MS. DIANE REHMThanks for joining us. I'm Diane Rehm. President-elect Donald Trump chose retired neurosurgeon and former Republican presidential rival Ben Carson to head the department of housing and urban development. Here to talk about the agency charged with implementing federal housing policies and how its priorities could shift in the Trump administration, Diane Yentel of the National Low Income Housing Coalition, Nick Timiraos of The Wall Street Journal. Joining us by phone from Los Angeles, Richard Rothstein of the Economic Policy Institute and by phone from Virginia, Pam Patenaude, former assistant secretary for community planning and development at HUD in the George W. Bush administration.

MS. DIANE REHMYou are, as always, welcome to join the conversation. I look forward to hearing from you either by phone at 800-433-8550, send us an email to drshow@wamu.org, follow us on Facebook or send us a tweet. And thank you all for joining us.

MR. RICHARD ROTHSTEINGood morning.

MR. NICK TIMIRAOSThanks for having me.

MS. DIANE YENTELIt's a pleasure. Thank you.

REHMThank you. Diane, explain to us what HUD was created to do.

YENTELSure. Well, the department of housing and urban development is responsible for working towards insuring that low and moderate income households have decent, safe and affordable homes. So it oversees a number of large rental assistance programs that serve about 5 million of the poorest families in the country. It administers tens of billions of dollars in block grants for community development, homeless assistance, disaster assistance.

YENTELIt enforces fair housing laws across the country and it insures mortgages. It insures about 20 percent of all mortgages in the United States.

REHMAnd Nick Timiraos, give us a sense of some of the biggest programs at HUD.

TIMIRAOSWell, as Diane said, their role insuring mortgages -- I think some people sometimes think of HUD as a poverty department and it, obviously, has a lot of anti-poverty programs. But since the financial crisis in 2008, the federal housing administration, which is a part of HUD, has played a huge role in backstopping the mortgage market. After the crisis, if you were trying to buy a home and you didn't have at least a five or ten percent down payment, you could still get a loan through the FHA.

TIMIRAOSThere's no income restriction so this is, you know, something that wealthy people could use as well as low income people. There are limits on the size of the loan and that was a really underappreciated role that the FHA played to step in and provide credit when the market wasn't really functioning very well. Reverse mortgages, so this is where seniors were able to take money out of their homes, almost every reverse mortgage being made right now is backed by HUD.

TIMIRAOSAnd so these are programs that when you hear HUD, you think, well, that's just Section 8. That's just public housing. And it does do all those things, but it's had a much bigger role since the financial crisis in the mortgage finance market.

REHMSo what has Donald Trump said about housing policies thus far?

TIMIRAOSDonald Trump has not said very much about housing policy and so his pick of Ben Carson, who also hasn't said very much about housing policy, leaves a bunch of wild cards for practitioners, for policy makers who have been following this space. No one really knows, for example, what they're going to do on FHA. There have been conservative Republicans who have wanted to curtail the role of the program because they say this is too much government backing of the market. Will they move in that direction?

TIMIRAOSThe industry wants the FHA to reduce the pricing of HRH to borrowers. Will they move in that direction? We really don't know, on issue after issue, with a couple of exceptions, which I'm sure we'll talk about on fair housing policy, we just don't know which way the Trump administration and Ben Carson are going to go.

REHMPat (sic) Patenaude, talk about Dr. Ben Carson and whether you regard him as a surprise pick for HUD.

MS. PAM PATENAUDE...surprise that President-elect Donald Trump selected Dr. Ben Carson to lead the agency. He's an intellect. He's a man with tremendous passion and he was brought up in poverty and through education and the support of, you know, a loving mother, he, you know, embraced education and reading and went on to become, you know, a world renowned neurosurgeon. You know, I believe Dr. Carson is the right man at the right time to lead HUD.

MS. PAM PATENAUDEHUD is in desperate need of leadership and somewhat retooling of the programs that have been in place now for decades.

REHMDr. Carson has said he opposes federal efforts to reduce segregation. What's he said, Pat?

