As energy expert Alex Epstein points out in Fossil Future, before we begin to analyze any idea or policy, we must first establish the proper standard of value. We must identify the goal or value that we seek, and then evaluate alternatives against this standard. Housing activists ignore this sage advice. Instead, they found their arguments on the wrong standard of value, and thus, their “solutions” invariably fail. Michael Weinstein, president of the AIDS Healthcare Foundation, provides an illuminating example.
Weinstein writes that
housing is not merely a commodity; it is a necessity of life. The marketplace has not and cannot guarantee that everyone has a home. If it could, our streets wouldn’t be teeming with homeless people while luxury units remain empty.
To Weinstein and most housing activists, guaranteeing everyone a home is the standard by which a policy should be judged. Since the marketplace has not and cannot satisfy this guarantee, we should not rely on the free market to solve the housing crisis. However, guaranteeing everyone a home is the wrong standard of value.
The values that life requires, including housing, do not magically appear. They require thought and effort to be produced. Production, which is the application of thought to the creation of values, requires freedom. It requires the freedom to test and implement ideas that others may object to or consider silly. Freedom enables individuals to act as they deem best, not as others dictate.
Housing activists such as Weinstein, don’t want housing producers to be free. Ignoring the fact that for more than a century, the government has shackled, controlled, and regulated housing production, they proclaim that the market has failed. As I demonstrate in my book, The Affordable Housing Crisis: Causes and Cures, has not been caused by a market failure, but by a policy failure. The reason is that for more than one-hundred years, housing policy has been guided by the wrong standard of value.
If we truly want to solve the affordable housing crisis, then we must embrace a standard that enables individuals—every individual—to produce or earn the housing that he desires. And that standard is: the freedom of each individual to act on his own judgment, so long as he respects the freedom of others to do the same.