Saturday, April 09, 2005

A ‘What, Me Worry?’ view of the future

«On housing, Mr Delanoë pledged at his election to reintegrate the Parisian population by buying up luxury properties, mainly in up-market areas of Paris, and making them available at lower rents to poorer tenants. This he has done by buying up properties in the west and centre of the city and thus making several hundred new apartments available as moderate rent dwellings, or HLMs (Habitations à Loyer Modéré), although this has not been welcomed by all the current residents, who accuse him of pointless social engineering. He says that this policy will reverse the trend of poorer people, especially younger families, abandoning the city altogether as well as reintegrating the city population, a policy already practiced in other European cities such as Munich.»«His policy is based on the ‘Law for Solidarity and Urban Renewal’, passed by France’s Socialist Government in 2000, which makes it compulsory for communes of more than 50,000 people to have rent controls in at least 20 per cent of the housing stock by 2020. The aim is to standardise the principal of ‘social variation’, and prevent neighbourhoods slipping into either very rich or very poor ghettos. Mr Delanoe applies this law to each of the 20 arrondissements (districts) of Paris, which vary between 30 per cent social housing to one per cent. He wants to make the obligatory minimum threshold of 20 per cent apply evenly across the whole of the city.»

All one can be sure of is that rent control REDUCES the quantity, quality, and diversity of the housing stock. What property owner would invest a cent into a rent-controlled building other than to keep it from being condemned? The south Bronx that became so famous for looking like West Beirut circa 1983 is a result of those ‘progressive’ rent control policies. While the do-gooders look at capitalism as being inequitable, the socialistic policies promise to be permanently inequitable.

What else would you expect from a pillow-biting, evolutionary dead-ender? There really is no ‘next generation’ to really worry about if you won’t or can’t have kids. If one only wants to project ones’ feelings on the young, and don’t care about their lives in anything other than an aesthetic way, then who cares?
The only way to guarantee ‘removing social variation’ is to make everyone miserable, and give the poor no way UP and OUT of poverty. Nor does anyone have a way to ‘slum’ in a low rent district while saving up or striving at a new business.

Economist Thomas Sowell has addressed many of the silly old saw policies in specific. They are things like height restriction and excessive environmental regulation which have the effect of reducing housing supply, raising the cost imposed on the builder, and thus the buyer – with no rendered addition of quality or value.
To quote Sowell who was reflecting on similar policies:

«As the realtors say, the three big factors in housing prices are location, location and location. In California, and probably some other places, there are three other big factors -- liberals, liberals and liberals. [note: in American English a ‘liberal’ means a ‘leftist’]

Liberals love to have the government do nice things -- without the slightest regard for the costs or the consequences. Greenery is nice. Open space is nice. It is nice to have buildings that are not too tall. There are all sorts of nice requirements you can put on builders before granting them permits to build.

There is no cash register ringing as the costs of all these nice things keep adding up. It is all done with a wave of the government's magic wand. Not having added up any of these costs, liberals are then shocked and outraged when they discover that apartment rents are stratospheric and housing prices astronomical.»

Other’s still have looked closely and done the non-PC thing of questioning the un-named notion of ‘smart growth’ planning which effectively creates miniature elitist faux-towns where environmental restriction and forced aesthetics are the rule, (again with an effect on the time lying fallow before building) which forces up the cost and means that the only way the developer can break even is to build luxury units.

It gets worse – a study conducted in California looked into the actual effect of forcing developers to build moderate-priced housing as a condition to permitting them to build at all. It took over 20.000 housing units off of the market while adding 384 of the programmed ‘moderate price’ units. Be warned – reducing supply is WHY rents and houses in California are costly in spite of large quantities of land, just as it is in any European city. What do they have in common? It’s the feel-good regulation, stupid.

But what the hell, eh? If you can’t have kids, and don’t care about anyone else’s kids, there IS no future.

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