Property Rights

George Will on the Unconstitutionality of Rent Control


Writing in The Washington Post, columnist George Will urges the Supreme Court to take up the legal challenge filed against New York City's rent control laws by property owner and landlord James D. Harmon Jr.:

Rent control is unconstitutional because it is an egregious and uncompensated physical occupation of property. The Constitution says that private property shall not "be taken for public use, without just compensation." The Harmons get no compensation for being coerced into privatized welfare: The state shows compassion to tenants — many of whom are not needy; one of the Harmons' entitled tenants owns a house on Long Island — by compelling landlords to subsidize them.

A property right in a physical thing is a right to possess, use and dispose of this thing. Because government-compelled possession of property by a third party is an unambiguous taking, the Harmons' property right has been nullified….

The Harmons' case illustrates government's steady and no longer stealthy desire to transform property from a fundamental right into an attenuated, conditional privilege. Government would like the right to be contingent on whatever agenda it has for ameliorating "emergencies" it causes.

Read the whole thing here. For more on rent control and the Constitution, see here, and also check out the video below.

NEXT: Reason Writers Around Town: Shikha Dalmia on Romney's Troubles in Michigan

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Health Care – Why Can’t it be This Easy? (A Real-World Example)

    This isn’t going to be a diary filled with fancy charts or economic gobble-talk. This is, quite simply, what happened to me the other day, and what I did about it. For real. In the real world. In a country other than the United States.

    Follow me, below the fold, and through the rabbit hole. to the rest of the civilized world…

    I live in Japan. I work in the public schools in a tiny town nestled deep in the mountains along a river valley. It’s about as far from the Big City as it’s possible to get in Japan.

    Last Monday, I wasn’t feeling great. My tonsils were hard as rocks and I was feeling tired. My throat hurt. I know I didn’t have the flu so I went to work. After my last class the school nurse took my temp and discovered I had a fever. The principal told me to go to the doctor. I bowed and off I went.

    There aren’t any hospitals in my town, just little clinics, but they’re good, too. I went in to see the doctor. At the front window I presented my national health care card and wrote a list of symptoms on a little square of paper. Then I waited for about 30 minutes. It normally doesn’t take so long but the flu has been going around here and there were a lot of people waiting.

    I went in and saw the doctor. He asked me some questions and examined me. He asked about my job and how the students were doing (as the only white guy in, literally, fifty miles, I kind of stand out, and my function in town is kind of obvious). The examination took fifteen minutes. Diagnosis: tonsilitis, with involvement of the lymph nodes, plus a touch of early-season hay fever adding itchy eyes and runny nose to my miseries. We chatted for a few more minutes and I waited again as he wrote a prescription.

    I went to the window to pick up the prescription and pay the doctor’s bill. Total: $10.

    I went next door to the little pharmacy (actually the pharmacist’s house, office on the first floor) and presented my prescription and my health care card. I got an antibiotic, a cough supressant, a non-steroidal anti-inflammatory, something for my runny nose, a gargle, a nose spray, eyedrops, and medicinal throat lozenges. Seven day supply of each. These weren’t cheapie drugs, either- most of them had Glaxo Smith-Kline emblazoned all over them. Total cost: $33.

    It’s a few days later and I feel great. Total cost to feel great and have peace of mind: $43.

    So how does this magical system work?

    Well, you pay into it according to your income. I know in the USA this is a weird concept, but if you make MORE money, you are expected to pay MORE into the system. I make about 35K a year (my wife is currently not working) and both of us are covered for about $150 a month.

    What do we get for that money? Well, national health covers anywhere between 70 and 90 percent of the total bill, depending on what the procedure is. In the example above, both the doctor visit and the prescription drugs were covered 80%. This means the doctor got a total of $50 for his work, $40 from national health and $10 from me, for fifteen minutes of work, which works out to $200 an hour. Not a bad wage, huh? Can’t really say that national health care is stealing any of his livelihood. Same goes for the drug companies and pharmacist. Of course, there are price controls here, to make sure things don’t get out of hand.

    Well, what about freedom to choose my own doctor? No problems there. I could have done the exact same thing at ANY doctor’s office in Japan, from Okinawa to Hokkaido, from Tomiyama-mura (the smallest town in Japan) to the biggest hospital in Tokyo. The card is accepted anywhere, and is handled in exactly the same way.

