The always entertaining and informative Chris Thornberg of Beacon Economics is at it again. The man does not shy away from controversy and politically incorrect conclusions if his analysis takes him there. After angering the entitled, subsidized, dynastically wealthy with his Prop 13 take down, this time it’s the Advocacy Establishment’s turn with a piece on “affordable housing” (“inclusionary” housing). (It will even anger knee-jerk, establishment environmentalists. He’s making friends fast.)
Worth a read. He even puts a nice touch on the end by calling out “petulant local politicians who expect a political handout for doing their job”. In case you’re not catching his drift, I think he’s saying that corruption and bribery are a problem.
[Update: Thornberg’s main point is that California’s lack of affordable housing is due to permitting obstacles, especially due to the California Environmental Quality Act (CEQA), and zoning regulations combined with NIMBYism. Thornberg does not mention Prop 13 is his linked affordable housing post.]
Think about it. Housing costs are higher for solid working class and middle class families so that the wealthy can have an affordable stable of servant class bodies close by – but not too close by – to serve their needs. This dovetails devilishly well in California, since the wealthy consumer of servant class services – valets, house(s) care, gardening, dining services, and much, much more – often lives in long-held property subject to the Prop 13 tax subsidy while the working and middle class pay the going rate for newly purchased property.
And as if on queue, Krugman points to this article unfavorably comparing today’s service worker with live-in servants of the past. Though the arch of that story is worthy of attention, I think the case is overstated and the quantitative work is highly questionable with respect to wages. More importantly, it ignores the value of ones many freedoms in today’s more fluid labor market. Yet there’s no denying the persistent scent of those long ago aristocratic days wafting through the air of our well-healed communities.
I bring the above article into the picture because I think affordable housing is usually a misplaced effort that avoids confronting core issues and ultimately provides the most benefit to the wealthiest citizens at the expense of middle income workers. It’s nice to see Thornberg on my side. And he’s a better writer.
Indoor Furniture Outside 
I’ll admit I didn’t read the article. Prop 13 definitely distorts the market. A bigger problem for affordable housing is restrictive zoning and NIMBYism. Those are probably also the biggest sources of local politican payola (even if it isn’t as blatant as cash in manilla envelopes).
@Rob: I’ve got to continue to work on my writing clarity. The Thornberg affordable housing post does not mention Prop 13. I only mention it here because a) it’s an example of another controversial topic Thornberg has tackled and b) it is a separate, complimentary layer of unfairness that favors the wealthy to the detriment of the working and middle class.