7 ms·

the rent, as always: https://en.wikipedia.org/wiki/Law_of_rent https://en.wikipedia.org/wiki/Law_of_rent and the companies do not want to compete: most modern

the rent, as always: https://en.wikipedia.org/wiki/Law_of_rent https://en.wikipedia.org/wiki/Law_of_rent and the companies do not want to compete: most modern large companies only exist as a _vehicle for investment_, and as such compete for shareholders, not consumers. Due to this, short-termism dominates: average CEO stays 4 years at a given company, and performance of the company after they leave is largely uncorrelated with their carreer success, while share prices during tenure actually does. So they'll suck the blood from us, crash everything, and get a raise when politicians ask them very nicely to try and fix it. And while share prices will go down on the S&P, billionaires will gte richer, and hedges will make bank...

willis936 3y ago
I'm not familiar with the law of rent, but it does not seem accurate. Right now blue collar workers can't afford to rent within a 60 minute commute to Boston, where they are not paid a wage that justifies that commute. Why would you cook or clean in Boston when you could do it literally anywhere else in MA without the commute? I guess my point is that markets continually prove to not be rational. Maybe a philosopher hundreds of years ago imagined they could be, but that's not how things are shaking out.
- codeflo 3y ago
  Why do you believe this to be a market failure?
  - barney54 3y ago
    Just for sake of argument, let’s say it is market failure. But what will correct it first, the market or a new law passed by Congress?
    - prepend 3y ago
      Is no one cleaning in Boston? It seems pretty easy to test whether it’s a market failure (ie, there are no cleaners cleaning in Boston). I think if you ask anything vs “new law passed by Congress” I’m going with anything. So at least the invisible hands will eventually solve this problem by raising cleaner pay until someone is willing to commute 60 minutes (note that was my commute in a larger metro area on programmer pay) or cleaners can afford closer.
- HPsquared 3y ago
  In the case of the Boston cleaner, that seems to indicate the living costs can also drive salary. If nobody applies to work somewhere, the wages either go up or the job goes unfilled.
  - willcipriano 3y ago
    When then starts happening the politicians start screaming about how we need more immigrants (who are willing to live 5 to a 1 bedroom apartment and suffer a brutal commute).
  - sobkas 3y ago
    > In the case of the Boston cleaner, that seems to indicate the living costs can also drive salary. If nobody applies to work somewhere, the wages either go up or the job goes unfilled. When one job salary doesn't cover living costs, you are more likely forced to have two or three, not a raise in your current one. It also solves problem of unfilled jobs. Because there are cases when job is only economically feasible if performed in urban area with high population density, so you can't really change your location.
- greenfield1 3y ago
  > Why would you cook or clean in Boston when you could do it literally anywhere else in MA without the commute? Because that's where you have your social connections. Friends, family. That's where your home is, your parents lived there, your grandparents lived there, you grew up there. And you hold out for better times. And that's why you can be exploited like that. That's the "not rational" part. The humans participating in the market are not "rational", for some odd definition of the word. But if you think through motivations, they are rational, if you put value in the reasons why people do this kind of job in this kind of situation.
  - willis936 3y ago
    No the "not rational" part is that wages are not commensurate with cost of living increase because short term thinking yielding record profit margins is addictive. Workers are leaving because they can't afford it, not because they want to stratify their families and leave their homes. For those thinking this is the market successfully working: has the market successfully worked in the Bay Area? How does SF look right now?
    - greenfield1 3y ago
