Liberals, Housing, and Hypocrisy

Thomas Sowell, in his book Economic Facts and Fallacies, says that the biggest economic fallacy about housing is that "affordable housing" requires government intervention in the housing market. He asserts that "It is precisely government intervention in housing markets which has made previously affordable housing unaffordable." The decades of the 1970s marked the beginning of severe government restrictions on the building of houses and apartments. Where those policies were most severe, the price of housing increased most severely. Sowell is all about studying historic patterns, then scrutinizing alternative explanations for the patterns.

Sowell explains that "neither supply nor demand by itself can explain prices, which are determined by the combined effects of the two." In fact, housing prices are often more affected by building restrictions than by increased demand. Fallacy: government intervention is the key to creating "affordable housing." Fact: "Such intervention has often been a key factor in making housing "unaffordable."

Sowell documents the "judicial erosion of property rights" that has taken place in America since the 1970s. The landmark case was the Petaluma case in 1975. In places like Boulder, Colorado and Monterrey, California existing residents were able to keep large blocks of land off limits to development. "The "open space" of some entails the overcrowding of others." I love this summary by Sowell, because I have seen that it is so true of Boulder, where we lived in a small condo when we were first married: "Such restrictions have been especially prevalant in overwhelmingly liberal upscale communities, where concerns are often expressed for the poor, for minorites, and for children - all of whom are among those most often forced out of such communities by high housing prices."