PATENAUDEWell, the op-ed that I'm sure all of you have read, that is not my interpretation of what Dr. Ben Carson said. I think Dr. Ben Carson pointed out there were programs in the past that were failed experiments. I believe Dr. Ben Carson is clearly understands the fair housing law and I think we was, perhaps, referring to the rollout of the affirmatively furthering fair housing, which, in my opinion, has really confused practitioners. The language has been in the law since 1968.

PATENAUDESo I think Dr. Ben Carson, you know, definitely stands behind the rule of law. So I think that was a misinterpretation. And as I said, you know, I have not read that article in some time, but I remember that it was -- he was looking back at policies that were failed experiments.

REHMRichard Rothstein, you say that housing policy has had a fair amount to do with actual segregation.

ROTHSTEINYes, it's no misinterpretation of Mr. Carson's op-ed. He said quite clearly that the efforts of the Obama administration to reduce segregation in metropolitan areas was a form of social engineering that should be rejected. The Obama administration proposed that every jurisdiction in the country assess the extent to which it was segregated and come up with plans to desegregate.

ROTHSTEINThe segregation of these areas, and this is what I think Mr. Carson hasn't yet learned, the segregation of every metropolitan area in this country was socially engineered. It was a deliberate creation of federal, state and local governments to insure that African-Americans would not live in areas where whites lived. So the Obama administration's proposal to try to reverse this process is a form of reversing social engineering. It's not a form of social engineering.

ROTHSTEINThe federal government, for example, throughout the 20th century, up until the late 1960s, subsidized developers, perhaps the best known example is Levittown in New York, subsidized developers around the country to build large subdivisions on condition that no African Americans be permitted to live there. The federal government created a series of public housing programs throughout the 20th century at a time when there was a housing shortage for civilians that affected both African Americans and whites and created segregated public housing projects throughout the country, placing African Americans in concentrated high rises in central cities and whites, as I said, lured to the suburbs with subsidized subdivisions from which African Americans were excluded.

ROTHSTEINSo this was a form of social engineering that went on throughout the 20th century. And the reason that we have segregation in this country today is primarily because of these federal -- and they were state and local programs as well. Many of the problems that we have in so-called inner cities today are the result of the deliberate concentration of African Americans in central city areas.

REHMRichard Rothstein of the Economic Policy Institute. Diane Yentel, how do you see this issue of segregation, what Dr. Carson has actually written and said on this issue?

YENTELSure. So just to be really clear, so the fair housing act of 1968 requires that we eliminate discrimination in housing decisions and work to reduce residential segregation through affirmatively furthering fair housing. So it seems in Dr. Carson's editorial that he agrees with the first piece. He says explicitly that he believes the fair housing act's requirements to eliminate discrimination are necessary and good, but it's the second piece of it that he takes issue with.

YENTELAnd that's the piece where he describes it as an Obama administration experiment, when, in fact, it's a requirement that is part of the fair housing law. So as has been said, you know, the requirement to further fair housing in order to reduce residential segregation has been part of the law for decades. What's new, what the Obama administration put forward, were some clear definitions and guidance and tools to enable communities to better meet their obligations to further fair housing.

REHMSo the basic question comes down to is Dr. Ben Carson a good choice for HUD, Diane?

YENTELWell, I believe that he is -- it's a surprising choice and it is troubling. It's surprising because given the complexity of the affordable housing crisis and the height of the crisis itself and given the complexity of the programs that he would be responsible for overseeing, I would hope to have somebody with experience and knowledge of the programs to oversee them.

REHMAnd that's what you believe he does not have.

YENTELCorrect.

REHMDiane Yentel, she's president and CEO of the National Low Income Housing Coalition. Short break, right back.

REHMAnd welcome back. We're talking about the Department of Housing and Urban Development, the choice of Dr. Ben Carson to lead that agency. One clarification, and Nick Timiraos, I'll ask you about that. Was Dr. Carson actually raised in public housing?

TIMIRAOSNo, his spokesman clarified the other night that he was not. There had been this kind of idea floating out there that he was raised in public housing. He certainly grew up in poverty, single mother who had her first child when she was 13 years old, but -- and so he grew up in poverty, he grew up perhaps around public housing, but his spokesman clarified that Ben Carson himself did not -- was not raised in public housing.

