PUBLIC HOUSING IS ONLY FOR POOR PEOPLE
Nancy Kwak
Perhaps the most commonly held misconception about public housing is that it is synonymous with strategies to house the poorest. Historically, however, this claim has not been true even in the United States, given that managers of most early public housing projects declined to house the unemployed and the least economically advantaged residents. And, when one looks outside the United States, the myth that public housing is only for poor people explodes completely. A more international look at housing experiments can infuse new perspectives into tired debates about American public housing, perhaps revivify our understanding of public housing’s possibilities in the United States, and provoke us to reexamine our definitions of “public” and “private.”
Overseas examples have demonstrated the critical role public housing can play in propelling economic development for countries in the first stages of industrialization: erstwhile colonial leaders in cities like Hong Kong, for instance, promoted mass state provision in order to address needs not met by the private market, to stabilize potential political unrest in a Cold War context, to clear slums occupying central real estate, or to jump-start export-oriented development by lowering the cost of labor.1 Whether for good or ill, public housing played a key role in state-led development, dominating local housing options (46.2 percent of all Hong Kong housing in 2006) and providing an effective means for the state “to manage private sector growth and . . . to support stability in private markets.”2 In Hong Kong, public housing may have begun as emergency shelter for the poor, but it quickly became much more, with a Ten-Year Housing Program offering new government-sponsored options for lower-middle income households through the Home Ownership Scheme (1976) and the Private Sector Participation Scheme (1978). Local leadership in Singapore, meanwhile, instituted an innovative compulsory savings and homeownership program within the public housing system that helped increase domestic savings while eliminating the much decried “hidden subsidy” of American middle-class housing assistance. By regulating housing speculation, the Lion City’s leaders ensured affordable shelter for the majority of its population. In this way, the Singaporean government successfully encouraged homeownership within the framework of a state-managed public housing apparatus, even as it incentivized increased personal savings and reaped the political benefits of higher living standards. As scholars Manuel Castells, Lee Goh, and Reginald Kwok observed in 1990, “In one of the most striking paradoxes of urban policy in the world, the two market economies with the highest rates of economic growth in the last twenty-five years [were] also those with the largest public housing programs in the capitalist world.”3
Singapore’s mass public housing program facilitated economic development and promoted gradual upgrading in mass living standards, with sometimes laudable and other times deeply problematic social and political outcomes. Most of the analysis in this chapter will center on mass public housing in Singapore because of the city-state’s phenomenal rates of construction and unique, state-facilitated homeownership within public housing (as opposed to the Hong Kong system, for instance, which encouraged the graduation of public housing residents into private homeownership through such mechanisms as a Home Purchase Loan Scheme, whereby the Hong Kong Housing Authority provided public housing tenants with interest-free loans for down payments on private housing). Still, comparisons with other cities will be added when useful.
Increased Private Savings through Public Housing
Many housing programs around the world, including those launched during the Great Depression in the United States, began with the primary goals of bolstering the construction industry and increasing private savings. Singapore’s Parliamentary Secretary and Ministry of National Development were no different from their American counterparts in thinking about housing as a stimulant for savings in the late 1950s and 1960s. This connection was made plain very early in the life of the transitional (1959–1963), Malaysian (1963–1965), and then independent (1965–) governments. According to the Parliamentary Secretary in 1964, “The most important device vital to the success of a national housing programme is a government-directed or supported institutional apparatus to mobilize savings specifically for building and construction purposes.” 4 Most often, governments in both industrializing and industrialized nations favored some form of owner-occupied housing as a way to galvanize private savings and release “unproductive capital,” since “people will save for housing even when they might not save for anything else,” to quote the United Nations Economic Commission for Asia and the Far East (ECAFE, 1947–1974, predecessor to the Economic and Social Commission for Asia and the Pacific, 1974–).5 Unlike the United States, however, owner-occupied housing in Singapore did not entail government insurance programs for private lenders or a government-sponsored secondary mortgage market; rather, owner-occupied housing flourished within an ever-expanding public housing program.
