If market economics could fix our affordable housing crisis it’d be fixed

My story on evictions in Southern Nevada prompted a panel discussion on KNPR Monday that I participated in, and that discussion revolved around the lack of equilibrium between income and rent, which is exactly what the discussion should be about. Clark County Commissioner Chris Giunchigliani jumped in early and often on the need for higher wages, and at least a couple callers also went straight for low wages/high rents as the root of the problem. Giunchigliani, who has fallen pretty hard for Matthew Desmond’s Evicted, also touched on how evictions are not just a reflection of poverty, but a cause of it.

Alas, the failure of market economics to redistribute wealth efficiently enough that working people can afford to pay rent is not something that will be remedied any time soon. In the meantime, renters need more protections, a point made by both Giunchigliani and Dawn Miller of Nevada Legal Services. It fell to Eric Newmark of the Nevada State Apartment Association to give the landlord’s side of the story, and there’s no doubt that evictions can be a huge headache for landlords. But the thing Newmark reminded me of most, even though he didn’t say it directly, is that it would be foolish to expect the apartment industry and other landlords to fix the affordable housing crisis that bedevils the state and the nation. As I think I did say on air, since the market has failed, there are no market solutions to the problem. Government needs to step up, and during the Trump presidency, that necessarily means state and local government..

One other thing I mentioned briefly but want to underscore is that federal and state housing policy is overwhelmingly weighted to help homeowners, not renters. According to Alex Schwartz, whose Housing Policy in the United States is a widely used text on the subject, nearly five times as many homeowners are helped by the mortgage interest deduction as there are households that receive any kind of direct housing assistance. And federal spending on tax expenditures — mortgage interest deductions and other tax benefits — dwarfs federal direct spending on low-income housing assistance. “Moreover,” Schwartz writes, “the lion’s share of these tax benefits … go to households with incomes above $100,000.”

I expect to have more on Nevada and federal housing policy and lack thereof later this week.