We all know Bernie Sanders. If you’re a Bernie Bro, I’m sorry. You wont like this one. Bernie Sanders loves socialism and it doesn’t get more communist than attempting to control the prices of everything in lieu of a free market.
We have seen the experiments with rent control in the past and we know that it simply doesn’t work, but Bernie Sanders think otherwise against all logic and against all known attempts. He knows that rent control has failed locally, but maybe it will succeed nationally. It could work, right?
In Sanders-like fashion, Bernie has unveiled a “housing-for-all” plan that would provide affordable housing for everyone. Of course he doesn’t like to talk about the price tag for it: 2.5 trillion dollars. All of this would come under increased investments the National Affordable Housing Trust Fund, increase construction of government funded housing, and more money to state governments to fight homelessness. This all sounds great on its head, until you look at how unrealistic it really is.
If all of this wasn’t Utopian enough, Bernie wants to institute housing price controls across the board and hand this power of price controls over entirely to the bureaucrats in DC. What could go wrong with such a wonderful idea. We all know efficient the federal government is with everything they do right?
Any recent graduate of economics will tell you this entire plan is a bad idea…like most of Sanders ideas. However, this one is easy. Restricting prices on housing will do only one thing:restrict supply across the board. What will this mean? More homelessness. That’s right, Bernie wants to put every one in a soup-line: Only this line it will be a constant “No soup For You!”
If profits are going to take a nose dive, as what happens commonly in socialist economies, there is little incentive to do anything. Builders wont want to build more houses which means they will be have to be bid off to the lowest bidder. This means the housing that is build will be shoddy at best and will end up a veritable death trap. I guess Bernie want to kill you too. But it gets better! Those areas with no rent control will see much larger prices as a result of the offset. Everything find a balance, people.
What is the solution?
Its pretty easy. Let the market do its thing. Remove a lot of the stifling restrictions from the bureaucrats in DC and let things grow again.
Its really that simple.