April 18, 2007 Leave a comment
“On this day in 1906, an earthquake struck San Francisco. The earthquake began near dawn, at 5:12 a.m. on a Wednesday morning, and lasted for a little over a minute. Scientists later determined that the San Andreas Fault had moved about 23 feet. A policeman said, ‘[The streets] began to dance and rear and roll in waves like a rough sea in a squall, [then] sank in places and vomited up car tracks and the tunnels that carried the cable.’ A fire broke out that raged for three days and most of the city was burned to the ground.” – Writer’s Almanac
But as Friedman and Stigler point out in their 1946 pamphlet, “Roofs or Ceilings?” (about which I recently wrote for Mises.org), there was no housing shortage after the crisis because the government did not intervene in the housing market:
The San Francisco earthquake of April 18, 1906 was followed by great fires which in 3 days utterly destroyed 3,400 acres of buildings in the heart of the city.
Maj. Gen. Greely, commander of the Federal troops in the area, described the situation in these terms:
“Not a hotel of note or importance was left standing. The great apartment houses had vanished … Two hundred and twenty-five thousand people were … homeless.”
In addition, the earthquake damaged or destroyed many other homes.
Thus a city of about 400,000 lost more than half of its housing facilities in three days.
Various factors mitigated the acute shortage of housing. Many people temporarily left the city — one estimate is as high as 75,000. Temporary camps and shelters were established and at their peak, in the summer of 1906, cared for about 30,000 people. New construction proceeded rapidly.
However, after the disaster, it was necessary for many months for perhaps one-fifth of the city’s former population to be absorbed into the remaining half of the housing facilities. In other words, each remaining house on the average had to shelter 40% more people.
Yet when one turns to the San Francisco Chronicle of May 24, 1906 the first available issue after the earthquake — there is not a single mention of a housing shortage! The classified advertisements listed 64 offers (some for more than one dwelling) of flats and houses for rent, and 19 of houses for sale, against 5 advertisements of flats or houses wanted. Then and thereafter a considerable number of all types of accommodation except hotel rooms were offered for rent.
I suggest that libertarians celebrate the important non-events of history. Think how much worse it could have been.