I wrote on Monday about the book Gang Leader for a Day and how a power vaccuum in the projects creates an opportunity for gangs and powerful (though perhaps immoral) tenant leaders to step in and fill the void. This contributes to a further breakdown of the traditional power structure which creates more opportunities for these alternative groups to increase their power.
This is no small problem. Researchers from New York University have found that students who live in public housing fare worse in school than their counterparts who live outside of public housing, even when factors like race and economics are figured into the equation. Read the book and it's not hard to see why.
The question about how to fix it is obviously much more difficult than identifying the problem. In fact, it would probably take a master's level dissertation to really get to the heart of it. Here's my version in a paragraph.
Just like a castle can't have two kings, a housing project can't have two true authorities. Part of the reasons that gangs and gang life is so prevalent in the projects is that the people tolerate them, not so much because they approve of the crack trade (the book was researched in the 1990s), but because the gangs provide a level of stability by regulating the activities - both legal and illegal - that take place in the buildings. That regulation provides a kind of order that would otherwise be lacking. However, if that order were to come from police, the housing authority, etc. (the way it does in other, more affluent neighborhoods), the tolerance for gang activity declines. In doing so, the power of the gang declines which provides a greater foothold for the traditional power structures to assert themselves.
Simple enough on paper, at least. Of course, actually doing it is where the trouble begins.