Optimists might have thought mayoral candidate Fernando Ferrer was only joking when he proposed last week what is at least a $1 billion tax hike, but his track record suggests he was all too serious. His latest proposal means that his campaign platform now consists of promises to increase levies on already overtaxed New Yorkers by at least $2 billion. Mr. Ferrer’s platform would be quaint if it didn’t threaten to prove so costly to city taxpayers.

The former Bronx borough president’s plan to confront the city’s perennial housing shortage would include new requirements that 30% of housing units built in “growth zones” be set aside as “affordable” housing and would provide incentives for developers to designate an additional 20% of the units in those developments as low-cost. There would be additional tax and subsidy incentives for property owners throughout the city who developed affordable housing.

Worse even than such government meddling in what gets built is how Mr. Ferrer would pay for the building. The plan carries a sticker price of $8.5 billion over 10 years. Most of that would come from the federal government forcing taxpayers to underwrite community development block grants and the monies the city extracts from its citizens for its capital budget.

Not content to rest there, however, Mr. Ferrer includes tax increases of indeterminate scale; the estimated amount only keeps growing. At last count, Mr. Ferrer proposes to raise the city’s taxes on undeveloped land about $900 million over 10 years. He would also raise $300 million by eliminating the 421a tax breaks that are supposed to provide incentives to boost the stock of low-cost housing. Affordable housing, apparently, doesn’t come cheap.

The centerpiece vacant-lot tax is a real howler. Since real estate is at such a premium in the city, reasonable people might assume that there is a valid economic explanation for why some lots are still undeveloped – perhaps the right project for a particular patch hasn’t presented itself yet, or the city’s approval process for building is too onerous. Mr. Ferrer, though, views the existence and trading of vacant lots as evidence of “speculation” and calls his levy on it an “anti-speculation tax.”

Mr. Ferrer isn’t the only city politician to jump aboard the affordable-housing bandwagon. Only two months ago, Mayor Bloomberg himself got a big kiss from far-left community activist Bertha Lewis for his support of nonmarket-rate housing at the proposed Atlantic Yards development that Bruce Ratner wants to build in Brooklyn along with a Nets arena.

We’re all for affordable housing. But the way to lower housing costs is with a free market approach that increases supply. The way to do that is by ending rent stabilization and rent-control laws that cause empty-nesters and singles to hang on to their absurdly cheap three-bedroom apartments, and by simplifying the city building code and permitting process to make it cheaper and easier to build.

Adding taxes and yet more requirements for nonmarket-rate housing only makes it more expensive for developers and New Yorkers. It contributes to the market-distorting regulation and taxation that are at the heart of the housing crunch already. It would discourage the creation of new housing that would meet the demand. A study by the Reason Public Policy Institute found that, in California cities that adopted requirements similar to those proposed by Mr. Ferrer, production of new housing units plunged and prices soared.

Mayor Bloomberg is not without his own vulnerabilities on tax issues. Another Democrat running for mayor, Anthony Weiner, has criticized Mr. Bloomberg for raising taxes too much. But by proposing an additional $1 billion tax increase for housing when he’s already proposed a $1 billion-a-year stock transfer tax for schools, Mr. Ferrer is displaying an attitude that Mr. Bloomberg’s campaign spokesman, Stuart Loeser, accurately described as “there is no problem that higher taxes can’t solve.”

Mr. Ferrer almost seems determined to drive New Yorkers to suburban tax havens like Greenwich, Conn., and the lower-tax cities of the South and West. If enough workers and jobs leave New York City, Mr. Ferrer may just accomplish his “affordable housing” goal after all, because the landlords and sellers will be cutting prices to attract the few people left who will want to live here. Here’s hoping it doesn’t come to that.