Rent Control

Last year California was one of the states targeted by libertarians in the post-Kelo environment for an initiative that, if successful, would essentially outlaw takings. The country is still at near-fever pitch about eminent domain, but the really scary aspect of the legislation (modeled on Oregon's Prop 37) was that it would have virtually tied local governments' hands with regard to regulatory takings as well. In California Proposition 90 failed to pass after the New York developer who was financing the campaign stopped funding it. However, the Yes campaign had created some strange bedfellows, with poor African-Americans in particular advocating Yes votes as a way to end the destruction of their neighborhoods through badly managed redevelopment initiatives.

The merit of rent regulation is a recurring debate in New York City. On one side are tenant advocates arguing that rent regulation is desperately needed to help poorer households, maintain socioeconomic diversity in New York City, and prevent the City from becoming the preserve of the super rich. Real estate interests on the other hand argue that rent regulation deprives property owners of the right to market their apartments as they see fit, causes landlords to under-invest in their properties, and that in many instances the beneficiaries of rent regulation are affluent. What makes the debate so bedeviling and contentious is that both sides are correct.