Restoring the American Dream
This is from Helen Gallagher at http://blogcritics.org/books/article/book-review-the-cul-de-sac/page-2/
What lies beneath the current housing crisis is the American Dream.
People happily living the cul-de-sac life may not feel the need to pick up this book, but they should. It has value for all of us. With The Cul-de-Sac Syndrome, we gain a better understanding of the American housing crisis as author John F. Wasik takes a thoughtful look at the tradeoffs in the American way of life.
Far from the days of the “real estate is the best investment” mentality we learned from our parents, today we’re faced with collateral damage from a boom gone bust. Investment brokerages went broke. The U.S. government seized Freddie Mac and Fannie Mae, deeming them too big to fail. The troubled assets relief program, TARP, propped up the nation’s financial system in desperation, while job losses, store closings, and foreclosures grew across America.
Fully explaining the cause and effect of this spiral, Wasik, a finance columnist for Bloomburg News, shares frightening statistics to back up his thesis on how and why this cyclone of circumstances occurred.
Much has to do with housing, and the sprawling urban areas Wasik dubs “spurbs.” In The Cul-de-Sac Syndrome, he explores a combination of many financial and cultural ailments that led us to a dead-end in private American housing, from planning and city development to business and history.
“The craving for upward mobility through home ownership escalated even as families on the verge of ‘making it’ were falling behind economically,” says Wasik. As their finances eroded, and people lost access to health insurance, we now have more than three million homes in danger of facing foreclosure in 2009.
During the boom years, people pulled money out of their homes for spending, lifestyle upgrades, college and vacations, nearly $600 billion in 2004 and 2005 alone, he says. Americans who never lived through a major downturn didn’t think they needed to save. They continued to reduce the value of their homes through mounting debt; unaware the market could, and would, turn sharply.
In time, upgrading lifestyles led to the McMansion scene across America, where “bigger and better” never seemed to stop. “Why go to a bank to see a grandiose marble floor when it could be in your very own bathroom or grand entrance,” says Wasik.
One of the most interesting sections of The Cul-de-Sac Syndrome is the “Origins of a Dream” chapter, providing valuable reading for anyone looking at the foundation of American life, starting with Thomas Jefferson’s vision of a country of farms and towns connected by commerce.
There is a fascinating snapshot of American history here, and Wasik’s research goes back to Thomas Jefferson’s Louisiana Purchase land grab to capture control of the Mississippi Basin for America, not for France.
As the country grew, planned communities sprung up, such as those in New Jersey and Illinois in the mid-1800s. Wasik uses Chicago to illustrate the move to suburbs as cities grew and became taller with the advance of steel-making. Suburban expansion was the answer, providing affordable housing and an escape from the overcrowded city in early 1880s.
As growth forged ahead, homes became more elaborate and expensive. By 2006 an average of 37 percent of monthly income went to housing expenses. The realities of “house lust” meant people were no longer keeping up with their parents’ lifestyles, and no longer able to stop the debt spiral.
Wasik explores options for restoring the concept of home and community with a solid foundation. As he works his way through to the answer, “Build Smart,” we are enlightened and encouraged to recognize the importance of personal values as we attempt to come back from the brink. Jefferson’s ideas of sufficiency were lost somewhere along the way, but that doesn’t mean we can’t turn back. Maybe we can go home again.
The way out is complex but Wasik argues it begins by unlocking property taxes from school funding and local development, by prioritizing transportation funding, updating building codes for the 21st century and opening the way for green jobs and private incentives for affordable housing.
Before you think the housing problems in American won’t reach you, or haven’t yet, check the author’s “Watch List” of troubled towns and bright spots on the landscape. It may surprise you. Either way, The Cul-de-Sac Syndrome will enlighten you.