How and why did homeownership become part of a larger public housing campaign? From the very beginning, the newly elected People’s Action Party (PAP, 1959–) and its charismatic leader, Lee Kuan Yew, made explicit the desire to avoid any hidden subsidy along the lines of the American housing system. While realtors and the home-building industry played a large role in securing government aid for their private ventures in the United States, and while the U.S. federal government had strong Cold War motives for quietly backing a “private” housing system, Lee faced the exact opposite incentives in the early years of his tenure as prime minister. Specifically, he faced three challenges: first, Lee needed to clearly differentiate his regime from the colonial British one that preceded him; second, his party’s political control was tenuous and repeatedly challenged by leftist trade unions and communists; third, he had to negotiate regional ethnic tensions as the leader of a Chinese-dominated state with Malaysia, Indonesia, and the Philippines as neighbors. As such, Lee and the PAP had a strong motivation for avoiding any appearance of corruption, favoritism, or erratic management as publicized in such notorious cases as the Tiong Bahru housing estates (operated by the Housing Development Board’s predecessor colonial agency, the Singapore Improvement Trust [SIT], and an ultimate symbol of unjust public housing distribution). The U.S. system of central and local government assistance for urban renewal, roadways, tax exemptions, and the like—some within public, others within private housing programs—had little political resonance with a government needing to prove its transparency and its pragmatic, fair approach to housing distribution. It was no surprise, then, that Housing Development Board (HDB) chief architect Teh Cheang Wan concluded in 1961, “The extent and scope of aid given by the American Government [to housing] . . . is interesting. However, so long as the principle of ‘no hidden subsidy’ is to be followed in Singapore, existing financial arrangements here will have to continue.” 6
In the 1960s, Singapore was hardly alone in instituting direct government provision and planned dispersal of residents in overcrowded primate cities out to satellite towns. Pakistan planned refugee satellite towns outside of Karachi, Ceylon’s Central Planning Commission began making recommendations for slum clearance and satellite town development, and the People’s Homesite and Housing Corporation in the Philippines (1945–1975) relocated thousands of slum families and built resettlement housing projects in greater Manila in roughly the same era. Nor was Singapore unique in its policy of gradually upgrading housing for the majority rather than rapidly improving housing standards for a few at a time; the PAP essentially replicated the “Hong Kong approach to public housing, in which a shelter of minimum standard [was] provided for immediate use with built-in provision for improvement and expansion when additional resources become available.”7 To be clear, this was not core housing along the lines of later World Bank programs, where small central units were equipped with basic services and land was left around the core to encourage owner-constructed expansion. Rather, the PAP—like Hong Kong—favored rudimentary, small apartments in large public housing complexes that would be replaced by larger, more luxurious accommodations as the nation developed.
The PAP’s real innovation lay not so much in its organization of New Towns, nor in its basic (at times, even crude) architecture or system of upgraded housing, then, but rather in its financing plan and persistent categorization of subsidized housing as “public housing.” Lee and fellow PAP leaders devised an innovative scheme to mobilize private savings that could then be used to finance massive new public construction. Instead of U.S.-style “hidden subsidies,” Lee, Housing Minister Lim Kim San, and Finance Minister Goh Keng Swee enacted policies that curbed land speculation through the exercise (or threatened exercise) of eminent domain as permitted under the 1955 Land Acquisition Ordinance, the 1966 Land Acquisition Act, and the 1973 Land Acquisition (Amendment) Act, while also keeping interest rates low on loans for new construction by borrowing against the Central Provident Fund (CPF, 1955–), a statutory board implementing a compulsory savings program first begun under the British as a colonial-era retirement and disability program.
