#856: Yes In My Backyard There's a simple way to solve the housing crisis in U.S. cities. Only problem is, almost everybody hates it.
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#856: Yes In My Backyard

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#856: Yes In My Backyard

#856: Yes In My Backyard

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ALEX GOLDMARK, HOST:

Back in 2011, Sonja Trauss was a 29-year-old living in St. Louis, and she was at a kind of crossroads.

DAN CHARLES, HOST:

She just failed out of a Ph.D. program in economics - really did not want to go home to Philadelphia.

SONJA TRAUSS: Because I had left being like, see you, guys. I'm going to get a Ph.D. and I just, like, couldn't go home after that after not getting it.

CHARLES: She moved in with her dad's cousin for a few months in El Cerrito just north of Berkeley in California, got a job teaching math at a community college in Marin County.

GOLDMARK: But Marin County is super expensive, like most areas around the San Francisco Bay. So she found a place in Oakland, and her commute was terrible. And so she's spending hours every week on her way to work with that economist brain just spinning and calculating.

TRAUSS: I made $20 an hour in Marin, but I calculated my real wage when I took into account how much it costs to get there and how much time it cost. My real wage was $12.50 an hour. So I quit that job and got a job at a bakery where I made $12.50 an hour. I wanted to move, but I couldn't even afford to move. And so I was reading in the paper about people who were displaced because they couldn't afford to stay. And I was like, but this place is terrible. You can't afford to stay, and if you want to leave, you can't afford to leave because you can't save up any money because moving costs. So it just felt so grim.

GOLDMARK: And everybody in the Bay Area, and basically every big city now, knows a horror story about housing. And a lot of them are way worse than Sonja's - students packed into garages, people sleeping in their cars or shelters.

CHARLES: And some people just take it as a fact of life. San Francisco has expensive housing the same way it has fog. It just does.

GOLDMARK: But Sonja Trauss doesn't take this for granted, not after all those years of listening to economics lectures.

CHARLES: One night in 2014, she's walking down the street in San Francisco on her way to hear some music in a bar. And in the window of that bar, she sees a sign. She's seen these signs here and there in the neighborhood. It says help us stop this developer from building a big, new apartment building here.

GOLDMARK: And that sign - it makes her so mad. It, like, triggers something in her econ brain because she's thinking that apartment building is exactly what I need. It's what the whole city needs.

TRAUSS: We have a housing shortage. The way you fix a shortage - build more housing - so simple.

GOLDMARK: And at that moment looking at that sign, she thinks the people who put that sign up, they probably own homes here. They're not struggling to find a place to live. They're making things worse for the rest of us. And she cracks.

TRAUSS: I was just like, screw you guys. Like, I know what you do. You make posters. You write letters. You go to hearings. So I saw that sign, and I was like, I'm going to make signs too, you know? I'm going to make a website, too.

(SOUNDBITE OF CHRISTOPHE DESCHAMPS AND LAURENT VERNEREY'S "DISCO FOREVER")

CHARLES: Hello, and welcome to PLANET MONEY. I'm Dan Charles.

GOLDMARK: And I'm Alex Goldmark. Today on the show - how to fix the housing crisis. It's the dark side of those cities that seem so great until you actually have to live there - rents you can't afford, skyrocketing home prices.

CHARLES: Cities have tried all kinds of ways to make housing affordable. A lot of those things don't work very well. There is a solution, though. It's simple. It really works.

GOLDMARK: Only problem is - just about everybody hates it, including maybe the most powerful bunch of people in the country.

CHARLES: Do we dare speak their name?

GOLDMARK: (Whispering) Homeowners.

(SOUNDBITE OF CHRISTOPHE DESCHAMPS AND LAURENT VERNEREY'S "DISCO FOREVER")

CHARLES: There was something that Sonja Trauss found really weird when she first got into this housing fight. It was how people just were not talking about the one thing she thought would do the most good.

