Monday, May 28, 2012

Defining Affordable

A lot of political rhetoric these days seems to include the word affordable. We're trying to make health care affordable, and create affordable housing. But just what makes something affordable?

Well, in government circles, affordable just means that you can manage the payments, though cheap credit, or longer-term credit, or through government subsidies. Or, it can mean, in effect, not in the least bit affordable by anyone who isn't rich.

Let's take the notion of affordable housing. I've seen some excellent ideas on how to make housing more affordable by actually making housing less expensive: smaller houses (but still very livable), more efficient construction techniques, and even just some good old elbow grease (which is how I've managed to live in a mortgage-free house).

But the government approach to affordable housing is low-interest loans and subsidies. But a low interest loan doesn't make an overpriced house into a reasonably-priced house, and subsidies just shift the burden of the expense to taxpayers (who also have to pay the costs of administering any system that issues and monitors the subsidies).

And the interest goes to banks and the subsidies end up in the pockets of big construction contractors. So who, exactly, is this affordable for?

I remember reading a story (which I have not been able to find the link for) of an architect who specializes in very small, but very comfortable, houses, who was offered the chance to design low-income housing. He was very excited, had great ideas on how to save money on housing, and was ready for the challenge. Until he got the specs, which stated that each house had to be a minimum of 1200 square feet with three bedrooms and two baths. Obviously, no one in that program is looking for any real innovation.

If governments really wanted to make housing more affordable, they would look at the many code requirements and, in some areas, minimum square footage requirements that make a pay-as-you-go home a pipe dream for most people.

When anyone in the government (and especially someone running for office) tells you that he or she is going to make your housing, your health care, or any part of your life more affordable, hold onto your wallet. Because somewhere down the road, in the long run, when all the costs are added up, the government's version of affordable will just give someone the chance to pick your pocket.

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