Louis Proyect: The Unrepentant Marxist

July 27, 2007

The Housing Question

Filed under: real estate — louisproyect @ 5:00 pm

My apartment building

Alison Rogers, the author of “Diary of a Real Estate Rookie,” was asked by salon.com: “Why are we so fascinated by real estate?” She answered:

It’s a sport. It’s like a way of watching baseball where we can see the standings. It’s voyeurism and gossip and social standing and architecture and beauty.

That is why the New York Observer’s real estate section has become one of the paper’s most attention-gathering sections. The paper was once published by insurance magnate Arthur Carter, as was the Nation Magazine. Under his watch, the Observer could be counted on for gossip about the left, including the Nation Magazine’s Eric Alterman who was described in an Observer article as having a “brainy-little-kid quality, with large fish-like eyes behind glasses.”

Under the new owner Jared Kushner, a Zionist with connections to the ultra-orthodox Lubavitcher sect, that tradition continues in–oddly enough–the real estate articles of Max Abelson who reported on July 10th that the leaders of the Socialist Workers Party, a couple by the name of Jack Barnes and Mary-Alice Waters, just sold their West Village loft for $1.8 million. Abelson writes:

If bow-tied, cigar-mouthed Republicans can have nice seven-digit, six-room co-ops, don’t a few old Manhattan communists deserve multi-million-dollar real estate, too?

A two-bedroom loft at 380 West 12th Street, a 109-year-old building on a cobblestone block by the Hudson River, was sold by American socialist leaders Jack Barnes and Mary-Alice Waters. Their buyers, a Sony BMG Music Entertainment vice president and his fiancée, Stephanie Jakubiak, paid $1,872,500.

In analyzing the significance of all this on the SWP mailing list on Yahoo, Richard Fidler pointed out that this was just a case of senior party members enjoying a customary perk:

As I recall, the SWP, looking ahead to their retirement years, purchased condominium apartments that were inhabited by senior staff comrades. In my days in New York, in the mid-1970s, there were a number of older comrades living in such condos on the Lower East Side. These were comfortable but not luxurious apartments in modest high-rise buildings, typical working-class accommodation in that city. But, as I understood it, they belonged to the party, de facto, even though the title may have been registered in the names of individuals.

I once visited some of these “senior staff members” at their apartment in Chelsea, no doubt paid for by my dues. It belonged to resident philosopher George Novack and long-time feminist and anthropologist Evelyn Reed and was not far from my studio apartment in the West 20s. As I recall, it was a cozy one-bedroom that would probably go for $2700 per month today. Evelyn made us watercress sandwiches and gin-and-tonic as we gossiped about personalities in the Trotskyist movement of the 1930s like James Burnham. I felt like I had stumbled into Dorothy Parker’s round table at the Algonquin Hotel.

I could never imagine myself ever living like them. I was 23 years old and dead-sure that the US would become socialist by no later than 1980, 1985 at the latest. I could care less about where I was living and only saw it as a place where I could crash after a full night of antiwar organizing. In my studio apartment, I had a mattress on the floor and a canvas director’s chair and that was sufficient.

Ten years later I had grown tired of not having a place I could call home. I had been pressured into leaving New York City and making the “turn to industry” in Kansas City, my birth place. It turned out to be an unmitigated disaster. One morning as a spot welder was all I needed to convince me that this was not for me. When the turn was first announced, somebody reassured me that I could still be a member of the party if it didn’t work out. When George Novack had washed out of a defense plant, the SWP was quite forgiving. As one of the few genuine intellectuals in the party, there was a place for him. With the super-proletarian atmosphere in the party in the late 1970s, it was clear that there was no place for me. Not that I was a genuine intellectual. I had dropped out of graduate school in 1967 and had never written for the party journal. If I would ever find the time to write anything, it would be the Great American Novel. As should be obvious, I was a slave to illusion even then. If it wasn’t socialist revolution by 1985, it was becoming the next Hemingway. I have learned to settle on being Louis Proyect living under capitalism, snarling at the ruling class all the while. The rewards are much more modest, but at least they can be relied upon.

After saying goodbye to the SWP in late 1978, I moved back to New York and found a beautiful and spacious apartment in a subsidized Mitchell-Lama building on the Upper East Side that I could finally call home. I have been there ever since but face being priced out after the building opted out of the program in 1998. My rent was $640 when I moved in and is now $2300. Despite having an income of more than $100,000 per year (I make $75k and my wife makes about $25k as an adjunct professor), we face being forced out of Manhattan. In some ways, my situation is not that different than those who are being forced out of their homes by the real estate shake-out nationwide. They are victims of a credit bubble, while I am a victim of New York being transformed into a playground for hedge fund managers.

Five years ago I could have bought my apartment at an insider price of $299k. It is now priced at over $700k on the open market. I would have made a killing like Jack Barnes and Mary-Alice Water but I simply couldn’t afford it. My mother was still in her house upstate, maintenance for which was costing me about $300 per month on average, my wife was not working, and I had vain hopes that my rent wouldn’t skyrocket after the building exited Mitchell-Lama.

Each day I read the NY Times to find new reports about tumbling real estate prices–everywhere except in New York of course. Five blocks from my building on the corner of 86th Street and 3rd Avenue a new high-rise building called The Colorado is under construction. A huge billboard at the site advertises two-bedroom apartments starting at $1.8 million, the same price that Jack and Mary-Alice sold their condo for.

As part of the class struggle, real estate has a way of impacting peoples’ lives in a fundamental way–where they live. When it comes to jobs, it is somewhat easier to bamboozle the worker–especially in white collar positions like my own. If you get a shitty raise or get fired, it is your own fault. You didn’t “perform” well enough. For blue collar workers, there is no pretense involved. You will lose your job because General Motors needs to improve its bottom line. With housing, you get more or less the same thing. The landlord will raise the rent or the bank will foreclose because it needs to protect the bottom line. It doesn’t really matter to them if you are on the street after living in the same place, as I have been, for the past 28 years.

