When Donald Sterling, the notoriously racist billionaire owner of the Los Angeles Clippers, was caught on tape saying hateful things about African Americans, it sparked a torrent of news coverage, and for good reason. The Clippers have long been one of the most abysmal teams in the NBA, yet they’re now fielding one of the best. Many wondered if the team’s predominantly black players would countenance playing in this year’s playoffs for a man almost universally regarded as despicable. Others have reflected on what makes Sterling so awful. So allow me to instead reflect on what has made Sterling so rich.
Sterling is what we colloquially call a “slumlord,” which is to say he’s a real-estate investor who has thrived by renting low-quality housing at high prices to low-income families in southern California. Los Angeles, like many cities across the United States, suffers from a dire shortage of affordable rental housing — a shortage that is particularly acute in liberal cities. And lo and behold, these shortages redound to the benefit of slumlords like Sterling, who can charge sky-high rents because development restrictions make it prohibitively expensive for real-estate developers to build multifamily housing.