No More Kicks on Route 66

Another Monstrosity Going Up in West L.A.

I live just a couple hundred feet south of U.S. Route 66, the “Mother Road,” as it comes close to ending by the shore of the Pacific Ocean. In my neighborhood, it is called Santa Monica Boulevard, which joins with Sunset Boulevard in East Hollywood and runs some ten miles from there to the Ocean. There is a mile-long stretch of Route 66 near me in which the old low-lying buildings are being replaced by high-rise apartment buildings mostly intended for filthy rich tenants.

There may be a few apartments in each building reserved for low-income tenants, but knowing the power of unscrupulous real-estate developers, most are not. And many of the units will be empty for years to come, especially as the coronavirus depression takes hold.

Martine and I cynically note the endless FOR LEASE signs on newish buildings. At the same time, there is a real shortage of housing for non-millionaires throughout the metropolitan area. Every month, it seems there are more tents with raggedy bums, more weather-beaten RVs, and more genuine homeless who have been turned out of their housing by greedy, unscrupulous landlords. The units in the building shown above will, no doubt, house only the well-to-do.

At the same time that multi-tenant units are springing up all over West L.A. (and other parts of the city), little attempt is being made to face the traffic problems that will inevitably ensue. Mayor Gil Garcetti thinks everyone will take the bus or rise the MetroRail trains; but I think that most of the people who can afford the new units would be afraid to take public transportation, as it brings them face to face with homeless turnstile-jumpers, and—oh horrors!—black people.

There will be a reckoning in the years to come—one that will topple the political ambitions of Garcetti and his associates who are altogether too cozy with the developers. And the developers? They will have moved on to cause problems elsewhere, as they always do.

 

 

“The Great Task in Life”

In California, the Realty Interests Are in Charge

To misquote Iris Murdoch, “We live in a fantasy world, a world of illusion. The great task in life is to find realty.” After all, if you have enough money to start with, it’s not terribly difficult to become a millionaire, requires minimal brains. Just invest in real estate. It worked for Trump (if you really believe he’s a billionaire). It can work for you. All it requires is a lack of moral compass: You too can live in a McMansion at the edge of a golf course. Isn’t that what life is all about?

Right now, California politicians are highly disturbed about the increasing rate of homelessness. Of course, they think that the solution is to find housing for all the homeless. Never mind that most L.A. homeless would prefer to live in a tent set up under a bridge, where they can enjoy their heroine and crystal meth without being hassled by John Law. And that doesn’t include the 25-50% who are just plain out of their heads and wouldn’t understand what you are talking about.

The word is out that there are not enough housing units. Then there was an interesting front page article in the Los Angeles Times a couple days ago to the effect that there are approximately 110,000 housing units that are theoretically up for rent, but not really.

The reason is the convenience to landowners of the law governing taxation of housing units. One is taxed not on the gross amount one makes, but on the profit one makes. If too many units are being profitably rented, the best way to lower your taxes is to net the rented units with units that are being deliberately kept off the market. That way, the profit is minimized—or even wiped out—and the NOL (Net Operating Loss) is subtracted from the total income.

From my years in accounting, I have seen dozens of filthy rich landowners living the life of Riley while paying zero taxes. That also is a trick employed by our Presidente.