This compulsory savings system proved critical in financing construction after independence, increasing steadily from 5 percent contributions by both employer and employee in 1955, to a high of 25 percent each for a total of 50 percent of wage or salary going toward savings in 1984. The vast majority of CPF funds (about 95 percent by 1990) went to government securities that were then used to pay for public investments, including new housing construction.8 Goh explained the fundamental principles of this housing program in a 1967 speech, aptly titled “Cities as Modernizers”: in addition to the aforementioned beliefs that housing should not be developed purely for profit, but should still “give reasonable return to capital invested” (that is, it should not be subsidized beyond the “initial grant of capital on soft terms”), and that the public housing program should be directed at the masses and not an especially fortunate or unfortunate minority, new homes should also be mass-produced with permanent industrial building materials and modern utilities, albeit on austere terms. “Ten thousand apartments in high-rise blocks would consume 25,000 tons of steel, 120,000 tons of cement, 370,000 tons of stone, 240,000 cubic yards of sand, 8.7 million clay bricks, 9 million cement bricks, 1.75 million square feet of tiles as well as US$1 million worth of pipes and plumbing, . . . US$500,000 worth of electric cables and switches, . . . [and] US$1.52 million for other items including earthworks, lifts, and TV antennae,” Goh noted.9 The HDB was building twice that number of apartments annually in the late 1960s, and by the end of the 1970s could boast the completion of 270,000 units in a single decade.10 Public housing, by Goh’s calculations, provided a major impetus to the domestic production of building materials and therefore could serve as a vehicle for rapid industrialization and modernization, all of which was made possible by the mobilization of mass savings. Goh made no secret of the political advantages, either: “Basically, what Southeast Asian countries need most [are] stable government[s]. . . . The provision of large-scale public housing in the capital cities would increase the stability of the government to a considerable extent.”11
After 1968, an important modification in CPF rules allowed Singaporeans to put part of their savings toward the purchase of a public housing flat in addition to its ongoing functions as a health and retirement system; this modification greatly accelerated participation in the Home Ownership for the People Scheme, which was launched in 1964. The government further incentivized participation in this homeownership plan through lowered assessments, while mandating increases in select rates of CPF contributions and increasing the range of contributors from less than half a million individuals in 1967 to well over two million by 1987, all of which mobilized ever-growing domestic savings as part of a broader counter-recession strategy.12 After 1974, CPF savings could also be used to pay for middle- and upper-income housing through the newly minted if short-lived Housing and Urban Development Corporation (HUDC, 1974–1982). Not surprisingly, these policies had immediate positive effects on homeownership rates.
In addition to the unquestionably novel form of housing finance mechanisms being put into place, members of Parliament Inche Abdul Aziz Karim and N. Govindasamy rushed to naturalize the demand for homeownership on ideological terms, arguing the use of CPF balances was commendable not only for practical contributions to nation-building but also because (1) “home ownership fulfills the desire of every person to own a home,” (2) “the scheme itself is in accordance with socialist principles,” and (3) it permitted more people to finally “give effect to their desire to become homeowners.”13
Public Housing as a Facilitator of Modern Housing Consumption
Perhaps Singaporeans did crave stability of tenure, but the homeownership the PAP offered was a distinctly modern ideal packaged with inevitable changes in lifestyle, family organization, labor distribution, and consumption. As such, homeownership within a new public housing system was not so much the fulfillment of long-cherished desires so much as it was a practical financial decision for working-class families with limited alternatives. From the point of view of the state, public housing could also serve as a coercive form of political management, with the state empowered to clear slums and break apart communities in the name of improved access to decent shelter.
