Ben Hecht on Equity, Innovation and Opportunity in American Cities

Posted September 21, 2019, By the Annie E. Casey Foundation

Ben Hecht at a signing event for his book, Reclaiming the American Dream.

In this episode of CaseyCast, Annie E. Casey Foundation President and CEO Lisa Hamilton interviews impact investor Ben Hecht, who has served as the president and CEO of Living Cities since 2007.

Living Cities — a collaborative that spans 18 philanthropy and financial institutions, including the Casey Foundation — harnesses the collective power of these partners to help improve the lives of low-income people and the cities they call home.

During the interview, Hamilton and Hecht unpack the collaborative’s urban focus and the unique role that local governments can play in driving innovation, reducing poverty, and promoting equity and inclusion across the nation.

A big thank you to Ben Hecht for chatting with us!

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In This Episode on Community Change, You'll Learn

  • The current state of urban America.
  • The role of Living Cities in supporting local change.
  • Why Living Cities focuses on local government.
  • The difference between transactional and transformative community engagement.
  • How Living Cities went from being race neutral to adopting a race equity lens.
  • The value of disaggregating and interpreting data and then using it to drive action.
  • Why real estate is “ground zero” for racism in America.
  • Why the private sector has an important role to play in supporting equity.

Conversation Clips

In Ben Hecht’s own words…

“What I've seen over the years is the more proximate to the problem, the more likely your solution is going to work.”

“People are realizing: We can't stand on the sidelines. We actually can't say these race neutral approaches work. We can't say that these disparities—while growing—will shrink without doing something different.”

“The citizen needs to have confidence in the government, and the government has to actually believe that the citizen is who they're serving. I think that's an area that is ripe for innovation and really urgent in many ways given where our nation is.”

“Data is really important. The data allows you, at least, to have the right diagnosis, so then you can come up with the right strategy.”

Resources and Links

About the Podcast

CaseyCast is a podcast produced by the Casey Foundation and hosted by its President and CEO Lisa Hamilton. Each episode features Hamilton talking with a new expert about how we can build a brighter future for kids, families and communities.

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View Transcript

Lisa Hamilton:
From the Annie E. Casey Foundation, I'm Lisa Hamilton and this is CaseyCast.

Today's guest is Ben Hecht, an impact investor who has served as the president and CEO of Living Cities since 2007.

Living Cities is a collaborative of 18 philanthropy and financial institutions — the Casey Foundation included — that work together to improve the lives of low-income people and the cities where they live. Casey and Living Cities share a commitment to reducing poverty and a focus on supporting collaboration, leadership and equity and inclusion.

With Ben at its helm, Living Cities has also gained recognition as a leader in taking risks, disrupting the familiar and challenging the status quo for society's gain.

Welcome, Ben. Thanks for joining us today.

Ben Hecht:
It's great to be here, Lisa. Thank you for having me.

Lisa Hamilton:
Let's start by talking about Living Cities. It's nearly 30 years old. Can you talk about how it all started and what you're focusing on today?

Ben Hecht:
Yeah. It's amazing that it's almost 30 years old because-

Lisa Hamilton:
How many philanthropy collaboratives last 30 years?

Ben Hecht:
How many of them last five years let alone 30 years? So, I think that's extraordinary, but I think it really is recognition of a commitment of leaders like you who are on the board of Living Cities. There's no reason that these 18 institutions have to work together. They have all the money they need to work on them by themselves. They have partners all over the country, but they've decided for almost 30 years that they have the potential to do something together that they couldn't do on their own and I find that to be exciting. That started out almost 30 years ago to try to build an affordable-housing industry.

How can we actually take advantage of Community Reinvestment Act which was regulating banks, the low-income housing tax credit which was getting new equity dollars to build affordable housing, and make it land in the most distressed under invested neighborhoods?

So, banks, insurance companies, foundations came together and said, "Let's provide the grants and the loans needed to build that industry." We have to give ourselves 10 years to really build an industry, can't do that in a day. That long-term view, that patience, has really been the hallmark of what we're about. Started with housing and as America changed, so did the role of Living Cities.

Lisa Hamilton:
So, tell me what Living Cities does? How does it help address the issues that it cares about?

