Taxpayers and the Homeless Are Just Pawns in Scheme to Buoy Leftist Donors

Arguably, Los Angeles Mayor Eric Garcetti is the most incompetent, destructive, negligent, no good, irresponsible mayor in American history. And he’s got plenty of competition right now. San Francisco’s London Breed, Ted Wheeler in Portland, and Bill de Blasio in New York City are all top contenders. Blue City mayors bent on destroying civilization are plentiful, but Garcetti is the worst member of this odious gang.

It isn’t that Garcetti doesn’t have partners in the ongoing annihilation of urban civilization in what should be America’s magnificent megacity on the Pacific Rim. He’s got a city council that is equally corrupt and delusional, and a newly elected Los Angeles County district attorney, George Gascón, who is one of the most dangerous, pompous imbeciles ever to live. But Garcetti is in the bully pulpit. Garcetti sets the tone. Garcetti could make a positive difference if he had the vision and the guts. The buck stops with Garcetti.

Garcetti attracted well-deserved outrage when he not only arbitrarily enforced “lockdown” orders throughout most of 2020, but went a step further and posted a page onlinestill up—where people can turn in anyone they think is violating the “Safer at Home” order. Then, just in case anyone hadn’t yet realized what a sinister authoritarian they had as mayor, Garcetti set up a bounty to encourage people to turn in their neighbors, and announced to the press that “snitches get rewards.”

The arbitrary enforcement of pandemic restrictions makes Garcetti’s snitch hotline particularly offensive. Neighbors, and competitors, get paid to anonymously turn in the corner bistro or nail salon, while big-box retailers and corporate fast-food franchises stay open with impunity. Citizens can be turned in and cited for walking their dogs, while within the city’s growing archipelago of homeless favelas, anything goes.

The problems of affordable housing and a growing homeless population afflicted Los Angeles well before the pandemic began, of course. But they’ve become considerably worse over the course of the past year. They are the twin signal failures of Garcetti’s mayoral tenure. The manner in which Garcetti has bungled these crises provides a sordid glimpse into an administration riddled with corruption and delusion. They have done absolutely everything wrong.

Many flawed theories underlie housing and homeless policies in Los Angeles. To name a few: “Housing first,” a policy first endorsed by Obama’s Department. of Housing and Urban Development, prioritizes funds to provide shelter before using any government money for treatment or counseling; the concept of “wet shelters,” which admit homeless individuals regardless of their sobriety; and the most misguided of all, “inclusive zoning,” the preposterous theory that the most appropriate way to house the homeless is to construct shelters on some of the most expensive real estate on earth.

Inclusive Zoning Corrodes Property Rights

The notion propelling “inclusive zoning,” that somehow anyone who is homeless, for whatever reason, has a right to live for free in a wealthy neighborhood, would be material for hilarious satire, except for the fact that its purveyors are deadly serious. 

Some of the proponents of inclusive zoning are motivated by compassion unfettered by the numerous reality checks that should apply; others are stone-cold Communists, determined to destroy the rights of property owners. But by far the most influential advocates for inclusive zoning are the special interests that correctly recognize it as a scam they can ride to riches.

The Los Angeles Planning Commission on Tuesday is scheduled to vote on whether to approve the “Reese-Davidson Community,” a proposed 140-unit monstrosity to be built on 2.8 acres straddling the main thoroughfares connecting Venice Beach to the rest of Los Angeles. Located just a block from the beach, the city-owned property is currently a parking lot for beachgoers. The most sensible and just choice for the city would be to keep the property as it is, at least if city officials ever manage to make the beach a safe place again for families to visit on the weekends. 

But there are other options.

Real estate in the heart of Venice Beach and close to the ocean is extremely expensive. If it were sold to a developer to build an unsubsidized, 140-unit multi-family complex, the market value of this land is conservatively estimated at $35 million. Imagine how this money might be spent by a resourceful city council committed to helping more people at a reasonable cost. 

Low-income housing can be built in low-income areas of Los Angeles for a fraction of the cost of the Reese-Davidson project, as can “permanent supportive housing” for the homeless. The construction cost alone is estimated at over $1,000 per square foot—that is, over $68 million. Taking into account the value of the land and the parking structure, this project is going to end up costing over $735,000 per unit—and most of the planned units are tiny studios.