TRAUSS: It might sound, like, silly, but it is really, really true that you could not - in polite company, you could not come out and say I think we need more housing. I think development might be a good thing. You could not say that. It was gauche.

GOLDMARK: Now, that's not completely true. There were builders who were saying what you need is more construction. Let us do it.

CHARLES: But why should we listen to greedy developers? They just want to make money.

GOLDMARK: Well, Sonja's feeling was, OK, so they're greedy. So what?

TRAUSS: Well, I don't see what the point is in moralizing something like that. Like, it doesn't seem like it helps the problem. I actually think that's why I went into economics because economics generally is that - one of the values that underlies it is that moralizing about people's behavior isn't super productive.

CHARLES: You know, there's another popular response to a housing crisis - rent control.

GOLDMARK: Rent control. San Francisco has tried it. A lot of cities try it. You just make a law that says you can't raise the rent too much. And Sonja says that is all well and good if you happen to be living in one of those rent-controlled apartments. But it's not enough. You still need to solve the shortage.

CHARLES: And right around this time, she comes across an article in the newspaper. It quotes an economist named Enrico Moretti who, as it happens, lives right in her backyard at the University of California at Berkeley. And Moretti is quoted in this article saying people here in the Bay Area should be marching for more housing permits.

TRAUSS: He identified exactly what the problem was, and he was like, the only way this is going to get solved is if citizens groups start that ask for housing.

CHARLES: It was like a call to arms addressed just to her. Start that group. Make those posters. Build the movement to give capitalists a chance. So she sent him an email.

TRAUSS: And I was like, you wrote about us. You know, you predicted that this is a thing that could happen or a thing that needs to happen, and it's happening now, so come meet us.

CHARLES: What did you think when you got this invitation from Sonja Trauss?

ENRICO MORETTI: I was pleased that she was organizing this event and that she invited me.

CHARLES: Even though he actually couldn't make it.

GOLDMARK: Office hours, lots of PowerPoints.

CHARLES: When I talked to Enrico Moretti on Skype, he was way off in the Alps on vacation but still thinking about those housing prices in California.

MORETTI: Fundamentally, the problem of housing costs in the Bay Area is a problem of demand and supply.

GOLDMARK: It sounds so basic - lots of people want to live there and not enough homes to go around.

CHARLES: And it's a self-inflicted shortage, he says. Local governments have made it hard to build housing. There's restrictive zoning. Neighborhood councils get to object, file endless appeals, even against something like a modest little building in the most convenient of locations.

MORETTI: Their position to even, you know, three-story developments next to the train station remain fierce. And I really don't understand and I really don't condone that type of a position.

CHARLES: Here's his argument. When governments create a housing shortage this way, it doesn't just make life miserable for people. It forces people into decisions that hurt the whole economy. Maybe nurses abandon their jobs in San Francisco. The whole health care system suffers.

GOLDMARK: Moretti and a colleague put a price tag on the local housing restrictions last year, and it was astounding. They calculated that over the last 50 years, three cities - San Francisco, San Jose and New York - they cut their growth rates in half by artificially driving up the cost of housing. It cost the entire American economy a trillion and a half dollars.

CHARLES: So the problem is real. It's huge. And here's how you organize to solve it. Step one - form a club. Give it a name with a catchy acronym.

TRAUSS: And I called it SF Bay Area Renters' Federation - SFBARF.

GOLDMARK: Love it.

CHARLES: Step two - invite people to parties. Turns out, getting angry together can be kind of fun. I met Laura Clark at one of those parties. She was one of the first people to join up with Sonja.

LAURA CLARK: Oh, yeah, Sonja was, you know - she was angry first, and I got to go run around and be like, oh, yeah, I'm going to go do what she's doing. We're going to go yell and it will be fun and exciting. And then we'll get a drink and then we'll like, you know, gossip local politics and make it into a whole event.

GOLDMARK: The anger bonding was real, and it felt like it was a battle of generations - renters versus owners, young people demanding change against old people who'd been there a while and liked their neighborhood just fine the way it was.

