Homes for Londoners? Sadiq Khan’s Record on Housing

sadiq-khan-for-london

‘The housing crisis is the single biggest barrier to prosperity, growth and fairness facing Londoners today. I’ve found that, both as a MP, and throughout my campaign to be Mayor of London, it doesn’t matter whether you’re talking to business leaders, local residents, charities or community groups: far and away the biggest issue across the board is London’s housing crisis. The city’s shortage of decent and affordable homes is causing real misery to millions of Londoners, and damaging London’s competitiveness.’

– Sadiq Khan, Homes for Londoners, March 2016

Very few politicians deliver the promises they make when campaigning to be elected to office; none have ever improved on them. With the charity Shelter announcing that 170,000 Londoners would be homeless this Christmas, the London Mayor, Sadiq Khan, in a letter leaked to the Guardian newspaper, responded that he was ‘considering’ introducing rent controls in 2019. This May Sadiq Khan will have been Mayor of London for two years, so now seems like a good time to assess the gap between what he promised voters in March 2016 and what he has delivered to address London’s housing crisis.

In his election manifesto Sadiq Khan promised to build 50,000 new homes in the capital every year of his administration; he promised to maximise the affordable housing in new developments; he promised to build new social housing and other ‘genuinely affordable’ homes; he promised to support councils and housing associations to build them; he promised to grant funding and planning permission to estate demolition schemes only when it has resident support and it does not result in the loss of social housing; finally, he promised to ‘tackle’ the source of homelessness. He promised a lot more besides, but that’s enough to be going on with. So let’s look at how the man Time magazine last year included in its list of the ‘World’s 100 Most Influential People’ has met these promises. The Mayor’s policies on housing are published under the title of Homes for Londoners. Here are the three most important.

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Whatever Happened to the Working Class? The British Ideology

‘The ideas of the ruling class are in every epoch the ruling ideas; that is, the class that is the ruling material force in society is, at the same time, its ruling intellectual force. The class that has the means of material production at its disposal has control, at the same time, over the means of intellectual production; so that thereby, generally speaking, the ideas of those who lack the means of intellectual production are subject to it. The ruling ideas are nothing more than the ideal expression of the dominant material relationships – the dominant material relationships grasped as ideas; therefore of the relationships which make the one class the ruling one – in other words, the ideas of its dominance. The individuals composing the ruling class possess, among other things, consciousness, and therefore think. Insofar, therefore, as they rule as a class and determine the extent and compass of an epoch, it is self evident that they do this across its whole range; therefore, among other things, that they also rule as thinkers, as producers of ideas, and regulate the production and circulation of the ideas of their age. Thus their ideas are the ruling ideas of their time.’

– Karl Marx, The German Ideology (1846)

There was a time, back in the early 1990s, when I could barely write an essay without quoting this passage or something similar as an epigraph to my learned disquisition on this or that question of cultural and political theory. Marx’s teachings on the relation between ideology and class were revolutionary for his time, but 150 years later, coming out of a decade and more of Thatcherism, it seemed the lesson had finally been learned – if not actually turned into practice. But the ideas of the British ruling class have come to fruition over the past quarter of a century, and what was seemingly learned has been unlearned, what was taken as given has been taken back with interest, and what was once regarded as fundamental has been undermined. So today, when its effects have never been more hidden in plain sight, it has once again become necessary to return to the question of class.
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A Home for All? The Art Exhibition as Political Propaganda

Mary Duggan Architects

The ‘6 radical experiments in social housing’, which include the Spa Green estate (1946-49), Keeling House (1954-59), the Alexandra Road estate (1968-78), and the Byker estate (1969-82), currently on show at the exhibition at the Victoria & Albert Museum will be familiar to anyone with an interest in the history of council housing, and by themselves don’t justify a new exhibition. It’s the new ‘experiment’, Lion Green Road, designed by Mary Duggan Architects and currently being developed by Brick by Brick in Croydon, that’s the real focus of the exhibition, the purpose of which is to give legitimacy to the kind of development being carried out today under the guise of ‘social housing’ by placing it within the history of UK council housing provision. However, as is typical of architectural discourse in this country – and of which the review of the exhibition in Arch Daily is another example – this history will remain a purely formal one, without any of the information by which a visitor to the show (or reader of the article) can make a judgement about whether this scheme is a continuation or betrayal of the preceding architecture. As is repeatedly the case, therefore, it’s up to ASH to provide that information.

