Rent

Berlin’s rent freeze, hailed by some as a potential model for London, is already coming to an end after less than two years. In its final ruling this week, Germany’s Federal Constitutional Court struck down the rent freeze as unconstitutional. In this sorry saga, there are plenty of lessons for those who supported rent freezes in our capital – not least London's mayor Sadiq Khan. The rent freeze was passed in June 2019, and took effect in February 2020. It froze nearly all rents across the city at their 2019-level, supposedly for a period of five years. It was hugely popular in Berlin, and attracted a lot of attention beyond. Rent controls were official Labour party and Green party policy in the 2019 General Election, and some specifically referenced the Berlin example.

It was inevitable that the wave of destructive rioting and looting that has swept through cities that are almost all governed by progressive Democrats, triggered initially by outrage over the sickening death in police custody of George Floyd, would be compared to the American urban riots of earlier generations. But the parallels miss profound differences in the underlying economic and social dynamics. The Detroit and Newark riots of 1967 and the Los Angeles riot of 1992, for example, took place in cities suffering from the effects of deindustrialization. Los Angeles is not often thought of as a major manufacturing center, but Southern California had a flourishing aerospace industry that went into decline following the Cold War.