I confess, I'm a little surprised to see someone defending rent control in this day and age. There is almost no economist consensus so complete--left to right--as that rent control is "the best way to destroy a city's housing stock short of aerial bombardment".
But commenter Muzzybelly takes the contrarian position:
Rent control is only bad policy if you look at it from a narrow angle.
Rent control saved New York. The city could have completely emptied in the 60s and 70s like many other American cities, but it did not. Rent control and stabilization gave too many people an incentive to stay. The stage was set for New York to re-emerge in the 1990s, in a way that no other hollowed out American city possibly could.
Yes, rent control has its problems. Also, it has been implemented somewhat unintelligently at times. Parts of the Bronx were devastated when money-losing buildings were torched for the insurance money by cash-strapped owners.
But for those of you who know New York, think back to the East Village and Alphabet City of the 1980s. It was a disaster. Practically the whole area was junkie town, crime was so high, shops went out of business. And to the north was Stuy Town, a huge hulking mass of middle-class workers who didn't get pushed out of the city they way they did in Pittsburgh, Cleveland, Detroit, St. Louis etc. Those middle-class workers kept the East 20s and 30s in business, and allowed the East Village to be able to recover.
I like me some contrarian economics, but I think this theory has a bunch of problems:
- Rent control was not implemented differently in the Bronx and Manhattan, so why did it result in buildings being torched only in the Bronx? This points to exogenous demand as the important factor, not rent control.1
- Why did rent control only "save" Manhattan south of 96th Street and a tiny sliver of Brooklyn? Arguably, because those were the only places where people had apartments below market prices in the 1960s . . . but this doesn't explain why the market price didn't fall, as it did in many parts of town, rendering rent control regulations moot.