provocations with violence, and that once people see this they’ll be shaken out of their stupor and overthrow the state. Hence, the preponderance of Guy Fawkes masks, smug and condescending. “East Village” anarchists were proponents of what Murray Bookchin called lifestyle anarchism, with its concern for autonomy and individualism. I’m not going to go into his arguments, or what he proposes as the alternative – it’s still a raincoat full of holes!

Anyway…

Reunion was probably not the right word to use to describe this event. I don’t think many people who were there that night came to this. For that matter, not that many people at all came to it!

Saturday

The Bambi Killers had just finished.

Sunday

During Iconicide’s performance.

I’m not sure three days of obstreperous noise was the best use of time and resources. Twenty five years later, is this what they still listen to? I know that many of the bands that played were around back in the late 80s, but three days of it? Even if three days was necessary, tables should have been set up around the perimeter with information, not only about that time, but current programs in the neighborhood. The Shadow¹ had a table, but then they were the sponsor of the concerts, so it was more for self-promotion.

I don’t know. I wasn’t there for the planning, but then this is not the first time concerts have been held to commemorate this event, and I’ve never seen any kind of outreach at those either.

***

There was also a film festival, sponsored by the Museum of Reclaimed Urban Space, that took place at different locations in the neighborhood, from August 3 to 10.

I think the film festival was a great idea. They billed it as “1st Annual MoRUS Film Fest,” so hopefully they’ll be able to continue this annually. I’m not sure if it was meant to commemorate the anniversary of the police riot – its timing may have been – but something like this goes a long way in engaging people, something that was sorely missing from the concerts. The garden that I am a member of was to host two of them. The first one was moved to the MoRUS space due to rain, but the second one was held in the garden. We had a great turnout, and look forward to participating again next year.

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¹The Shadow is going to start publishing again.

Stealth Gentrification

 
The bar Max Fish closed yesterday. Since Max Fish was one of the first of the gentrifying establishments to open in the Lower East Side, I thought it would be fitting to note its passing by focussing on one of the techniques by which it came to be.

Lara Belkind introduces her essay Stealth Gentrification: Camouflage and Commerce on the Lower East Side, thusly:

This article describes current adaptations of the traditional environment of New York’s Lower East Side. It examines how global factors such as expanding “content’ industries, market differentiation, and the internet have reinforced perceptions of the area as real and authentic while opening it to dramatic change. Specifically, the article considers a recent trend of commercial camouflage — hidden shops, restaurants and clubs that “re-present” tradition by meticulously preserving defunct façades, signage, and other physical traces of the neighborhood’s working-class and immigrant past. Urban camouflage, in various guises, has played a role in the transformation of the Lower East Side since the late 1970s, and has been employed by a succession of actors, from squatters to global retailers. As a cultural strategy, it has been inherent to the economic restructuring of the area, helping to overcome barriers to redevelopment that have persisted for more than five decades.

She divides the period into three stages: 1980–1994; 1995–2002; 2003–2005. I’m just focussing on the first stage:

Max Fish quickly became a destination for consumers of the downtown scene. … And it made Ulli Rimkus one of the first of a set of successful local artist-entrepreneurs.

…

Stealth aesthetics emerged almost immediately as an expression of this new bohemian movement, signifying authenticity, membership in the downtown avant-garde, and a condition of being “underground,” or beyond the realm of middle-class consumerism. This signification contained an inherent contradiction, however, because many of these new residents arrived with very middle-class objectives. In particular, they were seeking to buy property or to create small businesses — opportunities they were finding increasingly out of reach in other Manhattan neighborhoods.

…

Yet, despite expressions of solidarity with the local working-class, and despite positioning themselves as activists or bohemian outsiders, the motivations of many artists who moved to the Lower East Side were essentially middle class. By contrast, the very opportunities that attracted them to the area, to own property or start a small enterprise, were beyond the reach of most of their neighbors. Indeed, the concept of “pioneering’ in a residential community, even a battered one, inherently separated new residents from existing ones.

…

[M]any of the bohemians who arrived on the Lower East Side in the 1980s adopted countercultural elements as a commercial strategy. … But art that borrowed the found qualities of these spaces quickly evolved into a trademark aesthetic that was used to attract middle-class consumers.

***

There was one part of the article I found a bit disturbing:

 
The drug trade that existed in this area was responsible for countless deaths, family crises, homelessness, as well as burglaries and muggings. Clayton Patterson says this was a good thing. Was it a good thing for the people living there before 1980? Do you think they had the view that the drugs were a trade-off, necessary to keep the middle class away? I think this is appalling.

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¹Lara Belkind, Stealth Gentrification: Camouflage and Commerce on the Lower East Side, Traditional Dwellings and Settlements Review, Vol. 21, No. 1 (FALL 2009), pp. 21-36.