CHARLES: Yeah, there's a derogatory name for people who don't want new stuff in their neighborhood - NIMBYs.

GOLDMARK: NIMBYs.

CHARLES: Not in my backyard. Sonja and her friends called themselves YIMBYs - yes in my backyard.

GOLDMARK: So much more friendly.

CHARLES: Step three - go to meetings. Sign up to talk for two minutes.

(SOUNDBITE OF ARCHIVED RECORDING)

TRAUSS: Hi. My name is Sonja.

CHARLES: This was a city planning meeting in West Oakland four years ago when Sonja was just getting started. She walks up to the microphone in tank top, colorful tights...

(SOUNDBITE OF ARCHIVED RECORDING)

TRAUSS: Do new houses cause rents to rise?

UNIDENTIFIED CROWD: Yes, yes.

TRAUSS: No. Rising rents cause capitalists to build houses.

GOLDMARK: She's like an exasperated math teacher.

CHARLES: (Laughter) Her speech was pretty much the same everywhere - build as much as possible as fast as possible. But the people she was fighting against were different depending on the neighborhood.

GOLDMARK: In working-class places like West Oakland, people were suspicious of new development because they worried that it would mean richer people - white people - would take over the neighborhood. The fear was landlords would say this is an upscale neighborhood now. Maybe I will try to evict my old tenants, renovate the building, make more money.

CHARLES: So there were other places, though, like wealthier parts of Berkeley and San Francisco. There, it was people with multimillion-dollar homes who didn't want new development because it meant noise, you know, construction, bigger buildings messing up their quiet streets and beautiful views.

GOLDMARK: NIMBY. It seemed like everybody had a different reason to say, no, not here, and to say it loudly right into a microphone recorded for posterity.

CHARLES: Yes, there are tapes.

GOLDMARK: Lordy.

CHARLES: This is like SportsCenter highlights from local democracy in action.

GOLDMARK: (Imitating SportsCenter theme) The meeting in Berkeley was tense last night.

CHARLES: A developer wanted to put up a big, new apartment building where there used to be a drug store. And some people didn't like it, said this monstrosity will block a great view. Sonja was there with some of her YIMBY friends, and one of the other speakers turned on them.

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED PERSON #1: I also want to say that this little group of people over here is led by a woman who supposedly, from what I understand, lives in Oakland and goes around to Albany, San Francisco and Berkeley talking about development just because she loves it so much. We don't really know where she's getting her money from because she won't tell us. So what does this tell you? That this is a...

TRAUSS: (Unintelligible).

UNIDENTIFIED PERSON #1: Would you please wait? You'll have your turn - that this can only be a front group for development.

UNIDENTIFIED PERSON #2: (Laughter).

TRAUSS: Personal attacks - what is that all about?

UNIDENTIFIED PERSON #1: Are you going to let me have my time and make her stop?

UNIDENTIFIED PERSON #3: You can have your time. Let's not have any personal...

CHARLES: Sonja Trauss got to the microphone a few minutes later.

(SOUNDBITE OF ARCHIVED RECORDING)

TRAUSS: When you shop for housing and the landlord says, I need, you know, first, last and deposit and actually, you know what? I want the first six months up front, you're like, I can't really do that. And he's like, well, where else are you going to rent? How many units are there open? That's a very powerless position for us. So, please, don't push us into this powerless position. Property values go up when you don't build enough stuff.

CHARLES: It's that econ brain again. She's thinking if the homeowners keep new homes off the market, their own homes are worth more.

(SOUNDBITE OF ARCHIVED RECORDING)

TRAUSS: So I'm (laughter) you can say I'm here from a greedy developer, but I can say you're here as greedy homeowners.

CHARLES: So she and her friends were saying, build, build, build, private development, government subsidized housing. We want it all.

GOLDMARK: And more and more, other people were saying things that were kind of similar. The mayor of San Francisco at the time, Ed Lee, he said let's set a target - 5,000 new housing units each year.