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Invisible Britain: The Art of Catharsis

‘I have spoken of the operation of a certain type of fashionable photography that makes misery into a consumer good. When I turn to the New Objectivity as a literary movement, I must go a step further and say that it has made the struggle against poverty into a consumer product. In fact, in many cases its political meaning has been exhausted with the transposition of revolutionary impulses – insofar as these appeared among the bourgeoisie – into objects of distraction and amusement that were integrated, without difficulty, into the entertainment industries of the big cities. The metamorphosis of the political struggle from a drive to make a political commitment into an object of contemplative pleasure, from a means of production into an object of consumption, is the defining characteristic of this literature.’

– Walter Benjamin, The Author as Producer (1934)

Paul Sng, Invisible Britain (2018)

1. The Art of Catharsis

Who profits from the housing crisis? The immediate answer is obvious: property developers, housing associations, estate agents, consultants, architects, builders, the people who knock down council housing and replace it with new-build properties, half of which currently stand empty in London.

But there are other people who profit too. First in line, spotting a market in sob-stories for the middle classes, are the journalists, whose thin prose and even thinner research doesn’t stop them from bundling a few articles together and calling it a book. Behind them, ponderous as ever but champing at the bit of the next government grant, are the academics, who have responded to the burgeoning market in well-footnoted (to other academics), badly framed (‘gentrification’) and totally apolitical books about the housing crisis, which they transform into just another object in their musty archive.

But a new profiteer has emerged. As the public’s interest even in the fluff on the bookshelves wanes, enter the artist. In verbatim theatre productions, in performance poetry, in documentary films, in protest songs and in books of glossy photographs, the artist is the new self-appointed spokesperson for the masses, and their great claim to this role is – not the political and representational agency of their work – but something much more important: their sincerity.

The English have a strong claim to being the most artistically illiterate nation in Europe, and generally prefer a nice swing at Tate Modern to anything that makes them think. But this week, thinking about the latest piece of artistic ‘activism’ to come off the shelves, full of sincerity and endorsements from every hack, academic and luvvie in town, I was reminded of what the German critic, Walter Benjamin, said about fascism in his 1936 essay The Work of Art in the Age of its Mechanical Reproduction. Fascism, remember, was a kitsch, saccharine aesthetic that sugar-coated the violence it glorified for the masses in images of noble sacrifice; and it has more than a few parallels with the photographs of homeless Britains, protesting Palestinians and starving Yemenis that decorate our Sunday supplements or perch in glossy tomes atop many an Islington coffee table. Trying to understand this aestheticisation of the violence of the political, Benjamin concluded: ‘Mankind’s self-alienation has reached such a degree that it can experience its own destruction as an aesthetic pleasure of the first order.’

Poverty porn is nothing new, and has been the staple of reality TV for some time, preparing the way for the political assault on the working class it has served. Somewhat belatedly, the liberals who have colonised the arts in this country have now come up with their own use for the working class. Springing from the Methodism that defines the aesthetic and political sensibilities of the so-called Left in this country, this goes something along the lines of: ‘There but for the grace of God go I.’ In the political vacuum of liberalism, art is the opium of the middle classes, its aesthetic pleasures the last refuge from their willing embrace of the violence of capitalism.

It’s not by chance that the favoured, most sought after and most highly valued aesthetic response of the middle classes is tears. Tears stop the middle-class film-goer from seeing what’s in front of his face when he leaves the auditorium. Tears, whatever the middle-class book-buyer may think when leafing through its moving photographs, are always shed for herself. And the feel of tears running down their cheeks, the salty taste of them in their mouths, makes them feel that somehow they are sharing in the suffering they tell as many people as possible is their cause. Identification (preferably with a distant and grateful victim) is the cathartic object of the immersive art ‘experience’. ‘Heartbreaking!’ is the ultimate accolade for the liberal work of art. So what role does art play for its liberal audience in search of catharsis?
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Supply and Demand in Centre Point Residences

