QUORA: Why has capitalism failed to end homelessness?
by Saulius Muliolis, Amateur economist, self taught Austrian school. May 16, 2021 Because it hasn?t been allowed to. In the housing sector, we have massive govt regulation, including zoning laws, land use regs, large areas of land put off limits to construction, building permitting processes that are prohibitive, rent control policies that discourage the building of affordable housing, & then govt policies to try to fix the resulting high prices & low supply by throwing money at them. The govt enables, encourages, pressures, & sometimes forces mortgage lenders to lend more money & issue more & bigger mortgages to more home buyers, thus inflating prices even more.
All these policies, including ones intended to make housing ?more affordable? actually restrict the supply of affordable housing & drive the prices up, which is the opposite of more affordable.
The homelessness problem is worst in California, where the housing restrictions are the strongest, & there are more regs that cause more unemploy- ment, such as the highest state minimum wage (tied with DC) & heavy regulation on small businesses, usually based on environmental justifications.
How can capitalism solve the problem of homelessness when it is bound by so many restrictions & extra burdens?