Borders -- an uncomfortable example

Apropos of the last post -- a very uncomfortable example:

A federal grand jury has indicted seven Latino gang members in connection with a 2014 firebombing attack at the Ramona Gardens housing project in Boyle Heights, accusing them of trying to drive black residents out of the neighborhood, prosecutors announced Thursday. 

Federal prosecutors allege that the men – all described as members of the Big Hazard street gang – met before the attack, where Carlos Hernandez, 31, is accused of telling the group they were going to use Molotov cocktails to firebomb homes where black families lived. 

While no one was injured in the May 12, 2014, firebombing, three of the four apartments targeted were occupied by black families, recalling uneasy times from decades ago when similar attacks prompted most African Americans to flee the housing project.

I originally saw this on Steve Sailer's blog, but I have lost the link.

There is the obvious racial angle, of course, but I wanted to come at it from another direction -- a failure in markets because of an unwillingness to acknowledge an important reality.

Basically, through my economic lens this looks to me like a black market in operation -- even though nobody is talking about buying or selling anything.  You have people in the market for a neighborhood 'of their own people', resorting to violence and obnoxiousness because such a market is effectively closed off by law.  There is demand frustrated for supply, and the result is violence and criminality.  And to be sure, this is not the only place you see this kind of thing, it is just a very overt and nasty example.

Forget about race and all that for a moment -- it is just very hard to imagine being able to assemble, say, a Presbyterian, or an environmentalist, or a homeschooling community, or a whatever-enthusiast community, precisely because we have open markets in housing.  There just isn't a good way to coordinate anything, because it is disallowable by our system of things to control who your neighbors sell their houses to.  Maybe conceivably, some mega-bucks guy could just build a whole neighborhood and let his buddies live there, or something of that nature.  But hopefully that sounds like an unreasonable stretch of things.

And yet people have a very strong interest in who their neighbors are.  This is an extremely valuable thing for people, and how their communities are structured and who they interact with are extremely meaningful in their lives.  But the only available mechanism for discrimination in markets is price.  And so, as a result, we have a highly stratified market with people bidding up prices absolutely like mad, for houses probably many of them really don't even want, just for a chance to hopefully not wind up next door to criminals, or for 'good schools,' i.e., so their kids don't get shot.  Which is a pretty low bar, but all you can ask for the way we have things set up.

And worse, you have miscreants in government actively stirring the pot by shuffling people into neighborhoods they have no business in and lifestyles they can't handle.  (Sorry, no link, but you know the kinds of programs...)

I don't really know what the answer to this is.  It isn't always reasonable to think that there should be a market in absolutely whatever people want -- we don't have a market in slavery anymore, for example.  Or children.  Maybe some wants just should be frustrated, criminality and violence in such cases being just that and no more.  I don't really want to go down that particular avenue.

But this is really, really bad, it is a huge problem, and it is the result of a system which has little meaningful avenue for expressing the existence of borders.  It isn't good for anyone.