The Fed

The Future of HUD

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Written by Christopher Cox

There is definitely a new sheriff in town and his name is President Donald Trump. He’s brought his own deputies—one of whom is a neurosurgeon slated to be in charge of a $50 billion agency, the Department of Housing and Urban Development (HUD). His resounding qualifications: he grew up in a poor neighborhood and is black.

For those who are unfamiliar with the enormous powers of this agency, here is a quick primer on its far reaching duties including fighting urban blight and discrimination and helping struggling homeowners avoid foreclosures.

Briefly, HUD:

  • Is charged with ensuring that low and modest income families have access to safe homes and neighborhoods.
  • Runs the Federal Housing Administration (FHA), a multi-billion dollar home loan program.
  • Distributes money through the multi-billion dollar Community Development Block Grant Program, a funding mechanism cities use for redevelopment and rebuilding neighborhoods devastated as a result of natural disasters.
  • Runs the Section 8 program, a housing choice voucher initiative that helps the poor afford housing in safer neighborhoods.
  • Enforces the Fair Housing Act, part of the 1968 Civil Rights Act which renders housing discrimination illegal.

Furthermore, the Secretary of the Department of Housing and Urban Development vests all powers and functions of the department with few exceptions. Wow, that is an enormous job for anyone, especially one who has no government nor housing experience, but Mr. Carson believes he is ready for his seemingly surmountable task.

Carson’s Intentions?

In his statement before the Committee on Banking, Housing, and Urban Affairs—his confirmation hearing—Mr. Carson asserted that he grew up in the inner city with a single mother and understands housing insecurity. He and his family were forced to move from Detroit to Boston to live with relatives because his mother was unable to find affordable housing for him and his brother. They were able to move back to Detroit in six years due to his mother’s diligence. According to Mr. Carson, perseverance is all one needs to succeed in America. He went on to say that he wanted to heal American and drew a parallel between housing and health, citing such problems as lead poisoning, asthma, heart disease, and neurological disorders as problems associated with substandard housing. He said that regulation of the housing industry impedes progress and new ownership. To Carson, his life story is a testament to what happens when one dedicates himself to improving the lives of others. He intends to fight to help people reach their full potential. That all sounds swell, however Mr. Carson failed to give any specifics as to how he plans to achieve improving the lives of others nor did he provide any specifics about what success would look like. This lack of specifics creates a policy quagmire.

To bring this closer to home, in December 2016, HUD awarded over $600,000 to promote jobs in North Carolina, awarded nearly $200 million to North Carolina for Disaster Relief, and nearly $25 million for homeless programs. That’s nearly a quarter million dollars in HUD funding to the state of North Carolina in December 2016 alone—a significant investment and one that would be missed if cut or slowed.

Time Will Tell

We don’t know if soon-to-be Secretary Carson will continue what the Obama Administration put into effect. His outwardly myopic, pull-yourself-up-by-your-own bootstraps and poverty-is-a-choice mindset makes one wonder how seriously he would protect gains in curbing discrimination or ensuring that low- income families continue to have access to quality affordable housing.

“…that is an enormous job for anyone, especially one who has no government nor housing experience, but Mr. Carson believes he is ready for his seemingly surmountable task.”
We are equally unsure if the new secretary will allow President Trump or his business organizations to benefit from HUD’s billions.

We can hope and demand that the new secretary honor what the department has been charged to do in North Carolina and throughout the nation. We will be watching and hope that he will do what is right for this country and not President Trump’s businesses interests. We reserve the right to give Mr. Carson a chance. After all, he will be the head person in charge of HUD.

We will be watching and hope that he will do what is right for this country and not President Trump’s businesses interests. After all, he will be the head person in charge of HUD. Gauging from his remarks and actions, we don’t have a reason to be too optimistic. Several months in as Secretary of HUD, Carson has yet to give specific details about how he intends to implement Trump’s nearly $7 billion cuts to HUD nor has he spoken about its impact on families.

About the author

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Christopher Cox

Christopher G. Cox has over 20 years of experience in the real estate and finance industries. He has understands the complexities and diversity of the real estate market, and he has a passion of helping people realize the American Dream.