Thread by @CSElmendorf

Bharat's substack response ⤵️ to my thread about his & @nealemahoney's op-ed has brightened my day.

So refreshing compared to the snarks (and vivid expressions of desire for my assassination) conveyed on this platform.

A few notes on possible paths forward.

🧵/13

https://twitter.com/BharatRamamurti/status/1991174148077256797

By describing the credible commitment problem (the need to reassure developers of new housing or energy that their project won't face price controls for a very long time) I didn't mean to imply, as some critics on the right insist, that the problem is insurmountable.

/2

I think the problem can be greatly mitigated:

1. By offering DC-style "certificates of assurance" to developers, i.e., recordable contracts for compensation if the project is subjected to price controls within a defined period of time.

/3

https://x.com/CSElmendorf/status/1990125979193221136

(Yes, there are questions about whether such covenants would bind future legislatures, but the Contracts Clause has extra bite when the state is the contracting party, and the covenant would at a minimum increase the political & legal cost to state of reneging on the deal.)

/4

2. By progressive states sending "costly signals" that they understand that post-entitlement regulatory costs/risks threaten new development, and that they want to reduce those risks.

/5

E.g., in housing context, states could (and I think should):
- preempt or cap local real-estate transfer taxes
- preempt local rent control & tenant protections that go beyond the statewide standards
- reform condo-defect liability laws

/6

3. By progressive groups & thought leaders taking positions on what constitutes "reasonable" vs. "bad idea" price controls / tenant protections.

There won't be consensus, but if it becomes clear that some ideas are beyond pale the for most progs, that will help.

/7

Stuff I would hope to see pretty broad agreement on:

- Rent control should protect existing tenants from extreme/rapid price shocks, but not create nonmarket allocation of vacant units. (Vacancy decontrol is good.)

/8

- Developers should be able to rely on gov't representations about exclusions of new units from rent control. (Certificates of assurance are good.)

/9

https://x.com/CSElmendorf/status/1990253516192170295

- It should be legal to redevelop buildings in which tenants live if a supermajority of the tenants ratify the landlord's buyout proposal. (Exclusions in SB 79, etc., are bad.)

/10

- States should remedy the information asymmetries b/t landlords and tenants. (Rental registries and buyout registries are good and should be mandatory.)

/11

- It should be easy to evict tenants who are causing a nuisance to other tenants in a building.

(Consider allowing self-help evictions or exempting L from penalties for wrongful eviction if most of tenants in building sign a petition attesting to nuisance.)

/12

There's a long way to go (alas ⤵️), but w/ @BharatRamamurti, @econjared, & @nealemahoney inviting the conversation, & newly elected prog mayors like @ZohranKMamdani & @wilsonformayor in position to act, it's time to sweat the details.

/end

https://x.com/CSElmendorf/status/1990253507346338285

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