EDITORIAL: When it comes to housing, it’s the supply, stupid

After a dispute over petition signatures, the Culinary union has — for now — given up plans to put a North Las Vegas rent control initiative on the ballot this November. But this issue will be back, particularly if Democrats maintain control of the Legislature heading into the 2023 session.

Addressing a supply shortage with price controls is a sure way to exacerbate the shortage and drive up costs in the long run. If the union truly wants to tamp down rents, it should be encouraging North Las Vegas and other municipalities to ramp up construction permitting. But destructive ideology has a way of overwhelming common sense. (See: California.)

The Biden administration last year tipped its cap to the link between prices and supply by proposing a program that would use federal grants to persuade local governments to remove obstacles — zoning and otherwise — to housing development. In May, the White House announced that jurisdictions “that have reformed zoning and land-use policies” that discourage new construction would get priority access to a $6 billion pot of federal transportation grants.

Bribing local officials with taxpayer funds is an unseemly means of carrying out public policy, to be sure. But at least the program acknowledged the nexus between an overactive administrative state and high rents and housing prices. When red tape makes it more difficult to build, the price of housing increases. Similarly, when you put limits on how much landlords may charge, you discourage investment in the marketplace, leading to higher costs and less housing.

Unfortunately, the Biden administration initiative apparently met a familiar fate and emerged from the bureaucratic wringer unrecognizable from how it went in. Reason magazine reports that “it appears few if any grants were awarded to applicants who adopted, or promised to adopt, zoning reforms.” Emily Hamilton, a researcher at George Mason University’s Mercatus Center, reached a similar conclusion. “I didn’t see any evidence,” she told the magazine, “that localities’ zoning policies or housing market outcomes were determining where these grants were going.”

In addition, Reason notes, some of the grants went to cities — San Francisco, for example — “that have done everything in their power to make development more difficult.”

In the end, the political urge to distribute pork has so far prevailed over the White House goal “to ease the burden of housing costs over time by boosting the supply of quality housing in every community.” That’s too bad, because further ignoring the supply problem will lead only to more destructive schemes like the Culinary’s rent control gambit in North Las Vegas.