Throughout the pandemic, government officials have made policy decisions founded on short-term thinking. They have made decisions to solve an immediate problem while failing to consider the full context. It was inevitable that eventually the chickens would come home to roost.
For example, when government forced businesses to close, tens of millions lost their jobs and struggled to pay their rent. In response to that problem, government enacted eviction moratoriums which placed many landlords in dire financial straits. Many of those landlords are now withdrawing their properties from the rental market because they can no longer afford the expenses of operating a rental property.
When a business must provide a product or service for little or no compensation, it won’t provide that product or service for long. A story from Sacramento illustrates this point.
The story talks about the plight of a woman who has lived in the same rental house for fourteen years. She must move soon because the owner is selling the house. The tenant is finding few properties available, and none in the price range she has been paying. And the tenant is hardly alone.
One Sacramento real estate attorney has seen a ten-fold increase in the number of single-family rentals being removed from the market and sold. He noted that the eviction moratorium has placed a huge financial burden on landlords, and “some of those owners can’t bear it, and they’re put into a position where they are forced to sell for financial reasons.”
This was entirely predictable. When landlords must pay a mortgage, insurance, property taxes, and maintenance costs with little or no income, many are going to struggle. While the story only pertains to Sacramento, the same scenario is unfolding across the country.
This is the result of dealing with a problem or issue in isolation—i.e., dropping context. Leonard Peikoff has explained what this means:
A context-dropper forgets or evades any wider context. He stares at only one element, and he thinks, “I can change just this one point, and everything else will remain the same.” In fact, everything is interconnected. That one element involves a whole context, and to assess a change in one element, you must see what it means in the whole context.
More than a year ago, government officials thought that they could close businesses with few consequences. They were sadly wrong. Very wrong. And now the chickens are coming home to roost.