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Market forces are real, but can be regulated to align with our priorities. It's not a matter of explaining "how the world works." The market works how we design

Market forces are real, but can be regulated to align with our priorities. It's not a matter of explaining "how the world works." The market works how we design it to work. If it is unregulated, it frequently reflects exploitation. You make a quip about engineers and political theorists, but fail to explain why a market cannot be regulated in order to benefit society in general. We do it all the time.

rayiner 6y ago
Regulation doesn't change market forces. Regulation adds additional elements which in combination with the market forces moves the market to a different equilibrium. It's like pushing on a balloon--you can't change the physics, but you pushing on the balloon in different ways will produce different results dictated by those physics. The difference between those two views of the world is the difference between political theorists and engineers. A political theorist asks questions like "how do you justify your priorities?" An engineer asks "how much do I have to give up on this one priority in order to achieve this other priority?" Engineers deal with a world where achieving every priority means giving up some other priority. Applying this logic to your statement exposes the flow: "The solution is there if you are willing to reduce the wealth generated by investment properties for an already much wealthier investment class." Sure, things like price control prioritize affordability at the expense of "wealth generated by investment properties." If that was it nobody would argue against price control. So why do so many people oppose price controls? (The answer is not, I'm sorry to say, that many people simply want owners of investment properties to be rich.) See: https://www.brookings.edu/research/what-does-economic-evidence-tell-us-about-the-effects-of-rent-control/ https://www.brookings.edu/research/what-does-economic-eviden... > Rent control appears to help affordability in the short run for current tenants, but in the long-run decreases affordability, fuels gentrification, and creates negative externalities on the surrounding neighborhood. These results highlight that forcing landlords to provide insurance to tenants against rent increases can ultimately be counterproductive.

rayiner 6y ago

Regulation doesn't change market forces. Regulation adds additional elements which in combination with the market forces moves the market to a different equilibrium. It's like pushing on a balloon--you can't change the physics, but you pushing on the balloon in different ways will produce different results dictated by those physics. The difference between those two views of the world is the difference between political theorists and engineers. A political theorist asks questions like "how do you justify your priorities?" An engineer asks "how much do I have to give up on this one priority in order to achieve this other priority?" Engineers deal with a world where achieving every priority means giving up some other priority. Applying this logic to your statement exposes the flow: "The solution is there if you are willing to reduce the wealth generated by investment properties for an already much wealthier investment class." Sure, things like price control prioritize affordability at the expense of "wealth generated by investment properties." If that was it nobody would argue against price control. So why do so many people oppose price controls? (The answer is not, I'm sorry to say, that many people simply want owners of investment properties to be rich.) See: https://www.brookings.edu/research/what-does-economic-evidence-tell-us-about-the-effects-of-rent-control/ https://www.brookings.edu/research/what-does-economic-eviden... > Rent control appears to help affordability in the short run for current tenants, but in the long-run decreases affordability, fuels gentrification, and creates negative externalities on the surrounding neighborhood. These results highlight that forcing landlords to provide insurance to tenants against rent increases can ultimately be counterproductive.