Is rent moral or just?

Rent strikes are occurring in many locations in response to the economic effects of the coronavirus pandemic. Many worker-renters have lost their income, and can no longer afford rent. The common response to a rent strike often to ask whether it is moral for tenants to withhold their rent. This, I think, is the wrong question to be asking, or perhaps, the wrong way to frame the question. The better question is the title of this post: Is rent moral? Or, put another way, is it just (as in justice) that a large portion of the people in our society pays a portion of their income to landlords? In this post I’ll argue that the answer to these questions is “No, rent is not moral or just.”

The structure of my argument is as follows:

  1. Housing is a human/civil right.
  2. A system in which access to a human/civil rights is subject to exchange is immoral/unjust.
  3. Rent is essentially payment for access to housing.
  4. Therefore, rent is immoral/unjust.

I will take the first point as a given. The second seems straightforward, but it hides some nuance that I’ll discuss below. The third is the most important, and perhaps least understood portion of the argument. The final point, I believe, follows logically from the first three.

It is immoral/unjust to charge for access to a human/civil right.

Human and civil rights are those rights which are inherent to all human beings and citizens respectively. We can and should inquire into and debate what those rights are, but that’s not the point of this post. Among the rights that most reasonable people can agree upon are the right to food and clean water, the right to free expression, the right to a fair trial, and the right to vote. The latter three tend to be explicitly laid out in the constitutions of most, and unless you are a fanatical free-market fundamentalist, you would likely object if your government explicitly gave the public square, the courts, and the voting booths to private actors who then charged an access fee to them. If, in order to defend yourself against criminal charges, you had to pay a fee to CourtCo, you would rightly feel that your rights had been violated.

In fact, there is a way in which many arguments about reforming civic institutions boil down to to arguments about whether the state or the private sector is effectively imposing access fees to those institutions. One argument in favour of breaking up companies like Facebook and Google is that these companies now control large portions of the public square and impose fees, albeit indirectly, for access the it. If this argument is correct, then we would have to say that Facebook and Google are restricting our right to free expression.

The right to food is perhaps a little more complicated because, unlike free expression, fairness, and voting, food is a physical commodity. Most people, I think, would agree that they don’t have their human rights violated every time they go grocery shopping or go to a restaurant. So why is it okay to exchange money for food and not for access to the ballot? Because many people laboured and invested money to produce that food and make it so we can walk into a grocery store and buy a piece of fruit, and the money you pay is to compensate for that labour and investment. Also because, in many ways, the market for foodstuffs is a quintessentially free market: If you’re not willing to pay the sticker price for filet mignon, you don’t have to buy it. You can buy a cheaper cut of beef, or a cheaper meat, or non-meat proteins.

This is not to say that the current system by which we distribute food and other necessities is perfect. Poor people do not enjoy the same access to nutritious food as middle and upper class people. Indigenous people in Canada do not have access to clean drinking water. Corporations engage in price-fixing and hold monopolies over seeds for necessary crops. Recent days have seen instances of price-gouging and hoarding of necessities. These all represent injustices resulting from flaws in our society that we should reform.

The point that you should take from this discussion is that commerce and rights are not necessarily morally incompatible. However, if the commerce that amounts to the buying and selling of access to those rights is an injustice. Next, I’ll argue that rent, at its core, is the buying and selling of access to housing, a human right.

What does rent pay for?

To answer this question, Consider the following thought experiment:

Suppose you are a renter. You rent your primary residence, a detached house, from the owner of that house. At the outset of your lease, everything is included in your rent: utilities, garbage/recycling collection, internet, cable TV, a landline telephone, etc. Suppose, then, that you decide you have no need for cable or a landline, (Everything’s on the internet now) so, you go to your landlord and ask them to cancel those services and reduce your rent accordingly. They agree and your rent goes down a bit. Suppose you then decide you want to pay directly for utilities, internet, garbage/recycling collection, etc. so you make another agreement with your landlord and your rent goes down again.

At this point, your rent is not zero so you ask your landlord why. They respond that they still have maintenance costs, property taxes, and a mortgage on the house to pay off. So you offer to take over the maintenance of the house, and tell your landlord that you’ll pay the property taxes directly and mortgage payments directly, and your landlord accepts.

