The demand often raised in the renters’ protests that housing should not be a commodity is a correct and an important one. But it amounts to nothing as long as the relations of power and domination of this society are not called into question.
"The right to life is higher than the rights of private property!" (Slogan from the Russian Revolution)
With the German constitutional court overturning the Berlin rent cap, the real estate lobby has celebrated a significant victory. According to the unanimous verdict, the Berlin rent cap law “is incompatible with the constitution and is thus null and void.” The stock market reacted accordingly: the exchange rates of “Deutsche Wohnen” increased by 6.8%, those of the “Adler group” by 7.6%, and those of “Vonovia” by 2.9%. Thousands of renters are now threatened with hefty rent hikes and arrears in pandemic conditions. If they can't pay, they run the risk of losing their homes. Once again it is absolutely clear: bourgeois justice protects the property of the rich, but not the right to live!
The rent cap was of course never an effective instrument for stemming the rapid rise in rent prices. It was always temporary, it was full of loopholes, and landlords and real estate sharks routinely tricked their ways around it. Despite the rent cap, rents rose by 5%. From its very conception it was always a sedative from the Senate for the renters’ protests of 2018/19. The hope was of course that they would conveniently forget that the Senate consisted of the SPD and the Linkspartei, which between 2002 and 2011 had been selling off hundreds of thousands of homes dirt cheap to property companies. In this way they played a not inconsiderable role in the 106% rise in rents of the past ten years. And now the latest “cap” has been removed, this trend can continue...
The housing shortage and rapid increase in rents are in no way Berlin-specific phenomena. Rent prices are rising drastically nationwide. The average rent price in Munich currently stands at €18.48 per square meter, at €15.75 in Frankfurt and at €14.74 in Stuttgart. At “only” €13.68, Berlin “trails” at the bottom. Nor are suburbs and city outskirts protected from this development. In the meantime, almost 40% of net income is spent on rent. For the dubious luxury of a roof over your head, renters are forced to work ever harder, cut back on food and clothing, and/or form the most peculiar living communities. Female renters and people on low income are particularly stretched. The incidence of evictions is constantly increasing and with it the number of people immediately threatened with housing emergencies and homelessness.
The Housing Shortage: a Capitalist Misery
Of course it’s possible to try and explain this development within the logic of market economy. According to its logic, there are simply too many people for too few homes in metropolitan areas. Consequently, more incentives had to be created for construction and real estate firms to build more housing, so that the equilibrium of supply and demand could once again be restored. However, for the capitalist housing market, it is precisely the lack of affordable housing that is the source of such lucrative profits. The harder it is to find cheap housing, the higher the rents that can be collected. It is precisely because the actually existing capitalist mode of production is not orientated towards the fulfilment of real human needs, but is instead subject to the imperative of maximising profit, that we have this housing shortage which steadily increases alongside all the other problems we face! Investments are only made in the housing market in those areas where the expected profit greatly exceeds the costs. This is hardly possible through the construction of cheap social housing. It is far more so however by “modernising” and “renovating” pricey new lets as well as building luxury flats and condos. The amount of social housing has plummeted as a consequence. 43,000 of these homes fall out of social ownership every year, while fewer and fewer come into it.
The Crisis and the 'Flight into Concrete Gold'
Against this backdrop, the stroke of global capitalist crisis acts as additional fuel to the fire. When the post-war boom ended at the beginning of the 1970s, so too did a cycle of accumulation that had surpassed all previous ones. To compensate for the profit rate, global capital relied on restructuring the production process and a massive increase in the rate of exploitation. By expanding flexible, precarious employment conditions, capitalism attempted to reinvent itself as a “service economy”. At the same time, wealth created by wage labour has been shifted in recent decades into the financial sphere, where money “works” in wondrous ways (but without creating any real new value) and speculation flourishes. The shock of the financial crisis of 2008 did not put a stop to this development. In order to prevent the world economy from collapsing, the central banks increased the amount of money in circulation. In search of lucrative investment opportunities, especially when interest rates are zero or near zero, massive amounts of capital flow into so-called “concrete gold”, causing astronomical rises in real estate and land prices. Speculation in housing flourishes on the basis of the housing shortage. The big cities in particular are turned into playgrounds for investment funds, listed companies, wealthy individuals and other profit hunters. Their business model: housing becomes investment property, maintenance costs are minimised and the possibilities for rent increases are maximised. The consequences of this are observable in almost every neighbourhood.
