« PreviousContinue »
with low credit terms, low down payment, low interest rates, that we should turn to the farmer, not only the slum family, but to try and perfect a program that will extend some of the advantages of low-cost credit to the farmer who can pay for his own home, just like we do for the city man who can pay for his own home?
Mr. COLE. Yes.
Mr. MONRONEY. And the part of your testimony that interested me tremendously, Mr. Halverson, was the part in which you pointed out that the farmer puts up for security for his home, not only his land but his land and job as well, while the city dweller puts up only the home and the small portion of land on which it sits.
Now, with any program that would tend to balance the scales on how much security the farmer had put up to get financing on his home, we are trying to work out a farm home program self-sustaining along the lines of FHA.
I am trying to get somebody in the housing agencies of the Department of Agriculture interested in something like title I of FHA, where the farmer could borrow on a sort of a chattel-mortgage basis-not have to put up his land and lose his farm-on a moderate-sized loan for improvement or even for the construction of an inexpensive farmhouse, and require that the house could be built so that it could be sectionalized or panelized and if he did not pay for the house, so that it could be transported into town and reassembled.
I think, under the building techniques of today, we can develop a new type of home financing.
Mr. HALVORSON. I was not going to agree with you until you mentioned the fact that it would be necessary to have a type of house that can be moved, because, if the farm was not adequate for the house, it would not do any good to set that house off on the mortgage basis by itself, but if it could be moved it would make a difference.
Mr. MONRONEY. Under techniques today you would not require a prefabricated house. The house could be sectionalized, panelized, moved into town, reassembled and sold on a city lot if you had to, to protect this thing which you talked about, the integrity of the farmers' credit.
Yet there is a difference between the integrity of the farmers' credit and that of the city man. He has to put up three or four times as much for financing a home as the city dweller has to put up.
Mr. HALVORSON. Yes, sir; I think that is a good point, and it is in line with our thinking.
Mr. MONRONEY. That should come under something like FHA, I think, or some program which would provide for Government insurance behind that type of loan?
Mr. HALVORSON. I do not know much about it but I think FHA at one time had some provision for rural lending, and never got very far with it.
Mr. MONRONEY. It has never jelled. They have tried and tried.
Mr. HALVORSON. And the Farm Credit Administration, under the Land Bank Commissioner loans—let's see, I am getting into something else. This is the part-time farm, which probably would be the best place for the FHA type of operation.
Mr. MONRONEY. Are there further questions?
STATEMENT OF GEORGE W. PROFFITT, REPRESENTATIVE OF THE
NATIONAL APARTMENT OWNERS ASSOCIATION, WASHINGTON, D. C.
Mr. PROFFITT. Mr. Chairman, gentlemen of the committee, my name is George W. Proffit, and I appear here before this committee as a representative of the National Apartment Owners Association, whose offices are at 1129 Vermant Avenue, Washington, D. C.
We are opposed to the passage of H. R. 4000, known as the National Housing Act. We endorse and concur in the statement made to your committee by the National Association of Home Builders. We feel that this association has covered most of the objections we could offer to the passage of this proposed legislation, and without taking the time of this committee to go into repetition of statements by other opponents of the measure, we wish to relate much of our statemen in opposition to what we consider to be the primary cause of the so-called housing shortag: rent control.
Our association's representative appeared before this committee last month and presented testimony in opposition to the continuance of Federal rent control. In this statement we pointed out that there is actually no shortage of housing in this country. The shortage that does exist is a shortage in housing accommodations for rent. We showed, through the use of Bureau of Census figures, that there is actually more housing space per person than ever before in the history of our country. We showed that this housing shortage was created by law and offered as evidence of this fact that since 1940 we have lost nearly 21,2 million rental units from the rental market. We challenge anybody to prove that this loss of rental units from the market was not caused by rent control.
