The Last Realist

  • ©2002 Everett Raymond Kinstler Source

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    By now you’ve all seen, heard, and read that the great Tom Wolfe died this week. His social satire and sardonic wit carved out a distinctive path through post-modern America. Wolfe championed a literary style that was part journalism, part acerbic effervescence. Few (if any) recent writers were better able to craft stories by such vivid portrayals of particular people in particular places at particular times.

    Here is Tom Wolfe in one of his many interviews with William F. Buckley on Firing Line. Just two mid-century Yale Men parlaying over the Black Panthers, Bernstein, Balzac, Homo Ludens, and the Mets disappointing season.

    The question by the gentleman at around 39:45 is actually a good one and a complaint Wolfe faced his entire career. As a chronicler, he had a tendency to paint the events into flourishes that steered the situations toward the underlying themes that he was using to make his broader point. Conversely, as a novelist he was accused of conflating ordinary details into fantastic baroque ideals.

    There’s no denying that Wolfe was the master of expansive simplification. The principles of his style required a complete accounting of all the dimensions of the scene.

    The culmination of that manifesto was nowhere more on display than in his masterpiece The Bonfire of the Vanities. Here is snippet from chapter 5 following Kramer walking into the DA’s office.

    The guard buzzed Kramer through the gate, and Kramer’s running shoes
    squeaked on the marble floor. The guard gave them a dubious onceover. As
    usual, Kramer was carrying his leather shoes in an A&P shopping bag.
     
    Beyond the entryway, the level of grandeur in the District Attorney’s
    Office went up and down. The office of Weiss himself was bigger and showier,
    thanks to its paneled walls, than the Mayor of New York’s. The bureau chiefs,
    for Homicide, Investigations, Major Offenses, Supreme Court, Criminal Court,
    and Appeals, had their share of the paneling and the leather or school-of
    leather couches and the Contract Sheraton armchairs. But by the time you got
    down to an assistant district attorney, like Larry Kramer, you were looking at
    Good Enough for Government Work when it came to interior decoration.
     
    The two assistant district attorneys who shared the office with him, Ray
    Andriutti and Jimmy Caughey, were sitting sprawled back in the swivel chairs.
    There was just enough floor space in the room for three metal desks, three
    swivel chairs, four filing cabinets, an old coat stand with six savage hooks
    sticking out from it, and a table bearing a Mr. Coffee machine and a
    promiscuous heap of plastic cups and spoons and a gummy collage of paper
    napkins and white sugar envelopes and pink saccharine envelopes stuck to a
    maroon plastic tray with a high sweet-smelling paste composed of spilled coffee
    and Cremora powder. Both Andriutti and Caughey were sitting with their legs
    crossed in the same fashion. The left ankle was resting on top of the right
    knee, as if they were such studs, they couldn’t have crossed their legs any
    farther if they had wanted to. This was the accepted sitting posture of
    Homicide, the most manly of the six bureaus of the District Attorney’s Office.
     
    Both had their jackets off and hung with the perfect give-a-shit
    carelessness on the coatrack. Their shirt collars were unbuttoned, and their
    necktie knots were pulled down an inch or so. Andriutti was rubbing the back
    of his left arm with his right hand, as if it itched. In fact, he was feeling
    and admiring his triceps, which he pumped up at least three times a week by
    doing sets of French curls with dumbbells at the New York Athletic Club.
    Andriutti could afford to work out at the Athletic Club, instead of on a carpet
    between a Dracaena fragrans tub and a convertible couch, because he
    didn’t have a wife and a child to support in an $888-a-month ant colony in the
    West Seventies. He didn’t have to worry about his triceps and his deltoids and
    his lats deflating. Andriutti liked the fact that when he reached around behind
    one of his mighty arms with the other hand, it made the widest muscles of his
    back, the lats, the latissima dorsae, fan out until they practically split his
    shirt, and his pectorals hardened into a couple of mountains of pure muscle.
    Kramer and Andriutti were of the new generation, in which the terms triceps,
    deltoids, latissima dorsae, and pectoralis major were better known than the
    names of the major planets. Andriutti rubbed his triceps a hundred and twenty
    times a day, on the average.

    And that’s just the scene and status. The dialogue continues with the obligatory obscenities and a glimpse of “donkey loyalty”, as Wolfe calls the tribal ties that contrast the “Favor Bank” of the legal system.