Last week I was commissioned by VICE to write about the news that the unsold apartments in Central Point Residences had been taken off the market by the developer until offers met their multi-million-pound sale price. VICE only wanted 800 words; but this is the longer article I got out of it, in which I look at some of the more glaring fallacies in UK housing policy. This is based on three principles that underpin the cross-party consensus on the marketisation of housing provision by local authorities: 1) attracting overseas investment as the primary source of revenue for house building; 2) increasing the supply of residential properties for market sale to reduce house prices; and 3) cross-subsidising affordable housing provision with the sale of residential properties at the highest possible market price. In this article I look at why all three of these principles are fundamentally flawed as a model for the provision of housing Londoners can afford to rent or buy, and are instead designed to produce vast profits for those who invest in and sell the commodities in this property market. In a way, this is my response to Patrik Schumacher’s article ‘Only Capitalism Can Solve the Housing Crisis’, which was published by the Adam Smith Institute in April; but unlike Schumacher, my counter arguments aren’t based on academic theories about how capitalism can and should work, but on the all-too-real evidence of what capitalism has produced – beginning with the causes and effects of London’s housing crisis.

Photograph from Centrepointresidences.co.uk

From one end of London to the other we hear the same demand, from council meeting and corporate board room, from housing association and think tank, from architect and property developer, from Labour cabinet and Tory ministry, from the Greater London Authority and the House of Commons: ‘We must build more homes!’ This cross-party consensus between political rivals, the public and the private spheres, should alert us to the fact that something else is at stake here than the mere housing of London’s citizens, which has always been far down the ladder of political priorities; something which the announcement this week that the multi-million-pound properties in Centre Point Residences have been taken off the market for lack of offers matching their asking price has drawn into focus.

The London Mayor, Sadiq Khan, was elected on a promise to build 50,000 new homes every year he was in office. Unsurprisingly, his electoral opponents promised the same. As do the Conservative Government, the Labour opposition and the Liberal Democrats. The argument for doing so goes something like this. London has a housing crisis. If we build more homes the demand will drop, and with it the prices. This supposed ‘law’ of supply and demand is used to justify everything from the estate regeneration programme that threatens hundreds of London council estates with demolition to the hundreds of empty towers with planning permission in Inner London.

But there is a second part to this argument. Despite being the sixth largest economy in the world, the UK, apparently, is broke. There is no money for council housing as there was, for instance, after the Second World War, when the national debt was 245 per cent of GDP. To build the housing we need, London has to attract investment – from the private sector, from offshore companies, from foreign investors, from overseas buyers. This means that a lot of the housing that gets built will be for market sale, and some of it will be the sort of multi-million-pound apartments in Centre Point Residences; but with this money councils and developers can build ‘genuinely’, ‘truly’ (the adjectives increase with their prices) affordable housing for Londoners both present and future. Let’s test the truth value of this argument, which continues to define London’s housing policies, against the example of Centre Point Residences.

Photograph from the Met Archives

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London’s Most Influential: Citigroup and the Subprime Mortgage Crisis

‘What makes a city influential? Some say it’s the economic opportunities or the technological capabilities or the possibilities of connecting with other cities. We say it all comes down to people. The progress-makers. The ones whose boundless drive, passion and brilliance bring a city to life like no other. They’re why we’ve made it our job to be here. Believing in their ideas. Backing their ambitions. Making them real. In London. Around the world.

– Citigroup, The Progress 1000: London’s Most Influential People (2018)

‘The Truth is like poetry. And most people fucking hate poetry.’

The Big Short (2015)

Citigroup Inc. is an American multinational investment bank and financial services corporation with its headquarters in New York City. Citigroup owns Citicorp, the holding company for Citibank, as well as several international subsidiaries. Citigroup is ranked 3rd on the list of largest banks in the United States and, alongside JPMorgan ChaseBank of America, and Wells Fargo, is one of the Big Four banks. Citigroup is rated a systemically important financial institution and as such is on the list of systemically important banks that are regarded as too big to fail. It is also one of the nine global investment banks in the Bulge Bracket. Citigroup is ranked 32nd on the Fortune 500 list of the largest United States corporations by total revenue for their respective fiscal years. Citigroup has over 200 million customer accounts and does business in more than 160 countries. It has 209,000 employees, although it had 357,000 employees before the financial crisis of 2007-2008, when it was rescued via a massive stimulus package by the U.S. government.

The Subprime Mortgage Crisis

Heavy exposure to troubled mortgages in the form of collateralised debt obligation (CDOs), compounded by poor risk management, led Citigroup into trouble as the subprime mortgage crisis worsened in 2008. The company had used elaborate mathematical risk models that looked at mortgages in particular geographical areas, but never included the possibility of a national housing downturn, or the prospect that millions of mortgage holders would default on their mortgages. Trading head Thomas Maheras was close friends with senior risk officer David Bushnell, which undermined risk oversight. As Treasury Secretary, Robert Rubin was said to be influential in lifting the Glass–Steagall Act that allowed Travelers and Citicorp to merge in 1998. Then on the board of directors of Citigroup, Rubin and Charles Prince were said to be influential in pushing the company towards mortgage-backed security (MBS) and CDOs in the subprime mortgage market.

