As I’ve written, I just started a Huntsville chapter of New Liberals. These chapters were, until very recently, called Neoliberals. I identify as a sex-positive libertarian/neoliberal feminist, though as a special snowflake of course no label can perfectly describe all my positions.
I, personally, liked the trollishness of describing ourselves as neoliberals. It’s fun to reclaim a byword. And as an Autistic, I enjoy how literal the term is.
Though, I guess by that metric New Liberals is even better.
“Liberal” has become synonymous with “progressive.” “Classical liberal” tends to mean “libertarian.” We are literally new liberals. We’re not against markets like progressives nor are we against social safety nets like libertarians. We believe in liberalism – pluralism, cosmopolitanism, individual rights, and abundance through economic growth. We stand opposed to authoritarianism, populism, fascism, and nationalism.
New liberalism supports a competitive free market which promotes innovation and widespread prosperity. But the byword kind of neoliberalism often looks like policies that help incumbent businesses, harm competition, and harm consumers while appearing to help them.
Thursday morning my friend sent me a great example of what I would call “bad neoliberalism.” It’s an interview with Alex Lofton, who, with two co-founders, launched Landed, a for-profit company that gives people money for a down payment in exchange for a percentage of the home’s eventual sale price.
Here’s what sucks about Landed.
First, it profits from, rather than fixing, the problems it supposedly sets out to solve. It would be so much better to put that time, energy, and talent into fixing the root causes of the housing crisis rather than profiting from it. Plus, the more companies that profit from a problem, the harder it becomes to solve.
Lofton correctly points out that it’s difficult for people who don’t have parents who can give them cash for a down payment to buy a home. And he’s right that barriers to homeownership exacerbate racial and income inequality. Racist policies mean white people are much more likely to own their homes than Black people. Home equity comprises around 45% of the total net worth of middle- and lower-income families. Housing appreciation is the single biggest source of net worth increases for the vast majority of American families. So this gap is a huge part of why the typical white family’s net worth is almost ten times higher than the typical Black family’s.
It’s worth asking why only rich can afford down payments. Perhaps it’s because housing costs five times more today than in 1970, but median wages haven’t risen since 1970 for the bottom half of earners.
The main reason housing prices have risen so steeply is that the vast majority of cities where people want to live have banned affordable new housing.
Does Landed do anything to lower the cost of housing? Absolutely not.
The second reason Landed sucks is because it’s fundamentally regressive.
A rich person who gets money from their parents to buy their first house captures all that value when they later sell. A person who uses Landed has to give some of that profit back to Landed when they sell. For people who take advantage, some home equity is better than no home equity. But it also entrenches a system in which people from money get more money while people who don’t come from money have to fork whatever they get when they sell over to the companies that helped them get a foothold. Once again, we make it expensive to be poor in the US.
The third reason Landed sucks ass is that homes cannot be sources of wealth and broadly affordable at the same time. Home equity is definitionally zero-sum. When home values rise, it’s only by literally stealing housing affordability from future buyers. Landed is just deepening the housing crisis by continuing to prop up home equity as a legitimate source of personal wealth.
There’s only one way to decrease the cost of housing while at the same time:
Eroding racial and income inequality
Fostering economic growth
Improving public health
Helping to avert climate change
And that is legalizing dense new affordable housing in high-demand areas.
The bad kind of neoliberalism profits off the fucked-up status quo. The good kind fixes the laws and regulations that created the problem in the first place.
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