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Politics : Liberalism: Do You Agree We've Had Enough of It? -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (82674)	4/15/2010 9:38:37 PM
From: lorne	3 Recommendations Read Replies (2) \| Respond to of 224729

ken...."Well educated and selfish."... How are they selfish?

To: Kenneth E. Phillipps who wrote (82674)	4/15/2010 10:43:53 PM
From: Hope Praytochange	Respond to of 224729

L.A.'s Big Freeze Posted 06:54 PM ET Redistribution: Is the Los Angeles city council hellbent on sticking it to the little guy yet again, this time by cutting the housing stock? It couldn't come up with a better blueprint for that than its new scheme to freeze rents. Wednesday, Los Angeles City Councilman Richard Alarcon introduced a motion to freeze rents, solely, he claims, because he cares about "fairness." According to him, "a one-year hold on increases in rent (will) help our working families, and give the council time to consider longer-term fixes to ensure fairness in our rent control ordinance." As if they needed a year to get a clue. Alarcon's plan, which sounds wonderful at first hearing, will in fact stiff ordinary people as landlords lose their incentive to stay in the housing business. And freezing rents will do just that. Landlords will lose revenue as their costs continue to rise. The basic market reality is each unit rented represents a contract between a willing buyer and a willing seller who agree on price. When the city council interferes, based on the idea that landlords only raise costs out of malice, the result is a less willing seller. From there, it just gets worse. Units not subject to the law will go up in price to make up for those rented below market rates. Investment in apartments will fall. Not only will it mean it's harder for a tenant to get a sink repaired, but capital improvements on buildings will decline. America's second city will look shabby. The longer the freeze stays, the worse it gets. History shows that "temporary" freezes are never temporary. L.A. will eventually achieve the Beirut-like effect of the South Bronx during its Fort Apache days in the 1980s. That area got blown out because New York instituted "temporary" rent control measures during World War II that, somehow, never got lifted. Abandoned units became commonplace, robbers tore out their metal pipes to sell for scrap and squatters moved in. Disregard for an unworkable law also led to a rise of illegal units, as housing got hard to find. Ever wonder why places like Cairo and Rio de Janeiro are ringed with shantytowns? A big reason is rent control. As if that's not bad enough, a rent freeze will also cut city tax revenues, too. According to the Cato Institute, rent control leads to a decline in property value assessments. That, in turn, means less tax revenue for city coffers. Not a smart move for a city that's already hundreds of millions in the hole. It all shows that Alarcon's real scheme isn't to relieve working families, but to create a special interest group that will defend its privilege of paying below-market rents. Two-thirds of L.A.'s population pays rent, and 13 of the 15 city council members are Democrats. That provides a nice setup for a way to get re-elected, even if your political popularity is waning fast. The result will be less mobility and dynamism in a city that uniquely thrives on temporary deal-making. The only place for this economically foolish plan is the cutting room floor.