California Keeps Digging

The “First Law of Holes” (“If you’re in one—stop digging”) is usually attributed to the late British politician Denis Healey, but whatever. One thing is certain: California never heard of the First Law of Holes.

Item, from the Washington Post a while back:

The One Issue Every Economist Can Agree Is Bad: Rent Control

By Megan McArdle

There aren’t that many things you can get economists to agree on. Fiscal stimulus, minimum wages, monetary policy, health care, bank regulation — on almost all the major issues of the day, you can find a respected economist to argue for either side.

But there are a few questions where there’s near unanimity, and rent control is one of them. Pretty much every economist agrees that rent controls are bad. And in the last decades of the 20th century, economists had some success persuading state and local governments to curb these policies.

Item, from the New York Times:

California Approves Statewide Rent Control to Ease Housing Crisis

California lawmakers approved a statewide rent cap on Wednesday covering millions of tenants, the biggest step yet in a surge of initiatives to address an affordable-housing crunch nationwide.

The bill limits annual rent increases to 5 percent after inflation and offers new barriers to eviction, providing a bit of housing security in a state with the nation’s highest housing prices and a swelling homeless population.

Gov. Gavin Newsom, a Democrat who has made tenant protection a priority in his first year in office, led negotiations to strengthen the legislation. He has said he would sign the bill, approved as part of a flurry of activity in the final week of the legislative session.

Of course, it is overwhelmingly California’s bad government policies on housing, going back more than 40 years now, that have created the “housing crisis.” So yeah, let’s have some more bad policy. I’m sure it will work great this time.

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