America’s responses to the Wuhan coronavirus come at the expense of our natural rights, and property ownership is in the crosshairs. Politicians are calling for rent strikes, and networks of nonprofit activists across the country want to redefine American home ownership along the lines of socialist utopia.
Shelter-in-place measures put a large and growing number of Americans out of jobs. Not surprisingly, some of the newly unemployed can’t pay rent. Under indefinite lockdowns, even some people who still have jobs understandably feel uncertain about the future and prefer to opt out of some obligations.
By one estimate, 31 percent of tenants didn’t pay rent in April, up from 18 percent this month last year, and 19 percent last month. The Wall Street Journal comes up with a cheerier number, reporting that 22 percent didn’t pay rent in April, and 20 percent in May.
So anti-property activists are continuing to agitate. Organizers are calling on tenants to skip rent payments even if they can make them, since the eviction moratoriums local governments passed on the eve of lockdowns prohibit eviction of nonpaying tenants.
Rent strikes are not a spontaneous grassroots movements that crystallized in response to shelter-in-place. They’re an instrument from the socialist’s toolbox. Far-left activists have been staging rent strikes since the 1880s, and in recent years have fine-tuned their tactics for 21st-century America. For instance, the Philadelphia Tenants Union published a manual on how to break in tenants who might have moral quibbles about skipping rent, suggesting taking “baby steps” to gradually escalate actions to a strike.
Rent strikes are illegal. Typically, tenants can only withhold rent when landlords don’t live up to their end of the bargain, such as if they fail to perform property maintenance. In that case, renters have to put their rent checks in a separate bank account. Just because rent strikes are illegal, however, doesn’t mean a striking tenant can be easily evicted.
Creating a Different Relationship with Property
In a heavily rent-controlled area where evictions are a lengthy and expensive process, landlords, especially small landlords, don’t have the funds to sustain their businesses through a strike. If a number of tenants stop paying rent at once, there is precious little a landlord can do to reclaim his property or sell it. With his back against the wall, the landlord is forced to negotiate with the nonprofit activist organizations leading the strike.
Some of these nonprofits are organized as community land trusts (CLTs), which were invented in the 1960s as a form of subsidized housing and public facilities for the poor. CLTs don’t always acquire real estate through rent strikes and aren’t always nonprofits.
Once it secures ownership of a property, a CLT holds onto the deed to the land while offering residents some sort of subsidized arrangement for the structure on the property. Residents can be renters or have a partial deed to the structure. In the later arrangement, when they’re ready to sell, they can do so at a reduced rate and keep part of the money accrued.
Beyond creating subsidized housing and preventing “displacement,” the goal of CLTs has been to foster a different relationship with property. Executive Director of Oakland Community Land Trust Steve King explains that land trusts do that by “removing land from further speculation.” In other words, people entering this type of arrangement are not free to use their hard-earned money to buy property at market price, and to make profit on it in the future.
Another CLT operative Miranda Strominger elaborates: “The foundation of this work is to demonstrate and actualize a different relationship to housing — that it’s not for profit. There’s a growing movement for housing as a human right.” If housing is a human right, it stands to reason that it cannot belong to anyone.
Organizations buying up houses to distribute below market price need to find some source of income. Most CLT funding typically comes from charitable corporate donations, but industry leaders believe that insufficient. According to Ian Winters, executive director of the Northern California Land Trust and president of the California Community Land Trust Network’s board of directors, “The amount of money needed, in large part, will have to come from the public sector. We need billions per county.”
A Push for Collective Property Ownership
Here coronavirus presents an opportunity. Federal money is all of a sudden available for bailouts, and activists want to direct it to CLTs. The recently formed nationwide organization Our Homes Our Health proclaims, “We must ensure public money goes towards building a more equitable and just housing system, rather than towards corporate bailouts.”
Bay Area Rent Strike, another organization formed in the wake of the crisis, says a long-term goal of rent strikers is perfectly in sync with long-standing socialist goals of ending private property ownership: “We ground into the ever-apparent truth that community control of land and housing and collective and cooperative ownership of resources are essential for resilience, stability, and survival. We support Community Land Trusts and co-operatives and encourage you to support the ones in your community.”
There is a method to the rent-strike madness. With many Americans now unable to meet their obligations to landlords and lending institutions, nonprofits hope to pop in and snatch delinquent properties with bailout money.
Of course, real estate belongs to its owner, who can choose to live on it forever, turn it into profit, speculate, allocate units to friends, invite homeless people in, or even leave it empty. Whatever the decision, it belongs to the owner. Because under free market conditions he will bear the consequences of his choice, he is motivated to make a rational one.
How Socialism Betrays Promises
The Communist Soviet constitution guaranteed housing rights to all. Government owned most of the housing in the country, setting monthly payments at a very low rate, which hurt ordinary people because the planned economy couldn’t provide adequate living conditions.
For the USSR’s entire history, large swaths of the Soviet population were “underhoused,” living in dilapidated communal apartments or small overcrowded units. While Soviet women spent considerable time and energy to keep their apartments cozy and clean, the buildings themselves were shabby, and the common hallways creepy — inevitable for property belonging to everyone, which is to say no one.
Joseph Stalin wasn’t interested in solving the housing problem. After he was succeeded by Nikita Khrushchev, the USSR ramped up the production of pre-fabricated five-story cement structures that were supposed to house the masses over the next 20-25 years, at which point better, permanent buildings would replace them.
Not only were better houses never built, but the shabby mid-rises, colloquially called Khrushchyovkas, failed to provide for all people who needed a roof over their head. All the while, nomenklatura, or the communist elite, lived in comfortable flats.
Soviet socialism failed to house the poor and eliminate market forces, greed, or speculation. People continued demanding housing, and those in control of distributing people’s real estate were in a position to extort money. Tenants living in communal apartments spent decades waiting for flats and were willing to pay bribes to move up the line.
A more market-oriented Soviet option was to pay a substantial sum of money to buy into a faster-built “cooperative” housing project, but that was prohibitively expensive for many. Those in power allotted housing as they saw fit and profited handsomely.
Why Housing Fails as a Human Right
I seriously doubt we will see a Soviet-style housing black market in the United States. However, history teaches us that viewing government-provided housing as a “human right” neither guarantees acceptable living standards nor improves human nature. Instead, it drives the housing market underground and removes the incentive to take care of property.
When a significant portion of real estate comes under control of government-financed nonprofits, those organizations become providers and benefactors. Currently, the nonprofits control marginal real estate stock, usually run-down and in undesirable neighborhoods. But if the current crisis persists, and tenants and owners back out of monthly payments, CLTs will be in a position to expand their portfolios to include nice houses in middle-class neighborhoods. Free people owning property, taking responsibility, and making decisions for it will become increasingly rare.
Still, housing units have to be distributed somehow, and some are more desirable than others. Opportunities for corruption will emerge. Being dispersers of a scarce good, subsidized middle-class housing, nonprofits will be the lords of people who inhabit it — just like under every socialist regime in history.