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June 04, 2004

condos, gated communities, and shadow governments

Montréal: I’m at a Liberty Fund conference on private neighborhood associations. The Liberty Fund is a basically libertarian foundation that organizes more than 100 small conferences a year. The participants are not all libertarians—or else I would not have been invited.

It turns out that some 50 million Americans now live in some kind of community governed by an association: a condominium, cooperative, or a planned community with a board. Often a developer subdivides some land or constructs an apartment building and sells the units with deeds that (a) impose numerous rules on the buyer; and (b) create a board or other body that can legislate further and enforce existing rules.

These are voluntary associations: you don’t have to buy a house or an apartment in any particular condo or planned community. At the same time, they act like governments, taxing, regulating and fining residents and enforcing their decisions in courts. Indeed, they are more powerful than conventional governments, which are restrained by the Constitution of the United States. Residential associations can, and actually have, banned the display of signs critical of themselves, banned the sales of certain newspapers, even banned the private possession of materials they deem pornographic. The rationale for these rules is to increase property values, although the rules may also have other purposes, benign or malevolent.

These quasi-governments raise questions of interest to libertarians and others. For example:

  • Are they ways for people to secede from their responsibilities to the broader society? If so, will they lead—for better or worse—to less redistribution from rich to poor, as rich people become responsible for their own streets, schools, and policing, and refuse to pay into the common pool? Or will they offer opportunities for self-government to all, including the poor in inner cities? (Note: it’s practically much more difficult to create residential associations in existing cities, where there are existing deeds, then in open fields.)
  • Do they replace the special-interest politics that is said to be typical of cities with efficient market transactions? Or does each association become a special interest, pressuring the government to give it favorable treatment?
  • What happens to the individual rights of the members of households that join these associations? For example, in a city, a teenager has a first amendment right to picket, but not in a “gated community.” If his parents voluntarily move into the gated community, are his rights abused?
  • What kind of political socialization will these living arrangements create? Will residents grow up thinking that government is unnecessary, since a private association provides for their needs? Or will they decide that security and prosperity depend upon pervasive regulation of private behavior? If they learn to rely on regulation without political participation and individual rights, then they will be socialized for fascism.
  • Existing residential associations are pretty homogeneous. They aim to increase property values by preserving certain kinds of “bourgeois” appearance and decorum. Will this always be true, or will there be more condos, co-ops, and planned communities that are dedicated to utopian experiments: kibbutzes, communes, and 21st century Oneida communities?
  • Posted by peterlevine at June 4, 2004 12:05 AM


    How on earth does a Homeowner's association enforce a "porn" ban? Do they retain the right to search people's homes?

    Out here in California, signing away rights to the condo association is the norm, since these are the homes most of us have some ghost of a chance of affording.

    We need another Malvina Reynolds to sing about "Little Boxes".

    Posted by: Bill Humphries at June 4, 2004 01:39 AM


    I don't know the answer to your enforcement question--perhaps the boards relied on informants. By the way, the associations that banned pornography were created by Charles Keating, of Keating-Five fame.

    Incidentally, homeowners associations are most common in your part of the country--44% are in the West.


    Posted by: Peter Levine at June 4, 2004 08:23 AM

    As I'm looking at a condo as the affordable option to get into a house (unless I can find a way to get Mountain View to okay me building one of the interesting options at http://fabprefab.com/) the notorious homeowner's association is something I'm going to have to deal with.

    Did you know that we don't even get the right to a secret ballot in HOA buisness? Today I learned that state legislature is looking at a law that would require secret ballots in some, but not all HOA votes.

    Posted by: Bill Humphries at June 10, 2004 03:14 AM

    The seminal work that deals with the future of gated communities is Neal Stephenson's Snow Crash http://en.wikipedia.org/wiki/Snow_Crash

    Posted by: James at June 29, 2004 10:39 PM

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