Uncivil Rights

A BLOG rife with wit, sarcasm, and the endless joy which comes from taunting the socialistic and unpatriotic liberal left. Logical thoughts and musings ONLY need reply...unless you're really, really funny. You have the Uncivil Right to be an IDIOT. "Give me LIBERTY, or give me DEATH!"

Tuesday, December 07, 2004

Simple Economics

I feel I have to hammer this home for the liberals who think the government has all the answers. This is for the liberals who think if you increase the minimum wage, those workers will be able to buy more stuff and have a higher standard of living. This is for the liberals who believe in social welfare and income redistribution. This is for the liberals who don't have a clue (in other words) about how the REAL world works.

Here is an example of of how good intentions (with political motivation) will have those damned unintended consequences that make things worse. This article is on rent control (and from the Boston Globe!). It focuses on those unintended consequences when the government gets involved and regulates rent amounts.

Here are some excerpts:

The proposal would permit elderly, disabled, and low-income residents in apartments with more than six units to contest annual rent increases in excess of 5 percent, and all renters in such larger apartment complexes to contest increases in excess of 10 percent.

On the surface, this form of limited rent control seems logical and equitable. But paradoxically, the measure could lead to unintended consequences, worsening the housing crisis.

One problem is housing supply. Landlords who try to avoid raising rents to prevent costly litigation are less likely to maintain their properties, speeding deterioration of the existing rental stock. The measure could also provide greater encouragement to condominium conversion, further reducing the supply of rental property. Most important, it would almost surely discourage large developers from building new housing in Boston...

The second problem is an unintended adverse "distribution" effect. Landlords would be even less willing to lease units to low-income, elderly, and disabled households, which could grieve rent increases in excess of 5 percent when renting to others would protect them against such action until rents rise by 10 percent.

There is already evidence in the first few months after passage of Chapter 40R that communities are willing to consider implementing the new law. But approval of the rent measure would almost surely have a chilling effect on developers and lending institutions when it comes to further housing production in the city.

Rent controls have been devastating for the city of New York. Many building owners could not afford to maintain their buildings when they weren't making much on the rent. Therefore, a lot of owners have abandoned their buildings. There are more empty units in New York City than there are homeless people. Imagine that.

Another example of government intervention messing things up. Let the free market be just that, FREE.
totalkaosdave, 5:29 PM