Nostalgia

Nostalgia must be guarded against — it’s debilitating. People become nostalgic when they feel they’ve lost control of their lives. When they see no way forward, they look backward. Nostalgia is fear of the future, a symptom of resignation.

It’s sad to think that there are people who long for the degradation that existed in the “East Village” in the 1970s/80s. These are primarily (exclusively?) people who moved in when the neighborhood had been all but abandoned. Today, those left pine for the time when few people would venture into the area. They don’t take into consideration that regular, working people left due to the degree of decay that they cherish so much. “Slumming” is not something people born into slums find attractive.

When I was growing up, it was the beginning of the period of crisis that led to the current neo-liberal era. Nostalgia then was for the 1950s: American Graffiti was the rage. I remember my high-school English teacher asking our class why we were so enamored of the 50s. The 50s weren’t so great, he said. It was the time of McCarthy. Of course, it wasn’t our nostalgia; we were just high-school kids. It was the nostalgia of his generation. But it was the time of crisis, and to take people’s minds off of it, an idealized vision of the past was offered up as a distraction. Today, oddly enough, that idealized vision is of the crisis period itself! I guess it shows that the time is less important than the superimposing of childhood memories onto that time.

I had the idea to write this recently while walking with my son, approaching Whole Foods on Houston Street. It occurred to me that this will be his recollection of Houston and Second Avenue, while others go to their graves lamenting the demise of the Mars Bar. Your starting point is where you are today, and your goal is the future, not the idealized past.

Luxury Listings NYC – May/June

First, let me say I was very disappointed that the current issue of Luxury Listings NYC was not delivered to my door, as the past two were. Instead, a stack of them was left in front of the mailboxes in the lobby, wrapped in a rubber band. I didn’t even find the one with our name on it, just two addressed to others in the building. I’m going to contact The Real Deal, which publishes Luxury Listings NYC, and bring this to their attention.

I don’t need the paper copy for my purposes, though. The online version is better for making screen shots. Still, I want it in front of my door.

For those who didn’t read my last installment, or for those who want to be reminded: Luxury Listings NYC promotes every neighborhood-commodity in Manhattan below 110th Street: Upper East Side; Upper West Side; Midtown; Gramercy; Chelsea; Greenwich Village; Soho; Tribeca; Lower East Side; and Financial District. Every section has a “Celeb real estate in the neighborhood” listing too, telling which celebrities live in that neighborhood! (Who doesn’t want to live near celebrities?!) And as it is almost Summer, this issue has a section on the Hamptons and the North Fork of Long Island. I don’t have any screen shots of those though because, frankly, they just weren’t that interesting. The next issue, which I expect to see in front of my door in July, will certainly report on the merry-making decadence going on there, and I might comment then.

So, let’s get on with this!

I said something very similar to this just the other day. “$100 million is the new black,” I said. Really.

Silly Luxury Listings NYC. It’s not supply and demand, it’s 7-Eleven! (But really, it’s not supply and demand. That doesn’t explain anything.)

It’s beyond human control. This is what they’d have people believe. It’s an immutable law of physics. Supply and demand is the new black hole.

Anything they want to inure us to?

You might find them scary too, but relax!

And finally:

Certainly not! Privilege is privilege! It doesn’t stop when you come home.

***

Here’s a look at some of the places for sale.

Too much white.

Too much purple.

Who lives here, a monk? Do these people not own a single book? This place is crying out for something to be dropped on the floor.

It looks like Quilas, no?

***

OK, finally we get to my neighborhood. There’s really only one thing to report, and it’s a doozy! Check this out:

Two groups?! Does Luxury Listings NYC employ fact checkers? Do they think Quilas is some kind of petite bourgeois outfit, too? I can’t have been doing my job very well, if that’s that case. I have to contact The Real Deal about this (separately from my request to resume delivering my copy of the magazine to my door).

***

Finally, I leave you with a song:

It doesn’t make a difference
if we make it or not
We’ve got each other
and that’s a lot

$42 million is the old black!

N7E and Labor (Again): A Recapitulation

When discussions take place across separate blogs, and in the Comments sections of even different blogs, the focus begins to blur. Early on, I maintained that, as opposed to a bodega, a 7‑Eleven moving into the vacant space at Avenue A and 11th Street would raise the income of the neighborhood, against the assertion that 7‑Eleven would: 1) reduce the number of jobs; and 2) lower income in the neighborhood via the requirement that part of the profits be sent to the corporate headquarters. I believe I defended this position adequately at The Local Economy?.

Since that time, the conversation has shifted. This is a recent post from the leader of N7E (click on the image if you want to read the entire screed):

There appear to be two assertions here — only one of them is direct:
“…replacing a 7‑Eleven with a restaurant in NYC would improve the wage prospects of immigrant workers, documented as well as undocumented.” But the inclusion of wage statistics just before that indicates that they’re making the argument that wages in a restaurant would be higher (for the cook, in any case) than for clerks in a 7‑Eleven, and that a restaurant is, therefore, preferable.

