A Koch brothers opinion piece on the front page of HN.
"This reduction in rental supply likely increased rents in the long-run, leading to a transfer between future San Francisco renters and renters living in San Francisco in 1994. In addition, the conversion of existing rental properties to higher-end, owner-occupied condominium housing ultimately led to a housing stock increasingly directed towards higher income individuals. In this way, rent control contributed to the gentrification of San Francisco, contrary to the stated policy goal. Rent control appears to have increased income inequality in the city by simultaneously limiting displacement of minorities and attracting higher income residents.
These results highlight that forcing landlords to provided insurance against rent increases can ultimately be counterproductive. If society desires to provide social insurance against rent increases, it may be less distortionary to offer this subsidy in the form of a government subsidy or tax credit. This would remove landlords’ incentives to decrease the housing supply and could provide households with the insurance they desire. A point of future research would be to design an optimal social insurance program to insure renters against large rent increases."
I mean, the piece goes out of its way to cite Krugman calling it "among the best-understood issues in all of economics". HN generally discourages old content by labelling it, and the audience-appeal of this piece isn't the authors, it's that it specifically addresses a 2018 California ballot initiative.
I don't think we're going to get a great academic source on the current ballot initiative, because the consensus is that there's nothing new to say! G Sternlieb, The Urban Housing Dilemma (1972) isn't going to hit the front page, but everybody from the Cato Institute to Krugman is working off the same old bases.
My main beef with this piece is that HN pretends to keep politics off the front page but here we have right-wing propaganda masquerading as science on election day where the issue is on the ballot in California. If we're going to allow advocacy then the mods should stop automatically flagging whole classes of posts.
Proposition 13 is understandable for the same reasons rent control is, but also terrible policy for (some of) the same reasons as rent control. California's total unwillingness to build new housing (at least where people want to live) is even worse policy, although I object to seeing it attributed solely to landlords. The combination means all possible cost-fighting solutions will fail; all thats left is to decide how to distribute the damage.
And so all of the policy options also suck. Rent control is at most a stopgap for some current renters, which does nothing for those newly seeking housing, further discourages construction (it may not apply to new developments, but it sets precedent and they're going to be old developments eventually), and rewards landlords for driving away their tenants. Repealing Prop 13 is not only unattainable but likely to drive out the most vulnerable owners as broke cities try to repair their budgets. Restricting Prop 13 to non-rental properties suitably targets rentiers, but threatens even faster tax growth due to the smaller base - which will render leasing unprofitable with rent control or passed on to tenants without it. Even building new housing, the only thing that really stands to unwind the problem, is a mess. At small or moderate levels it will only slow growth and encourage people to move in, while at large rent-reducing scales it will wipe out every non-rentier property owner who bought at inflated rates.
So, yes, California's housing looks more or less hopeless. In most places I'm against rent control as a bad solution to a solvable problem. In California... dilemmas have outcomes.
"In many cases rent control appears to be the most efficient technique presently known to destroy a city—except for bombing." Assar Lindbeck, Swedish Economist and Socialist
It seems to me that there's still a considerable gap between a Koch having founded Cato and any opinion piece produced by Cato today being a "Koch opinion piece". A quick Google suggests to me that Cato is far from being under total Koch control - indeed, they've been involved in legal battles with each other in recent history.
The Kochs appear to have at least a 50% ownership of the Institute, although as this article says, "who knew a nonprofit can have shareholders?" https://www.forbes.com/sites/lauriebennett/2012/03/02/who-kn...