    Rest in Peace Tom Wolfe, and thank you for your works that contributed to our awareness and understanding of this ever perplexing world.

    Those With Dead Eyes

    I didn’t watch very much of the horrific YouTube tape of four inner-city “youths” of color tormenting a special needs white kid a tape that was all over the alternative media last week, and miracle of miracles, even made it to the national media, where incidents of black-on-white violence usually get to be covered, like with a pillow until they stop moving. It goes without saying that if the skin colors of victim and perpetrators had been reversed, just about every other national news story would have been driven off the front page and out of the first twenty minutes of national news for weeks. (Save perhaps one of the Kardashians bursting out of her dress like an overstuffed sausage in the middle of a top-drawer celebrity event.) I know that, you know that, we all are most tiresomely and cynically aware of that. Many would have been the chins tugged, NPR would have been consulting their golden rolodex for the most plummy-voiced commentator with an air of spurious authority over matters racial, CNN anchors and the correspondents of main-line news broadcasters over the world would have been hyperventilating in their efforts to keep up with the currently-fashionable expressions of condemnation of American racism, brutality, racism, cruelty to the ‘other’, white privilege, racism, the center-city of places like Chicago, Baltimore, St. Louis, Detroit (aside is there anything left in Detroit to burn?) would have been going up in flames … so on and so forth, und so weiter.

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    There Is No Possible Reform for HUD

    “The Department of] Housing and Urban Development has done an enormous amount of harm. My god, if you think of the way in which they have destroyed parts of cities under the rubric of eliminating slums … there have been many more dwelling units torn down in the name of public housing than have been built.” ~ Milton Friedman, Interview, Hoover Institution, February 10, 1999

    President-elect Trump’s appointment of Dr. Ben Carson as Secretary of Housing and Urban Development is being criticized on the grounds that he lacks the requisite administrative experience. More likely, Carson’s affront was to question why HUD exists.

    Republican presidents have been ambivalent. Having bigger fish to fry, President Reagan appointed Sam Pierce HUD Secretary so that he could ignore it. George H.W. Bush repaid Jack Kemp’s political opposition by first making him HUD Secretary and then frustrating his attempts to eliminate the Department. HUD Secretary Alphonso Jackson, appointed by George W., was allegedly focused on participating in the traditional kickback schemes while his Assistant Secretary for Housing pursued homeownership policies that contributed mightily to the financial crisis of 2008.

    Democratic presidents have used it as a platform to pursue other agendas. Jimmy Carter’s HUD Secretary Patricia Harris introduced Fannie Mae housing goals quotas as punishment for not appointing a woman to the Board of Directors. Between scandals, Clinton’s HUD Secretary Henry Cisneros promoted the homeownership goals that left both the financial system and the new mortgage borrowers bankrupt.

    HUD’s budget is relatively small as compared to other federal departments, but it has always punched far above its budget weight in destructive power. To put HUD’s annual budget of about $50 billion in perspective, the cost of the homeowner mortgage interest tax deduction is two to three times greater, but HUD’s “mission regulation” of financial institutions has given it influence or control over trillions more.

    The initial political interest in housing during the Great Depression was entirely Keynesian, i.e., related to the short-term potential to create jobs and relieve cyclical unemployment the “infrastructure investments” of that era. The Democrat’s approach to construction, management, and allocation of public housing was generally implemented to benefit builders and rife with corruption. FHA and Fannie Mae were chartered mostly as off-balance sheet financial institutions to stimulate housing production on the cheap.

    The problem of urban development, as many politicians and urban analysts saw it in the 1960s, stemmed from the 1956 Eisenhower initiative to build highways financed by the National Interstate and Defense Highways Act, a byproduct of which was that more affluent people commuted from the suburbs while leaving poorer families behind. The pursuit of the American Dream of homeownership left city administrations accustomed to cross-subsidizing municipal services in fiscal distress, creating a vicious cycle: as services declined, more affluent households moved out.

    The Housing and Urban Development Act in 1965 established HUD as a separate cabinet department as part of LBJ’s Great Society to give a greater priority to housing and urban issues. HUD inherited a mishmash of various New Deal federal programs, ranging from public rental housing to urban renewal, as well as financial oversight of FHA and Fannie Mae.