For a developmental state, public housing served as a highly effective—if problematic—way of acclimatizing and teaching diverse populations to behave “appropriately” in a modern capitalist society. Put a different way, public housing provided a useful training ground for the state to manage, supervise, and otherwise educate rural or former slum dwellers to inhabit modern housing, to grow and accommodate properly sized households, and to acquire or aspire to suitable household consumer items. Much as British colonists had employed Octavia Hill Women Housing Managers in Singapore to inspect and enforce housing regulations in SIT units and to manage “recalcitrant” tenants, so also did the “public” aspect of social housing permit state intrusions and behavior management—often with the same result of antagonizing residents along the way.14
The HDB made no secret of its desire to change how people lived. HDB workers organized the first of what would be a series of exhibitions at Selegie Road in December of 1960 to explain the functions of the new board (which replaced SIT), and this initial display proved highly illuminating. At a total cost of nearly $18,000, each department created presentations with photographs, layouts, and other paraphernalia to give some eighty thousand local visitors “a better appreciation of the difficulties which face the Board and of the efforts which are being made to encourage neighbourliness and build up peaceful and harmonious communities in the Board’s housing estates.”15 In image headings and banners, the HDB’s various departments made explicit their goals: the Estates Department wanted Singaporeans to live in “a happy new home,” with “the tenant reading a newspaper, his wife sewing and his children playing [with] toys on the floor.” The male tenant and his family could avail themselves of many amenities (playgrounds, sports facilities, car park, community centers, markets, and clinics); a display detailing unacceptable behaviors also indicated that the new HDB flats would be hygienic and controlled. Photographs portrayed such no-nos as children urinating in an elevator or writing on a wall, tenants throwing refuse out of a window, pulling up plants, rearing poultry, hawking on the estate grounds, throwing away large boxes in the garbage chute, knocking nails into a wall, or attaching multiple connections to one lighting socket. The Resettlement Department, meanwhile, informed attendees of the many improvements brought about by resettlement and clearance. The Planning Department emphasized the need for more housing and the remedies outlined in the Master Plan, the need to decentralize, and the proper planning of new towns and new or enlarged urban centers.16
Such exhibitions of HDB goals abounded and served a twofold purpose: urbanizing and modernizing individual behavior within HDB housing, while also propagandizing the efforts of a caretaker state to local and international audiences alike. In some of these showcases, public health messages were coupled with live demonstrations of HDB workers modeling how to sit, eat, and sleep in actual public housing units. In the entrance of one display, for instance, visitors viewed detailed charts explaining how one might identify and combat malaria before entering an actual HDB housing estate to view furnished rooms with compact, multiuse furniture and models playing a game of cards in one of the rooms. All exhibits included large placards discretely placed, announcing the price of each piece of furniture seen in what essentially was a diorama.17 According to HDB architect Alan Fook Cheong Choe, these sorts of exhibitions were prioritized because HDB staff realized they needed to demonstrate to future residents how they might actually occupy the much smaller, foreign interiors of HDB flats: “They don’t know how to organize the furniture, make the place more livable. . . . [So we needed to] build prototypes, build up true-to-scale units, [and teach future residents] how it can be furnished comfortably, economically, and meet their needs. That was the purpose. It was not to sell to people. It was more about resettlement. . . . They’re forced to go there, so you still have to win them over.”18
In one of many efforts at modernization, HDB leadership actively, deliberately changed Singaporean conceptions of “family” to fit developmental goals. Much like the SIT, the board defined “family” along kinship lines, but by 1967, the board had become much more specific about dictating what types of families it would accept into its units, and it amended its requirements to include definitions of “a proper nucleus of a family”: acceptable relationships might consist of the applicant’s spouse, parents or parents-in-law, children, siblings, grandchildren, and any blood relation between the ages of 21 and 60. While these kinship requirements were fairly all encompassing, income limits set stringent caps of $500 per family member per month with a total not to exceed $800 for the entire family.19 These state definitions of “family” served the practical purpose of ruling out exploitative sublease agreements, but the small size of the housing units coupled with squeamishness about gender mixing revealed the multiple rationales for such guidelines.20 The ideal size and composition of the family would come increasingly under government purview over the course of the 1960s, shrinking the once-expansive multigenerational housing system of kampong and informal settlements to form discrete cells for the nuclear family, such that the 64 percent of Singaporeans living in such family units in 1957 increased to over 80 percent by 1990.21 In reducing the number of people living together in one household, another equally critical change occurred: women were released from some of their former social service responsibilities and able (and indeed, actively encouraged) to enter the workforce—in particular, the PAP’s closely nurtured manufacturing industries—which they did in escalating numbers, from 21.6 percent female labor force participation in 1957 to 29.5 percent in 1970, 44.3 percent in 1980, and over 50 percent by 1990.22 The PAP coupled this sort of housing “persuasion” with explicit family planning programs, including the “Stop at Two” campaign of the 1960s and a truly revolutionary movement led by the prime minister’s wife to give women “equal pay for equal work” and equal retirement ages for women and men.23
All of these efforts to regulate and transform resident behavior led to a rethinking of ideal tenure type on the part of the HDB. Choe explained: “It all started at the architectural level. We felt that although we had a very disciplined people living in public housing . . . they [were] renter properties [and] vandalism and disrespect of environment was quite a feature. Many residents didn’t care about the building; they just dirtied the building because they [didn’t] own it. That prompted the government to think about [a] homeownership scheme.”24 Whether to regulate tenant behavior, decrease maintenance costs, increase national savings rates, or promote a benevolent image of the PAP, the new homeownership program within public housing increased popular “buy in” to the state and its programs in the decades that followed.
