Chris Powell: Rent control worsens housing shortage; teacher union greed

A price ceiling will create a shortage in between Qs and Qd.

— Photo by Karinnna13

MANCHESTER, Conn.

Connecticut may have had its "All power to the Soviets!" moment the other day as more than 200 people summoned by the Democratic Socialists of America gathered on the Internet to call for a law to limit residential rent increases to 2½ percent annually. Five Democratic state legislators have co-sponsored the legislation and thus have tainted themselves with its demagogic scapegoating, its accusation that landlords are uniquely responsible for inflation.

"Our rent increases every year and our incomes do not," a tenants union activist said -- an excellent point immediately discredited by the failure to acknowledge the wider world.

That is, real wages throughout the country long have been falling behind inflation in all important respects -- not just the cost of housing but also food, electricity, gasoline, medicine, education and other essentials.

So where is the legislation to limit those  costs?

Such legislation can't be introduced without exposing the scapegoating being done to the landlords, nor without revealing that a substantial percentage of inflation is caused by government itself as its creation of money far outstrips the production of  goods and services.

While Connecticut has a severe shortage of inexpensive rental housing, the rent-control legislation has just struck a powerful blow against efforts to get more such housing built or renovated.

For what housing developer or landlord will want to risk his money building or renovating apartments when state government may prohibit him alone from fully protecting himself against inflation?

Under the rent-control legislation, everyone else in commerce will remain free to raise prices by any amount to cover himself against inflation, and apartment tenants will be free to demand higher wages in any amount. But the rental-housing business will be strictly limited to price increases far below the inflation rate.

The result of this will be still more scarcity inflating housing prices. Under rent control housing providers will be effectively expropriated by inflation.

That's "democratic socialism" for you -- diverting the blame from government without ever solving the problem government itself caused. Whom will the "democratic socialists" scapegoat next?

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 Guess how Connecticut's teacher unions want the state budget surplus distributed.

It's not to do anything compelling. No, the teacher unions want to use the surplus to increase their members' pay, which is already nearly the highest in the country.

Connecticut does have a problem with teachers, as it does with police officers. As social disintegration worsens, especially in the cities, fewer people want to teach where as many as half the students are chronically absent and many misbehave, and fewer people want to work in law enforcement where respect for law has collapsed.

As a result many teachers and police officers in the cities have been leaving for jobs in the suburbs, where social disintegration isn't as bad and they are paid more for easier work.

But that is no reason to increase compensation for teachers  generally. It is a reason to increase salaries for teachers where more teachers are most needed  particularly  -- and not just in the cities but in particular subjects.

Typically, teacher union contracts won't allow that. So any new state money addressing the teacher shortage should be exempt from union contract restrictions.

Any new money also should come with audit requirements to determine if the money improves student performance, which is so bad in the cities that no additional spending is likely to accomplish anything unless it hires parents for the kids.

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The Board of Education in Bridgeport, whose schools long have been in turmoil and whose students perform terribly, wants to hire a public-relations company. According to the Connecticut Post, the company would "manage the district's reputation, provide risk mitigation and consultation services, develop a crisis response plan, and train administrators in crisis communications."

It's as if the board has never heard that to change the image, it's necessary to change the reality. But then all Connecticut seems to have given up on changing the cruel reality of its cities.

Chris Powell (CPowell@JournalInquirer.com) is a columnist for the Journal Inquirer, in Manchester.