    Well, what if I still think this national health care stuff is nonsense, and I still want private insurance? Well, guess what, mister tinfoil hat lover? You can get it. In fact, many people do carry supplemental insurance here. While getting 80% of brain surgery covered is a great thing, a $200,000 operation will still dent you for $40,000, so many people buy insurance that will fill this gap. Aaaaand, if you want to opt out entirely, there are also private health insurance plans available, too! But guess what? Since the private plans are competing with national health, they actually DO cover you, they are competetively-priced, and they are regulated by the government so they don’t do things like, say, suddenly refuse to cover you if they don’t feel like it. Imagine, private insurance companies DOING WHAT THEY’RE SUPPOSED TO! This is called COMPETITION, and I hear it’s a good thing for the free market and stuff, as opposed to COLLUSION and MONOPOLIES, which are bad.

    In fact, when we first returned to Japan in ’08, my wife and I were covered by one of these private plans while we waited to transition to national health care. The company was Inter Global and they operated out of New Zealand. Inter Global was about the same price as national health and covered the same stuff, with slightly different procedures. What was interesting was that they offered coverage in any country in the world, so that you could travel and not have to worry. Every country in the world… except the USA. I talked to the representative about this and he basically just laughed and told me, as politely as he could, that the USA’s system was completely f$#&ed; up. I told him I knew that.

    Well, the final argument goes… surely this system could never work in the USA, because of the bureacracy and corruption blah blah blah. Having lived in Japan on and off for nearly ten years I can definitely tell you that the USA’s bureaucratic system is a wonder of streamlined efficiency compared to Japan’s. Japan is a nightmare of red tape, both public and private. How so? In order for my wife to get her birth certificate, for example, she must travel to her home town and appear, IN PERSON, to request it. Most important records are still kept on paper on complicated documents, which is why many of the dead in the 3/11 disaster will never be identified, and why their next-of-kin face a daunting task- all land records were recorded on paper which washed away or burned. The banks are finally relaxing their standards so that you don’t need a physical bank book or inkan (personal seal) to access the accounts (related- banks don’t check photo IDs. If you have anyone’s seal and bank book, you can drain their account and there will be no record or trace that you did so). I could go on and on but I hope I’ve made the point- things do not run smoothly here, at least not as smoothly as we are used to in the USA. So if the Japanese can make a health care system like this one so simple, then we can do better.

    And if you’ve heard there’s a funding crisis in Japanese health care, that’s true, but part of it is due to a falling birthrate (which we are not experiencing) and part of it is due to corruption (money being drained off to go to other uses) which is preventable.

    Again, this is real. This is a real system, that I use when I need it, and it works. All of the things the neocons warn about are just fantasies. There’s no red tape, no rationing of health care, no exodus of doctors, no stealing money from doctors, no punishing drug companies or insurance companies, no loss of religious freedom or guns (if you’ve heard that Japan is gun-free, you’ve heard wrong- about half my neighbors own shotguns, and some of them go hunting for wild boar. Wild boar stew is delicious), no death panels or review boards or forced examiniations.

    There are, however, voluntary examinations. Last year I got screened for liver and kidney function and prostate cancer. My wife got a breast cancer screening. All free. Last summer, a bus came and loaded up all the high school-age girls and took them to a hospital in Shimada (a bigger city south of us) so they could get their anti-cervical cancer shots (forget what it’s called, sorry). I’m happy to report that there were no protests or wild-eyed 70 year-old men on TV claiming that this would turn them into sluts.

    Japan, which is one of the great basitons of the free market and practice capitalism with a capital C, seems to have survived the socialist menace of keeping their people healthy just fine, thank you very much.

    Why can’t we just look, and learn, and adopt, and try to make better, instead of wallowing in lies and bullsh*t? Who actually believes the lies that spew from neocon pundit mouths? We who have lived in the rest of the world need to speak up and spread the truth. I’m starting now. Who’s with me?

    1. I totally missed your appropo comments about the constitutionality of rent control.

    2. By the way, our resident Occutard lifted this diatribe word-for-word from someone who posted it yesterday under the name “Hatrax” at the freaking Daily Kos.

    3. tl;dr

    4. Awesome – this asshole is apparently going to shit on every thread with this stupid post.

      1. At least he sticks to a name. Makes the reasonable filter much more effective.

      2. Chrome + Resonable.

        Problem solved.

    5. Looking to bring more bisexual passion to your life? Welcome to=== Datebi.C/0/M ===, the world’s largest bisexual community for no strings attached encounters. Hundreds of thousands pretty girls and handsome guys eager for hookups, bisexual stands, and discreet affairs are active here. Come in and discover the excitement you deserve! u_u

    6. So, are leftists just unable to think for themselves congenitally, and that’s why they have to resort to copy pasta spam and human microphones and slogan chanting and that sort of shit? Or is there some other explanation?