Ben Hecht:
Well, today, I think you can't be anywhere. You can't pick up a newspaper or follow any social media without seeing the extreme disparities that we face. Those disparities despite the efforts of really good people like you and me have gotten worse, not better. So, what we are trying to do is actually instead of say, "Let's come up with a new program." We are saying, "How can we help local cities, local places and cities actually change their processes, so those programs actually add up to needle-moving change? How do we actually not just say "We're going to help everyone." but we're actually going to help those who have the greatest disparities, which are people of color? How do we do it with an intentionality that maybe, for whatever reason, we weren't doing before?"

What we found with this intentionality is you actually get better results. There's a famous adage is you get what you measure. It turns out you actually have a much better chance getting what you measure, but if you never measure, you almost never get. So, we've really focused on how do we help local leaders come together in new ways to address really seemingly intractable problems from all the sectors using data to see whether you're making progress, using capital from philanthropy, from private sector, financial institutions from government, and say if it's not working, how do we change it so it will. It's really about systems not programs.

Lisa Hamilton:
So, let's break that down into two things. One, why do you find cities to be the place we need to focus on change?

Ben Hecht:
For really three reasons.

One is, it's actually where change happens. At the federal level, as we all know there's paralysis. At the state level, there's less paralysis. At the local level, there's almost none. In fact, you get mayors and they may be a Democrat, or they may be a Republican, you won't find that on their website. They'll all be talking about doing the same thing, which is, how do they create economic mobility for those who most in need across their city? So, you have almost a nonpolitical focus on problem solving, number one.

Number two, you’re proximate to the problem. I mean, what I've seen over the years is the more proximate to the problem, the more likely your solution is going to work.

The third thing is just the demographics. America is an urban country. Seventy percent or more of America is in cities. So, if we want to really understand what are those interventions that are going to work and work at a scale and, we have local leaders who are going to take the risk to try to solve the problems, it's the perfect formula to hopefully get the kind of success you want.

Lisa Hamilton:
So, we understand why cities, let’s understand how.

Ben Hecht:
Yeah.

Lisa Hamilton:
What is it that city leaders, local leaders are experimenting with to try to increase the opportunity in the places they're leading?

Ben Hecht:
What I love is that there's a growing number — and there have been for really the 12 years I've been at Living Cities — a growing number of mayors who actually want to govern. By that, what I mean is they actually want to fix the mechanics of government, so it works for everyone. We're really riding that trend. I love that. They use both the mechanics, the technical mechanics and the bully pulpit. It turns out the bully pulpit is in many ways in many places around the country much more powerful than the technical, because people want to do the right thing, but they need their leaders to tell them what the right thing is and show them the way. Then, what are they doing? Well, some of the stuff is what I think of as foundational.

So, all of the metro Louisville staff have been trained in racial equity. It turns out systems are made of people. So, if the people can't see what is polluting their system, they can't fix it. So, these cities are both helping their staff professional… development of the staff to see it and then also adopting the most successful interventions for any of those departments, so you can then serve all of your people equally. That's one. So, they're taking some foundational steps that I find extraordinary.

Then the other is they're saying, "Well, how do we then use the things we control to change the conditions?" So, in Memphis, for example, there's that majority population of people of color and they were down at about 10% of their contracting going to people of color. They're like, "We want to change that." Memphis, in 18 months, went from 12% of their spend going to companies of color to 20%. It was all about an intentionality of understanding what are the barriers to making that goal today and then how do we overcome that.

What I love is when we work with the cities together, they all coopetition. They cooperate but they also want to compete. So, who's going to do better? And that just helps all Americans.

Lisa Hamilton:
So, you've started to touch on the issue of racial equity as central to the work that you're doing. Talk about how Living Cities came to understand that, because you didn't start with the focus on racial equity. How did your understanding evolve over time?

Ben Hecht:
Those who are listening to the podcast can't see me but I'm a white male. So, it didn't start with the incredible insight and vision of the white male CEO of the organization. It came from the extraordinary leadership of the management team, who are people of color. I've always had a diverse team. My entire career, I didn't have an inclusive organization. It was actually after Trayvon Martin was killed and who was just one in a line of very public black boys being killed on the streets of America's cities.

