Limited Equity Cooperative Housing

In the October edition (#116) of the Left Business Observer, Doug Henwood makes a great proposal for housing policy:

First he suggests the creation of a public housing institute that buys up defaulted mortgages (instead of letting the banks keep them). The defaulted former owners would become tenants, allowed to stay in their homes, who pay rent to the public housing institute. When the tenants move out, the house is sold as a limited equity cooperative.

Under a limited equity cooperative arrangement, the owners sell the house back to a cooperative (set up by the public housing institute) at a price reflecting inflation and improvements. The owners would not get speculative gains.

This would help avert the growth of a too large, parasitic landlord housing economy–and while economists would like to think renting indefinitely would not be such a bad option, in reality, landlords in general mean housing stock degradation and failure to improve housing stock. For good reason was Adam Smith was no fan of the rentier class. Having a stake in the place you live is much more likely to result in improving its livability and sustainability, as well as the neighborhood.

A limited equity cooperative would create a market of housing based on needs rather than casino capitalism. After all, housing should be treated as a basic need. As Henwood says, “We’re accustomed to treating rises in house prices as good news. But why is it good news when one of life’s essentials gets more expensive?”

Additional facts:

Whereas houses on average cost only about three times their owner’s income in 1985, by 2005 they cost over 5 times their owner’s income. (Harvard Joint Center for Housing Studies)

Currently, housing prices are staying the same as last year. But from 1995 to 2004, housing prices continued to increase more and more every year. By 2004 housing prices were increasing nearly 12% over 2003. In the last housing boom and bust cycles, housing prices continued to deflate for four years after the boom broke. That means housing prices should begin to decrease until about 2010. Economists estimate that the most recent, credit-fueled boom overvalued houses by about 40%; but they warn that the market will not be elastic enough to return to correct valuation. Instead, housing prices are more likely to decrease by 20-25%.


Global Warming: Abrupt

IPCC to warn of ‘abrupt’ warming
By Richard Black
Environment correspondent, BBC News website, Valencia

Climate change may bring “abrupt and irreversible” impacts, the UN’s climate advisory panel is set to announce.
Delegates to the Intergovernmental Panel on Climate Change (IPCC) agreed a summary of its landmark report during overnight negotiations here.

Discussions were said to have been robust, with the US and other delegations keen to moderate language.

The summary will be officially launched by UN secretary-general Ban Ki-moon on Saturday.

It brings together elements of the three reports that the Nobel Prize-winning IPCC has already released this year, on the science of climate change, impacts and adaptation, and options for mitigating the problem.

Among its top-line conclusions are that climate change is “unequivocal”, that humankind’s emissions of greenhouse gases are more than 90% likely to be the main cause, and that impacts can be reduced at reasonable cost.

Probable temperature rise between 1.8C and 4C
Possible temperature rise between 1.1C and 6.4C
Sea level most likely to rise by 28-43cm
Arctic summer sea ice disappears in second half of century
Increase in heatwaves very likely
Increase in tropical storm intensity likely
The synthesis summary being discussed here in Valencia strengthens the language of those earlier reports with a warning that climate change may bring “abrupt and irreversible” impacts.
Such impacts could include the fast melting of glaciers and species extinctions.

“Climate change is here, it’s impacting our lives and our economies, and we need to do something about it,” commented Hans Verolme, director of the climate change programme with the environmental group WWF.

“After this report, there are no politicians left who can argue they don’t know what climate change is or they don’t know what to do about it.”

Local witnesses

At a news conference, WWF presented testimonies from “climate change witnesses” in various parts of the world.

Speaking by video link, Australian scientists and fishermen spoke of the changes they were seeing on the Great Barrier Reef. And Olav Mathis Eira, a Sami reindeer herder from Norway, said that his communities are seeing weather patterns unprecedented in their oral history.

“Winter is one and a half months later than it used to be,” he said. “We observed birds and insects that do not have a name in Sami.”

The 20-page IPCC synthesis summary is due to be accompanied by a longer, more detailed document, and discussions on that are continuing here.

The findings will feed into the next round of negotiations on the UN climate convention and Kyoto Protocol, which open in Bali on 3 December.

The Kingdom of Spain

It’s just diversionary propaganda, interpersonal conflict accessible to know-nothing Communications Professionals, but as far as Chavez and the King of Spain go:

Juan Carlos, the King of Spain betrayed the Spanish military fascists by surprise transferring his royal imprimatur to liberal democracy when Franco died. So the fascists in Spain hate Juan Carlos and he’s had to live with that.

Since Spain has been a liberal democracy since 1975, the Left has increasingly called for an end to monarchy. You could interpret that as ingratitude–if you were a liberalista.

Now Chavez calls Aznar a fascist. As we all should know, fascism is the authoritarian, militaristic, business-friendly liberal opposite of social democracy. Fascism is an extreme within capitalism. Nixon said of the fascist Franco, “General Franco was a loyal friend and ally of the United States” (New York Times. “Nixon Asserts Franco Won Respect for Spain.” November 21, 1975, Friday, page 16). Today the fascist-liberal US supports Musharref in Pakistan, among many, many other tyrannical military dictators over the years.

Why should Chavez owe Aznar or Juan Carlos dissembling deference? Juan Carlos isn’t the arbiter of progress. At a certain historic point, after decades in which Franco had forcibly secured capitalism in Spain, Juan Carlos enabled a more moderate form of liberalism than fascism. That did take leadership at that time. But, sorry Fukuyama, history’s not over. More moderate liberalism does not under many global political-economic conditions, oppose fascism.

His self-righteousness and inherited privilege inflamed by capitalist consensus, Juan Carlos recently had a diplomatic meltdown, and I can understand why. A liberal monarch in Spain today is under a lot of pressure from both Right and Left. Que sera sera. At least Juan Carlos can console himself with the caviar, fine wines, cars, servants, estates, etc.

A Nation on Borrowed Time

Mike Whitney (11/12/07) has an article on the elite-engineered US economic situation at

Basically, after we strip away all the Experts’ guano layers of justification, it turns out that the reason why we have allocated absolute power to financial capital is not because it’s a good idea, but rather because they had considerable power in the capitalist system and a lot of people could make a living off of doing them favors. For a while. We are such freakin disaster monkeys.

Bye bye, carkeys. Hello, sparkles and flies. I keep them they’re mine.

Class and Professionalism

“As has been said in many other contexts, academe’s admissions, hiring, and promotion practices seem to favor people who look different but mostly think alike, largely because they belong to similar class strata. Celebrating diversity involves many arbitrary choices about who is ‘diverse’ and who isn’t, who should be shown deference and who should be shouted down, who should be ‘strongly encouraged to apply’ and who should be called ‘overrepresented.’ In the end, I think too much of the celebration is about making privileged people feel like they care about inequality without having to really change anything.”

William Pannapacker, Chronicle of Higher Education, November 2007.

At It Again

In these days of X-treme inequality, the scientizers are busy, busy, busy, legitimating away. This time, they’re not trying to claim that racial inequality is natural. The political scientists are simply trying to argue that class inequality is based in biology.

Here we go again! Wheeeeeee! I sure hope lots of All-American, church-going political scientists, with their families, student loan debt, and mortgages, can make a good living off of this round of crap! Go, John R. Hibbing and Kevin B. Smith of the University of Nebraska PoliSci Dept, you loyal technocrats, you!

Here’s the introduction of the New Social Darwinism:
The ANNALS of the American Academy of Political and Social Science, Vol. 614, No. 1, 6-14 (2007).