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I don't think there is an alternative to free markets, but I do believe that we can use the power of government to set price floors. For example let's say the g

I don't think there is an alternative to free markets, but I do believe that we can use the power of government to set price floors. For example let's say the government provides free housing for all citizens regardless of means testing. It doesn't have to be great housing, but it establishes a price floor that all landlords have to compete with by offering better housing or lowering their rents. No fear of homelessness, starvation, or death by uninsured illness also establishes a labor floor. People can take more time for a job search, or quit jobs that are exploitative/pay poorly. The government doesn't have to mandate a minimum wage, since jobs now must offer something more than a day-to-day subsistence. With advances in productivity we are more than capable of doing this but we allocate capital to other things in pursuit of profit. Think of how much capital was poured into web3 speculation that could have been used to actually establish a price floor for housing or a wage floor for labor.

lazide 4y ago
Why would a landlord participate, or instead move to a more profitable outlet for their effort and capital? If even after that there isn’t enough housing (say it’s a desirable area so people want to move in), who is going to build it? I’ve seen it work short term where there is existing stock built under a different scheme that can be ‘locked in’ to this. But then it quickly goes to a different kind of broken, where housing is ‘cheap’ but impossible to find unless you can get a friend to (usually illegally) sublet. The issue for a long time has been the fed printing money with pretty much no interrupting since ‘01. When they tried to take a break around ‘05 things got bad by ‘08 and they turned it on even higher. When money is cheap, people do steadily riskier and riskier things until it explodes. Then money has to get more expensive to help rein in the stupidity. So we’ll likely see housing get more affordable again for a bit. If we really wanted cheap housing, we need decently high interest rates. Here is the fed funds rate chart [https://fred.stlouisfed.org/series/FEDFUNDS https://fred.stlouisfed.org/series/FEDFUNDS] Here is the case Schiller housing price index [https://fred.stlouisfed.org/series/CSUSHPISA https://fred.stlouisfed.org/series/CSUSHPISA] When money is cheap, people try to make more money by buying and leveraging assets. Homeowners do the same thing, though they usually don’t realize it. That pushes demand and prices up. After all, people will buy more when it’s ‘cheap’, and that is based off the monthly loan servicing costs - aka interest rate, in large part.
- softcactus 4y ago
  The free housing I am referring to is housing built and owned by the government. Landlords are participating in the market because they have to rent apartments to make money. Look at Vienna's housing model if you want to see a successful example of this. I am aware that cheap Fed money keeps our markets propped up with speculative investing. My point is that food, housing, and medicine are not constrained by financial bottlenecks, it's a matter of political will. If we wanted to provide food, shelter, and medicine for all of our citizens for free we easily could. However that would reduce profit margins as labor costs would rise in an already relatively (compared to the developing world) labor market. Free housing could be provided but it would be detrimental to REITs and banks who provide mortgages, so we don't actually want to solve the problem.
  - lazide 4y ago
    Ah, but have you lived in a government housing project before? I have friends who have, and it replaces a tense landlord relationship with a overbearing, bureaucratic dystopia where attempts to escape (say by saving money for a reserve fund or to afford to move to a better place) are actively criminalized. In any larger scale system, it inevitably results in severe restrictions on things normal people do regularly on pain of eviction (such as smoking weed, or having a boyfriend!), after already requiring they have minimal savings and income below some threshold (see above), which inevitably leads to abuse by whichever civil servant or subcontractor is actually running it. It’s basically replacing a landlord who you could at least plausibly ‘fire’ at the end of the lease with an appointed bureaucrat or lowest-bidder who you can’t. Lack of political will is just a way of saying ‘when the rubber hits the road, no one is willing to pay for it or interested enough to make it happen’. Which hey, maybe. But in my experience these are for reasons that require time and expertise to understand, and often boil down to ‘the people/society involved couldn’t make it work’. If you can lead a successful effort to make something better work, be my guest! But like kids caught in the middle of a nasty divorce, wishing they liked each other isn’t going to change it, and the folks most impacted by it are usually helpless to do anything but get the brunt of the terrible outcomes. Those markets in Vienna yiu mention - by any chance are the current landlords the ones who were also there when they passed these rules, so were stuck? Or got into it via inheritance? Or perhaps they have long standing ties to the community and are doing it because it may not make them money, but helps them in other ways? Does Vienna have a decent safety net and a coherent social identity so that folks (both giving and receiving) feel they’re helping out ‘one of theirs’, and people aren’t likely to abuse the system?

