>I don't think this is the same problem you would address by rent control.
Of course not. Rent control is fundamentally a tool for getting political benefits at the expense of economic ones. It explicitly creates winners in the voting district that implements it at the cost of losers everywhere else. It's in the same moral class as dumping toxic waste into a river.
>And yet, there are many people living in rent-controlled housing who would disagree with you.
I'm not at all surprised that the beneficiaries of political favors support handing out those favors.
> Rent control is fundamentally a tool for getting political benefits at the expense of economic ones. It explicitly creates winners in the voting district that implements it at the cost of losers everywhere else. It's in the same moral class as dumping toxic waste into a river.
I'd love to hear the argument for this. Again, many people living in rent-controlled houses would disagree. Just because people are poor you cannot write them off as votes.
>Economists are virtually unanimous in concluding that rent controls are destructive. In a 1990 poll of 464 economists published in the May 1992 issue of the American Economic Review, 93 percent of U.S. respondents agreed, either completely or with provisos, that “a ceiling on rents reduces the quantity and quality of housing available.”
Ok, so economists agree that "a ceiling on rents reduces the quantity and quality of housing available". Thankfully, economists don't run our country. How does this support the statement "Rent control is fundamentally a tool for getting political benefits at the expense of economic ones."? Quantity and quality of housing are arguably much less important than ensuring there is a viable working class—just see how terrible a place SF or Manhattan is to live.
There's two different questions that policies should answer - what sort of stuff do we get out of it, and who gets that stuff. These are often referred to as allocative and distributive, though I'm remembering the precise technical wording from memory so I could be wrong on that.
That's the distinction that drove me to make the political versus economic benefits distinction. Rent control as a whole makes things worse - there's less housing, it's of worse quality, and it drives up the cost of market rate housing. On the whole, it's a bad allocation of resources: we'd much rather have cities with more housing that's of higher quality (because people are more than willing to pay for it). The problem is that this sort of policy creates winners and losers, and the losers are often the ones who get to set local policy.
There's two solutions - have a ban on rent control at a higher jurisdictional level (Washington State does this), or bribe current residents to lift rent control. The latter should make everyone better off - we pay for keeping the working class viable with the overall economic gains made by lifting rent controls.
Anyhow, my overall point is that we should hand out the who-benefits stuff without making society worse off as a whole, simply because the locals who happen to live in an area are able to hold overall policy hostage.
>pay for keeping the working class viable with the overall economic gains made by lifting rent controls
The economic gains from lifting rent control are going to go to slumlords, not just get dispersed to everyone. Also, housing isn't an elastic supply market. when rent goes up it doesn't necessarily mean the quantity of housing will increase as a result since housing is often limited by zoning, drainage, and many other things than profitability of rentals. Also when you consider the destabilizing effect of people having to move every few years due to rental price fluctuation, it's not really a clear cut benefit to "bribe current residents to lift rent control" if that were even an option.
>we should hand out the who-benefits stuff without making society worse off as a whole, simply because the locals who happen to live in an area are able to hold overall policy hostage
but this is how democratic communities work... local communities decide what is 'making society worse' where they live; as they should, since it obviously effects them the most.
>local communities decide what is 'making society worse' where they live; as they should, since it obviously effects them the most.
Local optimization is not the best strategy, even according to the those doing the local optimizations. Both participants in a Prisoner's Dilemma are better off if they hand their decision-making over to a third party, conditional on the other person also doing so. The Bay Area as a whole wants affordable housing, they just don't want to make the Bay as a whole better off by making unfair sacrifices in their neighborhood.
It's a classic coordination problem, caused in large part because decision-making is too local compared to the regional benefits of housing construction.
Of course not. Rent control is fundamentally a tool for getting political benefits at the expense of economic ones. It explicitly creates winners in the voting district that implements it at the cost of losers everywhere else. It's in the same moral class as dumping toxic waste into a river.
>And yet, there are many people living in rent-controlled housing who would disagree with you.
I'm not at all surprised that the beneficiaries of political favors support handing out those favors.