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“If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.” — Milton Friedman
Not too long ago, it was mentioned that Oregon had passed legislation to implement statewide Rent Control. This was in response to a crisis in affordable housing. The state government, presently run by a Democrat governor and supermajority in legislature, saw this as a move to curb the rising costs of housing, mostly in the Portland metro area. As far as I can tell, no one has reported a housing shortage over in Baker City, but the state government clearly knows better. It has run full tilt in spite of common sense warnings from anyone remotely familiar with economics. Once again, facts don’t matter if you are “morally right,” or something like that.
This has already had consequences. The daughter of a family friend has MS and has lived in the same rental home for over a decade. She was recently served an eviction notice despite never having any trouble in her home prior. Why? Well, it’s left unsaid, but the landlord has a limited time to make any renovations or repairs and raise the rent price higher before the state rent control limits kick in. Anecdotal? Certainly, but it fits in precisely with what was predicted. I suspect we’ll be hearing more of these stories.
But worry not, citizens of Oregon! The officials in the Portland area have also been hard at work to solve the crisis of affordable housing. But rather than limit what a landlord can do, they instead decided to build their own affordable housing! Voters were persuaded to vote for bonds so the metro area could design affordable homes; the first proposed is the Mary Ann. Pause for a moment to bask in these numbers: Units average about 730 square feet at an average cost of $530/sq. ft. Note again in the article that the average housing cost for a family in the area ranges at about $230/sq. ft. This is an affordable housing project in the Portland metro area. Shortage of sand indeed.
The problem is, of course, that Oregon’s government is not attempting to remedy the problem but rather one of the symptoms. A few decades back, Portland was swept up in the “Urban Sprawl” hysteria: the idea that cities and suburbs were growing at a breakneck pace which was overtaking and destroying nature around us. So the Oregon government believed something had to be done and found something to do! They created the Urban Growth Boundary.
Let’s ignore that Oregon is the ninth largest state in the union (at 98,930 sq. miles) and only 27th in population size (at 4,142,776 as of Sept. 2018). This is a pretty generous amount of land per person compared to many states — ignoring that the Federal and State governments own 60.4% of Oregon. (Notably the Feds own over 55% of the state.) Still, Oregon doesn’t suffer from insufficient land to hold its people and still have nature and farmland.
The Oregon government, however, can’t admit that their own policies are causing the so-called affordable housing shortage. Expansion is so restricted that when it’s announced that property will become available, there are bids to develop it before anything on that land has even gotten close to being ready for development. Oregon’s policy artificially chokes off supply, and of course, people who live there or want to move there will want homes and businesses. Demand doesn’t disappear. Again, anyone remotely familiar with basic economics will tell you this will be an inevitable result. But Oregon can’t admit to itself that a lack of affordable housing is a direct result of their own meddling.
Instead, they will continue to treat the symptoms and mandate affordable housing that no one can afford while patting themselves on the back for a job well done.
“Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.” — C. S. Lewis