lazide 4y ago

Why would a landlord participate, or instead move to a more profitable outlet for their effort and capital? If even after that there isn’t enough housing (say it’s a desirable area so people want to move in), who is going to build it? I’ve seen it work short term where there is existing stock built under a different scheme that can be ‘locked in’ to this. But then it quickly goes to a different kind of broken, where housing is ‘cheap’ but impossible to find unless you can get a friend to (usually illegally) sublet. The issue for a long time has been the fed printing money with pretty much no interrupting since ‘01. When they tried to take a break around ‘05 things got bad by ‘08 and they turned it on even higher. When money is cheap, people do steadily riskier and riskier things until it explodes. Then money has to get more expensive to help rein in the stupidity. So we’ll likely see housing get more affordable again for a bit. If we really wanted cheap housing, we need decently high interest rates. Here is the fed funds rate chart [https://fred.stlouisfed.org/series/FEDFUNDS https://fred.stlouisfed.org/series/FEDFUNDS] Here is the case Schiller housing price index [https://fred.stlouisfed.org/series/CSUSHPISA https://fred.stlouisfed.org/series/CSUSHPISA] When money is cheap, people try to make more money by buying and leveraging assets. Homeowners do the same thing, though they usually don’t realize it. That pushes demand and prices up. After all, people will buy more when it’s ‘cheap’, and that is based off the monthly loan servicing costs - aka interest rate, in large part.

softcactus 4y ago
The free housing I am referring to is housing built and owned by the government. Landlords are participating in the market because they have to rent apartments to make money. Look at Vienna's housing model if you want to see a successful example of this. I am aware that cheap Fed money keeps our markets propped up with speculative investing. My point is that food, housing, and medicine are not constrained by financial bottlenecks, it's a matter of political will. If we wanted to provide food, shelter, and medicine for all of our citizens for free we easily could. However that would reduce profit margins as labor costs would rise in an already relatively (compared to the developing world) labor market. Free housing could be provided but it would be detrimental to REITs and banks who provide mortgages, so we don't actually want to solve the problem.
- lazide 4y ago
  Ah, but have you lived in a government housing project before? I have friends who have, and it replaces a tense landlord relationship with a overbearing, bureaucratic dystopia where attempts to escape (say by saving money for a reserve fund or to afford to move to a better place) are actively criminalized. In any larger scale system, it inevitably results in severe restrictions on things normal people do regularly on pain of eviction (such as smoking weed, or having a boyfriend!), after already requiring they have minimal savings and income below some threshold (see above), which inevitably leads to abuse by whichever civil servant or subcontractor is actually running it. It’s basically replacing a landlord who you could at least plausibly ‘fire’ at the end of the lease with an appointed bureaucrat or lowest-bidder who you can’t. Lack of political will is just a way of saying ‘when the rubber hits the road, no one is willing to pay for it or interested enough to make it happen’. Which hey, maybe. But in my experience these are for reasons that require time and expertise to understand, and often boil down to ‘the people/society involved couldn’t make it work’. If you can lead a successful effort to make something better work, be my guest! But like kids caught in the middle of a nasty divorce, wishing they liked each other isn’t going to change it, and the folks most impacted by it are usually helpless to do anything but get the brunt of the terrible outcomes. Those markets in Vienna yiu mention - by any chance are the current landlords the ones who were also there when they passed these rules, so were stuck? Or got into it via inheritance? Or perhaps they have long standing ties to the community and are doing it because it may not make them money, but helps them in other ways? Does Vienna have a decent safety net and a coherent social identity so that folks (both giving and receiving) feel they’re helping out ‘one of theirs’, and people aren’t likely to abuse the system?