Most CEOs are not nuns.
Sister Lillian Murphy has been CEO of Mercy Housing for 23 years, so I did not know what to expect when I recently visited her office.
"The guy who was accused of threatening Nancy Pelosi lives in one of our buildings in San Francisco," the longtime advocate of affordable housing told me. "There's a picture of the cops out in front of the building arresting this guy.
"And I thought, 'Oh, do we need this?'"
Gregory Lee Giusti, 48 years old, is being held without bail after his arrest last month. He has pleaded not guilty to charges that he made at least four dozen menacing, profanity-laced calls to the Speaker of the House, allegedly taking issue with her position on health-care reform.
Wait a minute, Sister. This guy lives in your subsidized housing project and he's reportedly all torqued about socialized health care?
"That's a building that serves formerly homeless people," Sister Lillian continued. "We have support services in the building. There are counselors there."
Counselors? This guy has been getting subsidized counseling, too?
"You can't force people to take advantage of the services," she said. "As long as they are not disruptive..."
Um, Sister, I interrupt, isn't what he's accused of doing just a tad bit disruptive?
"We didn't know he was doing it," she said. "It's not his fault he's mentally ill."
It's not my fault, either. So why should he get subsidies? Why can't he rely on the free market like every other red, white and blue bleeding American?
"The free market has worked for two-thirds of the country," Sister Lillian said. "But there's this one-third it doesn't work for.. So what happens? Do we forget about them? Do we think about them as disposable?"
Maybe we should lock them in jail, I say, providing fully subsidized room and board for them there.
That's the expensive kind of societal solution that Denver-based Mercy Housing tries to avoid, Sister Lillian said.
The nonprofit has helped develop, preserve, operate or finance about 37,000 affordable housing units in more than 200 cities in 41 states. This amounts to $2.1 billion worth of real estate that provides affordable homes for than 128,000 people.
"We're trying to serve people who the markets will not serve," Sister Lillian said.
Mental illness, drug and alcohol abuse, homelessness, AIDS/HIV, broken homes, teen pregnancies, domestic violence -- those are just some of the woes it tries to address. Most of Mercy Housing's tenants are simply victims of the economy.
"About 75% of our people are working," Sister Lillian said, "but they are making so little that they can't afford a home."
Sister Lillian grew up in a home of eight siblings, the daughter of an Irish merchant marine who jumped ship on U.S. shores. "He was an 'illegal alien' as they call them," she said.
She became a nun at age 18, went on to earn a master's degree in Public Health from the University of California at Berkeley, and then managed hospitals before she took the helm at Mercy.
These days, she increasingly meets people who've been living in cars and garages, doubling up in tiny apartments, and even turning to homeless shelters after losing their middle-class jobs. She also sees the looming wave of Baby Boomers hitting their retirement years with inadequate savings due to downturns in stocks and real estate.
The free market has simply not provided enough affordable housing for America's growing ranks of low-income people. The U.S. had six million affordable housing units in 1970, and it has six million affordable housing units today, Sister Lillian said.
OK, I interrupted again, but isn't America's ongoing foreclosure crisis going to fix this? Isn't this just the free market's handy way of creating affordable housing?
"It's creating vacant housing," Sister Lillian said. "That's not necessarily affordable housing.. The prices haven't come down yet. The banks are willing to sit on them. They don't want to take the write-off. They think it's coming back."
Sister Lillian foresees demand for 19 million affordable housing units by 2015. She'd like to help meet this, but times have gotten tough for her organization, too.
One of the ways Mercy financed its projects was through selling tax credits. Fannie Mae (FNM) and Freddy Mac (FRE) were among its largest buyers. But after these troubled, government-sponsored mortgage makers stopped reporting profits, they no longer needed the tax credits.
This alone has wiped out much of Mercy's funding sources. Philanthropy is also harder to come by. So Mercy is increasingly turning to investors with social-responsibility clauses in their charters.
Sister Lillian's pitch to equity investors is that they can expect a financial return of 7% to 8% and a social return as well.
Perhaps there's nothing like the satisfaction of providing a home to a guy who allegedly makes menacing phone calls to Washington, D.C., I say.
"The fact that he may be threatening doesn't mean he's going to do anything," Sister Lillian said.
He's done this sort of thing before, you see. In denying bail, a judge cited two felony convictions and 13 misdemeanor convictions over the past 10 years.
In 2004, Giusti was reportedly arrested for threatening a train conductor who tried to collect his fare. Giusti then received a year in jail and three years of supervised probation.
And if he gets out again?
"We'll take him back," Sister Lillian said.
You'll take him back?
"We don't want him getting out of jail and going back on the streets," she said. "People are screaming about the homeless on the streets. You can't have it both ways.. He's mentally ill.. Somebody needs to help him."
Help him? But wouldn't that be the very kind of socialized health care he's reportedly so upset about in the first place? And aren't you a nun? Couldn't you just whack his knuckles with a ruler?
Al's Emporium, written by Dow Jones Newswires columnist Al Lewis, offers commentary and analysis on a wide range of business subjects through an unconventional perspective. He can be reached at 212-416-2617 or by email at email@example.com, or on his blog at tellittoal.com.