This isn’t unusual for taxpayer-subsidized housing projects in Los Angeles. In 2019, City Controller Ron Galperin published an embarrassing audit of how the city used its voter-approved Proposition HHH funds, which authorized the city to issue $1.2 billion in general obligation bonds partially to subsidize the development of supportive housing units. The gist of that report? Galperin writes: “The current median cost per unit for projects in the Proposition HHH pipeline is $531,373, and more than 1,000 units are projected to exceed $600,000.”

Big Money in the Homeless-Industrial Complex

The implications of these findings, which represent not only a scandal for Los Angeles but for dozens of other cities in California under the same type of mismanagement, illustrate the futility of this approach. 

To house the more than 60,000 homeless living in Los Angeles today at these prices for shelter would cost $32 billion. Since these projects are also designed to accommodate low-income residents of Los Angeles, easily 10 times more numerous than the homeless, the true cost to get the job done is more than $300 billion. And this is the low estimate.

The current theory of “housing first” means that until all the homeless are housed, money cannot be allocated for treating their addictions, even to the extreme of not requiring sobriety as a condition of their residency in these permanent housing units they’re being given. This means that Los Angeles, with its mild winters and inviting beaches, is a magnet for the indigent across America, from sea to sea. This is already a demonstrated fact, as a street culture reminiscent of “Lord of the Flies” plays out daily in Venice Beach. The party never stops, and the only heat comes from gangs.

But even if the number of homeless in Los Angeles were capped somehow, meaning that someday they all would find permanent supportive shelter, why would the developers who are building and operating these housing projects ever want to solve such a profitable problem? 

This is where the concept of “inclusive zoning” becomes extremely useful. One of the besieged Venice Beach residents, Soledad Ursua, interviewed recently in the Epoch Times, explained how the racket works. “Developer fees are a fixed percentage,” she said. “If you’re one of these nonprofit developers, which project would you work on, one that pays 10 percent of $10 million or 10 percent of $100 million?”

This 10-to-1 range of potential costs is not far fetched. Considering the value of the land and the inevitable cost overruns, it is possible, even likely, that the apartments of the Reese Davidson project would come in at a total project cost of around $1 million per unit. If the many amenities were dispensed with, and these studios were constructed efficiently in some of the inland neighborhoods of Los Angeles, it should be possible to build studios at a cost of $100,000 per unit. 

And for that matter, why aren’t homeless, especially the significant percentage who would be sane and able-bodied if they were denied drugs and alcohol, not just rounded up and offered shelter in a supervised tent encampment? Such facilities could be built quickly and cheaply—virtually overnight, even—not only would taxpayers save billions, but Los Angeles would lose its status as a magnet for the stoners of the world.

One must repeatedly ask why aren’t these solutions being pursued or even seriously considered? Why isn’t Eric Garcetti using his city’s resources to change the legal and legislative environment to make practical solutions possible? Why aren’t taxpayers demanding these reforms? 

The reason is that too many people are getting rich on this fraudulent masquerade of compassion. They are making billions in fees and receiving additional billions in tax credits to create projects that operate exempt from property taxes and business taxes as the problem gets worse.

Los Angeles Mayor Eric Garcetti may or may not deserve all of the unflattering descriptions leveled at him by his critics. He is part of a much larger hypocrisy. But Garcetti knows exactly what is going on, and nobody is in a better position to do something about it than he. 

The homeless and housing policies of Garcetti’s administration are destroying Los Angeles. With the lone exception of the relative handful of bureaucrats, consultants, builders, and operators who are making a killing, everyone in the City of Angels is a victim of this failed policy. It is not just the hardworking residents who can still afford their rent or their mortgages who are suffering but also the homeless themselves.

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About Edward Ring

Edward Ring is a senior fellow of the Center for American Greatness. He is also the director of water and energy policy for the California Policy Center, which he co-founded in 2013 and served as its first president. Ring is the author of Fixing California: Abundance, Pragmatism, Optimism (2021) and The Abundance Choice: Our Fight for More Water in California (2022).

Photo: David McNew/Getty Images

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