Monday, July 28, 2008

Obama's support for rent controls

According to "San Francisco's Alternative Online Daily" (in San Francisco isn't a self-styled "progressive" entity actually mainstream?), in 1997 a bill called the Rent Control Preemption Act was passed by the Illinois House 96 - 18 and the state Senate 46 - 6. Obama was one of those 6 to vote "no" to a prohibition of rent controls. Tellingly, the website trumpets this as "an example of his core progressive principles" and notes that many "liberal Democrats" supported the bill.

Economists are overwhelmingly opposed to rent controls, which would go a long way towards explaining why many "liberal Democrats' would share that opposition. Even Paul Krugman, who boldly describes himself as "liberal", calls rent control "a textbook case of economic stupidity" and goes on to note:
The analysis of rent control is among the best-understood issues in all of economics, and -- among economists, anyway -- one of the least controversial. In 1992 a poll of the American Economic Association found 93 percent of its members agreeing that "a ceiling on rents reduces the quality and quantity of housing." Almost every freshman-level textbook contains a case study on rent control, using its known adverse side effects to illustrate the principles of supply and demand.

I might add that in a poll of 211 economists published in the May 1979 issue of the American Economic Review, more than 98% of U.S. respondents agreed with the statement and the June 1988 issue of Canadian Public Policy reported that over 95% of the Canadian economists polled agreed with the statement.

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