Crony capitalism in New York’s “affordable housing” industry

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Zoning is a powerful tool.

“See that land? It’s designated for a highway.”

“But I own that land.”

“Not now.”

Zoning is often manipulated by developers and local cronies for profit. Heck, I’ve got it going on right in front of my house.

Such manipulation happens everywhere but in New York it happens on the grandest scale. As Jim Epstein reports, affordable housing units have become a great way for developers to extract subsidies for their projects. Why build with one’s own money if one can go through City Hall and get the taxpayers to finance one’s projects.

(From The New York Daily News)

Here’s the problem: Affordable housing developers aren’t simply do-gooders or risk-taking Silicon Valley entrepreneurs; they’re expert crony capitalists. If they’re not going to make a lot of money, they’re not going to build. It’s that simple.

Staffed with an army of expert budget nerds with deep knowledge of the city’s red tape and its wide array of local and federal subsidy programs, the developers won’t under any circumstances be squeezed.

Over the years, and perhaps especially these past 12 years, New York City’s affordable housing industry has done a terrific job at earning itself boatloads of money while producing a relatively small number of cheap housing units.

Click here for the article.