By Chris Powell
Nearly everyone agrees that Connecticut badly needs more inexpensive apartments. Many basic two-bedroom units in the state carry monthly rents that are as high as a home mortgage payment, and rents are still rising. As was demonstrated the other day at a state legislative committee hearing, many renters are desperate, especially with unprecedented electricity price increases coming on top of rent increases.
But no one has explained how a law restricting rents — government price control that would be exclusive to housing even as the prices of all other necessities are rising sharply as well — is going to encourage construction and renovation of rental housing. Indeed, with a rent control law Connecticut may send a powerful signal to rental housing developers to avoid the state and a powerful signal to landlords to convert their apartments to condominiums and sell them.
Rent control may help people who already have apartments but it won’t increase supply or slake demand.
Fortunately the major rent-control legislation under consideration in the General Assembly is a fraud. It would restrict annual rent increases to 4% [ITALICS] plus inflation. [END ITALICS] With the official inflation rate around 7% and real inflation closer to twice that, the legislation would hardly cap rents at all. Its main value to its advocates may be to establish the [ITALICS] principle [END ITALICS] of expropriating property without fair compensation.
Then, after a few years, other legislation might cap rent increases at 4% [ITALICS] without [END ITALICS] an inflation adjustment, and then freeze rents entirely. After all, many advocates of rent control think that [ITALICS] everything [END ITALICS] necessary should be free. Of course nothing is really free, and decisions about who should pay can be messy, since cost shifting is such a big objective of government.
Many people oppressed by their rents aren’t familiar with economics and how the real world works. But many advocates of rent control [ITALICS] are, [END ITALICS] and they know exactly what they are doing and what they are [ITALICS] not [ITALICS] doing.
They are [ITALICS] not [ITALICS] encouraging the crowd to understand inflation and where it comes from — government itself. They are not encouraging the crowd to notice that since most important prices have risen sharply, landlords aren’t to blame.
Nor are the rent-control advocates concentrating on the only solution to rising rents: increasing housing supply. No, expropriating is their objective.
There [ITALICS] are [END ITALICS] solutions to supply, but they aren’t quick and easy.
Liberalizing municipal zoning is the one most discussed. But any zoning solution will be slow and disjointed.
State government could build housing directly, exempting itself from municipal zoning, using eminent domain to obtain land, hiring contractors, and assigning construction plans, but that would risk much corruption.
Or maybe state government could exempt itself from local zoning, use eminent domain to obtain property near water and sewer lines and transit infrastructure, put the properties out to bid to apartment developers, and then exempt them from taxes as long as the properties were well maintained.
Such a policy would be sounder environmentally and possibly less controversial than putting apartments in rural towns that lack infrastructure.
But there can be no substantial construction of housing [ITALICS] anywhere [END ITALICS] without controversy. In the end the issue is a choice between the haves and have-nots. Government may try to mollify the have-nots with free bus rides, diapers, and contraceptives, but what they need most is less expensive housing.
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In the meantime state government will continue to take care of itself better than anything else.
Central Connecticut State University in New Britain has just announced its hiring of former Hartford Democratic state Rep. Edwin Vargas as the new occupant of the Gov. William A. O’Neill Endowed Chair in Public Policy and Practical Politics. The job pays $69,000, pretty sweet for someone who is 74 with pension income. That’s “practical politics” for you.
Vargas won re-election last year but, betraying his constituents, declined to take office in January so he could accept the university job. His predecessor was another state legislator, former state Sen. Donald J. DeFronzo, a Democrat from New Britain.
If Republicans ever want to occupy an endowed chair in public higher education in Connecticut, they’ll have to start winning a lot more elections.
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Chris Powell is a columnist for the Journal Inquirer in Manchester, Connecticut. (CPowell@JournalInquirer.com)
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Chris Powell column 