    7. In Asia, I go to the pharmacy for an eye infection. 0 minutes wait, 2 dollars. 20 500mg amoxicillin, o seconds wait, 6 dollars. 20 10 mg Valium, 0 minutes wait, 2 dollars. America – Fuck the AMA. Horrible, expensive service and 3rd interrogation. Land of the free? Kiss my ass.

  2. I’m glad to see Will mention the Due Process clause, even in passing. The recourse to the Takings Clause is the same mistake most Kelo opponents make. If a law says “X may not do Y unless Z,” and X doesn’t do Y, the law doesn’t apply. I’ve never understood the basic misunderstanding that goes, if the state takes property and gives it to someone else for their private use, then the property has been taken for public use, in violation of the Takings Clause. It really hasn’t. It shouldn’t be allowed, but the Fifth Amendment doesn’t say it shouldn’t be allowed.

    1. … or, more often, if the state takes property and gives it to someone else for their private use, it violates the Fifth Amendment, which prohibits taking property for public use without just compensation. It does?

    2. The constitution also doesn’t say that habeas corpus exists; it only specifies conditions where it can be suspended.

      The intent of the amendment was clearly to prevent all takings by govt. The idea of a forced private-to-private transfer by the govt was unthinkable at the time.

      1. …prevent all takings without compensation by govt…

      2. By stating when it can be suspended is an implicit statement of its existence.

      3. Agreed (the unthinkable part), in fact, I bet it was so unthinkable that nobody thought they had to say so, in specific terms. The appropriation of your property and transfer to somebody else without your consent is pretty much a textbook “depriv[ation] of … property, without due process of law.” My only complaint is with recourse to the Takings Clause itself.

    3. Sorry, Matt, but I disagree.

      If you own a home that is worth $100K and Episiarch wants it, then he has to make a deal with you to buy it at a mutually acceptable price. If for some reason you don’t want to sell it then Epi can’t buy it. It’s that simple.

      If Epi appeals to his cronies in the local tax board and they intercede on his behalf and condemn your property to turn it over to him then your property has been “taken” for public use, if only for the duration of the transition period. That transition period is long enough, for me, to be considered “public use”.

      1. Which is reason enough not to put you in charge.

      2. I just don’t think it’s necessary to root around and find a fleeting period of “public use” so that you can argue the taking violates the Fifth Amendment so that you can argue that it’s illegal, or even unconstitutional (under, say, the Due Process Clause). The Taking Clause doesn’t (in my opinion) cover takings for somebody else’s private use any more than it covers warrantless searches.

        1. (I’m carelessly saying “violates the Fifth Amendment” when I mean “the Takings Clause”; the Due Process Clause is also in the Fifth Amendment, sorry about that)

        2. “The Taking Clause doesn’t (in my opinion) cover takings for somebody else’s private use any more than it covers warrantless searches.”

          If Epi, on his own, can seize your property using eminent domain then you have a point. Since Epi cannot use eminent domain he must appeal to his political friends; only they can use eminent domain powers to seize property, and when they do it is a “taking” and it must be for “public use” because the government is by definition “public use”.

          My point is that allowing the government to steal your property to give it to Epi for his personal use, and them pleading that, “Matt’s property wasn’t taken for public use because we gave it to Epi” doesn’t pass the stink test, IMO.

    4. This is a poor legal reading, in my opinion. The Constitution is to be read as a grant of limited government powers. Because the Constitution does not say “the government may take private property and transfer it to another private entity”, the government may not do so. The fact that the government may take private property, for public use, with just compensation, is an exception that proves the rule that in any other circumstance, they may not take any property at all.

      In this case, expressio unis dictates the reading here. Not to mention that even when you get past the text, Tulpa’s intent point stands.

      1. The problem is that rent control laws are state laws not federal laws. The Constitution as a general rule restricts the federal government not the state government. So a general argument for limited government doesn’t work. In order for the federal constitution to limit state power, you have to point to a pretty damn specific prohibition.

        Likely this argument ought to be won by pointing to state constitutions.

        1. Wouldn’t this be covered by incorporation?

          1. Perhaps. But not everything is incorporated. Just some of the bill of rights and the 14th Amendment. You have to claim it is an unlawful taking. And for the reasons fluffy states above, that is a tough case to make.

