Author and freedom-fighter Harry Browne offered liberty-backing aphorisms like punches before he passed away in 2006, and one of his most famous is:
“The government is good at one thing. It knows how to break your legs, and then hand you a crutch and say, 'See if it weren't for the government, you wouldn't be able to walk.”
Landlords and those searching for affordable housing in New York (as well as other places that embrace the fascism of so-called “rent control”) might understand precisely what Harry meant. In fact, in the metropolis of New York City, where, since the 1920s, politicians have commanded property owners and ruled over what they could charge to occupy their spaces, contemporary collectivists are making things even worse.
Reason’s Christian Britschgi reports that, even after two years of the stunningly unconstitutional U.S. Centers for Disease Control and Prevention (CDC) prohibiting property owners from evicting defaulted renters (i.e. squatters, which put many landlords on the brink of bankruptcy), the Delphic Minds of the NYC government are instituting more market-crushing tyranny by “allowing” landlords to increase rent - but only allowing increases that are LOWER than the inflation rate.
“New York City officials have decided once again to allow rent increases at rent-stabilized apartments below the rate of inflation, upsetting both tenant advocates who wanted a total rent freeze and building owners who argue their properties are being ‘defunded’ by persistent real cuts to rent.”
Notice Britschgi reports that “Tenant advocates” were upset - meaning they think it’s legitimate to use the power of government to push around property owners, that it’s legitimate to lobby politicians to threaten and force others to do what the “advocates” want. That’s quite perverse, and represents just one of the monsters that has emerged from Pandora’s Political Box of collectivist ideology.
“On Wednesday, the city's Rent Guidelines Board (RGB) ordered that annual adjustments for one-year leases starting in October 2023 on New York City's roughly 1 million rent-stabilized apartments could rise by 3 percent and 5 percent for two-year leases.”
How beneficent of the “Rent Guidelines Board.” How the “RGB” is effectively any different than a mafia shaking-down local store owners and forcing them to sell at discount rates for their mob-favored friends is anyone’s guess.
Related: Federal and State Eviction Bans Are Forcing Some Landlords Into Poverty | MRCTV
But the “board” has made its decision, and property owners who don’t comply will suffer the consequences.
Actually, those who DO comply also will suffer, because the “allowed” rise in rent doesn’t make up for the landlords’ higher costs of operation, meaning that they either will be net losers year-to-year, or they will have to cut corners on things like upkeep, improvements, advertising, and sundry other considerations they typically would factor into their yearly plans. Which is just one of the many practical problems stemming from the immoral political imposition of that euphemistically titled practice of thuggish “rent control.”
Philosophically, morally, it’s even worse. It’s a form of Marxist gangsterism, wherein the “caring” political class portrays property owners as enemies, exploiters, and portrays renters/tenants as the “little guys” in the “proletariat” who deserve to have the gleaming government paladin “on their side.”
“The board cited rising inflation, which was 6.1 percent in New York City, as a reason for keeping rent increases low for tenants. That level of inflation nevertheless means that real rents are falling for building owners who are also seeing their own costs rise faster than inflation.
An RGB report from earlier this year found that owners' operating costs rose by 8.1 percent.”
The immorality of telling other people how they can or cannot offer their property or services to others is obvious, but it can be seen with new clarity if one were to switch the “identities” here.
Imagine that, instead of the politicians intervening to make the landlord accept tenants for less than what the landlord and the market might demand, the bureaucrats and politicians told the renters they would have to pony up more to “make it fair” for the landlords… After all, the landlords can’t keep going unless they can make a return on their investment. They’ll have to shut down, lose the property, go into foreclosure. What would happen to the demand from potential renters in the area? Faced with artificially higher prices, would they invest, or turn elsewhere with their money?
Such a thought experiment allows one to see the final practical lesson of so-called “rent control” – it stifles the market and sees potential builders shift their resources elsewhere.
If, as we imagined with the example of renters seeing government-upped rental costs, those potential renters will go elsewhere to get better bangs for their bucks, so, too, do potential landlords and builders look at different regions to see where their costs are lowest for their rate of return.
And this is particularly vital in a city which even the New York Times recently reported sees half of residents struggling to afford their living arrangements. When government "deciders" artificially increase costs, they decrease the incentive to expand supply, thus creating shortages of affordable housing. If they would leave the market alone, higher prices would be a signal of high demand that potential landlords could see and on which they could act, increasing the supply of housing units and, over time, decreasing the cost for consumers.
Related: Reps. Tlaib, Pressley Push Federal Cancellation of Rent, AFTER They Made Cash As Landlords | MRCTV
But, as Harry Browne cogently observed, it seems as if many people involved with government prefer to stifle supply and then promote purported government “answers” through tax-funded welfare housing. In other words, while they hobble the market, they give hardscrabble renters tax-funded crutches and claim they are "helping" them fight the "exploiters."
In market trades of goods or services for payment, there is no “exploiter.” The participants freely agree to the trade, and would not engage in trade if they did not think the transaction didn't make them better than their current positions.
By imposing limits on landlords – or adding expenses for renters (in reality, many government “safety regulations” DO add expenses to rental properties that the clients might not have chosen in a free market), the politicians and bureaucrats not only harm the growth of a market to provide more for less, they breach basic morals.
If they want to “control” prices for properties, let them do the peaceful thing and buy their own, enter the rental market, and see how they perform. It’s called freedom, and it works.
Follow MRCTV on Twitter!
Power Outage: Ford to Cut 'At Least 1,000 Salaried Employees,' Lose $3 Bil. From Electric Vehicle Investments https://t.co/CkzzDapqVu
— MRCTV (@mrctv) June 30, 2023