Anthony Ling, an excellent Brazilian blogger who also happens to be an avowed market urbanism, gives us an interesting look at the politics and economics of low-income housing in Brazil:
In Brazil there is a vast regulation defining what are the minimum requirements to have a building approved by local authorities. The most common example is probably the Building Codes set by each city, but specific details imposed by planning, environmental and building departments of each city are added to the equation. The recently created Performance Standard also follows this same path, being enforced nationally.
The explanation given to establish this regulation is the legal guarantee that every citizen will have a minimum quality of living. However, those who study public policy understand that the passing of a law does not miraculously create high standard buildings accessible to all and, like many other laws, produces effects opposite to those desired. The lower standard building prohibition does just that: tough regulation prevents entrepreneurs from building accessible housing for the poor. This results in government spreading the idea that entrepreneurs think only about attending the high class, and transforms itself as the hero that will build millions of popular houses, as [Brazilian Pres. Dilma Rousseff] did with the Minha Casa, Minha Vida [My House, My Life] program.
I think this has a very close parallel in modern American cities with inclusionary zoning and affordable housing mandates. In Brazil, the government creates a housing shortage by having unrealistical building safety standards (which ironically, as Anthony explains, encourage slums that are completely unregulated) and then swoops in and acts plays the savior with its own housing projects. In America, the government creates the shortage through sprawl-forcing zoning codes.
But unlike Brazil’s public housing, our politicians instead use rent control (rebranded as “inclusionary zoning” or “affordable housing”) to supposedly bring down the high prices that they unknowingly created. This is great for the lucky few who manage to get apartments (often middle-class public employees), but it acts as a further constraint on supply for the vast majority of renters and homebuyers, who have to buy market-rate housing, and sends prices even higher. The voters, who are just as economically illiterate as their elected representatives, then clamor for even more affordable housing, and the cycle repeats itself, resulting in ever higher housing prices.
The American planning profession has mostly learned its lesson about parking minimums and low-density zoning (at least in theory), but they remain stubbornly in favor of the density taxes known as affordable housing. Come to think of it, I can’t think of any progressive urbanists who have come out against inclusionary zoning and affordable housing mandates (with the exception of Matt Yglesias). Can you?