Hit & Run

Elizabeth Warren's New Bill Would Spend $500 Billion on Housing

The American Housing and Economic Mobility Act would nearly double current federal housing spending.


Tom Williams/CQ Roll Call/Newscom

Sen. Elizabeth Warren (D–Mass.) wants to build America out of its housing woes with a huge infusion of federal dollars.

On Tuesday, Warren introduced the American Housing and Economic Mobility Act, which would spend roughly $500 billion over the next 10 years on a variety of new and existing federal housing programs. It would give an extra $45 billion a year to the Housing Trust Fund—a big increase from the $219 million allotted to that program in 2017. An additional $2.5 billion would be spent annually on the Capital Magnet Fund, used to leverage private funds for affordable housing funding. Another $2.5 billion would go each year toward housing in rural and tribal areas. The funds would come mostly from hiking the estate tax.

All told, this is a giant increase in federal housing spending, more than doubling the current annual Department of Housing and Urban Development (HUD) budget of $50 billion. In return, this spending will—according to an analysis by Moody's Analytics—produce 3 million housing units by 2028, shaving a whole percent off per-year rent increases and lowing rents for below-market units by about 10 percent. (Moody's analysis assumes that each new unit will cost the federal government $175,000 to produce. That's close to the average per-unit cost of new, federally-funded affordable housing, but it's well below the $326,000 average cost of new affordable housing in a pricey state like California.)

The bill's spending measures makes standard progressive fare, similar to proposals from Sens. Kamala Harris (D–Calif.) and Bernie Sanders (I–Vt.). Harris introduced her own housing bill in July that would offer a refundable tax credit to renters spending more than 30 percent of their income on rent. Sanders called for "significantly expanding" the Housing Trust Fund in June.

Unlike either Sanders' or Harris' ideas, Warren's legislation calls out restrictive zoning laws for the upward pressure they put on housing costs. "Instead of supporting development and promoting competition, state and local governments have imposed needless rules that substantially raise the cost of buying or renting a home," reads the summary of Warren's bill.

To counteract these policies, Warren proposes a new grant program that would make $10 billion in infrastructure funding contingent on localities loosening their zoning rules.

It's welcome to see the senator addressing the issue of zoning at all, given the outsized impact it has on housing costs. But her solution is unlikely to fix the problem. Those cities and neighborhoods that have the most restrictive zoning laws tend to be wealthier communities that are less dependent on federal funds in the first place, so they're less likely to be swayed by promises of more cash.

More federal money for a new park or elementary school also seems unlikely to placate the concerns of most NIMBYs, whose opposition to new development usually can be reduced to narrow fears about unwanted construction noise, unwanted traffic, and unwanted neighbors (be they low-income tenants or gentrifying yuppies).

And while Warren's bill aims to reduce regulation with one hand, it would creates a lot more regulations with the other. The legislation would impose prevailing wage requirements on projects, expand the Community Reinvestment Act's requirements to more types of financial institutions, and broaden the Fair Housing Act's anti-discrimination measures to include sexual orientation and gender identity. So despite the encouraging language about zoning, the meat of Warren's proposal is more federal spending and more federal regulation.

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  1. But Democrats care about the deficit! /sarc

    1. The funds would come mostly from hiking the estate tax.

      As stupid as this idea is she is not suggesting doing it GOP style (deficit financed).

      1. I wonder how much the estate tax incentivizes the super rich to spend wildly in their last years in order to avoid it.

        1. Even liberals like Buffett and Gates know that giving their fortunes to charity is better than letting the government squander it.

          1. So it won't get funded, right?

            1. It's DOA. She is probably up for reelection and housing prices are a winning issue in Boston.

              1. All those poor Ivy League students living off of government subsidized tuition payments and a tax free endowment fund bigger than any mutual fund on Wall Street. These are the real victims.

          2. Buffett (in part) got rich selling life insurance to help people avoid the estate tax.

            Coincidentally he supports the estate tax.

        2. They give it to their kids before they croak, or set up a tax-exempt trust. Either way, they will find a way not to pay the estate tax. If you are wealthy enough for the estate tax to be an issue, you have to be incredibly stupid to pay it. But that won't stop Warren from saying "Hey look! We are doing something about it!"

        3. The rich avoid the estate tax through other means, such as whole life insurance, etc.

        4. the rich just create a trust so that it is no longer an estate and the family gets all the assets anyway

          1. You dont have to be right to create a trust.

      2. Still, she's a class envy cunt.

        1. Still better than a Big Deficit GOP cunt like The Con Man.

          1. I ascribe to the crazy idea that tax increases are just as bad as deficits, since they are both the same thing, except one is deffered. But, I guess, GO TEAM!

            1. The GOP deficits are future tax increases compounded by interest so therefore worse than a tax increase today in a sound economy.

              Since no party has any interest in cutting spending there is no alternative.

              1. I've never met a liberal that thinks the government spends too little.

                I have met some from the other team that says the government spends too much, but they generally sign off on more spending for the projects they want.

                Deficits are generally a bi-partisan affair except when a party holds the presidency and both houses of congress.

                When people talk about Obama lowering deficits, they are ignoring that the republicans held both houses of congress when that happened.

                At the end of the Bush admin, the democrats held both houses of congress.

                The blame game is a simple way to redirect people's attention so the spending can continue.

                1. And don't forget that his "lowering the deficit" was after spiking it to trillion+ levels by congressional dems who, coincidentally, never passed a fucking budget.

                  1. "lowering the deficit" was after spiking it to trillion+ levels

                    The Bushpigs left a $1.2 trillion deficit - you fucking idiot.

