Ten Years After ‘Great Debate,’ Rent Control Still Looms

Well, it has finally happened. Washington State now has rent control, joining 6 other states that either have statewide rent control measures or have local jurisdictions that have imposed it. Oregon and now Washington are unique in that they have imposed and will regulate the measure at the state level. For me, personally and professionally, the passage of the measure leaves me with mixed feelings. On the one hand, it is regrettable that the efforts I put into opposing rent control in the state for years failed. However, there is a “I told you so” sensation as well. I mostly stopped working in the state as the pandemic trailed off. It’s hard not to feel that the real estate community got what was coming to it after not listening to advice to change their approach.

On a hot summer day ten years ago next month, I debated socialist Seattle City Councilmember Kshama Sawant. Sawant had many hobby horses, but her two favorites were raising the minimum wage to $15 and the other imposing rent control. It might be surprising to know then that I consider Sawant to be the greatest political actor (and I’ll get back to that word later) that I have ever known personal or had the opportunity to work with. A century from now, the names of the politically pale and anemic players on the stage during her time in office in Seattle, 2014-2024, will be completely forgotten. Her name, while not eponymous for the era, will stand out as the most notable one.

Sawant was peculiar but principled. I had strongly advised and warned the real estate community about her rise during the 2013 local elections. People in Seattle, as many on the left, have a charm bracelet view of electoral politics. They voted for gay marriage, legalizing pot, and now, here was the chance to add a new charm to the rest: an honest to God socialist! I made a winning bet with some big shots in town, never collected, that she would win. And when she did, I snuck into her election night party to hear her speak. Would she back down and deliver the usual bathos—milquetoast and deflated—that most lefty politicians in this town issue when they actually win? She didn’t. She quoted Trotsky, a name most of the people in the room likely had to Google.

And she was prescient. She had supported the idea of using local bonding authority to build housing on City owned land, and idea that I supported because it was a really good use of debt and surplus land. Part of that idea has become reality (sort of) with the passage of two voter initiatives in Seattle in the last few years. That summer I managed to get a meeting with her to discuss this idea, explaining my previous efforts to get the City to use its credit card to create some value capture with neighborhood scale district energy programs. My intention was to suggest a consensus approach that could overcome the stodgy staff guarding the City’s credit rating to try something new.

Instead of following through with that proposal – she eventually lost interest in it – she suggested we debate rent control. I thought it was a great idea. It would be a challenge and an honor to debate a local politician who might know Marx as well as me and who had some principles, the wrong ones in my view, but still principles. It would also be a chance to persuade the hoi polloi that would gather about how adopting a market-based approach to housing would both be profitable and reduce rents and costs for people making less money and even, eventually, help better allocate resources to people living outside in improvised shelter.

Weirdly, as venues and rules were being negotiated, it became clear that Sawant didn’t want to debate one on one. She wanted to have Nick Licata a Councilmember who was as much of a socialist as she was but far less flamboyant and loud. I said that would be fine, I would be happy to debate both of them. But they demanded I have a partner. I couldn’t find one. Not a single member of the so call real estate community would step up. They were terrified. Most of them thought the debate was a mistake. They ran for the hills and left me to debate with a state representative from the east side of the state.

Who one that hot evening? The room was mostly Sawant’s red shirted followers who hissed and booed like they were attending a Victorian melodrama. I did paraphrase, much to my own satisfaction, Margaret Thatcher observation about “a liberal policy,” that they would rather have the “poor poorer, provided the rich were less rich.” I asked the crowd, “Would you support a policy that would allow developers make more housing and profit while lowering rents for poor people?” Of course, they shouted “No, never!” I think I said, “Let the record show that this crowd would rather poor people pay more rent and have less housing to prevent people from making money.”

However, we can truly say that Sawant and her act carried the debate in the long run. And I believe it truly was an act. While Sawant believed what she said, she was far better at the theater of politics than that grind of making policy. Most of her direct efforts failed, with her legislation being dismissed with a wave by one hand of the establishment, then enacted later with the other. Nobody ever picked up on how awkward it should have been for mostly white Seattle politicians to roll their eyes at Sawant – a native of India and a woman – and then pass the essence of her measures and demands as their own.

Sawant was singular in Seattle. Much hated and imitated, she shifted the city’s drab and handwringing establishment to the left, leaving real estate developers and landlords in the city and state with a choice, fight or hide. They hid. In the end, failing to address the real issues of poorer people struggling with rent with better ideas led to rent control which will make their lives worse. Ten years after the debate, the final passage of rent control and Sawant’s relationship with resentful and weak Democratic politicians and landlords reminds me of the phrase variously attributed to Alexander the Great or Talleyrand: “I am not afraid of an army of lions led by a sheep; I am afraid of an army of sheep led by a lion.”

You can watch the whole debate here: