I don't see how that will prevent rent from going up forever unless you put a cap on prices. Salaries in SF keep going up because rent is going up. The subsidy would have to continue to grow forever. If you are looking to just have certain groups of people to live there without concern for rising rents, just mandate rent control instead of the layers of indirection
Yeah just speaking mathematically, that rent has to come out of a new employee's paycheck. And if the companies are being taxed to pay the subsidy to a different employee, that puts a cap on how high rent can be. Assuming people are coming to the city to work and not buying a 10th home as a "pied-a-terre" using money earned elsewhere.
Theoretically there is a cap on rent through the forces you are describing, but we have no idea where that cap is and have yet to see it in reality. If its arbitrarily high it may as well be infinite for how it affects budgeting. Rent control will achieve the same pros and cons as your system but with a known value that people can plan around instead of seeing just how much money is going to be passed around in tax
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