REHMAll right, and joining us now by phone from New York is Michael Nutter. He's the former mayor of Philadelphia, now a professor of professional practice in urban policy at Columbia University. Thanks for joining us, sir.

MR. MICHAEL NUTTERThank you, Diane, I'm actually on my way to my class this morning.

REHMOh good. All right.

NUTTERThanks for having me on.

REHMWhat do you think HUD gets right about our federal housing policies?

NUTTERWell there are a number of areas. First of all -- and a few of them have been mentioned already. HUD of course oversees the public housing authorities all across the United States of America, probably the largest, you know, landlords, if you will, in the United States of America for housing for low- and moderate-income people. They oversee the Section 8 Program, the Choice Neighborhood Grant Program, of which Philadelphia was a recent recipient about a year or so ago, $30 million. They oversee the Promise Zone Program. They work with local communities, rural communities, tribal communities in the housing and economic development areas.

NUTTEROne of the guests earlier mentioned federal FHA, and standing behind mortgages. So it's a huge agency, $47 billion, all right, in funding, a bit over 8,000 staff. It is -- HUD is the lifeline for communities all across the country.

REHMAll right, and let me interrupt you, Michael Nutter, to ask you one last question because the connection here is not working very well. You were quoted in the Wall Street Journal as saying that you were disappointed with the choice of Dr. Ben Carson to lead HUD. Can you say why?

NUTTERAs I understand it, Dr. Carson is, you know, a great neurosurgeon. This is not brain surgery. This is public policy, and I have not read or seen anything in his history or background that indicates that he has had any personal nexus, relationship, connection, background or work that is in any way, shape or form related to what HUD does. And so there are clearly many more qualified people for that job that I'm sure Mr. Trump could've picked.

NUTTERSo I don't know where this pick comes from. I'm very concerned about a possible change in policy. The writings that he's made earlier, he said what he said, I don't think we have to try to reinterpret what someone writes down when they try to write clearly, and so this is a big issue that I don't necessarily agree with some of the other nominees that Mr. Trump has proposed, but it seems to me that all of those folks at least have some background or nexus to what they're being proposed for. And only in this particular case do we have someone who is completely unrelated to the agency that they're nominated to lead.

REHMAll right, Michael Nutter, he's former mayor of Philadelphia. Thanks so much for joining us.

NUTTERThank you, Diane.

REHMAnd I want to go to you, Nick, because I know you interviewed Mr. Nutter.

TIMIRAOSWell, you know, one of the things that Mayor Nutter raises and other Democratic lawmakers have already raised with respect to qualifications, Dr. Carson last month said he had been offered the job of secretary of Health and Human Services, and some people have said 30 years at Johns Hopkins Hospital as the director of pediatric neurosurgery, that -- he would have been much more qualified for that.

TIMIRAOSWhat's interesting is at the time, Dr. Carson said I don't particularly want to work inside the government, and so it was kind of assumed at that point that the Trump administration was no longer looking at him to run -- to run anything. Then Donald Trump tweeted that he was thinking about Ben Carson for HUD, and Dr. Carson wrote on Facebook that he had had a change of heart.

TIMIRAOSSo those words that Dr. Carson when he said he didn't think he wanted to lead a federal agency could be used...

REHMHe said he didn't think he had the credentials to lead.

TIMIRAOSRight, so I would expect Democrats in the Senate to bring that up in his confirmation hearing. Of course Republicans still have a majority in the Senate, and we haven't seen any Republicans come out and speak against Dr. Carson, so it's assumed that he will be confirmed to this position unless we see something else in the next few weeks.

REHMRichard Rothstein?

ROTHSTEINYes, excuse me, but I think too much is being made of this issue of qualifications. The reality is that Republicans in Congress have stated they were going to defund the HUD -- Obama administration's efforts to enforce the affordable -- Affirmatively Furthering Fair Housing provision because they're opposed to any efforts to desegregate the country.

