After more than 70 years of steady and remarkable success, America's housing and homeownership policies have been rocked by the rise of subprime lending, the financial sector's subsequent collapse, and the millions of resulting mortgage delinquencies, defaults, and foreclosures. Housing continues to be a drag on the recovery. The confidence Americans once had in home-ownership as a path to family wealth has been shaken. And a backward conservative narrative has capitalized on regulatory and market failures to launch an all-out assault on any government role in housing. Progressives and advocates for families and communities are struggling to make sense of the wreckage and are asking themselves what future housing policies should look like.
The idea that private enterprise should be harnessed to the creation of social capital is an old claim given new resonance by the financial crisis. After beggaring millions of people and threatening the global economy with ruin, banks and other credit providers surely have an obligation both to run their businesses soundly and to meet a higher standard of social responsibility. While some argue this could hobble, distract, or damage corporate focus on the bottom line, let's be clear. It was not an excess of attention to social needs that caused the near total collapse of the world's financial system but almost every other kind of excess.