• The Horror – Discriminatory Advertising on the Internet!

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    Nothing has
    ever made it so easy for buyers and sellers to get together and
    engage in trade as the Internet. It reduces transaction costs immensely
    because they can find each other so readily. And if one seller doesn’t
    have what a buyer wants, all that has been lost is the few seconds
    of time and the energy it takes for another mouse click.

    Everyone understands
    that if an Internet seller doesn’t have exactly what you want,
    or insists on terms you won’t accept, or chooses to sell to
    someone else, it’s no big deal. You simply move on. Well, not
    quite everyone. It turns out that there are authoritarians who want
    to use the law to punish people who have real estate for sale or
    rent and advertise on the Internet that they have preferences for
    the people with whom they would contract. Cries are going up for
    litigation or legislation to end this monstrous attack on the nation’s
    commitment to “fair housing.”

    The federal
    Fair Housing Act of 1968, one of the most offensive pieces of legislation
    signed by Lyndon Johnson (with LBJ, there were so many), makes it
    illegal for those who sell or rent housing to discriminate against
    buyers or renters. The prohibition extends to advertising. It is
    a violation of the law to hint even obliquely that you have a preference
    for a contracting party who has certain characteristics or doesn’t
    have others. If, for example, a landlord were to advertise that
    he has an apartment that’s “Great for a stable family,”
    that could be interpreted to mean that gays aren’t welcome.
    Of if an ad pictured a group of tenants enjoying a pool party, but
    the photo didn’t show anyone from different minority groups,
    that could be a hidden message that whites are preferred. Anyone
    who sells or rents property must be constantly alert to be sure
    that he is not in violation of this vague but aggressively enforced
    law.

    Following the
    passage of the Fair Housing Act, a plethora of “Fair Housing
    Centers” sprang up around the United States, staffed by eager
    crusaders who want to stamp out the supposed problem of housing
    discrimination. Those organizations have frequently brought lawsuits
    against sellers and lessors of housing and extorted substantial
    sums of money in exchange for a settlement. What now has the fair-housing
    crusaders in a snit is the emergence of Internet sites such as Craigslist,
    where properties are advertised. Sometimes ads run afoul of the
    law forbidding seller preferences – for example, one by a woman
    with an apartment to rent specifying that she wants a young, single
    female tenant. The law says that no discrimination is allowed and
    that woman is flagrantly violating it.

    “Fair
    housing” advocates are up in arms, of course. The executive
    director of the Greater New Orleans Fair Housing Action Center said
    in congressional testimony recently that discriminatory postings
    “are perhaps the most concerning issues we have confronted
    since the hurricanes.” A Chicago-based group has filed suit
    against Craigslist for running “discriminatory” ads. While
    court decisions have thus far held Internet sites immune from liability
    for the speech of those who post on them, the housing activists
    say that discriminatory housing ads shouldn’t be allowed. (A
    New
    York Times article
    published last year discusses this controversy.)

    The judges
    and politicians who wrestle with this issue ought to stop and ask
    a simple question: Is there any harm here? If someone looking for
    housing on the Internet comes across an ad making it clear that
    the owner prefers to deal with people who have attributes he doesn’t
    have, all the searcher needs to do is click on another ad. That
    inconvenience is no different from searching for other goods, services,
    or information on the Internet. If one place doesn’t have just
    what you want, you just move along. Most housing sellers don’t
    turn away prospective customers. Instead of attempting to stamp
    out “discrimination” – the pejorative term for having
    a preference in contracting – why not use the remarkable facility
    of the Internet to bypass it? If one landlord says that he would
    prefer a white, Catholic family, what’s so hard about searching
    a little longer to find one who cares only about getting paid each
    month?

    While the judges
    and politicians are at it, they might examine the central premise
    of “fair housing” legislation, namely that the preferences
    of those who sell or rent housing should be disallowed. If, for
    whatever reason, a landlord prefers to have tenants with certain
    characteristics, why should that be any business of the government?
    Buyers are permitted to act in accordance with their preferences.
    There is no law against buyer “discrimination” in housing,
    or anything else. If a prospective tenant looks at a house or apartment
    and decides to walk away, no law permits the disappointed landlord
    to sue him if he suspects that the reason he decided not to enter
    into a contract is a “bad” one. Not exactly equal protection
    under the law.

    I am not suggesting
    that the law should be made symmetrical by extending anti-discrimination
    features to cover both sides of the contract. Instead, it should
    be made symmetrical by eliminating it from the seller’s side.
    The proper rule to follow is that of the common law of contracts,
    requiring mutual assent before the law recognizes any contract.
    If one party has obtained the other’s assent through duress,
    then there is no true contract; and with its anti-discrimination
    laws, the government has introduced duress into every housing contract.
    We should return to the time when either side could say “no”
    without fear of reprisal.

    As for you
    folks at the various “fair housing” centers, if you’re
    really worried about renters who are turned down or advised not
    to apply, then just turn on your computer and help them find landlords
    who want to contract with them. It won’t be hard, and it won’t
    involve any coercion.

    March
    6, 2007

    George
    C. Leef [send him mail]
    is the director of the Pope Center for Higher Education Policy in
    Raleigh, North Carolina, and book review editor of The
    Freeman
    .

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