![]() When people lose income or face unexpected expenses, they typically “belt-tighten” or cut back on consumption. Social insurance programs play a critical role in buffering the effects of economic downturns but have many gaps and often fail to cover everyone. al (2021) show how housing instability experienced through actions such as evictions contribute to lower earnings, reduced access to credit, increased hospital visits, and increased homeless shelter use in the years following an eviction case. These households face the immediate threat of eviction or foreclosure in the event of unexpected income loss or expenses. In the United States, housing costs have become a significant share of a household’s expenses with the share of cost-burdened households in the United States rising from just 25 percent of renters and 2 percent of homeowners in 1960 to almost half of all renters and a quarter of homeowners in 2016. Keys propose three stabilizers that build on the lessons of the Great Recession and COVID-19 pandemic to backstop housing before the next crisis hits. In a new paper published by the Brookings Institution’s Hamilton Project, Robert Collinson, Ingrid Gould Ellen, and Benjamin J. These gaps leave one of the most important sectors of the national economy vulnerable to prolonged economic contraction, while millions of households face the trauma that accompanies housing instability. Indeed, COVID-19 laid bare that apart from the FHA insurance, large parts of the housing market operate without any type of protection for renters, for homeowners, or for the affordable housing industry more broadly. ![]() The logic of automatic stabilizers that kick in during economic downturns has been vividly demonstrated over the last 20 years, as have the gaping holes in our national safety net. Black and Hispanic renters also have fewer savings to weather unexpected financial setbacks. ![]() Few households have the resources needed to cover such shocks, which unfortunately are common, especially for households of color. Housing programs also fall short in helping households manage more idiosyncratic shocks to income and expenses. By contrast, housing assistance was almost completely flat. In 2010, outlays for UI were over four times as large as they were in 2007, while outlays on food were nearly twice as large. During the Great Recession, federal outlays on food support and unemployment insurance rose sharply.
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