Growing Wealth and Public Housing “Upgrades”
How exactly did the HDB structure homeownership within a public housing program? The Home Ownership for the People Scheme began by opening up housing investment to lower-middle income households with individual incomes capped at $800 per month.25 In fixing prices well below open market values and amortizing payments over fifteen years, the government brought the cost of the initial sale of two- and three-bedroom units at Queenstown well within reach; in fact, the secretary of the HDB claimed prices were so low that “a family is faced with the choice of either purchasing a home or a car.”26 The population responded slowly to such economic incentives at first, with the HDB selling a mere 2,967 flats in the first year of the program. That number of purchased flats skyrocketed to 40,013 from 1966 to 1970, however, after the government permitted the use of CPF funds toward purchase in 1968; the number continued to rise exponentially thereafter. The HDB sold 123,213 more units from 1971 to 1975; 205,502 from 1981 to 1986; and 308,454 from 1991 to 1996.27 By 2008, more than 80 percent of Singaporeans lived in HDB flats, and over 90 percent of those residents owned their own units. Urbanization rates in Singapore also easily surpassed those of its neighbors, with slum clearance literally paving the way for comprehensive urban redevelopment. The HDB cleared 63,000 squatters from 1960 to 1974 alone, making possible record-breaking construction rates of new public housing flats.28 Meanwhile, gross domestic product also climbed steadily under the careful management of the Economic Development Board (1961–), reaching a phenomenal annual growth rate of 10 percent in the 1970s, while unemployment dropped as low as 3.5 percent in the same years.29 By 2005, Singapore surpassed the United States in GDP at purchasing power parity per capita.30
Economic development thus proceeded in tandem with rising CPF-fueled ownership of HDB units, resulting in a comparatively affluent class of public housing dwellers. Lim Kim San reflected on some of the paradoxes of this system in 1998, noting that HDB flats had moved “from being a basic necessity . . . [to] a source of wealth—all this while the Government has continued to subsidize the cost of the flats.”31 Growing affluence did not mean the state lost its control over housing units, however. Since the HDB flat was “so heavily subsidized by the Government, it would not be correct if there were no restraints,” Lim added. “Of course these [could] be irksome. All restraints are. But in the final analysis, the question is one of balance between the individual who owns the flat and the rest of society who helped to pay for it.” This modified understanding of homeownership and homeownership rights alongside measured, ongoing “public” control (state control) of housing grew very naturally from a public housing system that had from its inception political as well as economic and social motives; homeownership played a critical role in structuring political legitimacy for the PAP.32
According to sociologist Chua Beng-Huat, there was one other factor that helped explain the upward mobility of HDB residents. Very simply, the HDB structured that mobility in incremental steps within its housing options, creating a wide array of prices based on age and size of unit. By committing to universal provision but differentiating that subsidy according to “the consumption abilities of the different housing classes,” the government created “incentive[s] for families to upgrade their housing consumption as their economic circumstances change[d] for the better, which in turn [led] to filtering down of older housing stock to the lower-income groups.33 Within the first decade of construction, the HDB had already launched an upgrading program that accelerated in the 1980s with the launch of a multimillion-dollar program dedicated to removing older, now-defunct, one-room emergency flats in favor of larger self-contained units. By the 1990s, that upgrading process became a formalized part of the government’s plans for asset enhancement, with residents required to vote on whether or not to participate in the program (75 percent had to agree), and if passed, required to share the cost of upgrading with the national government and town councils at a rate of 8–21 percent of the total sum.34
