In cities like Milwaukee, landlords are making inflation worse by jacking up rents. Here’s what we should do about it.

·4 min read

With record prices at the gas pump and the grocery store, the 2022 midterms will likely be remembered as “the inflation election”.

These are, no doubt, precarious times for Democratic incumbents. As Republican attack ads continue to focus (erroneously) on government spending as the cause of higher prices, Democrats’ electoral prospects depend on their ability to explain inflation to the public and present a plan that voters believe will solve the problem.

Yet Democrats have mostly ignored what has become the single biggest contributing factor to inflation: the rent.

Nationwide, housing costs accounted for 40% of the latest inflation increase. Locally, we’ve seen an 18% increase in Milwaukee-area rents over the last year.

So any plan to fight inflation that does not deal with housing prices is no plan at all.

Fortunately, policies to stop the meteoric rise in housing costs do exist and have proven remarkably successful. A recent study of 38 wealthy democracies found that more than half had some form of rent control. Americans have also caught on. Five states as well as Washington, D.C., have some form of rent control, as do 182 cities.

Rent control helps to promote residential stability. Tenants living in rent-controlled units are far less likely to move out than those in uncontrolled units, which suggests that rent control helps tenants avoid de facto evictions. This has numerous benefits, including positive long-term physical and mental health outcomes, especially for children.

Moreover, the negative effects of rent controls are exaggerated; countries with strict rent controls have extremely high quality rental housing, whereas Milwaukee has no rent controls and such low-quality rental housing that a Pulitzer Prize-winning book was written about the city, and the Journal Sentinel’s investigative reporters routinely publish stories uncovering the many abuses of Milwaukee’s most notorious landlords.

More: The Journal Sentinel's 2016 report 'Landlord Games'

More: Recent spike in eviction filings prompts city leaders to evaluate Milwaukee's eviction prevention programs

True, rent controls might threaten corporate profits. Yet in 2021, the largest corporate landlords saw their combined earnings surge by more than 50% to nearly $5 billion. Meanwhile, 18% rent increases will invariably mean more evictions, which will yield more job losses, material hardship, and worse physical and mental health.

So what can we do about it?

To fight inflation, our elected officials should start by targeting the state’s ludicrous law preventing local governments from instituting rent controls. With that law gone, local governments could fight inflation and needless hardship with common sense rent controls. Better yet, the state could follow the example of numerous other states and cities and pass rent controls itself.

Assuming that the state government will not act, however, elected city and county officials need to do everything within their power to assist Milwaukee renters facing the squeeze. This should include testing the legal limits of the state’s preemption statute — by creating penalties for landlords who engage in unscrupulous practices just to make a profit and incentives to charge fair rents.

Milwaukee’s leaders should also think creatively about the funding opportunities they currently have. The city has not yet spent more than half of the nearly $400 million it received in pandemic relief funding. Our community land trust — a program for permanently affordable homeownership — is a great way to spend the money, but for people a CLT cannot serve, the city should create a municipally-owned rental housing company to avoid the onerous federal restrictions on public housing. Such an enterprise could use eminent domain to purchase apartment buildings, thus rapidly expanding the stock of quality, affordable rental housing. Similarly, it could buy up distressed housing, rehabilitate, and rent it at reasonable rates. Milwaukee’s for-profit Strong Blocks program proves that such a program can be financially self-sustaining. None of this would be preempted by state law.

Finally, existing programs should be strengthened. The Social Development Commission is still spending Emergency Rental Assistance (ERA) money from the Treasury Department, but has failed to follow Treasury’s recommendations on direct-to-tenant aid and reducing paperwork burden by allowing for self-attestation. These recommendations were created because applications were initially several hundred pages long. The county should also make permanent its pilot Right to Counsel program, which provides free legal representation in evictions for eligible households.

Inflation is not a natural disaster. Our elected officials have the power to shield working-class Milwaukeeans from the scourge of spiking rents. If they fail to do so, they will have added merit to voters’ often-stated rationale for not turning out: that both parties have demonstrated themselves unwilling or unable to solve the problems everyday people face.

Chris Krco is the founder of the Milwaukee Community Land Trust and the president of Housing for All, a nonprofit organization focused on affordable housing.

This article originally appeared on Milwaukee Journal Sentinel: Landlords jack up rents, make inflation worse. Here’s what we can do.