I am a little skeptical of this report, which contends a declining federal Housing and Urban Development budget has caused an increase in homelessness. It has a lot of important information in it, though.

First of all, it’s not at all clear that the HUD budget is a good indicator of how much government money is being spent on housing assistance. As this graph indicates, tax breaks have gone up while other sources have gone down. If you read the report closely, it concedes that housing priorities, not housing spending totals, have shifted — the good point is that housing money has gone from the poor to the rich.

But according to a California organization, there are still resources for the poor, most of them non-HUD:

“Since the early 1980’s, HUD budgets have fallen further and further behind in reflecting the rapidly increasing need for affordable housing. Today, HUD is only one of a large number of sources of financing for affordable housing, along with banks, investors, the Federal Home Loan Bank, public agencies and foundations, among others.”

In addition, many localities and states have passed affordable housing mandates stating that X percent of new housing must fall into the “affordable” category (defined, completely at random, as 30 percent of income — as if people need no less than 70 percent of their income for food, transportation, insurance and utilities no matter how much they make, even when they don’t have kids).

Finally, the piece’s main solution — those affordable housing mandates, with increased spending — will give some poor people housing, but at great cost. Prices exist for a reason, namely, to lower demand. A high price indicates that a given commodity is highly valued, and when you artificially lower the price you end up with a line out the door. And when the previously homeless move in to “affordable” units in nice areas, property values can decline. Basic economics, folks.

The Reason Foundation has a good summary of affordable housing’s other problems here. Mother Jones weighs in here.

Robert VerBruggen blogs at http://robertsrationale.blogspot.com.