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GEORGE: Homelessness is a social and economic problem

December 12, 2017 - 12:11 PM

 


OPINION


Homelessness is a problem. For a long time I thought that it was a social problem. Then I thought it might be an economic problem. Lately I am thinking that it is both; our economic system has created it and our society is tossing up the usual roadblocks to dealing with it.

At its core, homelessness is a disparity between incomes and outflows. Housing is a market, and for decades it worked well. When supply waned, developers developed, builders built, and realtors sold the new product. Increased supply lowered prices and people had places to live. Rinse, lather, and repeat, right?

Not so fast. It became apparent that from time to time, the market simply failed to work like that. It is during these times that the government would step in to "fix" the problem. Programs were announced, shovels broke dirt and new affordable housing hit the market.

In the U.S., specifically in the boroughs of New York City, this got a bit out of control and thus was born "the projects", housing that met the criteria of being affordable, but the implementation left a bit to be desired socially.

In this country we built townhouses and apartment buildings, but have been careful to build "social housing" across neighbourhoods to avoid the consequences of having it all together in one place. No attempt was ever made to solve the fundamental problem of poor incomes, just as nothing is being done now in response to our current go round. We'll beat the symptoms to death and continue to ignore the disease.

The key to understanding why the housing market, in places like Vernon and Kelowna for example, can't fix this is to recognize that it isn't a problem of supply and demand at all. It is a problem of affordability. We can build all the low cost and subsidized housing we want, and it won't eliminate the problem.

There have been a number of proposals made to address the core issue of incomes that are too low to afford a home. Basic income, minimum wage increases, a "living wage"; the only thing that is likely to work is higher paying work in innovative and productive industries. Too bad we outsourced most of those to China.

Affordability, or more properly the lack of it, is manifesting itself across our economy. A great example is the fossil energy industry. Economists are still pretty sure that as the price of oil rises, new, harder-to-get-at supplies will come on stream and supply the market at that new, higher price.

At no point have they considered that the new higher price might not be affordable for those of us buying the products. The oil shocks in the seventies and early eighties showed us clearly what can happen when oil prices rise too high. 2008 should have hammered that lesson home.

So how are social forces preventing us from addressing homelessness? Well, right now there are a whole bunch of people known as "hard working, hard done by taxpayers" who are objecting to the usual band-aid solution of creating more government subsidized affordable housing. Ditto for any social spending on programs to help people with trauma, addictions, and mental illness, three drivers of the most extreme examples of how people end up homeless.

The social problem is mainly that ALL homeless people are now seen as anarchist drug addicts who do nothing but hang-out in parks, pan handle, wait for the dispensaries to open and in other ways annoy those who feel that if only they would get a job and live twelve up in a one bedroom apartment until things get better... you know, like they did when they were young people, that life would be good.

Counting the homeless is done in most communities. Numbers are up across the Interior. The recent survey in the Fraser Valley Regional District provides us with insight that goes beyond just numbers. While there are certainly things that are specific to the Fraser Valley driving homelessness, what their survey tells us about the population should roughly generalize across the rest of the southern half of the province.

One third of homeless people are not chronically homeless. This tells me that these people are not drug addicts or anarchists. They are likely just people who have been priced out of a place to sleep. Five per cent of the homeless are ex-military or ex-first responders. Almost half of the homeless came from either institutional or foster care.

Untreated trauma drives drug seeking and interferes with people's ability to function well in society. How about we treat their trauma as the medical problem it is instead of ascribing their situations to "personal choices"? We need to recognize that it will cost far more to treat people in the emergency room, our hospital wards, or in our jails than it will to provide them with a warm place to sleep.

The social solution is to recognize that prejudice isn't doing us any favours when it comes to addressing this issue. We are going to have to find a way to get people off the streets and into programs that will help them.

Longer term, we must find a way to remove the distortions of the market place that have plagued us for generations when it comes to housing. Last time around it was high interest rates that forced people out of their homes. It is fitting, then, that this time around it is low interest rates that are pushing people out of the bottom of the market. It has also convinced people that they are geniuses for making such a smart investment decision as to be in the right place at the right time to buy a home.

The debt frenzy of the past two decades has been great for creating asset bubbles. The dislocation in the housing market once interest rates come back to reality will be brutal. But it will certainly take the pressure off our streets by making housing more affordable.

Until then, we're just going to have to bite the bullet and work with what we have to look after each other. Most of us are a lot closer to that street than we like to think and we would do well to remember that.

— Chris George believes one measure of a just society is found in how well it balances fiscally conservative economics with social responsibility and environmental soundness in all of its living arrangements.


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