                    1. With a Democrat congress and Obama left 10 trillion more debt.

              2. The interest simply represents the future cost of the money. So a deficit that is paid in the future could probably be pretty close to a current tax in terms of lost value.

          2. Not really, Mr. WhatAboutTheGOP.

      3. So, wealthy people are going to fund something that they oppose?

        What world does she live in? Her overlords are going to give her a serious smack down.

    2. That is a lot of Wampum.

    3. $500 billion would buy lots of teepees. For my bunghole.

      1. lake titicaca

        1. Are you threating me?

  2. I'm not reading anywhere in this article about why this is Republicans fault.

    1. Trump wasn't even mentioned!

    2. Its assumed in all matters.

    3. Is that sarcasm, BUCS, or double sarcasm?

  3. Funny how the answer is never "Get the government out of the fucking way". The reason housing is so goddamn expensive everywhere is ridiculous overzoning crap.[

    1. Well, apparently it does attempt to control some zoning (though I kind of don't think that should be a federal incentive anyway, but still). The rest of the regulation added on top seems fairly onerous as well.

  4. Anyone remember Jared Polis, the last guy cosmos had a crush on before Beto?


    He's being accused of assaulting a female staffer. There are going to be so many sad faces at the next Georgetown cocktail party.

    1. Oh no, there's a police report and everything


    2. I thought he is gay.

      Non sexual assault is okay for Congresspeople.

      1. Heh, anything is OK for a congressman, even murder overseas....er...I mean "collateral damage"

    3. Refs unperson. Double plus ungood.

    4. Lefties had a Sad.

    5. The police report describes it as self defense against a blackmailer.

      The officer who interviewed Polis wrote in the report that Ms. Hughes "did knowingly and unlawfully take several files with original contracts and other sensitive documents" from the business.

      1. Hey now, don't let the facts of the case interfere with the fact that we should trust all women.


  5. Elizabeth Warren (D?Mass.) wants to build America out of its housing woes

    A massive expansion of housing? What could go wrong?

    1. Meh. They'll wind up building camps. Maybe with wrought iron gates and catchy little slogans above the entryways.

      1. Far more likely is that they'll build the type of housing that isn't in demand in those areas in an attempt to achieve their version of an ideal city.

        1. Berlin circa 1942?

  6. Unlike either Sanders' or Harris' ideas, Warren's legislation calls out restrictive zoning laws for the upward pressure they put on housing costs. "Instead of supporting development and promoting competition, state and local governments have imposed needless rules that substantially raise the cost of buying or renting a home," reads the summary of Warren's bill.

    That's....surprisingly refreshing. There's gotta be a catch.

    Oh, right, the $500B thingy.

  7. Those cities and neighborhoods that have the most restrictive zoning laws tend to be wealthier communities

    Well yeah, isn't that the point? Wealthy people can afford the costs imposed by zoning laws, whether they be in higher property values or just plain inconvenience. Sometimes increasing property values is the goal.

  8. "Government subsidies can be critically analyzed according to a simple principle: You are smarter than the government, so when the government pays you to do something you wouldn't do on your own, it is almost always paying you to do something stupid"

    PJ O'rourke

    1. I'd be stupid *not* to trade freely with China!

      1. Our money is helping to build the a real world big brother in China which is being used to further oppress the citizens. China hasn't changed on human rights. I'd prefer not to trade with China at all.

        Their citizen scoring program should give any human rights loving country a reason to not do business with them.

  9. Another housing bubble setup, like Democrats did with HUD rules and Freddie Mac and Fannie Mae to make ninja loans risk-free.

    1. Psst: Ninja loans were not related to Fannie and Freddie

      1. Hey, he is our resident idiot.

        1. I don't know. You're pretty stiff competition

        2. Buttplugger the troll and village idiot.

      2. Ninja loans were No Income, No job, No assets and were backed by HUD and had rules set by lenders like Fannie Mae and Freddie Mac.

        CNBC sub prime mortgages

        Freddie Mac and Fannie Mae are doing it again.

        "Last summer, Fannie Mae announced it would relax its lending standards for prime loans, allowing borrowers with higher debt and lower credit scores to obtain loans without additional risk overlays, such as large down payments and a year's worth of cash reserves.

        Fannie Mae raised its debt-to-income (DTI) limit from 45 percent to 50 percent. DTI is the amount of total debt a borrower can have compared to his or her income"

        1. Debt to Income ratios had to be 50% you idiot.

          "No income" means no income or job. Yes, Wall Street ate those loans up and was the cause of the financial crisis - not the two GSEs.

          1. ""Wall Street ate those loans up and was the cause of the financial crisis ""

            Really? How about giving people loans that could not pay them back?

            Trying to move poor people into home ownership is a cruel game played on the poor. Home ownership is a money pit. Sure we can get you a loan for the mortgage, but can you afford paying it back while paying the taxes, and a new roof?

        2. Buttplugger has been following me around all day.

          To much anti-Lefty facts posted here without some Lefty nonsensical reply.

  10. Urban progs do not want affordable housing to ruin the character of their hip neighborhoods, so not sure where this housing will be built. The job growth is in the big metro areas, so if the residents do not want it, what will they do, build a bunch of new houses in places where nobody wants to live or work?

    1. Pay people to dig a ditch and then fill it up again

  11. more money for developers who can then only rent to women with five kids and no husband. no one else need apply

  12. Nice to see she's allocating some of it for her fellow Native Americans in tribal areas.

  13. Sure, because when you are 21 trillion dollars in debt why not spend more money and burn out in style.

  14. Democrats spent enough money in the Obama years, it is the Republicans turn now to waste money.

  15. Why does it cost the government more to build "affordable" housing than it would cost someone to buy a supposedly "unaffordable" on the real estate market?

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