In defending her rent control proposal, Boston Mayor Michelle Wu said, “The status quo is not working.” She is correct. However, her solution to the problems caused by forcing individuals to act contrary to their own judgment is to force individuals to act contrary to their own judgment. Zoning laws serve as one example.
In Greater Boston, more than 80 percent of the land is zoned for single-family housing. Duplexes, garage apartments, “granny flats,” and small apartment buildings are prohibited. A plot of land that could house multiple households is limited to housing one family. This inflates the cost of land, and with it, the cost of housing. In 2020, a report from the Brookings Institution found that the median housing density near commuter rail stations was 2.8 homes per acre. That is more than 15,500 square feet of land per house. The median lot size in Boston is just under 5,000 square feet.
Zoning prohibits land owners from using their property as they judge best. An individual who determines that a land use other than single-family housing is prohibited from acting on his judgment. This is the status quo that isn’t working. But rather than change the zoning laws that arbitrarily drive up the cost of housing, Wu and her ilk want to impose more controls and restrictions.
And this is not an aberration. When government economic intervention creates problems, and it always does, the immediate response is almost always a demand for more government economic intervention. Restoring economic freedom is seldom even considered.
In terms of essentials, Wu’s rent control isn’t a rejection of the status quo. It is a continuation and expansion of the status quo. If the status quo is not working, and it isn’t, then rent control isn’t going to work either. But to grasp this fact, one must first think in principles.
To Wu, the status quo is simply the current form of economic intervention. If that intervention isn’t working, then the unprincipled solution is to try a different economic intervention. The advocates of such policies hope that somehow they will stumble upon the form of intervention that will work. They never will because the status quo is not working.