ROTHSTEINAnd Republican that Donald Trump had appointed to this position would presumably be following that same line. This is a Trump administration policy that we're talking about, not the personal qualifications of Ben Carson. The reality is that in order to desegregate the nation, it's going to require affirmative policies, and if Republicans believe, as Ben Carson does, but there's all Republicans presumably in Congress who have spoken up against this belief that Affirmatively Furthering Fair Housing is a policy that should not be funded, then we're going to get the same policy with any nominee.

REHMDo you, Diane, believe that the Congress under Republican leadership may in fact defund HUD?

YENTELWell, I think a couple things about that. I think specific to fair housing and HUD's regulation and implementation of it, I think certainly there will be efforts. There have been in the past, most recently this past summer when there was an amendment on the Senate floor to essentially take away any HUD funding for its ability to oversee and implement the Fair Housing Rule specifically.

YENTELThat amendment was defeated, but I would expect conservative Republicans to try again in the coming year and to be emboldened to have additional opportunities. Beyond fair housing, I think there are real threats to significant cuts to affordable housing programs in HUD and USDA. That's because -- and part of that was going to be the case regardless of the outcome of the elections, but it's made worse from the outcome. So what I mean by that is when -- in 2017 we are back to really tight budget caps that were created under the Budget Control Act in 2011.

YENTELTwice since that time Congress has given itself relief from those tight budget caps and lifted them, and in the negotiations to lift them, President Obama has always insisted on parity. So any increase on the non-defense -- on the defense-side spending had to be met with increases on the non-defense. So President-elect Trump has said he intends to do just the opposite. He wants to significantly increase spending on defense, and he wants to pay for it through cuts to the non-defense spending side.

YENTELIn addition to that he has said he wants to implement a penny plan. So he wants to have one percent cuts to all non-defense spending each year for the next 10 years. What that means for housing programs is that those inflationary cost increases that are necessary just to keep programs running at their current level are lost, and we go deeper into cutting the programs. It could result in cuts as high as 30 percent to HUD-administered programs by 2026.

REHMTim?

TIMIRAOSAnd it's not at all clear that, you know, Donald Trump supports the status quo of what we've been doing on housing. He was pretty -- even though he hasn't gone into the specifics of the programs Diane is talking about, he has said in many of his stump speeches over the summer that the inner cities are a disaster. He would say there's no jobs, there's no education, there's -- you know, there's crime, and so he thinks the status quo has failed.

TIMIRAOSHe is likely to see HUD as a part of that status quo that has failed, and so, you know, I don't think that folks who are working in this administration are going to lose much sleep about radically reshaping and cutting those budgets along the lines Diane has discussed.

REHMPam Patenaude, how do you feel about that? Do you see a move toward even the elimination of the Department of Housing and Urban Development?

PATENAUDEWell we certainly have not heard that President-elect Trump or from Dr. Ben Carson. I think what we have heard from the president-elect that he would like to see deregulation, I think streamlining some of the programs that HUD will save money. You know, I know that the advocates are in favor of protecting the status quo, but it's time for us to, you know, take a look at the HUD program, how can we improve that.

REHMBut let me, if I may, Pam, let me understand what you mean by streamlining.

PATENAUDEWell we -- we have been running the Section 8 program the same way with, you know, over 2,500 public housing authorities administering the program, and I think with, you know, technology that there are more efficient ways, perhaps, to run that program. I think that there are possible changes, you know, or improvements that can be made with mobility of vouchers, and some of the formulas that are used to allocate federal housing subsidies and --such as CABG and HOME, very antiquated formulas, I think we can take a look at that.

PATENAUDEAnd then just a note on the affirmatively furthering fair housing. I know that many practitioners believe that this has been punitive, and I don't know what the intent of the Obama administration was, but I do think that the affirmatively further fair housing, you know, the rollout has been confusing and needs to be revisited.

REHMPunitive, Diane?

YENTELWell, I think we would disagree on it being punitive, and I think HUD has been very clear from the outset that they don't intend it to be such and that they have created tools and worked to build the capacity of local governments to meet the obligations that they already have. If I could also just say I agree with Pam on the need to look for ways to streamline and find efficiencies within current programs. Certainly even highly successful programs like the Section 8 voucher program can be further improved.