Nadia Owusu, who you know, one of my staff people, have been there four or five, six years at the time said, "We are Living Cities. We're about economic opportunity for low-income people who live in cities and those people are people of color, right? Yes, why don't we say that?"

We don't talk about race in our work. We don't talk about race in our office. The people you trust the most don't actually think they can show up as who they are in the organization. So, we realize which, I think all organizations realize, we learned a lot from Casey and this because you guys have done that too, in face pioneered for many of us that you can go through that and still end up alive and in fact a better organization. The fear that especially white people have of doing that is palpable, but then you get through it, you go… it turns out we're better. I'm better and it's a better organization.

Lisa Hamilton:
There's also the recognition that the rising tide does not lift all boats.

Ben Hecht:
It does not.

Lisa Hamilton:
I think our own experience was that you can be well intentioned and think that you're going to move the needle for everyone, but it really takes targeted strategies to move the needle for some.

Ben Hecht:
Yeah. You literally don't know ... you can't see what you don't see. I had been running national organizations for 25 years and thought a race-neutral approach would lift all the boats.

Lisa Hamilton:
It does not.

Ben Hecht:
It didn't. It's part of actually spending the time to reflect. So, luckily, we had leadership within the organization who instead of saying it's about guilt and shame said, "Well, how can we all work together to change it?"

Lisa Hamilton:
It's about strategy.

Ben Hecht:
Exactly. So, we basically said if we don't get our house in order, how are we going to help anybody else? It's a journey that does not end, but we've built our capacities. All our staff have gone through and continue to increase their racial equity capacities. So, that's how we started internally. Then, we said, well, once we do that, and this is again a Casey idea, so once I had the understanding as a person about what I didn't know, then I had, "Okay, well in my role, what does that mean about how I show up in my role? Then, in that role, how do we fundamentally change the systems?" So, those systems that we can influence are one of them are local governments.

So, we basically then started talking to local governments and saying, "How afraid of this are you and what could we do to give you cover to do these kinds of work on these kinds of difficult issues that you maybe would like to have that you don't everyday have a group that is the 18 of the largest foundations in financial institutions giving you cover?" What we're finding over the last few years in particular, I mean this is a result of Donald Trump as president, is that people are realizing, we can't stand on the sidelines. We actually can't say these race neutral approaches work. We can't say that these disparities while growing will shrink without doing something different.

So, we're riding this wave. Our work with racial equity, with cities and with others is not on the cutting edge. In fact, we're just trying to keep up with the wave that's out there, that actually wants to finally reckon with this 400-year history in our country.

Lisa Hamilton:
That's fantastic. I'm even curious about the transition from city to state. Do you see the potential for the kinds of things that you're demonstrating at the local level having appeal or possibility at the state level?

Ben Hecht:
So, you guys have been great at working with states. Working with the states is critically important. It's really hard as an organization of my size to work at the city, work at the state, work at the feds. You need to be bigger and more resourced, but also I think we built a credibility saying we're about cities with the city actors. That said, the states need to be an incredible friend to cities that are trying to solve these problems, because more and more unfortunately, we see them actually not being a friend at all.

Lisa Hamilton:
Or preemption being an issue.

Ben Hecht:
Right. In fact, preemption is the issue. I was with a mayor just last week, I won't say which city, but as many places, he's a blue island in a state of red. It's not that that red or blue is necessarily good or bad, but in the sense that the red state is trying to actually limit the blue city from taking actions that are reasonable and really actually not political but actually practical. It's a problem.

Lisa Hamilton:
We haven't talked much about the role of the private sector in this work. In what ways are private actors participating or following the lead of what public leaders are doing in cities?

Ben Hecht:
I think it's really interesting. In many ways the private sector and government are the two most important actors, if we want to actually have an America that's more equal. Everybody else are really bit players in a way.

It's part of why we do focus so much on the local government. If you think about it, these are billion-dollar companies. If those billion dollar companies, what I mean is cities, if those billion dollar companies can actually spend their money more smarter, if they can actually hire and retain people in a better way, if they can be on the bully pulpit to encourage others to act differently, those are powerful. And, they're not financially so unstable like so much of the rest of the nonprofit community. So, it's not you need those but if you can get that actor to play the best they can play, they can be a disproportionally positive actor.

