Jeff Bezos recently appeared on CNBC's Squawk Box, where he made a bold comparison between Amazon's efficiency and New York City's school system. He stated that if Amazon operated like the city's schools, packages would take weeks to arrive. During the same interview, the Amazon founder pushed back against claims that short-term rental platform Airbnb is responsible for high rents in New York City. Instead, Bezos argued that government policies limiting housing supply are the primary driver of elevated rental costs.
Bezos Questions Airbnb's Role in Rent Increases
During a discussion on taxes, wealth, and government policy, Bezos turned to housing costs. He questioned the idea that Airbnb is driving rent increases, saying, "Why is rent expensive? Why is rent so expensive? I recently saw somebody blamed it on Airbnb. Okay, Airbnb is not the cause of expensive rent." He noted that restrictions on Airbnb in New York City have not led to lower rents. "In fact, it's been almost, let me finish here one second. It's already been outlawed—in New York City. And rents are still very high. So we know Airbnb isn't causing high rents," he said.
Government Intervention Blamed
Bezos attributed high rents to government intervention. "What's really causing high rent is government intervention," he stated. "We subsidize demand with things like tax policy, which is fine, but at the same time, we constrain supply. We constrain supply with things like zoning and permitting." He questioned why construction projects face lengthy approval processes, asking, "Why does it take so long to get something permitted to build?" According to Bezos, basic supply and demand economics explain the problem. "If you want rents to come down, econ 101—really simple. You need to, you can't sort of subsidize demand and constrain supply. If you do, prices are going to skyrocket." He added, "But this is not anybody's fault other than government policy. And this is fixable."
Criticism of Corporate Subsidies
Later in the interview, Bezos criticized government policies that favor specific industries. "I would say that we have way too much corporate welfare, way too much corporate subsidies," he said. He also condemned special provisions in the tax code, calling them "crony capitalism" and asserting that they should be fixed.
Bezos's remarks highlight his perspective on housing affordability and the role of government regulation. He emphasized that addressing housing costs requires aligning policies with basic economic principles rather than targeting platforms like Airbnb.