YENTELAnd some of the things that Pam mentioned are ones that we support, looking for ways to kind of consolidate the administration could save money and could make it easier for low-income people who use their vouchers to be able to use them in higher-opportunity neighborhoods. So I certainly think there are some commonalities there.

YENTELI think also when we talk about the need to kind of revise or look differently at affordable housing programs, we need to look maybe with a wider lens and look at the full federal housing policy, such as it is, and look for ways to rebalance it.

REHMAnd you're listening to the Diane Rehm Show. Richard Rothstein, I know you want to jump in.

ROTHSTEINYes, I wanted to say something about this deregulation business. You know, let's go back a little bit in history. In the early 20th century, the Supreme Court took the position that any infringement, any regulation of private property rights was forbidden. You couldn't have a minimum wage law, you couldn't have a health and safety law because it interfered with property rights. The only exception, the only exception that the Supreme Court made to this devotion to private property rights was they permitted suburbs to adopt zoning laws that prohibited the construction of townhouses, that prohibited the construction of modern income homes in order to remain segregated, and that was the explicit provision of many of these zoning laws.

ROTHSTEINOne of the things that the Obama administration has proposed as part of the Affirmatively Furthering Fair Housing Rule is when suburbs look at the extent to which they're segregated. One of the things they may have to do in order to desegregate is to repeal some of these exclusionary zoning laws so that moderate-income families, even lower-income families, can live in middle-class neighborhoods.

ROTHSTEINThat would be a form of deregulation that I would hope the Trump administration would support, but I doubt that they will because they don't really care about deregulation, but the support the kinds of regulations that maintain segregation, and they're opposed to efforts to repeal the regulations that would permit integration to take place in metropolitan areas.

REHMTim?

TIMIRAOSYes, I think what you're seeing right now if you step back, where we've been over the past 10 years in housing, we had a very painful bubble, a boom and bust. Now the home ownership rate is at a 50-year low, and we're seeing affordable housing crisis in more cities. So the housing landscape that the Trump administration is going to inherit is very different from the one that Barack Obama inherited. He came into office in the middle of the worst housing crash since the Great Depression, and it was all about staving off foreclosures, helping people refinance their loans.

TIMIRAOSThat has now pretty well passed, and so there's a view I think on some parts that, well, the housing crisis is over, and that's not really accurate because if you look out across the country, what you've had is home prices rising now, credit is harder to access, and rents are rising, too. So you have a different sense of concern now that what are we going to do to make housing affordable for, you know, folks of more modest means who don't have a lot of down payment resources and, you know, where we have weaker income growth. Those are questions that are very difficult even for the most sophisticated experts to agree on what we're going to do.

REHMAnd surely that's where HUD has come in in the past?

TIMIRAOSYeah, that's right. One of the arguments that I've heard I the last couple days in favor of Dr. Carson for this job, and this comes from folks including the man who helped Jack Kemp run HUD in the first George Bush administration is that, look, HUD has had some successes, but it has mostly helped at the margins. And if you look back over the past 45 years, the 50 years of HUD, it hasn't radically changed urban policy in America.

TIMIRAOSAnd so the argument that some of these people are making and that they're likely to make when Ben Carson goes before the Senate is, you know, what do we have to lose by trying something out of the box and bringing in maybe more of a reformer. The issue I think with that is there maybe isn't a whole lot in Ben Carson's resume to suggest that he is a restructuring guy, perhaps, that he has experience coming in to organizations that he isn't as familiar with and really breaking them apart and trying new things.

TIMIRAOSSo if you were to pick somebody without housing experience because you wanted to do something like that, it maybe isn't clear that Dr. Carson is that individual.

REHMTimiraos, he is Wall Street -- forgive me, it's Nick Timiraos, he's a reporter for the Wall Street Journal. We'll take a short break here, and when we come back, I'll open the phones for your questions, comments, as well as your email. Stay with us.

REHMAnd here's our first email as we talk about the Department of Housing and Human Development and President-elect Donald Trump's appointment of Dr. Ben Carson to head up HUD. Here's the email. My name is Ida. I attend San Miguel Tulsa Middle School. Our class is listening to your show. What changes will Dr. Carson make to HUD? Richard Rothstein, any ideas?