Then you have the private sector. A couple of years ago, I believe the greatest social program that happened in this country was Walmart and Target and Costco gave all their employees a dollar raise in their salary. Huge, right? No formal government regulation involved in that.

So, if you can get the private sector to change the way they act, they can make it again be a disproportionate player. Both are challenging to get to change and often need external pressures to make happen, probably almost always need the external pressures to make happen.

One of the things that we're doing with private sector because, of our unique role with both philanthropy and financial institutions and other private sectors, is we went out and spend about a year including with some people from Annie E. Casey and other members of Living Cities, and we ask companies: "How much does the fact that the fastest growing population in America are people of color matter to your company?" They said, "Well, demographic changes matter a lot." We said, "Well, how much does it matter that that fastest growing population actually doesn't have the income and the wealth that the current majority population has?" They're like, "Some of us, it matters a lot."

You think about companies like Prudential who's on our board. You want someone to buy an insurance policy and pay it for 50 years.

Lisa Hamilton:
They've got to have a job.

Ben Hecht:
Yeah. You just have to have a job. So, more and more we saw from this kind of assessment, we did about six or eight month assessment that there a number of companies, growing number of companies, more than five less than 30, who actually see that it's not only a moral imperative but an economic imperative to their own bottom line.

Lisa Hamilton:
Right. They aren't sustainable if they don't pay attention to this issue.

Ben Hecht:
Simply not sustainable. So, we began a couple of months ago, asking all of our friends and family, the “Lisa Hamiltons” on our board, the folks who have been on that working group looking at was this a real trend, and we said to them, "We're not going to do a bunch of cold calls to companies. You tell us who you know in corporate America. You open the door for us and we're going to ask those companies, "Would you be part of an initiative where you would say, "Yes, we believe this is of national importance. We'll even tell other companies how we're changing our own operations. Where we say operationalizing racial equity within our company."

We are in active conversation with 15 Fortune 500 companies. Nobody has said they don't want to have the conversation. Half of them we've had two conversations and I'm hoping within the next few weeks we'll have the first three or four actual commitments.

Lisa Hamilton:
That's fantastic. One of the things that you highlighted is the fact that these cities are large organizations that operate in many ways like private institutions do in terms of their procurement, their hiring. They've got the same issues and so as they figure out new ways to address these issues, they could very easily be great exemplars for private institutions to take up the same kinds of practices.

Ben Hecht:
Absolutely right. Again, it goes back to what are you doing in house, which again I say what you guys have done in Annie E. Casey in house, what we're doing in house. If we can tell these companies or the City of Memphis, you should hire entrepreneurs or companies owned by people of color, but are we doing it? So, we're now almost 100% of all of our contracting is with people of color. We go and do this event in Memphis. All of the contractors in Memphis are contractors of color. It's like we're going to actually live the values and people will follow, if, in fact you can show that it's possible. So, interestingly to your point about modeling: So the University of Chicago, one of my favorite people, Derek Douglas, worked for Barrack Obama when he was president.

Lisa Hamilton:
He's been on this podcast.

Ben Hecht:
Derek beat me to the podcast. So, Derek is a fabulous person. Derek went to the University of Chicago. You probably talked about it on the podcast.

Lisa Hamilton:
We did.

Ben Hecht:
What I love about the Derek Douglas story is, Derek went to University of Chicago and talking to the president and essentially said, "Why aren't we spending more of our University of Chicago money in south side of Chicago?"

If he didn't ask, they wouldn't do it. When a leader asks, oftentimes the answer is yes. They did it. Then after they did it, now there's a whole citywide — it's called the Chicago Anchors for Sustainable Economy — there's 32 public and private organizations who are coordinating their spend towards that end in all of Chicago. It all started because Derek had the audacity to ask that question and then to make it real with the University of Chicago.

Lisa Hamilton:
Absolutely. The last thing I'll say in sort of this complementing public sector or city practice with private sector practice is that you have the same motivation. Cities want to thrive and be successful. That can't happen if everyone isn't included. Companies have the same motivation as well. They want to be able to have customers and it's not going to happen if everyone doesn't have the opportunity to participate in the economy.