Probably the most damaging effect of rent control on our whole country has been the general acceptance by so many American citizens, including many of our top leaders, of the idea that free enterprise cannot cure the housing shortage. Thus they are willing to accept public housing as a cure. These people do not recognize the terrible curse of public housing in any country. They do not know that it is the Communists' utmost desire. The American people did not even know what public housing meant until after rent control caused the great false housing shortage and the present confusion. Rent control is truly the father of public housing. Under controlled economy many things happen that cannot always be calculated until after the effects have taken place. We have seen this in the recent shortage of butter, coffee, sugar, and so forth. This false housing shortage has come about in much the same manner as shortages of the other items. However, it has been more confusing and it has taken us a little longer to find out how it happened. There was one group who were not deceived by this housing shortage; they are the top economists. These men proclaimed that the very things that happened, would happen, and that the people would not be able to understand and would believe they had a true housing shortage.
These economists did not have to depend entirely on their reasoning power. They had a perfect example in the European housing situation, where rent control began with the First World War. Rent control has never been taken off. Each year, by normal observation,
the people thought they had a housing shortage. In a very short time, the Socialistic-minded leaders convinced the people it could not be cured by free enterprise. The only cure they said was public housing. This is always a big step toward totalitarian government. One of the principal edicts of the Marx manifesto was that the government should control the housing. By controlling housing, it is easy to control the people.
Today, a large percentage of our citizens believe our housing shortage is real. They are almost convinced that free enterprise cannot cure it, so they become easy victims for public housing propaganda. These people have not checked the records of public housing. They do not know that it does nothing it claims to do. It is pure socialism. It is the result of housing shortages created by rent control.
Rent control was presented and inaugurated in this country as an emergency war measure. Most people patriotically accepted it as such: a temporary war emergency measure. It was to keep rents from soaring in war-industry centers where great increases in population took place. Congress quickly passed this law as an emergency war measure, but at that time instructed rent-control directors to freeze rents only when they became speculative and inflationary in character. In a short time the bureaucrats made it almost Nation-wide, regardless of war industries, abnormal increases in rents or population.
Today, many people wonder if it was not a scheme of the Government leftist group to actually change the economy of this
country. No one seems to know who the true authors of this Rent Control Act were, but we do know it was not our elected legislators who drew the act. If we check the top people who directed rent control in Washington, we find they were persons who believed in a controlled economy. They knew they would create confusion and misunderstanding that would make the people believe that they had a real housing shortage. They had the records and experience gained in Europe. They did the job so well that they fooled many of our national legislators and eventually got them very close to accepting public housing as a cure.
Now we find groups of people working for the Government in our rent-control offices. These people are paid by taxpayers for controlling other people's business. They spend large amounts of Government money to issue propaganda booklets, press and radio reports to perpetuate themselves in control. The more housing confusion they create, the longer their jobs last.
Rent control is one of the most deceptive and malignant laws ever perpetrated on the American people.
It has deceived the American people into believing they have a real housing shortage when, as a matter of fact, they have more housing per population than they ever had before.
Our citizens act as if they were plagued with opiates. Millions of normally fair-minded, honest citizens are asking for something that they would quickly reject if they knew the facts. Leaders in all fields are now loudly voicing their opposition to any totalitarian form of government, yet many of these same men want rent control. It is sad to think that many free-enterprise leaders, who benefit from bargain housing under rent controls, are willing to jeopardize our whole free system for a little cheaper rent.
We must destroy this law before it destroys our free competitive system. The American citizen enjoys almost four times as much
housing space as does the English citizen under socialism, and almost 10 times as much space as the Russian under communism. Why should this great country, with the finest housing in the world, find itself in a chaotic confusion, caused by a rent-control law? When its perpetrators first proposed this law, they said that it would protect the people from skyrocketing rents in war-industry centers, where they expected great increases in population during the war.
History shows that they had no such intention in mind, but rather a plan for the complete control of all rental housing in the United States. Once the law was passed, bureaucrats immediately started to list and regiment the renters and owners of rental property in every important town and city and in the country. The record shows that it was the most firmly held control of all. Nearly every other product that was put under control was allowed to rise in price whenever justification of an increased cost could be shown. In the case of rental property, it was held tight and fast, regardless of the increase in cost. Every type of argument was used to hold it firm. Owners were told that injustices and inequities could be expected in time of war and that nothing could be done about it.
A large group of renters did save money under rent control, but think of the great increase in cost to all who did not have rent-control protection.