Is your rent zero after this?

I think the answer is “no” here. Even if a renter directly payed every cost that their landlord incurred, they would still need to fork over a portion of their monthly income to the landlord. What is that portion for? It can’t be compensation for the landlord’s labour or capital investment—those have already been taken care of. The only thing that’s left is that the residual rent pays for access to housing.

It follows, then, that rent, being a fee for access to a human right, is unjust.

Note also, that rent is fundamentally different from condo fees, mortgage payments, and the purchase price of a house/condo. Condo fees pay for building upkeep and amenities, mortgage are temporary loan payments, and the purchase price of a home is generally negotiated freely between equal parties. And, of course, these descriptions are idealizations. There’s plenty of room for injustice in all of these transactions.

A radical conclusion? Hardly

This all might seem a bit radical, but on the contrary, none of it is even that new. Housing as a human right is in section 25 of Universal Declaration of Human Rights, and it forms the basis of Canada’s National Housing Strategy. The immorality of charging someone for something that is rightfully theirs is a basic moral principle, but it’s been explored in a more nuanced way by philosopher Michael Sandel in his 2012 book What Money Can’t Buy. Finally my analysis of what rent pays for was done better and more stridently by that radical economist—the one who taught us that the economic value derives mainly from labour, not capital, and that whenever capitalists get together, they conspire to undermine free markets—none other than Adam Smith (The Wealth of Nations, Book I, Chapter XI, recently highlighted in Existential Comics, #337). So, I don’t think anything I’ve written here should be judged new or radical, but I suspect that many people would have such judgements. This, I think points to a deeper problem in our current culture.

Postscript: Morality and justice

Thus far, I’ve blurred the line between morality and justice—two concepts that are related but distinct. Roughly speaking, the distinction between the two is linked to the distinction between individuals and systems. The actions of individuals can be moral or immoral, but systems can be just or unjust. But, as I said, they are linked concepts. For instance, many moral quandaries occur because they are embedded in unjust systems. Take perhaps the most basic one: “Is it wrong for a person to steal a loaf of bread to feed a starving family?” Most people would acknowledge that stealing is morally wrong—though they might argue about what constitutes stealing—but justifiable when it’s necessary. Likewise, most people would agree that a society in which some families are starving cannot be a fully just society. Perhaps this gives a good functional definition of injustice as that which makes immoral acts justifiable.

In the society in which I currently live—Toronto, Ontario in 2020—a sizable chunk of people rent their homes from private landlord—either individuals or corporations. This is an unjust situation. But what can we say morally about landlords, who benefit from this injustice? I believe it’s safe to say that extracting rent from anyone for access to a basic human right is not a moral way to make a living. I believe that the existence of corporations whose sole purpose is to extract rent from workers and entrepreneurs is morally unjustifiable. I also believe that some landlord-tenant arrangements can be morally neutral or perhaps approach moral neutrality because they are, in fact, based on agreements between equals. Consider a situation in which a family takes out a mortgage to buy a home, but then has to move away for reasons of work. Suppose that family finds another family willing to rent the home and agrees that the rent will be entirely based on upkeep, taxes, and mortgage payments. And suppose that once the mortgage is paid off, the renters have the option of a reduced rent covering only upkeep and taxes, or switching to a rent-to-own arrangement. I think such a situation would be morally neutral. This, however, leaves a spectrum from neutral to unjustifiable.

But regardless of where a landlord might fall on this spectrum, they are harmed by the unjust system that they participate in. Being the beneficiary of an unjust system, I think, has a damaging effect on a person’s soul. In the case of landlords, we can see this when some landlords bemoan the fact that they are not free to enter rental units or evict tenants at will. They see this as an encroachment on their rights, but the rights being encroached upon are those that would allow them to violate basic rights of their fellow humans. We can see it when some landlords frame themselves as charitable benefactors, who grant their tenants the right to a home, completely ignoring the fact that they profit from their purported charity. And we can see it in how a number responded to the fact that their tenants are losing income in the current pandemic, not as an understanding equal, but in the same way that a gangster responds when a local shop owner can’t make payments. None of this behaviour should be surprising: Rent is an unjust system and unjust systems inflict moral damage on everyone within them.

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