Ben Hecht:
I think part of our job in the nonprofit or philanthropy is to make it as easy as possible, because the harder it is, the more unlikely it's going to happen. So, what does that mean? Sometimes companies are saying ... or universities or companies will say, "I can't find the companies to contract with." That's the one or the talent.

Lisa Hamilton:
They're invisible.

Ben Hecht:
Right. The talent to hire. These are the things that make me apoplectic, right? Well, how much have you tried? So, even if it's being a part of this ecosystem in a local community, that simply makes it easier to identify these companies. You take one more barrier away from why this is impossible or put more positively, you make it easier to reach these more ambitious goals.

Lisa Hamilton:
So, I know that one of the things that you do is use data to try to help people understand what they're doing and appreciate the progress that they are making. Talk more about the role that data plays in the work that you are doing with institutions and with cities.

Ben Hecht:
Yeah. So, I always looked at ... when I look back at my career, I would say what I was always about was more.

Lisa Hamilton:
Not how much just more.

Ben Hecht:
And somehow if you just did more, you'd be solving the problem.

Lisa Hamilton:
Forward.

Ben Hecht:
Yes, it is progress but it's not solving a problem. There's a difference between the two. So, really over time what we've really realized is again if you don't decide what you want to ... what the result is and then measure it, you never have a chance of achieving it because you have no idea what you're trying to do.

Lisa Hamilton:
Or where you’re staying.

Ben Hecht:
Or where you are right now, right. So, we've really made that an important part of our practice. And that is not the only part of the practice. So, for example, if you are data-driven, but you don't have a racial equity lens, you're not going to solve the problem. If you're data driven but you don't have the community that's engaged in a really meaningful authentic way, you're not going to solve the problem.

So, there are different, what we call capacities, that organizations and cities need to be able to do whatever, to apply to whatever problem they're trying to solve, but data is really important. The data allows you at least to have the right diagnosis, so then you can come up with the right strategy, but along those lines, the other thing we've seen is that even when you have data driven places, if they don't disaggregate the data, they still avoid the problem.

Lisa Hamilton:
Because, they're masking the impact on various communities.

Ben Hecht:
Totally. Practically speaking, I hear Ralph Smith who was a former Casey executive's head, his voice in my head all the time which is a scary thing by the way.

Lisa Hamilton:
It's a booming voice.

Ben Hecht:
Ralph would talk about third grade reading and you go to a community. Almost every community and they're reading ... overall the community is reading at 80% level at third grade. All the kids are reading at the right level for third grade. 80% are reading. You're like, "That's not that bad." Then you look at, "Well, who's the 20%?" It's 100% the black boys in two schools. So, if you're not actually coming up ... again, that's the diagnosis. If the diagnosis is it's 20%, you'd give all the third grades all the same amount of money. If the diagnosis is actually 100% of the black boys in two schools, then you actually solve the problem in those two schools. That's the thing about data, it is really to help you understand the problem, so you can then have the right solution to that problem.

Lisa Hamilton:
Casey does lots of work around helping localities and states get access to the right data. Oftentimes, data is contained in silos and so we aren't able to properly see what's going on because we aren't integrating the data in ways that can be helpful. What are you seeing in terms of local leaders figuring out how to access the right data they need or even bring it together in ways that enables them to see issues across different domains?

Ben Hecht:
I think it still remains a huge gap. I think the awareness that places should be using data is almost universal now. That is a huge change.

Lisa Hamilton:
That's a huge change.

Ben Hecht:
Yeah. That's progress. So, we had our board meeting, Living Cities board meeting a few weeks ago. Lisa, you were there. We had the mayors. We had the mayor of Rochester, the mayor of Kansas City, the mayor of Louisville at that meeting and we were talking about data at the meeting from Ryan Rippel from Gates. Gates also likes data like you guys do. After the meeting was over, the mayor of Rochester said to me, "I love that conversation about data." She said, "But, the reality is our data can't talk to each other and because they can't talk to each other, we can't look across all those systems. We are not good at solving those data integration problems."

She's like, "That would be something philanthropy could be huge at helping us. We don't want to have to pay the ongoing cost. We're okay with that, but we would love to get some help to be able to have our systems, so we could get the data across." Then the other thing that we've seen, the other two challenges is even if you get all the data, people don't know how to interpret it.