Starting in June 2006, Senior Vice President Richard M. Bowen III, the chief underwriter of Citigroup’s Consumer Lending Group, began warning the board of directors about the extreme risks being taken on by the mortgage operation that could potentially result in massive losses. The group bought and sold $90 billion of residential mortgages annually. Bowen’s responsibility was essentially to serve as the quality control supervisor ensuring the unit’s creditworthiness. When Bowen first became a whistleblower in 2006, 60 per cent of the mortgages were defective. The amount of bad mortgages began increasing throughout 2007 and eventually exceeded 80 per cent of the volume. Many of the mortgages were not only defective, but were a result of mortgage fraud. Bowen attempted to rouse the board via weekly reports and other communications. On November 3, 2007, Bowen emailed Citigroup Chairman Robert Rubin and the bank’s chief financial officer, head auditor and the chief risk management officer to again expose the risk and potential losses, claiming that the group’s internal controls had broken down and requesting an outside investigation of his business unit.

The subsequent investigation revealed that at the Consumer Lending Group had suffered a breakdown of internal controls since 2005. Regardless of the findings of the investigation, Bowen’s charges were ignored, despite the fact that withholding such information from shareholders violated the Sarbanes–Oxley Act (SOX), which he had pointed out. Citigroup CEO Charles Prince signed a certification that the bank was in compliance with SOX despite Bowen revealing this wasn’t so. Citigroup eventually stripped Bowen of most of his responsibilities and informing him that his physical presence was no longer required at the bank. The Financial Crisis Inquiry Commission asked him to testify about Citigroup’s role in the mortgage crisis, and he did so, appearing as one of the first witnesses before the Commission in April 2010.

As the crisis began to unfold, on 11 April 11, 2007, Citigroup announced that it would eliminate 17,000 jobs, or about 5 percent of its workforce, in a broad restructuring designed to cut costs and bolster its long underperforming stock. Even after securities and brokerage firm Bear Stearns ran into serious trouble in the summer of 2007, Citigroup decided the possibility of trouble with its CDO’s was so tiny (less than 1/100 of 1 per cent) that they excluded them from their risk analysis. With the crisis worsening, on 7 January, 2008, Citigroup announced that it was considering cutting another 5 percent to 10 percent of its 327,000 member-workforce.

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The Architecture of Death

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As some of you will know, on Tuesday, 2 October a man was killed by a window pane falling from the Corniche building, which with Merano Residences (designed by Rogers Stirk Harbour & Partners) and the Dumont building (designed by David Walker Architects) is one of three new developments of what the advertising boards call ‘luxury apartments and penthouses’ that make up the newly-named Albert Embankment Plaza. This lies within the Vauxhall, Nine Elms, Battersea Opportunity Area, over which the London Mayor has planning authority.

Like the other two buildings comprising the Albert Embankment Plaza, the Corniche was built by the Berkeley Group, the largest property developer in London, which has 75 per cent of its sites inside the M25, and pre-tax profits for the year ending April 2018 of £934.9 million, up 15 per cent on the previous year. The building was designed by Foster + Partners, the largest architectural practice in the UK, with pre-tax profits last year of £20.8 million, and whose partners took £23.4 million in bonuses, up 43 per cent on the previous year.

ASH went round to have a look at the building later that day, and the fallen pane could clearly be seen missing from the penthouse apartment on the 27th floor. The last five remaining 2-, 3- and 4-bedroom apartments are currently on sale for between £2.7 million and £6.25 million, but the penthouse from which the window pane fell was reported by the architecture and design magazine Dezeen to have been on the market for £22 million (although this information has subsequently been removed).

Apparently this isn’t the first time a window pane has fallen from the building. Last August, during construction of what Foster’s website describes as ‘curved gardens in the sky’, another pane slipped from its frame and nearly hit two carpenters working on the site. Despite this precedence, the hoardings outside the building advertise the Corniche as ‘Life ahead of the curve’, the irony of which disappears with this latest fatality from London’s housing.

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