Cityscape: Volume 19 Number 1 | The Goldilocks Dilemma of Moderate-Income Housing Subsidies: Finding the “Just Right” Amount for the Missing Middle

The Goldilocks Dilemma of Moderate-Income Housing Subsidies: Finding the “Just Right” Amount for the Missing Middle

Kurt Paulsen
University of Wisconsin–Madison

The question presented—whether federal, state, or local governments should subsidize housing costs for moderate-income households—forces us to confront tradeoffs between competing policy priorities in the presence of limited funding. Although it might be useful to speculate about a world where housing was considered a basic human right for all, and the federal government made a robust commitment to affordable housing for all, such a world is unlikely in the near future. In a world where incomes were adequate or housing was inexpensive, very few households at all would need any housing subsidies, but such a world is also unlikely in the near future. For purposes of this argument, however, we shall deal with the practical world of policymaking, taking existing institutional arrangements as given. Given limited budgetary resources, because I argue that some moderate-income households should potentially receive some housing subsidies, I also have to argue about where those resources should come from and the likelihood of such a policy being implemented.