Law & the Courts

The Tragedy of the Eviction-Moratorium Debacle

People camp out on the steps of the U.S. Capitol to highlight the expiration of the pandemic-related federal moratorium on residential evictions, in Washington, D.C., July 31, 2021. (Elizabeth Frantz/Reuters)
The harmful policy was not intended to be a form of rent control, a fact that progressives seem willing to ignore.

Andrew McCarthy did the legwork this week illuminating the Supreme Court’s failure to throw out the CDC’s now-expired eviction moratorium. As he explains, the executive branch had no authority to extend the moratorium, which itself was “lawless.” It’s important to note how constitutionally indefensible the CDC’s order was, but the Biden administration announced this afternoon that it is planning to implement an eviction moratorium in certain states and districts anyway. However, even if a federal eviction moratorium were legal (which, again, it is not), the administration still shouldn’t extend the policy.

The eviction moratorium was implemented at the height of the pandemic and was intended to help stem the rising tide of COVID-19 cases. The idea was that keeping people indoors, isolated, and (ostensibly) healthy was worth the tradeoff. Importantly, the policy was not intended to be a form of rent control, a fact that progressives seem willing to ignore.

Vox recently wrote on the eviction moratorium, decrying the Supreme Court’s decision to halt the eviction hold after July 31. It described the situation facing Congress like so:

At its height, this moratorium may have saved as many as 40 million Americans from eviction. But, in late June, the Supreme Court signaled that this moratorium must expire at the end of July, effectively leaving many renters without protection.

Unsurprisingly, Vox pushed for more government intervention in the economy and our lives. However, it curiously neglects the obvious point that an eviction moratorium isn’t a solution to the housing crisis because it does nothing but create a backlog of evictions.

A moratorium can’t change the underlying incentive structures that make evictions necessary. It doesn’t pay landlords by disbursing direct payments to them, nor does it help renters who are still on the hook for thousands of dollars in back payments. Furthermore, it disincentivizes cooperation between tenants and landlords by implying the government will step in and simply resolve the problem.

Unfortunately, the government is inefficient and has been unable to pay landlords and renters. Payments to tenants have not been delivered, and the uncertainty surrounding the moratorium timeline has made for angsty landlords. The end result of the moratorium is as predictable as it is sad. The Associated Press reports:

More than 15 million people live in households that owe as much as $20 billion to their landlords, according to the Aspen Institute. As of July 5, roughly 3.6 million people in the U.S. said they faced eviction in the next two months, according to the U.S. Census Bureau’s Household Pulse Survey.

Shutting down the economy and disincentivizing work has undoubtedly contributed to the problem. Many unemployed and underemployed people have had trouble making ends meet. The human element of this problem shouldn’t be lost in the numbers. From another AP report:

The 27-year-old [Chelsea Rivera] said she started to struggle after her hours were cut in May at the Walmart warehouse where she worked. She’s applied to numerous agencies for help but they’re either out of money, have a waiting list, or not able to help until clients end up in court with an eviction notice.

This situation is the very definition of a government-induced crisis. Draconian lockdowns may have been necessary at the beginning of the pandemic, but we ignored the economic damage of lockdowns for too long. This prevented many businesses from reopening and hiring new workers. Worse still, federal payments have been dreadfully mismanaged.

However, while Democrats are campaigning to preserve an awful policy, Republicans have done little to offer their own solutions to the eviction problem. They should. As I have detailed before, cutting local regulations and spurring new housing developments needs to be part of the long-term plan. However, for women such as Ms. Rivera, waiting years for the market to self-correct isn’t an attractive option. Republicans should meanwhile work to find a bipartisan arrangement to more quickly disburse rental assistance — where necessary. If that doesn’t happen, local governments may extend the moratorium on an ad hoc basis.

The eviction moratorium is not only unconstitutional, but it has hurt landlords and renters alike. Landlords have lost billions, and eventually evicted renters will have to deal with the credit fallout of missing payments. Unfortunately, both Democrats and Republicans have offered no lasting solutions to people who may find themselves without a home.

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