Brad Avakian and his party are worried

With polls showing Republican Dennis Richardson leading Democrat Brad Avakian in the Oregon Secretary of State race, it looks like Avakian’s supporters are worried.

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Why isn’t this man smiling?

Just in the first three days of this month they pumped $398,915 into his campaign, according to state filings.

Although union members account for just 14.8 percent of wage and salary workers in Oregon, they play a big role in Avakian’s campaign. Union donations in the first three days of November included:

  • The NEA Fund for Children and Public Education – $50,000
  • AFSCME – $30,000
  • Local 48 Electricians PAC (4572) – $15,000
  • American Federation of Teachers-Oregon Candidate PAC (113) – $10,000
  • Ironworkers Political Action League Muti Candidate Committee – $5,000
  • Our Oregon – $5,000
  • Oregon AFSCME Council 75 – $4,000

Some donors to other Democratic candidates may be surprised to learn that another significant source of recent donations to Avakian is the campaign committees of fellow Democratic candidates. In a move that should be prohibited, those committees simply took contributions to them and, in effect, passed them on to Avakian.

These donors include:

  • Friends of Tobias Read – $5,000
  • Sara Gelser for State Senate (4680) – $1,000
  • Blumenauer for Congress – $2,000
  • Friends of Mark Hass (11487) – $1,000
  • Rosenbaum for Senate (Diane) (1430) – $1,000
  • Friends of Lee Beyer (14049) – $5,000
  • Friends of Tina Kotek (4792) – $5,000
  • Reardon for Oregon (15621) – $3,000
  • Kurt Schrader for Congress – $5,000
  • Elect Ellen Rosenblum for Attorney General (15406) – $5,000
  • Friends of Jeff Barker (4270) – $2,000
  • Friends of Jennifer Williamson (15145) – $2,500

Other large contributors to Avakian’s campaign in early November included the Cow Creek Band of Umpqua Tribe of Indians ($10,000) , the Oregon Health Care Association PAC (275), $5,000) , Cain Petroleum ($5,000) and James D. Fuiten, President of Metro West Ambulance ($5,000).

These recent contributions brought Avakian’s campaign committee total to $2,216,482.79 as of Nov. 3, 2016, substantially more than the $1,490,837.52 raised by Richardson, as of Nov. 4.

We’ll see whether all this loot can pull Avakian ahead.

 

Memo to Portland landlords: raise your rents now

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Oregon House Speaker Tina Kotek (D-Portland) wants to be a decider on regulating the cost of rental housing.

Kotek and other ill-informed Democrats want Oregonians struggling with rising rents to believe that ending the statewide ban on local rent-control measures is the holy grail that will solve their problems.

Don’t be fooled. Rent control is a simplistic political solution to a complex problem.

Though liberals may castigate the free market and favor government intervention, the facts on the ground support the conclusion that the free market works with rentals.

After a rental market boom has pushed up prices across the country, rents in some of the hottest markets are now starting to decline.

While the national apartment market is still performing above the long-term average, the moderation from the unsustainable levels of 2014 and 2015 has come, particularly in urban cores.

“Apartment rents declined in some of the country’s priciest cities during the third quarter, a dramatic reversal that could signal the end of a six-year boom for the U.S. rental market,” said Axiometrics Inc, a provider of apartment and student housing market intelligence.

The market is feeling the effects of the concentrated new supply according to Axiometrics. “In particular, rent growth has declined precipitously in markets with the highest rents in the country, such as New York and the San Francisco Bay Area,” Axiometrics reported recently. “Rent levels declined year over year in the three major markets with the highest rents – San Francisco, New York and San Jose.”

In other words, rent control promoters, the market works.

Not that this will dissuade liberal deniers. So, raise your rents now, landlords, before the know-nothings go into action.

 

Rent control: Kotek’s folly

On Sept. 12, Oregon House Speaker Tina Kotek (D-Portland) said she planned to push for an end to Oregon’s ban on rent-control laws, enabling local governments to move ahead with measures of their own.

Kotek said she also wants to ban all rent increases above a “reasonable” percentage and end to no-cause evictions.

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Oregon House Speaker Tina Kotek

The problem is, no matter how much liberals embrace the concept, rent control doesn’t work. Any short-term benefits, including the applause of some constituents, are always overshadowed by the long-term problems rent control creates.

  • However you phrase it, under rent control, government dictates what private owners are allowed to charge for their private property. Yes, the free market has flaws, but it is far better than having bureaucrats running things.
  • Landlords who can’t raise the rent on their property to a market price are more likely to cut back on maintenance and less likely to invest in improvements. Not only will landlords have absolutely no economic incentive to invest more in their properties, they may not even have the funds because of limits on their rental income.
  • Rent control distorts the housing market by misallocating rental units to those who are already renting them. Whenever government prevents the charging of prices high enough to clear the market, shortages will occur.
  • The imposition of rent control can lead to a “demolition derby” where older controlled rental units are purposely torn down and replaced with higher priced units.
  • Rent control does not guarantee low rents because it doesn’t regulate the starting rent for a new tenant. When a tenant in a rent-controlled unit moves out, any savvy  landlord will set the rent in the new lease at the current market rent, which is likely to be much higher.
  • In a review of 140 economics studies on rent control in Economics Journal Watch, economists overwhelmingly agreed that, “A ceiling on rents reduces the quantity and quality of housing available.” From the abstract: “I find that the preponderance of the literature points toward the conclusion that rent control introduces inefficiencies in housing markets. Moreover, the literature on the whole does not sustain any plausible redemption in terms of redistribution.”
  • A broad survey of economists by the IGM (Initiative on Global Markets) Forum revealed a similar repudiation of rent control. The Forum is a program of the University of Chicago’s Booth School of Business. “Rent control discourages supply of rental units,” said Associate Head of the MIT Department of Economics, David Autor. “Incumbent renters benefit from capped prices. New renters face reduced rental options.”
  • Once rent control is imposed, it is extremely hard to get rid of, even where its futility is eventually recognized. That’s because rent control will have held rents far below the market rate, so removing them is likely to cause immediate and substantial rent increases, something few politicians (and even some rent control critics) will be willing to embrace in the face of a potential public outcry.

As Art Carden put it in The Unintended Consequences of Rent Control, “Suppose that you want to destroy a city. Should you bomb it, or would it be sufficient just to impose rent control?”