            1. I think Takings is pretty well incorporated against the states.

              1. It is. But this might not be a taking.

      2. I absolutely agree, all I’m saying is that the *Takings Clause of the Fifth Amendment* doesn’t prohibit taking private property for somebody else’s private use. I certainly think that under many circumstances such a taking would be prohibited by the Due Process Clause, and them’s that aren’t are theft.

  3. I think the problem here is that the way to defend rent control is to frame it as a regulation on the form of contracts.

    Can a state pass a law that says, “No contract for rental or lease will be considered valid if it does not contain a clause allowing the tenant the unlimited right to renew the term of the lease subject to rent increases according to the following defined formula”?

    Unfortunately, I think it can – without it being a Takings. The UCC defines all sorts of permitted and prohibited elements of a commercial contract.

    1. But rent control laws go far beyond that. The right to contract becomes an inheritable right in many cases. Your kids get to inherit your rent control. Also, it doesn’t freeze rents, it mandates the price.

  4. Certainly the initial imposition of rent control was unconstitutional and should have been challenged at the time. But if you built or bought your building with that law already established I think you have less of a case. I am not defending rent control which is bad economics but it’s not like they are suddenly taking something away for public use.

    Full disclosure: I lived in an a spacious 2-bed rent-controlled apartment on the Upper East Side for about a decade and my rent was less than $2000/mo. Similar new units went for well over twice that.

    1. My friend’s aunt lives in a spacious 2-bedroom rent controlled apartment on the east side, where she has been for many decades. Her rent is less than $1,000/month.

  5. We believe this whole arguement is just a window into Mr. Will’s blatant disregard for poor people and minorities. Why are you a racist one percenter Mr. Will?

    1. True dat.

      When so much human suffering is on the line, anyone who can quibble about “constitutionality” and other irrelevancies is a heartless bastard.

  6. I expect the Supreme Court to conjure up some sort of “No Man is an Island” rationale to justify State intervention in private rental contracts.

  7. SCOTUS will uphold rent controls. They have upheld the elephant of asset forfeiture, they won’t strain at the gnat of rent controls.

    TBS, if by some miracle they do strike it down, this will be Team Blue’s Roe v Wade for the next 20 years.

  8. I wish they would have created car control years ago.Think of U.A.W. members working for 1970 wages.

    1. College tuition control.

  9. Given the government’s utter contempt for the concept of private property, I can’t imagine that the plaintiff has much of a chance. After all, ruling that property rights actually mean something would unravel all sorts of “vital” government programs.

  10. It is funny how when the group getting the money is liberal, like say college professors, the liberal solution is to subsidize purchasers. When the group getting the money is a political, land lords, the liberal solution is to control prices.

  11. If you buy a property that is already subject to rent control laws, or if you build knowing that you will be subject to rent controls, there is no taking. I imagine that the vast majority people who own rent controlled buildings knew or should have known exactly what they were getting into. And probably most of them worked in a lower purchase price based on the lower rent they could expect to collect.

    The only people that have an argument here, are those who had rent controls retroactively imposed on them, and maybe their heirs.

    Bad policies more often than not do not have a constitutional remedy. For the most part, rent control is one of those.

    1. This is all true. And it is the reason why rent control creates housing shortages. Who in their right mind would build housing knowing it would be subject to rent control?

    2. As a matter of what is laughably called “constitutional law” I’m sure that you’re correct, and that the court will rule as such.

      As a matter of right and wrong I don’t agree. Purchasing property when you know that your property rights will be interfered with may be imprudent but that doesn’t give the government the rightful authority to continue interfering with the right, simply because you are aware of the transgression.

      1. I agree that on the whole, rent control is a bad and misguided policy. I just have very little sympathy for someone who buys property knowing or who ought to be aware of the regulatory burdens. Don’t buy, work to have the law changed democratically or work in a more advantageous purchase price. Just don’t waste the time of the courts by using the constitution as a pretext to get yourself a better deal.

        1. As JW explained below, property rights are as important as any other. Without property rights we are no more than slaves. I don’t accept the premise of your position that the government has the rightful authority to interfere with property rights.

          And yes, I know they’ll do it anyway. And there isn’t shit I can do about it. That doesn’t mean I’ll accept it as a right action.

        2. I just have very little sympathy for someone who buys property knowing or who ought to be aware of the regulatory burdens.

          Ah, the “lie back and think of England” rationalization. Works every time.

    3. If you buy a property that is already subject to rent control laws, or if you build knowing that you will be subject to rent controls, there is no taking.

      If you try to speak when you know the speech isn’t permitted, and are arrested for such speech, then there is no censorship.

