Rent control rears its ugly head
Bad economic ideas can be found just about everywhere. Truly destructive economic ideas are still, mercifully, less common. But one of those truly destructive ideas is having a sudden burst of popularity – rent control.
And it may be coming to a big city near you:
Voters in Minneapolis and St. Paul this month approved ballot initiatives to enable the Twin Cities to cap rent increases. Santa Ana, Calif., did so in October. And Michelle Wu, Boston’s new mayor, campaigned earlier this year on restoring rent control — an idea that Massachusetts’ Republican governor has repeatedly objected to but says he’d be willing to discuss to help tackle housing woes.
Supporters and opponents alike say the recent initiatives are just the beginning, with politicians and voters desperate for ways to deal with spiking rents nationwide. Groups representing landlords are already spending millions of dollars to fight back and preparing for the proposals to pop up in more cities.
There is no quicker way to create a housing shortage than imposing rent controls. But the most vociferous advocates for rent control are taking their cues from the top:
Affordable housing advocates say they’ve also been emboldened by the success of the nationwide eviction bans imposed by the Trump and Biden administrations during the pandemic, before the Supreme Court blocked the policy in August.
“There was a tectonic shift in housing advocacy in a way that I think is really important,” said Lindsay Owens, a former aide to Sen. Elizabeth Warren (D-Mass.) and executive director of the progressive Groundwork Collaborative. “Many things don’t feel feasible until they are, and rent controls feel feasible now.”
Give a government health agency power over real estate nationwide, and the resulting market (and political) distortions will echo for years to come.
The people who will suffer most are those in the very communities these self-styled housing advocates say they want to help. But they aren’t going to let economic reality stand in their way:
“This is fundamentally about housing being a human right and a necessity over a commodity that should be profited off of,” Torrejón Chu said. “We see rent control as a solution that allows for a reasonable regulation of the market.”
Spoken like someone who has no idea how markets work, and even less about the consequences of market distortion.