That was then, this is now, rent control vs. building deregulation edition

By early 1919 many New Yorkers — even many who held that the long-term solution to the housing problem was “to build more homes and build them now” — had come to believe that neither private enterprise nor public authority could do much to alleviate the housing shortage in the near future.  From this belief it was only a short step to the conclusion that the state legislature had to take action to stop the city’s rapacious landlords from raising the rent…

Here you will find a recent WSJ article (or read this ungated) about municipalities once again turning to rent control…

The above passage is from the highly useful and deeply comprehensive The Great Rent Wars: New York, 1917-1929, by Robert M. Fogelson.  Note that back then both rent control and “building more” won.  As for today, Megan has a relevant column.

Comments

Perhaps it’s time to introduce tuition (and fees) control, to prevent those greedy universities from continuing to raise their rates.

Of course, we need to protect the poor students from the rapacious academic class. Students so poor they have to work minimum wage jobs all hours of the night, only to feed the incredible luxury of the Professor class.

Or simply raise the possibility, and watch how fast these lefties are able to articulate Econ 101 principles. Worth a laugh anyway.

I support price (including tuition) controls and wage (including fees) controls.

It's no coincidence that inequality in the 1920s was about the same as inequality today. Duh. But let's be practical: the political response today won't match the political response following the 1920s as long as the Fed can keep asset prices from collapsing. The irony of Cowen's drumbeat is that his Austrian friends at Mercatus want the Fed to let asset prices collapse during financial crisis. The double irony is that if Cowen's Austrian friends get their way, tenants won't be demanding rent control. The Austrians get what they want and Cowen gets what he wants. It's win, win.

Rent control is a scam in NYC. Just look to congressman Charles Rangel's four rent-controlled apartments. How many other politicians, union bosses, and other influential and wealthy people have control over them? http://www.nytimes.com/2008/07/11/nyregion/11rangel.html

If we can get rid of property zoning then getting rid of rent controls is advisable....

Rent controls are highly effective at controlling rents and should be adopted more widely in places where the rent is too high.

Rents are too damn high just about everywhere and so government price fixing should be adopted everywhere. What could possibly go wrong?

Tuition controls are highly effective at controlling tuition and should be adopted more widely in places where the tuition is too high.

Good point. You saving enough for your kids' college?

Yeah, but I'd much rather keep the money for myself instead of giving to a bunch of over paid academics.

@Jan:

... if that's sarcasm, a /s would be helpful to us bumpkins.

If not sarcasm, the curious ideological premise has been around a very long time.

Rent control was the socialism of fools until Net Neutrality displaced it. But it never went all the way away, and now is bouncing back. So rent control is the drug resistant tuberculosis of fools?

But socialist property-zoning is ok?

California's rationing will take the form of some kind of moral purity race in which landlords interview prospective tenants in something resembling blade runner's Voight-Kampf test.

On a related note, this is a great paper that analyzes the effects of rent control on tenants, landlords, and inequality in San Francisco. http://www.nber.org/papers/w24181

Why do right-wing never clamor for an end to property zoning?

We believe in free markets except when we don't.

Challenge accepted.

I hereby officially clamor for an end to all property zoning laws and regulations. (I've also written against it in the past).

There, happy?

B Cole - are you confusing libertarians with the “right”? I was just reading some English 19C history, and the free market , free trade, and low taxes was then the policy of the Liberals and seen as highly progressive because they understood that the free market was better for poor people by lowering the cost of food and other essentials. The Tories opposed these policies as they wanted to protect their ancient privileges. It is funny how things have flipped since then.

Rent control is bad policy, but it's one of the few bad policies that (arguably) benefits poor and otherwise disadvantaged citizens. Land-use regulations, property tax caps and needless environmental lawsuits are all just as harmful to the housing market (at least in California).

Tying rent control regulations to building restrictions could put the political economy in the right place: If a community doesn't want to build, existing landlords can't just raise rents indefinitely.

It doesn’t benefit the poor, that’s the simple point. Poor people are less able to housing after the policy than before.

Think of it this way, imagine car prices were controlled and only allowed to be sold at a maximum price determined by a regulator. Don’t you think there would be less cars sold? And so poor people would be on aggregate less able to get a car than before?

A point made by TC with his Henry George posts and that post about taxing places near El/NYC subway stops: rent control allows 'monopoly gains' to go to the wrong people, namely, the tenants who can sublet (scam) the landlord. Instead, if you want rent control to work, you should tax property owners more, and pass the money to the local government to build more ghettos, of the kind found here:
Monticello (Photos), Middletown, Poughkeepsie (Photos), Hempstead (Photos), Troy (Photos), South Jamaica, Uniondale, Newburgh (Photos), Brownsville, Utica (Photos)

I was reading neo-neocon recently and she had a link to an article in the New York Post about people who met each other in the old fashioned way - by moving into apartments near each other. So quaint. But one couple included one member of Twisted Sister. Who lived in a rent controlled apartment. As did his new wife. I may have forgotten the details and I am too uninterested to look it up again but I believe when they got together their landlord gave them one of those apartments in exchange for giving up the other.

I find it hard to believe anyone can justify this. Since when do Rock and Roll millionaires need rent control?

Aside from the fame, do you think Twisted Sister made millions? I doubt it. My family, in the 1% (min. net worth greater than $10M) is probably richer than most rock stars.

https://www.celebritynetworth.com/richest-celebrities/rock-stars/dee-snider-net-worth/

So, about as much as you.

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