The Real HUD Scandal

It's Hard to Keep Summoning Outrage at HUD Leadership

By Mary Kane 04/18/2008

Former Housing and Urban Development Secretary Alphonso Jackson's foray into making himself and his friends rich with money intended to help house the poor gets a closer look in today's New York Times.

The details of Jackson's tenure at HUD are, of course, scandalous, right down to spending $100,000 to commission oil portraits of himself and other HUD secretaries. But the story in many ways seems less shocking than it should be, only because of the agency's long, sad history of scandals. When another one comes along, it's hard to summon up the outrage yet again.

In the 1970s, HUD subsidies intended for low-income housing turned into a candy store for private developers, leaving blocks and blocks of city neighborhoods across the country scarred by vacant homes. It took decades to recover. In the 1980s, HUD Secretary Samuel Pierce resigned over allegations of favoritism, mismanagement and theft. He was never charged with a crime, but 16 people under him were. In the meantime, President Ronald Reagan, in one way he actually did make government smaller, slashed spending on low-income housing in half.

Over the decades, probably hundreds of millions of dollars intended to help desperate people living in terrible circumstances has been stolen, misused or misdirected toward the wealthy and connected. Ripping off HUD is ingrained in the popular culture; the Sopranos even dedicated a story line to it.

With a few exceptions, HUD has become a dumping ground for figureheads to lead an agency no one really seems to care about, one that some conservatives wish would go away entirely. Reagan once famously failed to recognize Pierce at a Cabinet meeting.

After the headlines from the latest scandal fade, everyone will no doubt go back to ignoring HUD again -- except for poor people trying to find decent housing and the low-income housing advocates who work on their behalf. They're not exactly among Washington's power elite.

But this is what I try to remember, every time I read about HUD corruption, because it rarely seems to merit attention. When those at the top steal HUD's money, the people at the bottom pay for it. In 1990, as developer A. Bruce Rozet enriched himself with HUD's funds, his tenants "lived like rats," by one account.

I once visited a woman who lived in one of Chicago's infamous, and now-demolished, housing projects. She had found a job, and was trying to save to get out of there. In the meantime, she heard about a program that offered vouchers to public housing tenants to move to the suburbs. To get a voucher, you had to call a hotline on a specified day and hope you got through. She took off work to do so, and spent the day calling, and calling, and calling.

There's a humane way to run a housing program. Anyway, she never got through, and never got her voucher. What I recall most from that visit is she told me she was so terrified of living in that project that she rarely, if ever, left her house. She stayed inside with the doors locked, like a prisoner. When I stood up to leave, this soft-spoken woman ordered me, sternly, to sit back down, told me to get out of there as fast as I could, and urged me to call her if I managed to get to someplace safe.

People like her still live that way, every single day, in crime-ridden neighborhoods in any city in America. They don't make headlines. When it comes to HUD, attention only gets paid when there's yet another round of corruption, fraud and deceit at the top.