Lisa Hamilton:
What it's saying?

Ben Hecht:
What does it tell you? Yeah, exactly.

Lisa Hamilton:
It can be an overwhelming amount of data.

Ben Hecht:
Overwhelming. And, so, interpreting is the next set of skills that people need. Then again, then actually turning into action or as our mutual friend Jeff Edmondson would say, cities and other places love to admire the data. So, can we move from admiration to execution? Those remain the challenges of data, but the need of it, I think we've overcome a huge hurdle on people understanding the need.

Lisa Hamilton:
So, we'll pivot to the action. One of the things you said earlier in the podcast is that working at the local level puts you more proximate to the problem, but even in a city I'd imagine, a mayor is distant from the communities that might be most in need and the perspective and real experiences of people. How were you seeing cities bridge that divide from local leadership to community engagement? How are they using that to try to problem solve?

Ben Hecht:
Yeah. I think it remains an area that is underinvested in. I'm less excited about the state of that. It's one thing that we're really trying to figure out how do we better build into our practice, how do we work with our cities at the government level and build in a real and wanted ongoing civic engagement where civic engagement is more about accountability than input to a transactional decision. Come to a meeting at 8:00 on Wednesday, help design, help co-create, help actually hold people accountable. I think there's a huge opportunity to innovate in that area. I think there's a huge opportunity to get mayors to be willing to innovate in that area.

The few things that I see are more about how do we expand the opportunities for the transactional relationship? So, by that I mean, the idea that all you do is hold the town hall. It's like that actually is rare these days. It still happens, but often ... I was with some cities last week and they were saying, "We go out every other week to different parts of the city and we just say we're open for business. Then we have a rule that within seven days we're actually going to respond to the questions in a very public way." There are mayors who are regularly doing online meetups or Facebook Live-type things.

So, I think they're using technology to have more exposure. They're using technology to give people more ways to interact, but it's still largely on a transactional basis.

Lisa Hamilton:
Not problem solving.

Ben Hecht:
Or transformational about the relationship between the citizen and their democracy. I do think that these are the kind of things that we have to figure out, because the citizen needs to have confidence in the government, and the government has to actually believe that the citizen is who they're serving. I think that's an area that is ripe for innovation and really urgent in many ways given where our nation is.

Lisa Hamilton:
Let me ask you about two issues that I think are on the horizon for cities that I'm curious about your perspective on. One is opportunity zones and the second goes back to the founding of Living Cities, affordable housing and the crisis that we have around affordable housing. Let's start with opportunity zones.

Ben Hecht:
Yeah. So, I have a very healthy skepticism about them.

Lisa Hamilton:
Tell people what the opportunity zones are.

Ben Hecht:
Wealthy people have capital gains taxes and the regular income, like we get from our salaries, is taxed at a certain rate and capital gains are gains from investments. So, you buy piece of property, you sell it. That sale is actually a gain, is taxed at a different rate than your personal tax. So, there were really some high-tech folks said, "Are there ways that we could actually not only not pay those capital gains, but have it serve a public purpose?" So, they came together, and they convinced Congress to pass these Opportunity Zones.

The idea is that you take the amount that you would have had to pay from your gain… you take your gain… from capital gains and instead of paying taxes on it, you put it in a fund. That fund will then make investments in certain geographies that have been identified as an opportunity zone. The idea is like other zones, empowerment zones, enterprise zones over the years, the idea is that there are under invested, disinvested communities that if you could target investment to them, you would make them better. I think the concept is flawed honestly. So, if I don't believe-

Lisa Hamilton:
It takes more than just a built environment.

Ben Hecht:
Exactly. Exactly. So, if the concept is flawed, then throwing more money on a flawed concept is my skepticism. That said, there are ways of course like any tool, it can be put for good. So, the idea would be, can you create these local funds so the local communities would be able to understand where those moneys would best be invested locally? The problem is there are no regulations that require it to be spent only except in a certain geography. And you could imagine any listeners know if you take any city — take San Francisco just for example or New York, Manhattan — the difference between making an important investment in a community that will change its character and just accelerate gentrification is a very fine line.

