Understanding the Native Housing “Crisis”   5 comments

I ran across this article on how Native Americans are a large percentage of the homeless population because they are often couch surfing and live in a secession of overcrowded homes. The article comes from the UK publication The Guardian, so I read it with interest and then felt compelled as a tribal member to comment.

https://www.theguardian.com/commentisfree/2017/apr/06/americas-forgotten-crisis-50-percent-native-american-tribe-homeless?utm_source=esp&utm_medium=Email&utm_campaign=GU+Today+USA+-+Collections+2017&utm_term=220667&subid=11404366&CMPToday

Image result for image of cherokee indian reservation housingThe federal government is responsible for managing Indian affairs for the benefit of all Indians. It has largely failed in that responsibility, resulting in Native American reservations being are among the poorest communities in the United States. Here’s how the government keeps Native Americans in poverty.

Chief Justice John Marshall set Native Americans on the path to poverty in 1831 when he characterized the relationship between Indians and the government as “resembling that of a ward to his guardian.” With these words, Marshall established the “federal trust doctrine”, assigning the government as trustee of Indian affairs. That trusteeship continues today, but being treated like minor children has not served Indians well.

This doctrine rests on the foundational notion that tribes are incapable of owning or managing their lands. With the exception of Alaska, government is the legal owner of all land and assets in Indian Country and is required to manage them for the benefit of Indians. Hawaiian Native land is held in trust by the State of Hawaii. Alaskan Native land is not held individually, but is controlled by Alaska Native Corporations.

Because Indians do not generally own their land or homes on reservations, they cannot mortgage their assets for loans like other Americans. This makes it incredibly difficult to start a business in Indian Country. Even tribes with valuable natural resources remain locked in poverty. Their resources amount to “dead capital”—unable to generate growth for individuals within tribal communities.

If the tribe discovers resources to develop, it isn’t free to make use of that opportunity. All development projects on Indian land must be reviewed and authorized by the government, a notoriously slow and burdensome process. On Indian lands, companies must go through at least four federal agencies and 49 steps to acquire a permit for energy development. Off reservation, it takes only four steps. This bureaucracy prevents tribes from capitalizing on their resources.

It’s not uncommon for years to pass before the necessary approvals are acquired to begin energy development on Indian lands—a process that takes only a few months on private lands. At any time, an agency may demand more information or shut down development. Simply completing a title search can cause delays. Indians have waited six years to receive title search reports that other Americans can get in just a few days.

Thanks to the legacy of federal control, reservations have complicated legal and property systems that are detrimental to economic growth. Jurisdiction and land ownership can vary widely on reservations as a result of the government’s 19th century allotment policies. Navigating this complex system makes development and growth difficult on Indian lands.

One such difficulty is fractionated land ownership. Federal inheritance laws required many Indian lands to be passed in equal shares to multiple heirs. Any Indian who didn’t win clear title to land by 1934 was left with a fractional share of the reservation’s land held in trust. With every generation, each share was divided among more family members and today hundreds of people may have a partial claim to one share of trust land. Often there are no records of where many of these people are. On the Crow reservation, 1 million of the 2.3 million acres are held in trust for such individuals. The Dawes Act created another problem: The non-Indian owners of privatized land in a reservation have always faced legal questions over whether they come under the jurisdiction of the tribal authority. The checkerboard pattern of private and trust land in some reservations make it tough for tribes to provide services and do land-use planning. After several generations, some of these lands may have hundreds of owners per parcel. Managing these fractionated lands is nearly impossible, so much of the land remains idle.

The result is that many investors avoid Indian lands altogether. When development does occur, federal agencies are involved in every detail, even collecting payments on behalf of tribes. The royalties are then distributed back to Indians, if the government doesn’t lose the money in the process.

Prosperity is built on property rights, and reservations demonstrates what happens when property rights are weak or non-existent. Because the vast majority of land on reservations is held communally under federal trust, residents can’t get clear title to the land where their home sits … which explains the abundance of mobile homes on reservations. This prevents Native Americans from establishing credit so they can borrow money to improve their homes because they can’t use the land as collateral. Besides, investing in something you don’t own doesn’t make a lot of economic sense.