The government also oversaw an incremental approach to local management in public housing estates. By the 1990s, the HDB had designed new institutions addressing demands for less centralized management; as the People’s Association observed in 1990, “A large centralized estate management system [could] result, among other things, in [a] lack of opportunities for public housing residents to participate in the management of their own estates and to establish a sense of belonging and identity.”35 In response, the HDB organized local community leadership through parapolitical organizations like Town Councils (Town Councils Act, 1988), People’s Associations, and Citizens’ Consultative Committees. According to First Deputy Prime Minister Goh Chok Tong and Prime Minister Lee, it was never the original intention for the HDB to become a management corporation for the vast majority of Singaporeans, nor did it have the capability of making life “meaningful and worthwhile,” or of “enabl[ing] individual towns to develop their own character and identity.”36 In reality, however, the HDB continued to be “the manager of Singapore’s everyday life” through these sorts of partially enabling agencies.37
Nor did HDB efforts remain strictly within the realm of public housing. This model of incremental improvement extended to include semiprivate housing, as in the case of the aforementioned HUDC units from 1974–1982, which the HDB built as an initial foray into condominium development on higher priced central real estate. This semiprivate middle-class housing catered to those segments of the population whose income disqualified them from HDB units but who could not afford homeownership in the unsubsidized private market, largely in the form of apartments and townhouses. In yet another move to shift homeowners incrementally up the housing scale, the HDB privatized these same HUDC units in the 1990s in order to “enable their current owners to improve the value of their property and to move from public housing to private housing without having to make a physical move.”38 Meanwhile, the national government helped facilitate executive condominium consumption by wealthy local and foreign residents in the same decade, appointing private developers to build such suites at a price point of 15–20 percent less than comparable private units. These condominiums offered greater architectural variety, presented a “sharp visual contrast” to the uniformity of slab block HDB construction, and “provide[d] residents with a country-club lifestyle and more gracious living” replete with swimming pools, manicured gardens, and marble floors.39
Lessons for the United States?
It is, of course, highly unlikely that most Americans would ever accept the terms of universal housing provision along the lines of a developmental state like Singapore. The deeply rooted American preference for the ownership of land and single-family homes, especially when contrasted with assumptions that multifamily public rental housing should be consigned to the poorest, ensures that powerful ideologies and myths remain tightly conjoined. Still, there are some very useful lessons to be drawn from Singapore’s dramatic example. First, international comparison highlights just how widely varying definitions of “public” and “private” can be, and how most housing policies operate in the vast gray area between total government management, planning, and funding on the one hand, and purely private investment on the other. As such, the important lesson to be drawn from a case like Singapore is not that public housing construction ought to be pursued in greater numbers, or that homeownership within public housing is the silver bullet that can remedy social housing’s ills, but rather that the HDB’s pursuit of incremental upward mobility and asset enhancement has proved highly successful in improving overall housing standards for the working class. When looking at American public housing projects and their residents, then, the central policy questions might shift away from assessing the worthiness of welfare recipients, or even a single-minded focus on moving public housing residents into owner-occupied units, and instead focus on how to improve assets and to provide smaller, incremental steps up the housing ladder. Under these conditions, homeownership would only make sense if it provided a stable investment with the potential for incremental upward mobility.