In the 1930s, long before there were massive trade union struggles, the resistance of working people to eviction manifested itself. On June 3, 1931 the heading of a NY Times article read:

44 Reds Arrested in Eviction Protest
Police Surprise Band of 100 Moving Dispossessed Family Back into Tenement
East Side Crowd Watches
Communists Sing “Internationale” While Undoing Marshal’s Work
All Freed in Night Court

By contrast, today’s foreclosures meet with virtual no resistance. Perhaps that will change when the tempo of the foreclosures steps up.

In another astute observation on workers, socialism and housing, Richard Fidler referred to a series of articles in the SWP newspaper from the 1980s when it was still somewhat readable:

One was ideological: a confusion between what you propose as a social solution for society, and what you may be inclined to do as an individual in actually existing capitalist America. I was reminded of this back in the 1980s when Doug Jenness wrote a series of articles in The Militant on the housing question, based largely on Engels’s wonderful pamphlet on that issue. Doug argued that workers were crazy to buy houses. His argument was not based on the practical economics of home ownership (e.g. the tax deductions for mortgage interest Walter [Lippmann] refers to – something we don’t have in Canada), but rather on the Marxist critique of private home ownership, and the need for social housing, to be regarded as a social right not a property right. Great argument, but as advice for individual workers it substituted abstract theory (“program”) for real life realities.

Turning to Engels’s “The Housing Question,” there’s still a lot that sounds current especially the following, which will assume more and more weight as the housing crisis deepens and a Hillary Clinton takes over the White House:

It is perfectly clear that the existing state is neither able nor willing to do anything to remedy the housing difficulty. The state is nothing but the organized collective power of the possessing classes, the landowners and the capitalists as against the exploited classes, the peasants and the workers. What the individual capitalists (and it is here only a question of these because in this matter the landowner who is also concerned acts primarily as a capitalist) do not want, their state also does not want. If therefore the individual capitalists deplore the housing shortage, but can hardly be persuaded even superficially to palliate its most terrifying consequences, then the collective capitalist, the state, will not do much more. At the most it will see to it that the measure of superficial palliation which has become standard is carried out everywhere uniformly. And we have already seen that this is the case.

6 Comments »

  1. Great post, ties in a lot of themes. I do kind of hope that a 30’s style depression will get those hedge fund managers jumping out of windows – until I realize that they’ll be landing on my broke, jobless, homeless ass. I doubt the NYC housing boom will stop unless some big banks and hedge funds start go under.

    What happened to the SWP in the 70s-90s is really a tragedy. Even though you would call me a “state-cap,” I take no pleasure at the steady decline and transformation of what was once an important and positive group on the revolutionary left into a bizarre sect. And there were a lot of talented, capable people who got sick of it along the way, like yourself, Camejo (whose document I read thanks to your website), Mike Alewitz, and others whose names escape me at the moment.

    Maybe if you’re not writing the Great American Novel you could write memoirs like Barry Sheppard or something. At least those who frequent your blog would buy it.

    Comment by Binh — July 27, 2007 @ 8:40 pm

  2. Another elegant, illuminating Project contribution. Where do all these rich people come from? How do they all pay 5-15K rents and equivilant mortgage hits and maintenance bills every month? Are there that many corporate lawyers and stock peddlers? Hundreds of thousands of them? These people are sucking up all the housing stock in Manhattan. Are they from another planet? Which one? I am mystified?

    Comment by J. Marlin — July 29, 2007 @ 3:16 pm

  3. Proyect, not Project.

    Comment by J. Marlin — July 29, 2007 @ 3:17 pm

  4. My wife and I both spent much of our earlier decades working in non-profits and the service sector, and so have never really managed to save a lot of money. Consequently, when rents here in Seattle started becoming comparable to paying a mortgage: $1500 for a two bedroom apartment in the Capitol Hill area- we joined those legion of home buyers who were allowed to take on housing loans under the “sub prime” rubrick four years ago.

    When the crash began to hit in the spring, we discovered that we did not qualify for an equity loan, as we had no equity even after four years of paying a sixteen hundred dollar mortgage. Neither of us found this surprising, as we’ve always seen the house as a home rather than an investment, but given that we were planning on using the money for a much-needed outside paint job,it was a little disappointing. I’m spending the summer patching windows here and there, getting the house ready for winter, and it’s looking pretty motley indeed. Our most recent appraisal of value was about seventy five thousand dollars below what we borrowed to meet purchase price. That’s good tax-wise, I guess, and we’re grateful that the interest rate is locked in at five per cent. Also that we both have jobs that enable us to meet the mortgage- at least for now- which is better than most folks in our situation are dealing with right now.

    But what a scam it all is. I hope someday there’ll be some study and analysis of folks like ourselves, who found ourselves basically forced into the housing market by ridiculous rents, and the real estate hustle.

    Comment by Michael Hureaux Perez — July 30, 2007 @ 2:22 pm

  5. […] included Jack Barnes and Mary-Alice Waters, the two leaders of the Socialist Workers Party, who sold a loft near party headquarters in the West Village last year for nearly 2 million dollars. The article was titled […]

    Pingback by Captalist pig of the month « Louis Proyect: The Unrepentant Marxist — January 30, 2008 @ 8:59 pm

  6. I betcha that some mega rich people are buying like 5 mansions and expensive apartments or more in New York. That would explain how so much expensive property is being sold right there.

    Comment by David — March 7, 2009 @ 10:42 pm


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