There really isn’t anything to say about “improve the wage prospects of” except that it does not follow from “Mean average for a cooks wage…” just before it. You find this all through their literature. And it’s ambiguous. “[I]mprove the job prospects of” makes more sense. They may be right that it lowers the “wage prospects” of undocumented workers, but they’re going to have to tell us exactly how many people they’re talking about. Are they ready to claim that X number of jobs at less than minimum wage, with employer threats of deportation, are preferable to a similar number of jobs at ≥ minimum wage, with the increased opportunity to organize a union? (I’m going to deal with the topic of organizing in a future post. For now, let this suffice as an example of what 7-Eleven workers can do. I’ve also maintained that, as a large company, 7-Eleven is susceptible to pressure from outside its workforce.)

Now, to the money question. To begin with, why would they cite the mean, average wage for cooks across the country after reading what I posted in Restaurants, which examines the pay of restaurant workers in New York City? Hmmm? Maybe they just skimmed it, and thought “Look, numbers. We should get some numbers too.”

¹

The problem with the BLS figures they cite² is that they’re not accurate hourly rates. Many are extrapolated from flat rates divided into hours scheduled per week. Others are determined by taking the mean, average annual income (e.g., $23,300), dividing it by 52 weeks, then dividing that by 40 hours, as if cooks worked eight hours a day, five days per week. As already established:

¹

$23,300 ÷ 52 weeks ÷ 6 days ÷ 12 hours = $6.22/hour.
÷ 10 hours = $7.47/hour.
÷ 8 hours = $9.33/hour.

As we narrow the discussion to increasingly-specific details, like the hourly rate of a cook in a hypothetical restaurant, it becomes more difficult to generalize. A 7‑Eleven at that location that hires ten people instead of seven, or a restaurant that employs a chef instead of a regular cook, limits the inferences we can make. But there are a couple of observations that can be made with certainty: there is no evidence that a restaurant would be significantly better than a 7‑Eleven for either total number of people hired or total wage receipts; and everyone who works at the 7‑Eleven will be paid at least minimum wage, while many of those who work at the restaurant will not be. It’s nothing to write home about, but this discussion has never been about why 7‑Eleven is good, just about why it’s less bad.

***

Finally, almost as an aside, I will address this last claim:

“The majority (66 percent) of low-wage workers are not employed by small businesses, but rather by large corporations.”³

I have no doubt that this is true, but it’s completely irrelevant to the discussion! (You find this all through their literature.)

It’s funny they should refer to this report. If they had bothered to turn to page 2, they’d have seen the following:

Oh well. This isn’t their forte, after all.

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¹Unregulated Work in the Restaurant Industry in New York City
²Occupational Employment and Wages News Release
³Big Business, Corporate Profits, and the Minimum Wage

Sharon Zukin on Jane Jacobs

What’s a bobo?

‘No 7-Eleven NYC’ Comes Clean

Finally! It was like pulling teeth!

Since shortly after their inception, I have maintained that No 7‑Eleven NYC is a group of people whose activities promote the interests of small businesses in the “East Village”. Nothing could have been more obvious from their literature. Yet when I raised the issue, here and on other forums, they denied it fervently. It was strange, but that’s what they did.

Well finally, in an email discussion I’ve been having with one of their leaders, they admit it:

So galling must it have been for them to admit this that they followed up immediately with:

What I’ve written about them (12 out of a total of 45 posts) has been opposed to, not so much their aims as, the limitations of their aims. 7‑Eleven opening up was an opportunity to examine existing social relations in the neighborhood. I seized that opportunity; they didn’t. They could have shone a light on conditions of workers at bodegas, as I did. They could have examined why the choices were limited to 7‑Elevens and bodegas, as I did. Instead they ignored it all, focusing on superficialities and nativist fears.

I could be wrong, but I have the feeling that now that they’ve stepped forward and admitted their class bias, I’ll probably write less about them. They will go on promoting the interests of small-business owners over both their employees as well as their competitors (how will they do this when one bodega threatens another?), and I will continue to promote the interests of the workers. Once 7‑Eleven moves in, I will advocate for the people who work there, the way No 7‑Eleven NYC does not advocate for the people who work in bodegas.

***

But wait! What’s this?:

They’re going to start concerning themselves with labor? Hmmm, maybe I will keep writing about them.

See you in the salt mine.

Gated Communities, Redux

There are these people in the neighborhood who have a Twitter account, and have tweeted information about towns around the country that seek to prevent certain types of stores from opening within their boundaries. The idea is that the “East Village” should emulate this effort.

An interesting thing about these towns is that their populations are significantly lower than that of the “East Village”.

An even more interesting fact is that the median household income of these towns is significantly higher.

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All figures from City Data.