Lisa Hamilton:
Right. There's no guarantee that the people who live there now are going to benefit from those investments.

Ben Hecht:
Will benefit from it. Right. So, that's what they are. The real question and I think in everyone's mind is, "Will it be good or will it be bad overall?"

Lisa Hamilton:
But an important issue that cities are going to have to grapple with, and they are an important intermediary in identifying where these opportunity zones exist and perhaps even protecting the interest of their citizens and residents who live in the places where these investments need to happen. So, something important on the horizon for cities to be thinking about.

It's related to, but still different from, the issue of affordable housing. Share with us what the affordable housing crisis looks like in America now and even compared to 30 years ago when Living Cities began.

Ben Hecht:
Yeah. So, it is very interesting that we spent our first 15 years just doing affordable rental housing. Spent the last 12 doing anything really but the built environment. Now we realize, of course, they're all necessary but not sufficient. So, what the current housing crisis is that we have at least 11 million people — some people say as many as 40 million people — who are paying more than 50% of their income for rent. That's an addition to many of those people also paying more than 30% or 40% of their income for transportation. So, you are looking at a huge number of Americans-

Lisa Hamilton:
With nothing left.

Ben Hecht:
... with nothing left.

Lisa Hamilton:
Nothing left.

Ben Hecht:
So, the exigency of the problem, the extremity that people are living day to day.

There was a recent federal reserve study, and these come out all the time, but this was just a couple of weeks ago that said something around 40% of Americans can't meet a $400 emergency bill. And what was also in that report, which was less reported on, that an even greater amount are saying that they already don't pay all their bills every month. So, this is a real issue and it's an income issue. Of course, it's a wealth issue.

If you have wealth, you can sometimes smooth over those problems. And so: Affordable housing, what does it mean? So, it means that we know there isn’t enough of it. It means enough of it that you could go and find something that is affordable.

Number two, it's not in the right places. Because of our history of segregation and discrimination, the height of racism is red lining, which is real estate. So, real estate whether it's home ownership or rental is just the ground zero of racism.

So, what we know with Raj Chetty and others who people like Casey and other institutions have supported is that if a kid of color grows up in a community that is an opportunity community, which just means community where ... all I know is where I grew up, right? A white boy in New Jersey, not rich but not poor, but it was safe. The schools were good enough and I had food on the table. It's like when a kid grows up in that, it's like people paid Raj millions to figure this out and we all, of course, know it.

Lisa Hamilton:
Just say what we know intuitively.

Ben Hecht:
Right, but you have to document it. That is that it is different when the black boy grows up in the community, I grew up with than, if he grows up in parts of Baltimore where we are. It has nothing to do with other than the neighborhood.

In fact, an economist friend of mine says that if you could change two factors for black boys, it's put them in an opportunity neighborhood and solve the school discipline problem, you actually would solve a huge percentage of the barriers. So, can you get affordable housing that is available in these opportunity neighborhoods? So, first of all, they have to be built. There was a great article in the New York Times last week that showed what percentage of land in major American cities is zoned for single family.

Lisa Hamilton:
How much?

Ben Hecht:
So, I'm going to get the data wrong, but you can look it up. It's Emily Badger's, a New York Times reporter. It's worth looking it up. In many cities, 90 plus percent of the land is zoned for a single family. You can't have anything but single family which means it's just for white people and it's for people who can afford single family on a lot. I want to say San Jose was in the 90s. I think DC was in the 70s. Most cities were somewhere between 50% and 90%.

Lisa Hamilton:
Wow. Which means the majority of housing people, who are at the lower end of the income spectrum, are locked out of it.

Ben Hecht:
They literally can't legally live there.

Lisa Hamilton:
They legally can't live there.

Ben Hecht:
And so, we have to think about zoning and land use completely differently. Some places like Minneapolis are doing that now. They basically are saying you can build up to four units on every lot in Minneapolis. It doesn't mean they all will be, but it means you can. Right now in those cities, you literally can't.

