MARCH 4, 2016 9:50AM
Oregon Legislature Repeals Laws of Supply & Demand
By RANDAL O’TOOLE
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Buoyed by its success, the legislature yesterday passed a law legalizing inclusionary zoning, that is, forcing homebuilders to sell a certain percentage of their products below cost. This will also lead them to build fewer homes and to sell the market-rate homes they do build for higher prices to offset their losses on the “affordable” homes. In other words, this law relies on the counterintuitive notion that making housing more expensive will make it more affordable.
Once again, the legislature is playing a balancing game. A few people will get–and be very grateful for–more affordable housing. Every other homebuyer and renter will end up paying more, but not enough more for them (the legislature hopes) to complain about it.
The Oregonian, for example, accompanied my article criticizing the urban-growth boundary with a photo of a man who enjoys “affordable” housing provided by the city of Bend that was funded by taxing all other new homes in the city. Where are the photos of the people having to pay higher taxes or who can’t afford to buy a new home because of that tax?
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This is just a variation of Bastiat’s Broken Window fallacy.
“The broken window fallacy” — Frédéric Bastiat Ce qu’on voit et ce qu’on ne voit pas (That Which Is Seen and That Which Is Unseen) 1850
The politicians and bureaucrats are always “giving” but we don’t see those “taken from”.
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