We’re less than eight weeks away from the New York City mayoral election, and there are still four candidates standing: frontrunner Zohran Mamdani, Andrew Cuomo (running as an independent), incumbent Eric Adams and Republican candidate Curtis Sliwa.

Mamdani maintains a double-digit lead in just about every major poll out there. Barring any massive shake-ups, he seems primed to become the city’s youngest mayor in history. What exactly is Mamdani saying that resonates with New Yorkers? In a word: affordability. Mamdani’s messaging focuses almost entirely on decreasing the cost of living in NYC via increased government intervention in housing, transportation and childcare.

But I’d argue that his policy proposals are not feasible solutions to address the affordability crisis. I’ll discuss two of the proposals here – rent freezing and free buses – and highlight multiple historical examples of these policies failing, and, in many cases, making the affected systems even worse.

Rent Freezes

“I’ll freeze the rent for every single rent-stabilized tenant.” - Zohran for NYC, 53 second mark

While rent ceilings could indeed provide short-term relief to tenants, they are, historically speaking, a pretty bad long-term solution. The studies are extensive, and all come to similar conclusions: rent ceilings lead to decreased rental unit supply, degraded rental unit quality, misallocation of units and stifled investment in new rental construction.

Stigler and Friedman’s 1946 paper “Roofs or Ceilings? The Current Housing Problem” illustrates the “decreased rental unit supply” point. In 1906, a massive earthquake hit San Francisco and wiped out half of the city’s housing facilities, causing an acute housing shortage. The city experienced another rental unit shortage in 1946 – this time part of a nationwide housing shortage caused by the millions of WWII veterans returning home combined with a pre-existing shortage of housing.

In 1906, “price-based rationing” was legal, simply meaning that rents could rise and fall naturally based on demand. In 1946, there were still rent ceilings in place from the Office of Price Administration (OPA). Stigler and Friedman compared newspaper advertisements between 1906 and 1946, finding noticeable disparities in the numbers of people seeking and offering rental units:

In 1906, after the earthquake, when rents were free to rise, there was 1 [advertisement seeking a rental unit] for every 10 “houses or apartments for rent”; in 1946, there were 375 [advertisement seeking a rental unit] for every 10 “for rent.”

They highlight another point, too: landlords would simply use “under the table” agreements with tenants to demand higher prices for their units than rent ceilings allowed. They highlight an example from New York in 1946: WWII veteran Charles Schwartzman, “a brisk young man in his early thirties,” searched all across New York City for three months looking for a place to live. And what did he find?

An offer of a substandard cold-water flat An offer of four rooms at Central Park West and 101st Street at a rental of $300 a month provided he was prepared to pay $3,000 for the furniture in the apartment. An offer of one room in an old brownstone house, repainted but not renovated, at Eighty-eighth Street off Central Park West by a young woman (who was going to Havana) at a rental of $80 a month, provided he buy the furniture for $1,300 and reimburse her for the $100 she had to pay an agent to obtain the ‘apartment.’

He finally found a three-room apartment in a renovated house on West Seventy-fifth Street. The rental was $150 a month. He had to pay a bonus of $1,000 and the rent was subject to a 15 percent increase in the event the rent-control law was amended to permit it.

In the face of rent ceilings, many would-be renters will 1) choose to keep the space themselves, 2) list the house for sale instead, where there are no price ceilings in place, or 3) find gray methods for demanding higher prices, as illustrated above.

Frederich Hayek’s 1929 “The Repercussions of Rent Restrictions” argues the rent restrictions implemented in post-WWI Vienna led to severe housing shortages by discouraging private investment in rental properties. He further argues that, unable to charge a market-rate rent, landlords lack the financial incentive to invest in maintenance, repairs and improvements to existing units.

Glaeser and Luttmer’s 2003 “The Misallocation of Housing Under Rent Control” illustrates that rent controls prevent efficient match of tenants to units (aka misallocation). Simply: a tenant is more likely to stay in an oversized, rent-controlled apartment because of the supply shortage, even though they do not need the extra space. Or, put another way, a family of four is likely to stay in their cramped apartment due to worries of finding a larger unit for the same price. Their research estimates that 20-25% of rent-controlled apartments are misallocated.

A modern day example: In November of 2021, Saint Paul, MN voters approved a Rent Stabilization ballot initiative requiring landlords to “limit residential rent increases to 3% in a 12-month period, or request an exemption.” Three months later, data illustrated that multifamily building permits were down over 80 percent. St. Paul city council rescinded rent control measures in May of this year.