You can't even put ... so like in my house in Washington, D.C. we have a garage. My wife and I are thinking maybe we turn that into an accessory unit, and we rent that and provide some income to us but it also add to the housing stock in Washington, right? If everybody did that, that's one of the solutions, not the only solution. We have to look at all of our solutions to add… how do we just simply build more and then have it in the right places? Then I think the other thing is we have to decide what is the nation that we want to live in and do we believe that people should pay that much. I believe there will always be people … is it 15% of our population? Is it 25? I don't know what the right percentage. I don't know what the right realistically is, but that we as a society have to help.

Lisa Hamilton:
Housing is such a fundamental need for families. When we look at what the crisis creates in terms of real experiences for families, the high mobility rates it creates or people accepting unsafe housing that then puts their children at risk health-wise, it has so many collateral consequences that I think people just don't appreciate.

Ben Hecht:
They appreciate in their own way.

Lisa Hamilton:
They do.

Ben Hecht:
They don't appreciate in the public realm. I think that's what we have to go back to is to understanding that we actually all have a responsibility for our neighbor. And who pays for it and how its paid, those are all things that smart people can negotiate.

Lisa Hamilton:
Great. Well, you have written a book, four actually, but your most recent book is called Reclaiming the American Dream. This term the American Dream can mean different things for different people. I'd like to close by asking you, what does it mean to you?

Ben Hecht:
What it means… I actually get teary thinking about this.

Lisa Hamilton:
I don't think anybody's cried on my podcast.

Ben Hecht:
I know. I get teary thinking about this because I think of the opportunity that… like I was saying my family lived the American dream. My father was white. He grew up poor literally, on getting canned food during the depression and standing in line going… He was the older brother. He went down, got the food, brought it back home, fought in World War II. Came back, went to college on the GI bill. Bought a house with FHA financing. All of those things, same black soldier, same kid down the block from my father, didn't have the same opportunity. That's not right.

Lisa Hamilton:
You're here because you had those.

Ben Hecht:
I'm here because I had it. We have wealth in our family. His family had no wealth. He had no wealth. He built it. We were able to go to college. All of those opportunities are because of a system that we created. It wasn't because my father was anymore extraordinary than that black soldier who also fought in World War II or the brown one. It's that we had the society — very intentional—of who's going to benefit.

So, I want everyone to have that same opportunity my father had. It just means that we have to create these new normal, whether they are GI bill type thing. I'm not saying it has to be huge federal program, although I do believe in reparation.

What I do believe is that we have to change, we have to take out the pollution that's in our local systems that currently keeps those barriers. And what my book is about are examples from all over the country, not just in New York and San Francisco, actually I intentionally went to the Midwest to Texas, to Oklahoma. I went to the places where they say the populations were most suffering right now — are the poor people of color and whites. It turns out in all of these examples that I had, that when you solve for the people of color, you know what?

Lisa Hamilton:
Angela Glover Blackwell, the curb-cut theory.

Ben Hecht:
Target universalism. It's true. If you build a program that helps kids who are dropping out of high school to say in high school and actually graduate high school with a college degree at the same time, helps those white kids, too, because they're dropping out at the same rate.

So, it's examples of that all over the country. It's about mutually reinforcing. We know we have to increase education. We know we have to increase income. We know we have to increase wealth. We know we have to help people get connected to opportunities, but even more importantly, we need to reknit the social fabric where we say too we actually care about our neighbor.

We're seeing communities all over the country doing it and it's the stories of the Derek Douglas's who basically said I'm leaning into the power I have to make the new normal what it needs to be for the 21st century.

Lisa Hamilton:
That is beautiful. Well, I am so appreciative of you helping us understand Living Cities and what's going on in major American cities and the opportunity and innovation that's happening there and some of the things we need to think about as the work goes forward. So, thank you so much for being on the podcast. It was great having you.

Ben Hecht:
Thank you for having me.

Lisa Hamilton:
Thank you for allowing me to partner with you in Living Cities. It really is wonderful to be a part of that.

Ben Hecht:
It's great to have you as a partner.

Lisa Hamilton:
I want to thank our listeners for joining as well.

If you've enjoyed today's conversation, please rate our show on Apple podcast to help others find us. You can ask questions and leave us feedback on Twitter by using the CaseyCast hashtag.

To learn more about Casey and the work of our guests, you can find our show notes at aecf.org/podcast. Until next time, I wish all of America's kids and all of you a bright future.

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