Calling upon the Genius of Private Enterprise: The Housing and Urban Development Act of 1968 and the Liberal Turn to Public-Private Partnerships

Abstract

President Lyndon Johnson declared the Housing and Urban Development Act of 1968 to be “the most farsighted, the most comprehensive, the most massive housing program in all American history.” To replaceeveryslum dwelling in the country within ten years, the act turned from public housing, the government-run program started in the 1930s, toward private-sector programs using both nonprofit and for-profit companies. As a result, since its passage, for-profit businesses have developed the great majority of low-income residences in the United States. The law also helped popularize the idea of “public-private partnerships,” collaborations of government agencies and non-government entities—including for-profit companies—for social and urban improvements. Remarkably, political liberals supported the idea that private enterprise carry out social-welfare programs. This article examines the reasons that Democratic officials, liberals, and housing industry leaders united to create a decentralized, ideologically pluralistic, and redundant system for low-income housing. It shows that frustrations with the public housing program, the response to widespread violence in the nation's cities, and the popularity of corporate America pushed the turn toward the private sector. The changes in housing and urban policy made in the late 1960s, the article concludes, helped further distinguish the American welfare state and encourage the rise of neoliberalism in the United States.

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