ROTHSTEINWell, I think we've covered some of them. He will cease to try to encourage and eventually force segregated all white suburbs from desegregating. We mentioned the Section 8 housing program before. Another new rule that the Obama Administration has adopted is one that would adjust the amount of subsidies that are granted to families to be able to afford apartment rentals in middle class neighborhoods and integrated neighborhoods. He may try to reverse that rule and go back to the situation we have now where Section 8 Housing (unintelligible) are used primarily to reinforce segregation.

ROTHSTEINBy allowing them to be used, or, effectively, permitting them to be used only in neighborhoods where rents are cheap, which are typically segregated, concentrated areas of poverty.

REHMAll right.

ROTHSTEINSo those are two very important changes he might make.

REHMDiane.

YENTELSo, here's a couple things that more that we do know. We know that Dr. Carson, while he was raised in poverty and while it seems that his mother may have benefitted from some safety net programs that he has referred to poverty being a state of mind only. He has said that one of the values that his mom instilled in him most is that if you're not successful, it's because you're not trying hard enough. And he has said that safety net programs create dependency.

YENTELAt the same time, we know that Speaker Ryan and Chairman Jeb Hensarling of the House Financial Services Committee have talked often about the need to apply some of the same policies that were used in welfare reform to other safety net programs including housing assistance programs.

REHMMeaning?

YENTELAnd specifically, they've talked about applying work requirements or time limits to housing assistance.

REHMAll right.

YENTELWhich would be problematic in a number of ways, mostly because the vast majority of people who are receiving HUD subsidized assistance are either elderly, they're disabled, they're caring for a family member with a disability. Or they are working, but they're working at very low wage jobs.

REHMAnd here's an email from Jim who says, remember, HUD is also about my white 84-year-old mother in small town Kansas having a safe and affordable apartment in her retirement. It's not just inner city.

TIMIRAOSYeah, that's right. I mean, HUD has a range of programs from urban areas to rural areas and as Mayor Nutter said, tribal areas as well. I think one of the big questions now is who will Dr. Carson bring in to staff the agency? Who will be his top lieutenants? The Federal Housing Commissioner, the, you know, the various directors that run this federal bureaucracy. Those people will now have -- I mean, those are already important jobs, but because they're going to be getting the new Secretary up to speed on a lot of these programs, they will have enormous influence and sway.

TIMIRAOSAnd so, there's a big difference between picking somebody who believes that, you know, the FHA program has served its purpose through the crisis verses somebody who thinks that the FHA caused the financial crisis. Which is a narrative out there that isn't terribly well-supported by facts but still has some strong believers. So, you know, Donald Trump ran as this reformer who said he was going to drain the swamp, but when you bring in people who maybe don't have as much technical experience into these jobs, you actually cede, perhaps, more power of the bureaucracy to these insiders who we don't know who they are.

REHMSo, the head of a department like HUD becomes the face to the public, but not necessarily the decision maker.

TIMIRAOSRight, and there is some history for that. I mean, we've had, we've had past directors of HUD have generally been either kind of housing technocrats, think of Shaun Donovan, currently the Budget Director. He was Mayor Bloomberg's Housing Commissioner and Obama's first HUD Secretary. Now we have Julian Castro, the former Mayor of San Antonio, who, you know, he was the mayor, so he did have experience with urban issues. But maybe didn't know all of the particular technical agency programs under HUD.

TIMIRAOSSo, we've had a mix of backgrounds and experience levels, but Ben Carson is definitely, you know, further out there in terms of just being a newcomer to housing policy.

REHMAll right, let's open the phones to Carl in Cincinnati, Ohio. You're on the air.

CARLHi, thank you. Dr. Carson is clearly anti-government, philosophically. And while he was not the recipient of public housing growing up, will he be confronted in Senate hearings about the fact that he definitely was beneficiary of public education through high school, Government sponsored affirmative action programs to get into Yale? And then University of Michigan Medical School, which is a public institution, and public supported hospitals and residency training at Johns Hopkins?

REHMNick, do you think those items will come up?

