Evening star., 1954-05-01

crooked or grossly unethical deals are
being exposed is that the kind of hous-
ing most needed in this country is not
being built. In the long run it is prob
ably even more reprehenSible to deprive
millions Of families of the decent shelter
at cost they could afford than it was
to make exorbitant profits out of prof.
ects built in that frantic postwar pc
riod when the scandals actually oc-
CURED.
The 2O-year history of FILA should
show beyond question that Government
guarantees are absolutely essential if
we are to obtain a substantial volume
of home building in this country. The
real criticism Of FHA is that it has
regarded itself only as an institution
to enable businessmen to avoid taking
risks rather than to give service to
people needing housing. Instead of
tackling the tough part of its job,
FHA has largely confined it's activities
to building for the upper middle income
brackets, where the need is not so
pressing nor the demand so great as
in the lower middle income groupings.
The CIO and others have repeatedly
urged Congress to require Government
insurance guarantees be confined to
housing that could be bought by the
IS to II million people in the $500
to $4,000 brackets. who today can sell
dom afford to buy typical accommoda-
tions sold by the average builder. The
percentage of FHA insurance on
homes selling below $4,000 is disgrace
fully small Yet the largest volume
of demand is in that price range.
In 1858, the CIO urged Congress to
set either $4,000 or $4,000 as the top
limit on mortgage insurance. Not that
this limitation would in itself prevent
all opportunity for abuse or irregular
ity, but because it would narrow the
chances of graft and gougir1g to mi
, nutey proportions Ns4
Certainly, the FILA personnel re-
sponsible for. current malpractices
should be dropped. But what then? For
years FHA has actually been run as
a sort of adjunct to the real estate
industry. If it is to do the job that
is needed, FILA must prepare to play
a very different role. In it's earlier
days FILA served useful purpose in
putting a stop to the worst sort of
Jerry building" After that it went
along pretty much in the general pat
terms of the industry. Now FHA must
bring about, preferably by education
and persuasion - if not by whatever
types of pressure it may use-a diff
ferent set of goals.
FILA must use it's influence and
authority to require improved technics
in the housing field. Small-scale. high
c& r,e% 1aA Iary
ass-production technics.
Instead of taking profits from 81 900
to $4,000 per small house, which is the
accepted figure today, the industry
must cut that rake-off way down and
learn instead to make steady and rea-
sonable profits by selling five to ten
units where today only one is sold. This
can be done by getting the average
cost of the house somewhere in the
neighborhood of $4,000 with minimum
down payments and long term mort
gage, which will produce total monthly
shelter costs in the range of $50 to sos.
If FILA would aggressively and in
telligently encourage the formation of
housing co-operatives-or other types
of non-prof1t setup-the people who
need the housing would quickly see to
it themselves that this program gets
under way. FILA has sabotaged the
coop program: moreover, it has failed
to do first-class job with those CO.
operative projects it has underwritten.
If the home construction industry
bogs down as result of the current
investigation, the entire economy will
suffer A -million-unit home build
ing program, because Of its pervasive