Shreveport govt seems unaware of new law's pitfalls

After years of talk, Shreveport enacted a few months ago some kind of minimum property standards for rental housing. Its City Council every two months is to review reports on city enforcement of property standards. As the year ends, maybe it's time they looked how how Ordinance 11 of 2012 is working out.

Much as some think they can repeal them or pretend that they don’t exist, politicians cannot avoid the law of supply and demand. They need to realize two corollaries as they apply to the situation where people live in housing that does not have entirely working plumbing, electricity, flaws in construction, etc.: people may choose to live in this housing because it’s all they can afford, and by far leading reason why housing can deteriorate into this condition is because of the people who live in it.

Among many policy-makers and a good chunk of the chattering classes the idea that certain behavioral choices indicated a moral defect that thrust responsibility for the consequences of that behavior on its doers has fallen by the wayside in favor of the idea that circumstance beyond their control “forced” them to do certain things. Because fault no longer was assigned to them, instead parts of or all of society not only had to pay collectively those costs, but also had to permit and even subsidize continuance of the behavior.

This latter attitude, a fundamental misreading of human nature, would collide with the truisms noted above to produce disastrous consequences in any minimum property standards policy. Institution of such standards would cause an increase in costs for landlords who, contrary to the misimpressions of some, seldom possess bottomless wells of slumlord-generated cash. These increased costs appropriately need passing along to the renters themselves, for the latter get a more valuable service in return

As a result, this may price some out of the housing market. So homelessness will increase. How will the city deal with this, without externalizing these additional costs onto the citizenry? It also may price some housing out of the market, where landlords understand they will be unable to recoup the extra costs and thereby remove stock from the rental market by selling it to owner-occupiers or leaving it unrented, perhaps demolished. These actions will have the same impact, and raise the same question leading to another one: would it not be better to have substandard housing, if that’s all that can be afforded, than none at all?

Further aggravating this tendency would be the rude but indisputable fact so many wish to avoid acknowledging that the main reason for many renters to be in this situation is they have made poor choices during their lives to give them limited means and earning potential. While this can take a variety of forms, the best conceptualization of this comes from Edward Banfield’s taxonomy of people with a “present” or “future” orientation. Those with the former seek immediate gratification, paying little heed to long term opportunities and consequences that exceed those of the short-term kind. While misfortune plays a part for some, and for others disability or general inability to contribute much to society by their labors even if they do choose wisely and for the long term, as unfashionable as it may be to admit the fact is for many it is their fault they have put themselves in a position where they only can afford, or choose to afford, to live in the substandard kinds of properties a code would address for any longer than a brief period on their way to being able to afford something better.

From the perspective of the quality of property, that means a significant portion of those living in properties at the low end of quality, with the present-oriented attitude, translates that into negligent or even destructive behavior that degrades the value of the property. The kinds of things a code would cover address circumstances that only rarely would come as a result of genuine defect, or wear and tear. Put another away, it’s hard to damage a toilet, clog up plumbing, blow an electrical system, break windows, punch holes in walls, etc. unless there’s incredible ignorance or extreme negligence if not an outright attempt to do so. Yet the attitude that encourages those kinds of actions is part and parcel of the same attitude that puts one permanently into the low-rent district to begin with.

So, the reason substandard housing becomes so is most often due to the renters themselves. Yet a code no longer would forgive financially such behavior; the question is, to whom will it pass the costs along to in order to stay up to code? If owners, who now must cover these costs, this only would encourage them to raise rents and/or deposits to price people, including the minority who don’t behave this way, out of the market. If to the renters who do not change their ways – some will, but some won’t – the increased costs to them may price them out of the market.

These question need addressing. Shreveport's government needs to determine regularly whether the new code works without externalizing costs to its citizens.