Business: Black Rent Threat

Biggest challenge to OPA’s new get-tough enforcement program is neither the tire bootlegger nor the gas-coupon clipper but the widespread evasion of controls on rent. OPA last week swung one of its hardest punches, ordered rents reduced and stabilized on Oct. 1 in 54 more defense-rental areas scattered across the whole country, bringing under federal rent control areas where a total of 50,000,000 people live. In 53 of these areas rents are cut back to March i levels; in the 54th (Chateau, Okla.) the ceiling is based on the preceding October.

Black rent might some day be the “sick chicken”* threatening the whole existence of OPA. Unlike most other ceiling-price violators, landlords fight back, make the direct accusation in court that the price-control act is unconstitutional. OPA remembers what happened to NRA when the Supreme Court decided the same issue.

Five rent-control cases, which went into special three-judge Federal courts because they involved constitutionality, have been fought through successfully by tough little Talbot Smith, OPA rent lawyer. Two of these cases were in South Bend, two in Mobile, one in Wichita—but though widely separated on the map, all the cases were curiously alike in their defense—arguing that the act delegated legislative powers to a Governmental agency which should be exercised specifically by Congress. OPA’s Lawyer Brunson MacChesney, chief of the compliance section, thinks the similarity no coincidence, believes there exists an organized resistance to rent ceilings.

* NRA charged the Schechter Bros, of Brooklyn with selling unfit poultry and otherwise breaking the Live Poultry Code; in 1935 the Supreme Court’s decision on this famed test case made the Blue Eagle a very dead bird.