This leads to what economists call the “tragedy of the commons”: If everyone owns the land, no one does and that results in substandard housing and the barren, rundown look that comes from a lack of investment, overuse and environmental degradation. It’s a look that’s common worldwide, wherever secure property rights are lacking. We’ve all seen pictures of Africa and South America, inner city housing projects and rent-controlled apartment buildings in the U.S. that look similar to Indian reservations.

Interestingly, more than a third of the Crow reservation’s 2.3 million acres is individually owned, and the contrast with the communal land—often just on the other side of a fence—is stark. You should Google view it. Terry Anderson, executive director of the Property & Environment Research Center in Bozeman, Montana, co-authored a study showing that private land is 30-90% more productive agriculturally than the adjacent trust land. The land isn’t better: A study of 13 reservations in the West put 49% of the land in the top four quality classes, while only 38% of the land in the surrounding counties was rated that highly. For the Crow reservation, 48% of the land made the top four classes; only 33% of the adjacent land did.

“The raw quality of the land is not that much different, it’s the amount of investment in that land that’s different.” Terry Anderson, Executive Director, Property & Environmental Research Center, Bozeman, Montana

Any land reform effort must go through the Bureau of Indian Affairs, which isn’t about to pave the way for its own demise by signing off on an effort to privatize reservation land. Under the 1887 Dawes Act, land could be allotted to individual Indians (and my ancestors took advantage of this in Kansas), but by 1934 so much land had been privatized that Congress reversed course and returned to a policy of communal tribal property.

“Allotment threatened the bureau so it had an incentive to end the process.” Dominic Parker, an economics professor at Montana State University.

Image result for crow indian reservation montanaI can guarantee you that my tribe’s council is like most other councils and have no intentions of giving up the patronage and power that comes with controlling vast amounts of land. Washington DC spends $2.5 billion a year on Native American programs, which is a powerful deterrent to change.

“For the bureau and other narrow interests, staying with the convoluted system of land ownership is safer than improving property rights,” Dominic Parker

And then there’s that fractionated land, again.

Anderson puts the choice for tribes in sharp terms:

“If you don’t want private ownership, and want to stay under trusteeship, then I say, ‘fine.’ But you’re going to stay underdeveloped; you’re not going to get rich.”

It’s more than reservation residents not having the right incentives to upgrade their surroundings. With some exceptions, even casinos haven’t much benefited the dozens of reservations that have built them, which includes my own. Companies and investors are often reluctant to do business on reservations—everything from signing up fast food franchisees to lending to casino projects—because getting contracts enforced under tribal law can be iffy. Indian nations can be small and issues don’t come up that often, so commercial codes aren’t well-developed and precedents are lacking. Indian defendants have a home court advantage.

“We’re a long way from having a reliable business climate. Businesses coming to the reservation ask, ‘What am I getting into?’ The tribal courts are not reliable dispute forums.” Bill Yellowtail, former Crow official and former Montana state senator

Many reservations are rich in natural resources, but there’s no big rush to develop them, given the tangled issue of property rights and the risk of making a big investment without a secure legal footing.

“We have 9 billion tons of high-quality coal sitting under the reservation, going largely untapped. Natural gas, too. Potential development galore, but that potential is never realized.” Yellowtail

Some tribes are taking steps to improve their legal structures, such as adopting new commercial codes to make their laws more uniform. Over a 30-year period, reservations that had adopted the judicial systems of the states where they’re located saw their per capita income grow 30% faster than reservations that didn’t, according to a study by Anderson and Parker. A separate study by Parker showed that Native Americans are 50% more likely to have a loan application approved when lenders have access to state courts.

“Putting reservations under the legal jurisdiction of the states, and facilitating better legal codes and better functioning court systems, would assist tribes in developing their land,” Anderson

Personally, I think a larger obstacle to these reforms isn’t logistics or special interests, but the culture of the reservations and the generational dependency. I don’t know a lot of tribal members who donate their “per capita payment checks”—derived from tribal nation trust income — back to the tribe.