      1. Rather than bother taking the time to elaborate further, I’ll just advise you that you’ve entered the department of bad analogies.

        1. That was a perfectly good analogy, if rent control is unconstitutional.

        2. If you say so.

          Don’t be afraid to ask questions, if you don’t understand.

          1. Fine. Here’s why your analogy is bad.

            Constitution and common sense says, censorship bad, don’t sensor. Not permitting speech is censorship, whether you’re aware of the law ahead of time. So caveat emptor has nothing to do with the price of tea in China in that instance.

            On the other hand, constitution and common sense says, takings are bad, and don’t do so without providing compensation. The question is, when does a regulation become a taking. If you buy property that you know comes with certain regulatory burdens beforehand, nothing is being taken from you.

            Or, I would like to buy the GI Joe with the Kung Fu grip. I go to the store and am told by the clerk that the Kung Fu grip has been removed by government decree for the good of society. I nevertheless decide to buy the GI Joe. The Kung Fu grip that I knew was no longer available has not been taken from me, and people would be looking at me funny if I went looking to someone to compensate me for the missing Kung Fu grip.

            1. Here’s why you are wrong.

              You accept the premise that the state has the right to interfere and arbitrarily set terms with a contract between consenting adults, purportedly to advance a **cough** societal cause.

              Common sense and history shows us that when you engage in price controls, you distort the market and inevitably cause that market to reach equilibrium either through shortages, quality, or as usually the case, both. You, in fact, do more harm with this action than good, that you set out to supposedly remedy.

              Property rights are just as fundamental as speech rights and shouldn’t be beholding to any artificial qualifications as to the correctness of a purchase. Just as in the case for speech rights, you would be wrong for making such a distinction, and as apologists for state sanctified oppression are, you are wrong for property rights as well.

    4. and if you rent a rent controlled apartment where maintenance has been deferred, then you knew going in that maintenance has been deferred, and thus have no legitimate complaint ever regarding deferred maintenance.

  12. I assert that anyone buying a rent controlled building is either a moron who will someday kill himself during the mundane act of lacing up his shoes or he’s a politically-connected financial genius that knows how to make these profitable. There is no middle ground.

  13. George will fails to tell everyone that in the most part buildings with rent controlled apartments have changed owners in the last 60 years. The price paid for the building reflected the rent controlled apartments. The buyers have bought hoping for a free capital value bump once the law was rescinded. The building owners in the most part bought in with a gamble and have George Will as their lobbyist. Nice!

    1. Way to beg the question.

  14. Rent control is a horrible idea. But I think it undermines efforts to restore the Constitution to American jurisprudence to claim it’s unconstitutional. If rent control is unconstitutional then why aren’t building codes? And if building codes are constitutional you’re saying that it’s a constitutionally protected right to throw up low-cost high-density housing that’s destined to go up in flames. Stick it on any property you own.

    That’s not gonna work

  15. What if the local government just imposed a 100% tax on rents above a certain level and then gave all the proceeds back to the tenant? That’s essentially what rent control is, and it is also almost certainly Constitutional. (Although it is counterproductive, destructive, etc). You can argue that rent control boils down to something being taken from you, and you’d be right. That’s what taxes are.

    1. Thom,

      But that isn’t what Rent Control and Rent Stabilization is all about. Rent Control is means to allow poor people to continue to live in gentrifying/improving communities. Renters cannot be forced out by an arbitrarily raised rent. When a landlord rents an apartment out, the lease or rental agreement is not an agreement until the death of the renter, there is a time bounding on the rental agreement. When I sign a lease, it says, I’ll pay $X per month for 1, 5, or 10 years.

      But, the New York City government has stepped in and said to landlords you must allow existing tenants to stay and you can only increase there rent some small percentage that is well under inflation per year.

      This is not a tax, in any way, shape or form.

      In reality, the people with rent controlled/stabilized apartments are people that can afford to pay the market rate for the place. Charlie Rangel had 4(!!!) rent controlled apartments, one of which he was using as an office! So, what was once an intended benefit for the poor has been captured by the rich and powerful to screw over small-time property owners. Properties rented by actual poor people become run down, because the owners cannot afford the upkeep, utilities and the property taxes (property assessments don’t go down just because the rooms are rent controlled).

  16. Your comments section sucks. Always flagging my posts as spam. Get your shit togethjer.

  17. I’ve been posting here for years. When I criticize thje AMA it’s flagged as spam. Whisky Tango Foxtrot?

    1. And there are few things on Earth less deserving of criticism than the AMA, the fucking scumbags.

Please to post comments

Comments are closed.