Have you filled out a rental application lately? If not, you will be shocked at the depth of the questioning. You need evidence of a stable income stream with employment verification, of course. That’s been true for some time. But these days, there’s much more involved.
Income verification is tied to your credit rating, which is tied to your credit-card debt and savings. It is done with a simple move. You click one button. The leaseholder is granted full access to your bank account. AI spins through your entire payment and income history, not just months but many years back.
As much as you can see, the rental company can see too. Within half a minute, the system comes back and says whether you are approved or not. Meanwhile, a company you don’t know now knows everything that matters about your life.
It is convenient but also tremendously alarming. Why should the apartment owner have the right to know all this stuff? Should it not be enough to have assurance that you will pay your rental bills, and that’s it? One might suppose so.
If you are unbanked or missed a payment at some point, you can forget it. You won’t have any place to live. You are as good as homeless unless you have a friend or family who can rescue you.
You can dismiss this new digital intrusiveness as symptomatic of our age. This is how all things are going. The panopticon will rule all things. Privacy is gone. Data rule the day. Whatever was ours now belongs to megacorporations to download, store, and share. This will go on until human exigency and volition are wholly replaced by artificial intelligence, in which our job is nothing but algorithmic compliance.
However, there is a proviso here. This is not just about digital empire building. It’s also about risk aversion in light of a massive breach of property rights just a few years ago.
In March 2020, as a frenzy over a disease was overtaking politics, Congress, as part of the CARES Act, imposed an astonishing rule. It announced to renters all over the country that they did not have to pay. No one could be evicted. Many people decided to test the rule, and suddenly, rental companies all over the country faced a fiscal disaster.
It was nothing short of a fundamental attack on property rights. The guy renting the basement apartment was granted the legal right to be a squatter in your own house, and there was nothing you could do about it.
The legislation had set the eviction moratorium to expire on July 24, 2020. The rule did technically expire.
That’s when the Centers for Disease Control and Prevention (CDC) stepped into the breach. In a more sweeping rule that was much broader than that passed by Congress—and with zero legislative authority—it imposed a comprehensive rule that no one nationwide could be evicted from any property. The stated reason is beyond belief: They didn’t want COVID people wandering the streets infecting others.
In other words, they claimed that their mandate to control the microbial kingdom gave them rights over all property relations in the country. It heavily enforced eviction bans with criminal penalties: $250,000 and one year in jail. Imagine that: You try to collect rent or kick out non-payers, and you are arrested as the criminal.
Property owners lost some $13 billion in rental payments in the course of two years.
What was the basis for this law? It was Section 361 of the Public Health Service Act, which grants sweeping powers to the government for sanitation and disease control. It allows the government “to make and enforce such regulations as in his judgment are necessary to prevent the introduction, transmission, or spread of communicable diseases from foreign countries into the States or possessions, or from one State or possession into any other State or possession.”
The act further allows the agency to “provide for such inspection, fumigation, disinfection, sanitation, pest extermination, destruction of animals or articles found to be so infected or contaminated as to be sources of dangerous infection to human beings, and other measures, as in his judgment may be necessary.”
The assertion of such powers was immediately met with a flurry of court challenges. The Supreme Court weighed in with Alabama Association of Realtors v. Department of Health and Human Services. The CDC had argued, according to the court, that “if evictions occur, some subset of tenants might move from one State to another, and some subset of that group might do so while infected with COVID–19.”
“This downstream connection between eviction and the interstate spread of disease is markedly different from the direct targeting of disease that characterizes the measures identified in the statute,” the court stated.
The 5–4 decision went on to state that the CDC has exceeded its authority. Indeed, the government’s interpretation of the law would grant a “breathtaking amount of authority.”
It’s astonishing that fully four justices of the court actually believed that it was fine for unelected bureaucrats to override every lease agreement in the United States on a whim. It was a close call, but property owners did regain their rights.
And yet the dissenting opinion, citing infection data, reads as follows: “The public interest is not favored by the spread of disease or a court’s second-guessing of the CDC’s judgment.”
Still, many eviction moratoriums were enforced at the state level until late in 2022. Property owners were never compensated, although they should have been under the Fifth Amendment. It was certainly a taking of the sort banned by the U.S. Constitution.
No matter, the damage was done. It was now up to any property owner to vet renters based on their likelihood of paying, even in the event of another government intervention. Property rights have been fundamentally attacked. The government not only failed to stop the attacks; it permissioned and enforced them.
Henceforth, it would be up to property owners themselves to make sure they got paid. That means taking as few risks as possible. Only those people who paid despite the moratorium can get a place to live. That’s the thing. Government can decline to enforce evictions, but it cannot force property to take on risks for new leases. As a result, many people who could easily have gotten an apartment five years ago cannot get approved today.
You won’t be shocked to learn that the homeless population has grown as a result. We have seen an 18 percent increase from 2023. You know this from visiting any U.S. city in the past few years. The homeless problem is out of control. Part of the explosion of numbers in the group (soon to be a million people nationwide) is a result of the eviction moratorium imposed first by Congress and then continued by the CDC.
Here’s the great irony. The CDC stated that it didn’t want diseased people walking around, but now we have more substance-addicted people walking around than ever before. They have nowhere to live precisely because the CDC undermined property rights and profoundly disturbed the market for rental housing.
Hardly anyone today who is filling out these outrageously intrusive applications can tell you why this is happening to us. But a deeper look provides insight into the reason. When the government attacks rights, it incentivizes private parties to take enforcement into their own hands. We are all the victims.