CHARLES: So it really seemed like progress, but when it came to real decisions, there were a lot of setbacks. For instance, a couple of years after she started her group, the San Francisco Board of Supervisors, which is what they call their city council, was considering a new law. It would've allowed taller buildings, denser housing in some residential neighborhoods.

GOLDMARK: This is what the housing nerds call upzoning. It was an upzoning bill, and Sonja was a big fan. But at community meetings around town, it did not go over well.

TRAUSS: It was terrible. Every meeting, everybody who spoke up was totally against it.

CHARLES: Or another meeting.

GOLDMARK: (Imitating SportsCenter theme) Let's go to the tapes. The face-off was fierce over a new condo building in the heart of the Mission.

CHARLES: Now, seriously, you may know the Mission. It's a working-class Latino neighborhood gentrifying. A lot of people don't like that. They didn't like the new condo building, either, like Scott Weaver from the Latino Cultural District Council.

(SOUNDBITE OF ARCHIVED RECORDING)

SCOTT WEAVER: On Valencia Street, you can have a meal for $50 to $100 per person. You can buy fancy clothes. You can spend $350 for a handbag. These are not the types of businesses that belong in the Latino Cultural District.

GOLDMARK: When Sonja got up, she laid into the building's opponents.

(SOUNDBITE OF ARCHIVED RECORDING)

TRAUSS: And when you come here to the board of supervisors and say that you don't want new, different people in your neighborhood, you're exactly the same as Americans all over the country that don't want immigrants. It is - it is the same attitude. It is exactly the same attitude.

CHARLES: People were furious at this. One supervisor who said he'd come to the meeting intending to vote for the building, now he wouldn't just because he didn't want to be on the same side of the issue as Sonja Trauss. The vote was 9-0 to delay the project.

GOLDMARK: Fernando Marti had been on the opposite side of Sonja Trauss at a lot of these meetings. He's the co-director of the Council of Community Housing Organizations, one of the groups fighting gentrification in the Mission. And he has two basic disagreements with the YIMBYs.

CHARLES: One of them is practical. See; YIMBYs complain a lot about neighborhoods making it hard to build things. But Fernando says that's not the main reason there's a shortage of housing. He says, the big problem is it's just really, really expensive to build anything in the central district of San Francisco. It is so expensive, the only kind of housing that developers can figure out how to finance is high-end condos for rich people.

FERNANDO MARTI: They would build cheaper if they could, but they can't, so they just build for that top 2 percent.

CHARLES: The other thing that gets on his nerves is when these mostly young, mostly white, mostly educated YIMBYs adopt the language of civil rights, when they say, the way Sonja said in that meeting, that, you know, folks in the Mission are like nativists trying to keep new people out of their neighborhoods.

MARTI: I think people who have seen the effects of, you know, redlining and gentrification and evictions, they want to be able to shape their own community and shape what comes in.

GOLDMARK: Sonja isn't apologizing for what she said at that meeting. But she was listening. In fact, she changed her mind about something. It started with something that she read probably scanning her Twitter feed.

(SOUNDBITE OF ARCHIVED RECORDING)

TRAUSS: Somebody who was associated with Mission activists was saying it's not fair that all the housing is going into the Mission and not the Westside. And I thought, that's true. That isn't fair. That's a great point.

CHARLES: She realized she'd been thinking too small. She'd spent so much time going to where the arguments were, arguments over this or that building, but the arguments weren't even happening in most of the city, the quiet residential part of the city mostly on the western side. There were no arguments because you couldn't even think about building an apartment building there because of zoning rules.

GOLDMARK: She realized to make a real difference, those rules had to change. So that's the new YIMBY campaign. Their new slogan - legalize housing everywhere, not just because it's fair but because it's cheaper. You can add a lot of new apartments in these residential places without having to build those expensive, high rises made of concrete and steel.