    Faced with steep “guns and butter” budget deficits, LBJ focused on ways to further encourage off-balance-sheet financing of housing construction through “public-private partnerships.” Republicans, led by Senator Edward Brooke of Massachusetts, convinced by academic studies that the urban riots of the 1960s were the direct result of poor quality housing and the urban environment and by lobbyists for housing producers, supported the Housing and Urban Development Act of 1968. The “goal of a decent home and a suitable living environment for every American family” was first introduced in the 1949 Housing Act. Title XVI of the 1968 Act “Housing Goals and Annual Housing Report” introduced central planning without specifying the goals, a timetable for implementation, or a budget.

    In the late 1960s, the Weyerhaeuser Corporation produced a forecast of single-family housing production in the coming decade to assist with tree planting. Congressional math wizards divided the total forecast by 10 to produce HUD’s annual housing production goals for the nation. For the next decade, HUD Secretaries were annually paraded before their Senate oversight Committee on Banking, Housing, and Urban Affairs to explain why they did or did not meet these production goals.

    Republicans have historically supported rental housing vouchers for existing private rental units for privately built housing to minimize market distortions. Republican HUD Secretary Carla Hills in the Ford Administration pushed HUD’s Section 8 subsidies for existing housing something arguably better administered as a negative income tax as a political alternative to the Democrats’ push for a return to public housing construction. But as a further political compromise, the largely autonomous local public housing authorities would administer these vouchers, leading to the same concentration of crime and urban decay as public housing. To borrow a phrase from former House Speaker Newt Gingrich, “Republican social engineering” isn’t necessarily better than “Democratic social engineering.”

    The economic goals of “affordable” housing have generally been in direct conflict with urban development. When I proposed demolishing the worst public housing projects and redeveloping the land, using the proceeds to fund subsidies for existing private market housing (something partially achieved during the Reagan Administration), Clinton Administration officials scoffed at the idea.

    HUD combines socialist goals and fascist methods that seriously distort and undermine markets. There is neither market nor political discipline on the enormous scope of its activities. HUD met unfunded goals through financial coercion, undermining both Fannie Mae and Freddie Mac, and their commercial banking competitors, with the collusion of the Senate Committee responsible for both financial and housing oversight, leading to the sub-prime lending debacle of 2008.

    There is no economic rationale for a federal role in housing or urban affairs in a market economy. HUD represents a continuing systemic threat for which there is no cure. May it RIP.

    Kevin Villani


    Kevin Villani

    Kevin Villani, chief economist at Freddie Mac from 1982 to 1985, is a principal of University Financial Associates. He has held senior government positions, been affiliated with nine universities, and served as CFO and director of several companies. He recently published Occupy Pennsylvania Avenue on the political origins of the sub-prime lending bubble and aftermath.

    This article was originally published on FEE.org. Read the original article.

    Quote of the Day

    Home Builders Say Federal Loan Limits Shut Out Many Buyers (WSJ):

    One of the hallmarks of the housing recovery has been the historically low level of new-home construction, particularly at lower price points attainable for first-time buyers. Although a wide range of factors are at play, from slow wage growth to higher regulatory costs, builders say the FHA limits in many markets are shutting out potential buyers.
     
    The challenge is particularly acute in California, which has the nation’s highest upfront fees for new construction, according to housing-research firm Zelman & Associates. Fees to pay for roads, sewers, schools and other infrastructure in California markets average between $40,000 and $72,000 per home, according to the firm’s research, compared with an average of $2,600 in Houston. [emphasis added]

    Despite Drop in Home Ownership, an Increase in Renters*

    Millennials cause homeownership rate to drop to lowest level since 1965:

    The drop in homeownership is largely due to a delay in homebuying by the millennials, who have the lowest ownership rate of their age group in history. Millennials are not only burdened by student loan debt, but they have also delayed life choices like marriage and parenthood, which are the primary drivers of homeownership.

    Why have today’s young people, as compared to young people in the recent past, delayed buying property, marrying and having children?

    “While the millennial homeownership rate continues to decline, it’s important to note that the decrease could be just as likely due to new renter household formation as it is their ability to buy homes,” wrote Ralph McLaughlin, chief economist at Trulia. “Certainly low inventory and affordability isn’t helping their efforts to own, but moving out of their parents’ basement and into a rental unit is also a good sign for the housing market.”

    Why are many of today’s young families choosing to rent rather than buy their homes?

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