A Tough Mission, Scandals, and Neglect

The Jackson resignation is just the latest of the federal housing agency's ills.


Secretary Alphonso Jackson announced his resignation March 31, 2008.


The U.S. Department of Housing and Urban Development has endured a roller-coaster ride since it was created as a hopeful antidote to inner-city poverty in the 1960s. A difficult mission, scandals, and the disdain of many conservatives have all plagued HUD. Last week's resignation of Secretary Alphonso Jackson, now facing a criminal investigation for allegedly peddling contracts to political allies, is only the latest indignity. Advocates for public housing argue he's merely symptomatic of HUD's anguished history.

President Reagan slashed spending by half and directed his secretary, Samuel Pierce, to essentially tell cities grappling with the poor to do more with less. The agency reached its nadir after a 1989 internal audit that discovered widespread corruption that resulted in millions being funneled to Republican consultants even as the budgets were slashed. Pierce admitted that his "own conduct failed to set the proper standards," but he was never charged with a crime. However, 16 of his subordinates were.

Times were better under the first President Bush, who appointed the politically powerful Jack Kemp to lead the agency. The former congressman charged forward with the HOPE VI program that sought to replace dense pockets of urban poor with mixed-income developments. The Clinton years continued in the same vein.

But HUD has received a cooler welcome from Bush's son. The Bush II White House has regularly sought to cut the agency's budget and push it in different directions. "To the extent [HUD] has been a priority, it's been to figure out how to reduce the appropriations," argues Sheila Crowley, president of the National Low Income Housing Coalition. "This has been a very bad period for federal housing programs." Notably, the administration tried, to no avail, to slash funding for housing from Community Development Block Grants and redirect it to economic development. The number of housing vouchers, meanwhile, has stagnated.

The current administration's first HUD secretary, Mel Martinez, was regarded as little more than a figurehead. He led the White House's failed charge against HOPE VI, but he quickly departed for a successful Senate bid. Jackson, a former director of a housing authority in Dallas, was soon dismissed by critics as underqualified for the job. Under Jackson, HUD has taken hits for its handling of public housing in New Orleans, where several dense, low-income projects will be replaced with less dense housing that is likely to contain fewer units. "What we've seen is the Bush administration, frankly, isn't interested in HUD's mission," says Austin King, national director of ACORN's Financial Justice Center. "That's been demonstrated not only by its previous attempt to gut its core missions but its laissez-faire approach to brewing trouble within the department's leadership."

Plenty of conservatives regard HUD as little more than a big-government entitlement program. With the success of welfare reform in the 1990s, they wonder why the same hasn't happened at HUD. Perhaps more significantly, HUD serves a limited and relatively powerless group of people, the poor. That makes the agency's voice harder to be heard in Washington. And as wealthier, typically white, Americans fled the cities after World War II, the plight of cities became less than a cause célèbre. "Historically, there's been a lack of interest," says Susan Popkin of the Urban Institute. "[HUD] oversees a public housing program which has come to be seen as a symbol of failure of American social welfare policy."

HUD's troubles come at a critical juncture. With the housing market gone bust, more Americans than ever are in need of federal housing assistance. HUD's turf isn't just the inner city now; more and more frequently, the issues faced by urban America are spreading to the suburbs. That, experts argue, should drive home how important the oft-overlooked agency is. "The functions of HUD are critical in our housing economy," King says, "and the ability for the middle class to grow and achieve the American dream."