“Privatizing land is fine but it falls far short of the answer. Our people don’t understand business. After 10 or 15 generations of not being involved in business, they’ve lost their feel for it. Capitalism is considered threatening to our identity, our traditions. Successful entrepreneurs are considered sell-outs, they’re ostracized. We have to promote the dignity of self-sufficiency among Indians. Instead we have a culture of malaise: ‘The tribe will take care of us.’ We accept the myth of communalism. And we don’t value education. We resist it.” Yellowtail

Yellowtail believes that the situation is improving. I agree with him in part. There are more reservation entrepreneurs than 20 years ago as networks of Native American business people have sprung up in Montana, Oklahoma and elsewhere.

“We have to start with micro loans, encouraging small businesses. Then we have to make it okay to leave the reservation because the most successful are going to want to branch out. Entrepreneurs are going to have to stick their neck out, be a role model. We Indians are going to have to do it.” Yellowtail

What it really comes down to is that we have these enclaves of the 3rd world inside the richest country in the world and it’s mainly because of government regulations designed to “protect” Indians, but that actually treat them like children and prevent them from making decisions in their own best interests.

Yeah, there’s alcoholism and a horrible past of white people misusing Indians in past generations, but the current system doesn’t work because it can’t work. Lack of private property rights is the single-largest driver of poverty worldwide, so why should we be surprised that it’s the single-largest driver of reservation poverty?

You’re not going to hear every Native American say that because so many of them believe the lies that the reservation protects their culture and keeps them from being exploited. They’ve been mislead that in the past Indians didn’t believe in private property. I know members of my own tribe who believe that even though history shows they had private property rights that were somewhat similar the American colonists.

If we want to fix the reservations, the best way to do it is for the government to turn the land over to the tribes with the proviso that the land be allotted into private hands by a certain date and then white people just got out of the way and let Indians figure it out.

Watch! There’ll be a McDonald’s on the corner across from the casino by Friday and a Walmart opening before Christmas. Maybe there will be few failed businesses and mistakes made along the way. That’s the price of being treated like an adult.

 

 

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5 responses to “Understanding the Native Housing “Crisis”

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  1. Tom King in his book The Inconvenient Indian also shows in various ways how Indians (or in Canada, First Nations people) are being held back and treated like second class citizens. Keeping a demographic or ethnic group under guardianship is denying the group equality in terms of human rights. So, while South Africa has been judged harshly till it formally rescinded apartheid, Canada and the US continue to be in violation of human rights for Indians/First Nations members.

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    • I can’t speak for First Nations, but being an American Indian, my own take is that my cousins bring some of it on themselves. Here in Alaska, the Natives were given their land (held in trust through the Native Corporations, which hold a lot of money as well). That puts them a step ahead of Lower 48 Indians (like my tribe which has to ask permission from the feds to do anything), but there’s a move here to put Native land in federal trust under the guise of tribal sovereignty. They’re embracing this step backward because someone has convinced them that they will retain their distinctiveness if they put their land in trust.

      So, yes, there is a history of human rights abuses, but the tribes have to take responsibility for themselves if they want to leave that past behind.

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      • There are a number of different takes on how to deal with the mistreatment of the past, the measures the Canadian government has taken to destroy their cultural heritage including their language in the name of ‘civilizing’ the Indians. I value the observations of someone like yourself that identify as an Indian.
        In reading Tom King, he explores both the Canadian experience and the US experience, but likely just US south of the 49th.

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      • I’m actually a Lower 48 Indian, but because I grew up in Alaska, I am more familiar with Alaska Native issues. There are no reservations in Alaska. The Natives here claimed the land they wanted, exceptions being national monuments and certain state parks. They were given financial assets that they have spent the last 40 years building up to where the wealthiest private companies in Alaska are Native Corporation-owned. They have a good system, but they’re undermining it with trying to enter into federal trusts. It will lock up their lands and prevent them from using them as financial assets. I’m not sure who they’re listening to, but it defies logic. All they need to do is go visit my tribe’s Rez, which is right next door to the Cherokee Nation and see the abject poverty … and the CN is one of the wealthier Lower 48 tribes.

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      • It is encouraging to know there are some viable financial models with the hope that Indians can thrive as part of North American non-indigenous folk.

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