Theft by Any Other Name is Still Theft

Lawmakers and political activists like to frame their policy proposals in terms that hide their real meaning. An example of this is a proposal in Colorado to impose “rent stabilization” on mobile home parks. Rent stabilization is nothing more than a euphemism for theft.

The bill would require park owners to pay up to $30,000 to each household if the park is closed. The bill’s sponsor said that mobile park residents are often “handcuffed” to the park because they can’t afford to move their home. The solution, he believes, is to simply rob park owners.

The sponsor said that the bill is a response to an influx of wealthy investors who buy mobile home parks and raise the rents. “We’re no longer dealing with sort of a mom-and-pop market,” he said. Bills like this are almost guaranteed to make that a reality. Wealthy investors often have the resources to overcome government regulations, but smaller investors do not. When their income is arbitrarily limited by government fiat, they often have little choice but to sell.

The bill would also limit rent increases to 3 percent per year. Last year, inflation was 7 percent, which means that park owners would see their real income decline by at least 4 percent per year. Declining income means a reduced return on investment. And that means that investors will move their capital to more profitable uses.

If someone paid their rent, and then demanded a refund at gunpoint a few days later, we would recognize that action as robbery. The principle doesn’t change just because government acts the proxy and demands the refund at the time rent is paid.

Colorado, like nearly every other state, has a severe shortage of affordable housing for low- and moderate-income households. Bills like this simply add to the cost of providing housing and discourages new investment.

Depriving people of their property without their consent is theft. And that is true whether it is called rent stabilization or anything else. Theft is theft, no matter how politicians and pundits want to label it.