Under rent control veterans have been deceived and ill treated. When they returned they were told that there were no rental units for them because of the great shortage. Most of them did not know the shortage was false. They were told to buy new homes. These homes were sold at extremely high prices and financed with large mortgages, over a long period of years. The veteran now find himself living in a home that he did not want, usually far away from transportation and convenience. He actually desired to rent one of the units which is occupied by a single person who stayed home from war.
Under rent control, there has developed a shortage of what the young veteran needed and wanted : Housing accommodations for rent. Each year since the beginning of rent control, we lose thousands and thousands of rental units from the rental market, and each year it is continued, we will continue to lose thousands of rental units. We believe this is by design, and we have pointed out year after year that as the rental market dried up, those proposing public housing as the only cure would have a stronger case.
If we are to accept the philosophy that everyone who wants a house is entitled to me, regardless of his ability either to pay for it or to carry it, there is doubtless a shortage. "If we adhere to the more traditional approach that the right to a home must be earned, then, we seriously question the extent of the so-called housing shortage.
If we are to accept the proposition that we have slums in our cities which are in need of clearing and that our lowest-income groups need public subsidy to provide them better housing, then, we recommend that such projects be accomplished on the local level with the money raised within the community where the work is to be done.
How are slums created? Old houses do not create slums. They are caused by: (1) Improper maintenance of property by owners; (2) slovenly housekeeping on the part of the tenants; (3) inadequate municipal housing and sanitary codes; and (4) lack of enforcement of existing housing and sanitary codes.
Senator Flanders has recently made a public statement that there exist within a few blocks of this Capitol terrible slum conditions.
There is a vast amount of housing in the District of Columbia which creates any eyesore to the casual observer. Frequently, he is impressed by the extreme filth and garbage surrounding the dwellings.' Then, perhaps he notices broken-out windows, replaced by cardboard, and dislocated doors. A disfigured front of the dwelling is very apparent. Sometimes the lack of cleanliness on the part of the inhabitants further distorts the picture. The buildings probably need some repair. The plumbing may not be operating efficiently. Such housing is popularly referred to as a slum.
However, by more careful observation, it usually can be seen that the physical structure of the houses is perfectly sound and that the deficiencies which appear most obnoxious on the surface can be quickly remedied and with little cost. A shovel, a broom, a few wash rags. and some soap and water will, in most cases, bring about an amazing transformation at no cost whatsoever. Then some paint, a few fistures, perhaps a couple days of a painter's time and even less time from a carpenter and plumber can make the structure entirely livable and pleasing to the eye.
The low-income groups can be properly housed in good, safe, and sanitary housing in this manner. The slums can be cleared on an economic basis and the tenants will be paying a rent they can afford. The clearing of our slums is a vast job and therefore must be undertaken on an economic basic. Otherwise we will be severely limited in the extent to which they can be eliminated.
Irrespective of how much public housing is built, complete slum clearance will not be possible until the four conditions enumerated above are corrected.
Property owners should be required to properly maintain their property or else close it up. Of course, such an imposition would be unjust under rent control. The law should specify just what the owner is responsible for and what items the tenant should be held accountable. For example, little is accomplished by making the owner keep the building properly repaired if the tenant is permitted to throw the garbage out the window and carelessly stop up the plumbing
In Baltimore we have seen how the enforcement of the exacting housing and sanitary codes can be effective in clearing up slum conditions. We are sure that this Baltimore plan has been presented to this committee.
We would like to take a few minutes of the committee's time to show a series of photographs made right here in Washington within a few blocks of this Capitol, and probably the very slum conditions referred to by Senator Flanders. From these photographs we can show what can be accomplished in the way of slum clearance by following a plan similar to that in Baltimore. And, Mr. Chairman, in making that statement, I may find myself not in agreement with some members of this committee, but I do find that in that statement I am not entirely alone, and, for the record, at this point, with the permission of the chairman of the committee. I would like to submit for the record an editorial from the Saturday Evening Post, issue of April 30, which says, in the last sentence: “To a considerable extent the housing shortage is the child of rent control.”
Mr. MONRONEY. That may be inserted in the record at this point.