TIMIRAOSI think they will. I think we will have a hearing that will try to extract more views out of Dr. Carson about what he believes. But you'll see a lot of kind of falling back into the traditional partisan stances over HUD. And it will be interesting to see how Senate Democrats try to either pin Dr. Carson down on certain priorities or extract guarantees on different issues that are of interest or concern.

REHMAll right, let's go to Kevin in Baltimore, Maryland. You're on the air.

KEVINHi, thanks for taking my call.

REHMSure.

KEVINI've been developing affordable housing for 20 years in the poorest neighborhoods of Baltimore. And President Obama's enforcement of fair housing has been crystallized in a set of criteria called site and neighborhood standards. That boil down to the poorer and blacker a community is, the less it's able to qualify for federal dollars. It's made it almost impossible to get federal money into the distressed communities of our cities for revitalization. And it's my understanding that this is what Carson is against.

KEVINAnd I didn't vote for Trump. I find it tremendously ironic that it's taken the election of a man like Trump to address this mischaracterization of fair housing on the part of HUD.

REHMDiane.

YENTELWell, I disagree. I think what you're getting at is this idea that fair housing only means creating housing opportunities in higher opportunity neighborhoods. Which may be the whiter suburbs. That's an important piece of it. It also, and I think HUD was very clear and the Supreme Court in its ruling last summer, related to fair housing, was also very clear that furthering fair housing means that. And it means deconcentrating poverty and reducing racial segregation in poor communities.

YENTELSo, it is both -- it's preserving housing where it exists. It's building new housing opportunities for the lowest income people in high opportunity neighborhoods. And it is comprehensively revitalizing those poor, highly segregated communities.

REHMHere's an email from Dennis, who says Charlotte, North Carolina came in as number one in the lack of upward mobility. Affordable housing was a major contributor. What happens in Charlotte is developers get permits for building apartments by promising to make a portion of the units quote affordable. Then, they don't. Do you believe that HUD will address this issue? Richard Rothstein.

ROTHSTEINWell, I don't know if HUD will address this issue. But I was going to say, Diane, was that we have had 50 years now of experiments of trying to focus on revitalizing inner cities without desegregating them. We started out in the Johnson administration with the Model Cities program. Then we had, under Jack Kemp, and even Bill Clinton, Enterprise Zones. They've all failed because once you concentrate the most disadvantaged families, the most low income families in single neighborhoods, the problems they suffer accumulate.

ROTHSTEINThey reinforce each other and unless you integrate them into the broader society, we're going to continue to have the kinds of segregated neighborhoods that give rise to the conflicts that we've had in the last few years in Ferguson, in Baltimore and Milwaukee and so on. It is true that the Obama Administration has attempted to avoid placing all low income housing in already low income segregated neighborhoods. That's what the Affirmatively Furthering Program is about.

ROTHSTEINAnd unless -- of course, it's easier to build low income housing in low income neighborhoods, because the land is cheaper there. Because you don't get community opposition. Because lots of people who might live there live nearby. But unless we have the courage to begin to take steps to integrate the society, we're going to see more Fergusons, more Baltimores, more Milwaukees, more Charlottes in the years to come.

REHMNick Timiraos.

TIMIRAOSYou know, one thing we haven't touched on, and it's dangerous to bring up, because you could devote a whole another hour to this, but Donald Trump has promised ambitious tax reform too. And there is a suite of affordable housing programs that are really run through the tax code. Low income housing tax credits and so forth. If you cut corporate taxes, and Donald Trump has proposed taking the corporate tax rate down to 15 percent from 35 percent, you change the value of all of these other programs out there.

TIMIRAOSDonald Trump is familiar with the impact of kind of cottage or niche programs from tax reform. Because the 1986 tax reform that President Reagan passed, Donald Trump was highly critical of for the impact that it had on commercial real estate. So one area to watch that doesn't just sit within HUD is this kind of broader suite of tax reform and what that is going to do to all these other programs that depend upon the different ways we spend through the tax code. And it's not clear how familiar Dr. Carson is with the interplay of tax policy and housing policy.

REHMPam, do you want to comment?