There are more examples that illustrate the widespread issues associated with rent control: depressing the market, incentivizing tenants to stay in units which may be too large or too small for their needs, disincentivizing further construction or development due to capped returns – the list goes on. Judge Glock does not mince words on this topic in his recent article, “Is There a Dumber Housing Policy Than Rent Control?”

This proposal should be a point of concern on two fronts. Most acutely, it does not work. New York renters should not be forced into an experiment that is destined to fail. More broadly, it implies a level of naivety on the part of Mamdani. How can one confidently propose a solution that has been so thoroughly tried-and-failed?

Free Buses

“I’ll make buses fast and free.” - Zohran for NYC, 41 second mark

Another well-intentioned policy that has big problems. For a modern-day example of why free fare systems do not work in practice, we need to look no further than my hometown of Kansas City. Back in 2019, The Kansas City Council unanimously voted to get rid of bus fares, citing many of the same benefits as Mamdani does now: economic stimulus (riders will use their would-be fare in local business instead) and faster trips (no hold up as people need to pay as they enter). Sounds great, right?

Not quite. This past April, KC announced it was reinstating fares: the city could no longer compensate for the lost revenue from fares. In addition to the revenue loss, the city had to outlay further money for increased security on the buses due to increased “loop riders” – people who occupy bus seats for hours at a time and (sometimes) refuse to exit the bus at the end of the route. KC bus drivers surveyed during this era further reported safety on the buses had deteriorated. In short, it was a double ding – lost revenue and further money spent on police resources to shore up security.

New York City’s bus system is two orders of magnitude larger than Kansas City’s – the NYC system carries 2.2 million riders daily while KC serves ~38,000 per weekday – thus the risks associated with a fare-free system are that much more severe. There is more risk for “loop riders”, too. The lost revenue estimates range from $600 - $800 million annually. And that says nothing of the potential resources needed to further police the buses in a free-fare system. How would the city manage without that lost revenue?

It’s also worth noting that all the potential benefits proposed on Mamdani’s website – packaged together in a cute, colorful infographic – are sourced from an independent research report by economist Charles Komanoff. Komanoff is an NYC policy researcher, and he wrote this report for the “Nurture Nature Foundation, a non-profit focused on “addressing the conflict between environmental protection and economic development.”

To say nothing about the lack of a peer review process on this report, the paper fails to meaningfully address any counterarguments to the plan. It borders on comical. The only portion of the 21-page paper that discusses potential issues with a free fare system is found on… page 21, in a one-page section titled “Other Considerations.” It is only here where Charles addresses that maybe the free fare system could reduce the city’s ability to upgrade the bus transportation system, that maybe buses could become a “hangout zone for miscreants who might disturb or actually harm other passengers,” and that maybe the city might need to invest in more buses due to the increased ridership. Most comical of all, the “Rising Lost Revenue?” section does not even address the issues of rising lost revenue – it just debates whether the revenue loss estimates are accurate or not.

It’s hard to find any meaningful defense of the plan from Mamdani elsewhere. There is the fun video of him taking the Staten Island ferry (which is free) and saying that if this can be free, why can’t the buses? There is the YouTube short of him explaining the free bus pilot program he championed and sharing how he’ll fund the endeavour (increasing corporate tax rate plus a flat 2% tax on NYC residents making more than $1 million annually). But as Charles Lane explains in his fantastically written article “Free Buses are a Recipe for Disaster,” the pilot program had underwhelming results:

Ridership grew significantly—no surprise there—but only 12 percent of the growth came from new riders. The rest were existing riders taking more trips—and picking them up caused bus speeds to fall by 4.3 percent. It cost the MTA $16.5 million in foregone fare revenue.

Interestingly, the new riders enjoying the free fares were a bit more likely to be earning above $100,000 per year than the pre-pilot clientele: 11 percent vs. 9 percent. This supposedly progressive reform, in other words, distributed its benefits slightly regressively.

Mamdani nailed the target when he identified the problems New Yorkers are facing right now. It feels like everything is getting more expensive while wages and purchasing power have remained stagnant. But this is how his proposed solutions make me feel:

They are way off the mark, and it makes me question the feasibility of his platform holistically. And I get it – we’re not living in a vacuum here. I understand that when compared to Cuomo and Adams, Mamdani seems even more appealing. He’s not establishment, he hasn’t been involved in scandals and he knows how to connect with people. And there are other factors at play that are motivating his voting base. But the truth is, these policies don’t pass basic muster, and New Yorkers deserve pragmatic, defensible policies that can actually address the affordability crisis, not exacerbate it.