TRAUSS: Actually solving our problem in California, and probably anywhere in the U.S., is only going to happen if we allow these miles and miles, acres and acres, of single-family, large-lot neighborhoods to become places with mixed-housing types. People need to be able to allow their single-family homes to be torn down and build a fourplex or maybe even a 10-unit garden apartments.

CHARLES: So the new and latest phase of this campaign to make new construction cool - she's going after the suburbs.

TRAUSS: Look; I'm serious when I say everywhere. I'm not kidding.

CHARLES: So for instance, there's a town sitting right on an expensive commuter rail line. It will not allow some apartment buildings to get built. Sonja's suing them.

GOLDMARK: And in the past year or so, the YIMBYs have even started making some political progress.

CHARLES: Remember that proposed law that was going to maybe allow denser housing construction in parts of residential San Francisco?

GOLDMARK: What the housing people call upzoning.

CHARLES: Yeah. It got such a hostile reception when they introduced it in 2016.

TRAUSS: About a year later, when they went around again, by that time, YIMBYs had started organizing in some of the Westside neighborhoods. And so the second round of community meetings, there were, like, three or five, you know, half a dozen YIMBYs, people who said I think this might be a good idea. I think this could help our neighborhood. And just having them there completely changed the possibilities for the bill.

CHARLES: Last year, the supervisors passed it 11-0.

TRAUSS: When it finally passed, it was the first time ever in the history of the universe that there had been an upzoning in the Westside of San Francisco.

GOLDMARK: And just a couple of months ago, San Francisco elected a new mayor - London Breed. She'd grown up in public housing in the city, and she made more housing a big part of her campaign. Right away, in her inauguration speech, she sounded a lot like a YIMBY.

(SOUNDBITE OF ARCHIVED RECORDING)

LONDON BREED: The politics of no has plagued our city for far too long - not on my block, not in my backyard. We have made mistakes in the past by not moving housing production forward all over this city. And I plan to change the politics of no to the politics of yes. Yes, we will build more housing.

GOLDMARK: That is the new mayor of San Francisco.

CHARLES: And Sonja Trauss - she is running for a seat on the San Francisco Board of Supervisors. The election's in November. She's got three more months to make her case.

(SOUNDBITE OF JEROME FABY'S "BLUES ROCK ATTITUDE")

CHARLES: We post a link to every episode of PLANET MONEY on Facebook. If you have thoughts about housing and the YIMBYs, leave a comment on the post.

GOLDMARK: We read every single one of them. If you're looking for another fun economics podcast, there is our other podcast, The Indicator. It comes out every day, 10 minutes or less. This week, they explain Adam Smith's diamond and water paradox. You need water to live. You don't need diamonds. So why are diamonds more expensive? It's a paradox. Subscribe to The Indicator from PLANET MONEY wherever you get your podcasts. And you can also get in touch with us on Twitter or Instagram. We're @planetmoney. We read all the emails to planetmoney@npr.org.

(SOUNDBITE OF JEROME FABY'S "BLUES ROCK ATTITUDE")

CHARLES: Today's show was produced by Sally Helm and Taylor Haney. Bryant Urstadt is our editor. You, Alex Goldmark, are the senior producer.

GOLDMARK: That is true.

CHARLES: I'm Dan Charles.

GOLDMARK: And I'm the aforementioned Alex Goldmark. Thank you for listening.

(SOUNDBITE OF JEROME FABY'S "BLUES ROCK ATTITUDE")

GOLDMARK: (Imitating SportsCenter theme) And now for last night's meeting highlights.

(SOUNDBITE OF MONTAGE)

UNIDENTIFIED PERSON #4: My family has lived 75 years in our home, and I don't plan on leaving until I'm in a box.

UNIDENTIFIED PERSON #5: Busy. We've lived there so - we've lost six cats to that street. That's how crazy busy it is.

UNIDENTIFIED PERSON #6: Children, like plants, need light to thrive.

[POST-BROADCAST CORRECTION: A previous version of this episode misstated the location of a town that Sonja Trauss is suing. It is to the east of San Francsico, not the south.]

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