Montana’s Market-Based Solution to the Housing Shortage


Friday, February 17, 2023

One of the most important and exciting policy drives in America is happening in Montana. It holds the promise of radically raising the standard of living across the country. It could make housing affordable and available in a way that seems out of reach for so many Americans, and the past few months may have brought it several steps closer to reality.

Montana might seem like an unlikely candidate for tackling the problems of housing affordability; it is a huge rural state with enormous farms, ranches and parks. Its largest city, Billings, only has 117,116 people. However, Montana is also a top destination for people leaving nearby states and is quickly growing. Housing is not being built fast enough to keep up, so Governor Greg Gianforte established a commission to create new housing, fast; the commission’s report advocated investing in building trades education, speeding up permitting, and relaxing density restrictions.

Montana state legislators are also proposing bills to simplify and speed up the process. HB 337, for instance, would reduce minimum lot sizes statewide. The Republican sponsor said “The beauty of this bill is it puts things like development into the free market.” 

Whether someone supports or opposes any specific bill, her attitude is absolutely right. Housing has not just gotten expensive in Montana; American homes now cost 7.5 times as much as the average worker makes in a year. That is the highest ratio in recorded history; the housing bubble peaked at seven and it was under five as recently as 2012.  This translates to more than thousands of dollars a year, since housing is most Americans’ biggest expense by a lot.

Basically, demand for housing grows as America does, but the supply is not keeping up. This is because of overregulation in everything from construction methods to what kind of housing you can build on your own land. If states take steps to allow markets to operate, this unleashing of the housing supply could be our generation’s supply-side economics.

Supply-side economics, pioneered by Art Laffer and Robert Mundell and enacted by President Reagan, is often sneered at by progressives as ‘trickle-down economics’ as a mere smokescreen for supporting the rich at the poor’s expense. The thing is, supply-side really did work in the ‘80s. Income tax rates were too high, and corporate regulations were a mess; dealing with those unleashed the supply-side capacity of the American economy and gave us years of strong growth and employment. 

Today, maybe tax rates should come down some more, and there are always some regulations to ax. However, doing those would not suddenly unleash an economic boom or make life cheaper in a way that is fiscally sustainable into the future. We have picked the low-hanging fruit in those areas, and housing is the new frontier.  Instead of thinking ‘what did Reagan do’, let’s try to imagine ‘what would Reagan do’, if he were addressed with today’s challenges.

Unfortunately, too many conservatives do not see it that way. The clearest and most fundamental objection is voiced by people like Tucker Carlson and Beth van Duyne when they warn of a ‘war on suburbs’ that jumps from opposing a specific federal housing bill to a less reasonable insistence on single-family homes. Their argument goes that owning a house is the right way to live and how most Americans want to live; Democrats want you to rent an apartment in dense cities instead.

That is not really a fair characterization of the issues. First, no one is proposing ‘abolishing’ single-family houses; the debate is over whether it should be illegal to build anything else if the private owner wants to. If individuals choose to build a duplex or apartment, why should they be banned? Private property rights are the bedrock of economic liberty. 

Second, apartments are often owned by the family who lives there and detached houses are often rented. In fact, decreasing the cost of housing could make buying a home within reach for millions of renters.  

Third, the fact that some progressives are coming on board does not automatically make it a bad idea. Conservatives have plenty of our own reasons to take housing costs seriously. Affordability is a big reason so many Americans left pricey blue cities like New York to decamp to red states like Florida. This has rightly been a point of pride, and even if you do not personally like New Yorkers, the fact that they are moving means Florida’s been doing something right that blue states are missing. 

Conservatives have the tools to meet the housing challenge head-on; property rights, state-level decisions, and supply-side economics have served us and the country in good stead. Housing affordability is an unavoidable problem but is it not unsolvable. It is just a matter of having the will to do what works.

Ethan Mackler is student at Binghamton University. Ethan's interests include history, politics, and the Pittsburgh Penguins.

The views expressed in this article are the opinion of the author and do not necessarily reflect those of Lone Conservative staff.

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About Ethan Mackler

Ethan Mackler is student at Binghamton University. Ethan's interests include history, politics, and the Pittsburgh Penguins.

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