Socialisation in the Existing Falsehood?
This development does not end with the middle class anymore. Now an increasing number of voices reaching far into the bourgeois camp are calling for the state in its regulatory capacity to impose limits on the development of the private housing market. With the “Campaign to Expropriate Deutsche Wohnen und Co”, an alliance has been formed in Berlin calling for a referendum on the expropriation of the largest real estate firms. Spokespeople for this alliance claim simultaneously to stand firmly on the ground of bourgeois legality and to have revived the debate on “socialisation”. Both these things are true. However, this comes at the cost of having robbed the term “socialisation” of all meaning. Thanks to the whingeing of the real estate lobby and bourgeois parties, who warn of a “relapse into socialism”, the proposed “socialisation” initially creates the appearance of a radical undertaking. However, on closer inspection it is no more nor less than a question of the “remunicipalisation” of around 200,000 homes that were sold off by the Senate at ridiculously low prices in the 2000s. These are to be transferred into the ownership of “institutions of public law”, following the model of the Berlin transport company(!). All this with the payment of proportionate compensation to real estate enterprises, which will amount to at least ten times more than the original sale value. Considerable sums, then, to be repaid from “fair rents” and interests, i.e. to be thrown into the jaws of rent sharks. Thus the dead end of reformism is mapped out. Bizarre numbers games and calculations of feasibility are accompanied by prayer wheel-like illusions that “remunicipalisations”, “nationalisations” or “socialisations” (these terms vary according to will) of individual housing complexes could solve the housing problem, put a stop to leasing and evictions in inner city districts, or partially push back capitalism. But much to the chagrin of various movement strategists, legal property titles change nothing of the capitalist character of home ownership. The crisis does not exist separately from the housing shortage. Neither a state-, council- nor cooperative-owned construction company will ever be able to extricate itself from capitalist laws of exploitation. Especially in view of the slogans screamed by the statist left for a so-called “right to the city”, we would do well to remember once more what a worthy comrade had to say on this subject as early as 1872:
"As long as the capitalist mode of production continues to exist, it is folly to hope for an isolated solution of the housing question or of any other social question affecting the fate of the workers. The solution lies in the abolition of the capitalist mode of production and the appropriation of all the means of life and labor by the working class itself." (Engels, The Housing Question)
Peace to the Huts, War on the Palaces!
The demand often raised in the renters’ protests that housing should not be a commodity is a correct and an important one. But it amounts to nothing as long as the relations of power and domination of this society are not called into question. Real socialisation of housing in the interests of the working class without compensation can hardly be implemented through a referendum, let alone through a law passed by the Bundestag. This is not only a question of “control of banks”, “heavier taxation of the rich” or the “nationalisation of housing firms”. A state-controlled capitalism cannot pose any alternative. The experiences of Stalinism in the Soviet Union and elsewhere should have been proof enough of this. Only with a clear break from the capitalist logic of profit, with the disempowerment of the ruling class, and with a fundamentally different mode of production can a new society be possible in which the exploitation of humans is put to an end. The capitalist system’s contempt for human beings, which manifests as clearly in the housing crisis as in the intensification of exploitation, forces us increasingly into resistance, initially against the immediate effects of this system. Struggles against rent increases and wage dumping are an important terrain on which to assert solidarity in the very areas where the ruling class draw narrow boundaries. But this is all in vain if we fail to make clear that they go hand in hand. We are communists – far be it from us to remain silent on our positions and perspectives! We have no “tactical”, instrumental relationship to humanity. We reject all representational politics! Our task as we see it is to keep our focus on the whole interests of the working class, to support its struggles, to criticise the limitations of those struggles, and to try to strengthen the consciousness of wage workers of their own power. This requires an organisational framework, a political tool for intervention: an internationalist organisation, with an international structure and roots. We are all too aware that the creation of this organisation will be a lengthy and arduous process. But it is necessary in order to meet the attacks of the ruling class with the appropriate response.