NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Neal Peirce wrote an article following the Bellagio summit in August which also appeared on the Acumen Fund blog a couple of weeks ago.? It is certainly worth a read, since it really does make the case that its title suggests.In his article, Peirce expresses great enthusiasm for the potential that grassroots collective action has for producing changes in urban slums, citing examples from around the world of slum-dwellers taking action to upgrade their informal settlements into true homes and habitable communities. He also links this with the potential of identifying and using local communal credit capacity to bring micro-financing into housing development work.

I second his enthusiasm, although what doesn?t always seem to appear much in the discussion around micro-financing and housing is the major role that government and politics also play in housing development. For example, in Brazil, grassroots action in the favelas often happened in response to decades of government neglect, systems of political patronage, and systems of social exclusion that finally sparked the formation of community groups to push for service upgrades. These movements were community-based and motivated by the desire for basic physical changes; however, they also quickly became linked to political action, and sometimes even to politicians or specific parties. Although micro-finance and politics are not often mentioned together now, housing is certainly a subject that could increasingly bring the two into the same space.However, the thing that struck me most about Peirce’s article was his emphasis on organic action and how much it resonates with my own observations. A few years ago, I spent three months living in a housing project constructed by the Polish government for low-income people in San Salvador back in the 1980s. At the time the project probably was designed so that everyone would one day have a sewer connection and maybe even constantly running water, but by 2003 that still wasn?t the case for many of the two or three-room cinder block units.

Since the community had not ?built itself,? very little cohesion seemed apparent in the barrio–neighbors many times did not know or care much to know each other. With little sense of organization, few opportunities to get ahead or make improvements, and no entrepreneurial energy, the project was quickly becoming core territory for a very different type of organization: MS-13, or MaraSalvatrucha, a notoriously violent gang, now spread across various Central American countries and parts of the United States.

This is not to say that community action has not been used many times and in many countries to reverse this sort of decay. But, I think it is important to recognize that providing housing to people without the communal support network and organization of ideas and action that will enable it to grow and prosper, and without strong potential for generating greater economic activity in the future, is not a sufficient solution. Communal motivation, combined with sustainable financing practices, I suspect, will produce much brighter prospects for both quality of life and economic activity.