In California, and on the left wing of the political spectrum, there has been a lot of chatter about abundance, the theme (and title) of Ezra Klein and Derek Thompson’s bestselling new book. The book—praised by Governor Gavin Newsom—argues that progressives have been hurt by “well-intentioned” politicians with “blind spots” on economic issues like housing, especially in big cities where Democrats have embraced “scarcity politics” and heavy regulation.
Savvy observers such as Nate Silver have noted that Abundance, published after Democrats’ historic losses in 2024, was “carefully calibrated to persuade insiders” that progressives have been hurting themselves with heavy-handed economic policies that are doing more harm than good, particularly in US cities where progressives dominate the political scene.
Alas, it seems that many Californians didn’t get the memo (much like New Yorkers). One week after voters in the Big Apple elected Zohran Mamdani mayor, the city council of Los Angeles took its own leftward lurch, voting by a 12–2 margin to ramp up the city’s rent control law.
Under the change, which was supported by LA Mayor Karen Bass, most Los Angeles landlords covered by the city’s rent-control system—about 75 percent of all rentals—will face much tighter limits on what they can charge for rent. Instead of being able to raise rents by 3 to 8 percent a year, they’ll now be restricted to increases of only 1 to 4 percent.
Members of the council said the goal was to make rent affordable for the more than 2 million people in the city’s rental market. “What we have before us right now is an opportunity to make L.A. more affordable,” said City Councilmember Nithya Raman, another supporter of the measure. “Because when people can afford to stay in Los Angeles this entire city thrives.”
There’s no question that the City of Angels is facing a housing crisis. She currently has a homeless population of some 44,000. The average rent for all homes is $2,750, according to Zillow—nearly 40 percent higher than the national average. Unfortunately, the city’s new rent-control policy is all but certain to make Los Angeles’s housing crisis much worse.
Economists don’t always agree, but one thing virtually all economists agree on is that rent control doesn’t make people better off. A 2024 University of Chicago survey of 45 leading economists showed striking agreement on two core questions: None of the economists agreed that a 5 percent rent-control cap would substantially reduce income inequality, while just one said a rent cap would make middle-income Americans better off over the next decade.
Rent control laws have many flaws, but the biggest is that they discourage the one thing that most effectively lowers housing prices: building new homes. By making it harder for landlords to turn a profit, rent control discourages the creation of new housing units (and disincentivizes maintenance of current units). Whether you’re looking at recent rent-control results in Europe and the US or historic examples in Latin America, the research tells a similar story: rent control makes housing affordability worse.
Lawmakers in my home state of Minnesota recently discovered this. In 2021, voters in St. Paul, the state capital, approved one of the toughest rent-control laws in the country. The following year, data showed building permits were down 80 percent—which prompted the city’s Democratic mayor to urge the city council to amend the law. Two years later, the St. Paul city council quietly gutted the measure.
California doesn’t need a complicated housing bill or a new stack of regulatory “solutions.” It simply needs to start respecting property rights again.
A simple glance at Los Angeles’s housing stock reveals the city’s real problem. Los Angeles has seen a steady decline in residential property permits in recent years, which largely stems from the city’s four-year “rent freeze” and aggressive tenant-rights laws that make it extremely difficult to evict tenants, even if they’re not paying rent or are destroying property. “It’s really hard to tell investors, ‘Let’s take all this risk,’ in a city that hates landlords and developers,” developer John Gregorchuk told Politico.
If you doubt Gregorchuk, consider that earlier this year, California lawmakers rejected a proposal to make it easier for property owners to remove squatters and trespassers. Many readers may not be familiar with California’s squatting problem, but perusing local media coverage reveals its scope and brazenness.
Online testimonials also abound. Benjamin Miller, the CEO of Fundrise, a company that operates in real estate and venture capital, recently described his experience of managing properties in Los Angeles. “The LA system is so insanely tenant friendly that a tenant has literally started bonfires in one of our unit living rooms and we still couldn’t evict them,” Miller wrote. “We had tenants who hadn’t paid rent in years. We had squatters who broke into the houses and dealt drugs from the house, and we couldn’t evict them.”
Progressives like to talk about abundance, but most of them don’t seem particularly interested in pursuing policies that lead to abundance. All too often it seems their real priority is preserving an ideological model of government-led solutions. The appearance of serving the “public good” outweighs actual public benefits, while their agenda conveniently serves entrenched interests—unions, contractors, and bureaucracies. The phenomenon—classic public choice in action—explains how you end up with $80 billion high-speed rail projects that go nowhere and $1.7 million public toilets.
Americans of all political stripes would do well to remember that the path to prosperity isn’t complicated. Adam Smith pointed out the formula centuries ago.
“Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice,” Smith wrote in The Wealth of Nations, “all the rest being brought about by the natural course of things.”
The last part of Smith’s famous quote is often overlooked. His phrase “tolerable administration of justice” is admittedly vague, but it plainly includes basic property rights. At minimum, that means the freedom to sell one’s property at a chosen price and the authority to remove those who trespass.
California doesn’t need a complicated housing bill or a new stack of regulatory “solutions”; it simply needs to start respecting property rights again. If you doubt this, consider how Argentina recently solved its own housing-affordability crisis. President Javier Milei didn’t pass a high-profile five-point plan; he simply rescinded the country’s harmful rent-control law, which had disincentivized housing construction. The result was immediate: the cost of housing fell roughly 40 percent, and the supply of available units surged by 180 percent.
Many people, myself included, had hoped Klein and Thompson’s book would be a wake-up call for Democrats, whose favorability hit historic lows in 2025. With the Trump administration embracing its own command-and-control style of economics, there is an opening for an abundance and reform movement in the center or, as Klein has observed, on the center-left.
If California is any indication, it unfortunately looks like progressives will chart a different course. Instead of choosing the abundance path—removing regulatory barriers and protecting property rights—leaders appear intent on doubling down on scarcity.
This is an ominous sign. If progressives in blue states and America’s largest cities remain hostile to property rights even as their cities fail, abundance will remain just a slogan—and the costs will be high.