PATENAUDEI just -- I would like to comment on an earlier question, that I believe that the changes that Dr. Carson will bring to HUD is that he'll take a much more holistic approach. Nobody understands better than Dr. Carson the synergies between health and housing. And I also believe that Dr. Ben Carson has, you know, spent his career focused on people and throughout this program this morning, we have not talked about the people that HUD serves. And I do believe Dr. Carson will focus on the families and the elderly -- the seniors that the programs serve.

PATENAUDEI also believe that Dr. Ben Carson supports a safety net for those that are unable to work, but perhaps is focused on the people that are able to work and provide them economic mobility. Programs like the Family Self-Sufficiency Program that have been very successful in helping families move from dependency on subsidies to being able to work.

REHMNick.

TIMIRAOSYeah, it remains to be seen, you know, how he's going to approach these different issues, what he's going to make a priority. You can't make everything your top three list. So the questions are going to be in light of some of the issues we've talked about. Tax reform, funding cuts for non- defense spending. What does he make the priority and how will Congress support, interfere, you know, help with whatever those priorities are?

REHMAnd you're listening to "The Diane Rehm Show." Let's go to Brenda in DeSoto, Texas. You're on the air.

BRENDAGood morning. I've just got a comment. My thinking with picking Ben Carson to head HUD is just another person. They picked him because he was black and he is a very yes man. He's not going to say no to Donald Trump about anything. Donald Trump is not a smart man himself. He'll take this country and put it on its knees. When President Obama was became President of this -- the country was on its knees financially. And he has brought it back to where we are today.

BRENDADonald Trump, Ben Carson, that whole group of people up there are nothing but people who want to see -- spread a lot of hate and discontent.

REHMAll right Brenda, do you want to comment, Diane?

YENTELWell, I would say one place where it will be interesting to see how a disagreement between Dr. Carson and President-elect Trump works out is around the mortgage interest deduction. That's a place where, and it's important too because it gets at...

REHMThat's huge.

YENTEL...yeah. And it gets at kind of what Nick was saying earlier about HUD today is really only able to kind of help at the margins. And that's true. We know that the vast majority of people in need of housing assistance get none. And that's because of the way we fund and the way we manage our overall federal housing policy. We spend about 200 billion dollars a year to help Americans buy and rent their homes, but the vast majority of that goes to higher income home owners through the mortgage interest deduction.

YENTELSo there's only a quarter of those subsidies left to help low income renters, those with the clearest and the greatest needs. Now, there are reforms to the mortgage interest deduction that are on the table in comprehensive tax reform discussions. There are reforms that could both increase the benefit of home ownership to low income home owners, who currently get none. And realize significant savings that could go towards expanding affordable housing solutions. So that we can actually meet the need.

YENTELBen Carson has -- while he was running for President, he proposed eliminating the Mortgage Interest Deduction altogether. So, it will be interesting to see where we go with that.

REHMNick.

TIMIRAOSOne other thing I'd say in response to the caller Brenda is that, I mean, people should remember here, Donald Trump is a real estate guy. His father made his living in affordable housing in Queens. So, to the idea that there's no expertise here, I mean, we have just elected a President who is a real estate -- I mean, that is what he knows.

REHMMogul.

TIMIRAOSYeah, he knows the tax code on real estate, and so to the extent that he personally decides to get involved in some of these decisions, that could be very interesting to watch because he knows that he knows this stuff.

REHMPam, do you want to comment?

PATENAUDEWell, I agree with Nick. We have a President with, that has, President-elect with tremendous amount of expertise. And I again believe that Ben Carson is a man of integrity and deep faith. I believe cares about the people that the department serves and I think he will be a great leader. He, you know, is an inspiring leader and I would respectfully disagree with the caller that Ben Carson will make decisions based on evidence. And I believe that's going to be the difference between the two.

REHMAll right. All right, we'll have to leave it at that. Pam Patenaude was Assistant Secretary at HUD under the George W. Bush Administration. Richard Rothstein is Research Associate at the Economic Policy Institute. Nick Timiraos is a reporter for the Wall Street Journal. Diane Yentel is President and CEO of the National Low Income Housing Coalition. It will be fascinating to see exactly who Dr. Ben Carson appoints to work with him because as you've all said that could make a huge difference. Thank you for being with us. Thanks all for listening. I'm Diane Rehm.