Ron Paul Liberty Report
  • Home
  • Archives
  • About

Another Bad Policy That Backfires: Eviction Prohibition From Covid Unemployment

11/30/2020

 
Picture
By Walter E. Block

The Centers for Disease Control and Prevention, operating under the US Department of Health and Human Services, has effectively ended all evictions from residential rental units until the end of 2020.

It is interesting to note how very different the law treats food and clothing, on the one hand, from shelter, on the other. If someone breaks into a Walmart, grabs a cake and some shoes, and tries to leave without paying, the repercussions are clear: that person is a shoplifter, and will be treated harshly not only by the forces of law and order, but will also lose out in the court of public opinion (I abstract here from when the person is a looter; then all bets are off, amazingly).

But if a person occupies an apartment, and does not pay the rent, then, he is treated very differently. Yet, in both cases, there is theft. True, in one of them it is theft of services, in the other it is robbery of physical goods, but this can hardly explain the very different manner in which the two are treated. For, if someone obtains a massage, haircut, nail treatment, session with a psychologist, and decline to pay, this is also a theft of services but the perpetrator will not be gently treated by the police or the courts.

What is it that is so special about domiciles that failure to pay for them should be singled out for kid glove treatment by all and sundry? Who knows? Perhaps the explanation lies deeply within us; maybe we are hard-wired from evolution when we lived in caves or trees to see home and hearth differently than all other items.

​All we can say for sure is that even under ordinary non Covid circumstances, this bifurcation holds. For example, if you engage in shop lifting during Christmas season, woe betide you. But if you are a few months behind in your rent payment, no court will grant the landlord an eviction notice until January arrives. However, both are theft. Who needs rent control when tenants can live fully free for the last few months of every year? Only a Bernie Sanders type of person can smile at this situation.


So much for the normative elements of freezing evictions. Now let us consider the positive ones. One bad effect of this slap in the face of landlords is that we will have less shelter for people than otherwise. This policy reduces investment in this sector of the economy. Hence, the horrendous and multitudinous phenomenon of people living under bridges or on sidewalks.  Eviction prohibition is not pulled on owners of commercial real estate or office buildings, hence we do not have the equivalent of homeless people in those arenas (apart from a very few trucks and hot dog stands).

What is going on viv a vis Covid, in this connection? We are now poorer than we would otherwise be, if the economy had not been to a great degree shut down. I abstract from the issue of whether this was wise or not. But the undeniable fact is that poorer people can afford less housing than otherwise. If evictions are allowed, where will the evictees go? Why, to smaller and/or cheaper accommodations. Landlords don’t relish empty apartments! If numerous people now occupy fewer rooms per person, there will be more space available. That is Adam Smith’s “Invisible Hand” at work. How else can the homeless be rescued from their plight? We are not now building more rental units, for goodness sake.

​The mistake well-meaning people make in opposing evictions is that they think the evictees will be consigned to living in the street. As Henry Hazlitt reminds us in his excellent book Economics in One Lesson, we should look not only at the visible immediate narrow effects of any public policy but also at the long run results for the entire economy. Evictions economize on space; they are a necessary condition for downsizing. Preventing them means more homelessness, not less.


Landlords are no more mean-spirited than other profit maximizers (that means pretty much all of us). If they cannot collect rents, their property will be foreclosed on them by banks. Will the CDC declare a moratorium on that sort of thing until the end of the year? Not bloody likely.

Evictions seem callous, but they are not. Rather, they are the way the market maximizes human welfare when we face economic difficulty.

More Resources:
https://www.theguardian.com/us-news/2020/aug/11/evictions-us-coronavirus-protections

https://mises.org/power-market/cdc-americas-new-landlord

https://www.zerohedge.com/economics/unprecedented-move-cdc-halts-most-rental-evictions-until-end-2020

Walter E. Block, Ph.D.
Harold E. Wirth Eminent Scholar Endowed Chair and Professor of Economics      
Loyola University New Orleans
6363 St. Charles Avenue, Box 15, Miller Hall 318                                       
New Orleans, LA 70118                                                                                       
[email protected]       
Skype: Walter.Block4
tel: (504) 864-7934



Comments are closed.

    RSS Feed

    Archives

    June 2025
    May 2025
    April 2025
    March 2025
    February 2025
    January 2025
    December 2024
    November 2024
    October 2024
    September 2024
    August 2024
    July 2024
    June 2024
    May 2024
    April 2024
    March 2024
    February 2024
    January 2024
    December 2023
    November 2023
    October 2023
    September 2023
    August 2023
    July 2023
    June 2023
    May 2023
    April 2023
    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015



  • Home
  • Archives
  • About