Is federal rent control, just proposed by Commissar Biden, a good idea or bad?
Well, it’s good in one way — great to torpedo the incentives and capital of owners while reducing the supply of rental units and further eroding property rights.
All of which is bad.
Very bad.
A few details of the economic principles being blithely ignored by Biden and/or his handlers are explained by The Wall Street Journal (“another classic White House policy contradiction: Subsidize housing, then discourage its development”), Mises.org, and Breitbart Business, among other places.
What are the chances that this pot shot at the economy will become law in the near future: slim or none?
Slim.
Not none, unfortunately — we’ve seen too many unthwarted federal attacks on the property rights of landlords and owners, including during the COVID-19 pandemic.
The chances are considerably more than slim if there’s a Biden Simulacrum 2 administration.
The goal of Biden and/or his handlers is to make clear to persons who want something for nothing — a goodly percentage of Biden’s constituency — that even a near-brain-dead party leader or his puppeteers can come up with scads of new schemes to loot fellow Americans as long as Biden or a Biden-type is at least nominally in office.
So if you want more pelf, along with an expiring economy with a war of all against all, vote for Biden!
Or whoever replaces him at the Democratic convention.
If you want freedom, prosperity, respect for property rights and each other, don’t.
This is Common Sense. I’m Paul Jacob.
Illustration created with PicFinder and Firefly
—
See all recent commentary
(simplified and organized)
3 replies on “National Control”
What should be noted by those who hope to benefit by looting from landlords is that rent-control will result in higher rents combined with a decrease in the quality of rental units. We’ve seen that point illustrated both by what happens over time when rent controls are introduced and by what follows in those cases in which rent controls are removed.
Rent controls disincentivize the deliver of rental properties. Fewer units are built, more units than otherwise are converted to other use (eg, condomina) or abandoned, supplied units are less well maintained or less well renovated.
Just as fewer people build or maintain houses when squatters are likely to seize them, fewer landlords build or maintain rental units knowing that many renters are going to become partial squatters, clinging to units for which they won’t pay market value. The way to try to get ahead of the squatters is to increase rents based upon expectations about what prices are necessary for profitability given how long renters will cling.
A negative feedback loop results. With every other landlord calculating similarly, renters will occupy units that they would otherwise leave, because the alternatives for renters are worsened.
The political left too often imagines the quantities of commodities as simply determined by technologic considerations, with prices then being determined by ratios of these quantities plus some premia imposed through the social power of landlords and of capitalists.
In this context, the left imagine rental units as simply being provided in essentially the same quantities, so long as some basic price, well below that actually observed, is paid.
(Likewise, the left imagined employment of unskilled labor would be virtually constant, in spite of statutory wage minima.)
The Democrats’ and the globalists’ ultimate goal: you will own nothing and you will be happy.
Of course, if we’re not, they’ll settle for us acquiescing to not owning anything.