      > No the "not rational" part is that wages are not commensurate with cost of living increase because short term thinking yielding record profit margins is addictive. Wages are where the two parties met. It's high enough so the seller of the good (employee) is ok with selling and it's low enough so the buyer of the good (employer) is ok with buying. As long as they do business with each other, they are apparently both deciding, rationally, that this is an acceptable deal. Better than the alternative. > Workers are leaving because they can't afford it, not because they want to stratify their families and leave their homes. Great that they are leaving! They should be leaving! Cause then, and only then, will businesses be driven closer to raising wages since the sweet spot in the above equilibrium moves upwards. > For those thinking this is the market successfully working: has the market successfully worked in the Bay Area? How does SF look right now? Well in the Bay Area, the market is highly distorted. Lots of NIMBY zoning rules preventing high density housing being built. People sitting on detached homes because they can't afford to move. This heavily distorts housing costs which then impacts salaries since all those tech workers need to live somewhere. Big tech and VC-funded not-as-big tech is floating in money, so can afford to push salaries/compensation higher and higher. It's the market, but it's not pretty and it's heavily distorted.
listenallyall 3y ago
The problem with your (and many others) "short-term thinking" argument is that the assumed long-term consequences -- you wrote "crash everything" -- doesn't happen. We went from 2008 to now, 15 years, with corporate profits and stock prices zooming straight up. Even shutting down the globe was just a temporary blip. Highly aggressive corporate activity, massive expansion of economic inequality, yet the longest non-recessionary period in this country's history.
- jaggederest 3y ago
  > the assumed long-term consequences [...] doesn't happen. It's not the fall that kills you, it's the sudden stop at the end. I would hesitate before saying anything categorical.
  - listenallyall 3y ago
    I'm not claiming there will never be another downturn -- of course there will be -- but the fact that we just went through the longest non-recessionary period in this country's history, despite all the "short-termism" already indicates at least some flaws in the original hypothesis
    - jaggederest 3y ago
      I would question whether the measure we should be concerned with is "recession or not" - everything can be getting worse while simultaneously corporate profits are high. That's kind of by definition what short-term thinking gets you - cash in hand but ruined infrastructure and societal safety nets.
      - listenallyall 3y ago
        You can always find negative things if you go looking for them. The reason people care so much about "income inequality" rather than "poverty rates" is that poverty has declined dramatically around the globe. So doom-and-gloomers shifted the goalposts and ignore successful results. You can't accuse corporate CEOs of short-term thinking and then use infrastructure and "societal safety nets" as the measurements -- CEOs are responsible for the success of their company, not of the well-being of an entire society, that's the government's job.
andrepd 3y ago
>the rent, as always: https://en.wikipedia.org/wiki/Law_of_rent https://en.wikipedia.org/wiki/Law_of_rent And regarding efficient and just taxes: https://en.m.wikipedia.org/wiki/Land_value_tax https://en.m.wikipedia.org/wiki/Land_value_tax and https://en.m.wikipedia.org/wiki/Georgism https://en.m.wikipedia.org/wiki/Georgism It's amazing how people have figured this out in the 19th and 20th centuries yet we're still arguing with bunk neoliberal economics today.
refurb 3y ago
Yet rents dropped by 20% during Covid in San Francisco. Seems like companies and landlords do compete on price.

willis936 3y ago

I'm not familiar with the law of rent, but it does not seem accurate. Right now blue collar workers can't afford to rent within a 60 minute commute to Boston, where they are not paid a wage that justifies that commute. Why would you cook or clean in Boston when you could do it literally anywhere else in MA without the commute? I guess my point is that markets continually prove to not be rational. Maybe a philosopher hundreds of years ago imagined they could be, but that's not how things are shaking out.

codeflo 3y ago
Why do you believe this to be a market failure?
- barney54 3y ago
  Just for sake of argument, let’s say it is market failure. But what will correct it first, the market or a new law passed by Congress?
  - prepend 3y ago
    Is no one cleaning in Boston? It seems pretty easy to test whether it’s a market failure (ie, there are no cleaners cleaning in Boston). I think if you ask anything vs “new law passed by Congress” I’m going with anything. So at least the invisible hands will eventually solve this problem by raising cleaner pay until someone is willing to commute 60 minutes (note that was my commute in a larger metro area on programmer pay) or cleaners can afford closer.
HPsquared 3y ago
In the case of the Boston cleaner, that seems to indicate the living costs can also drive salary. If nobody applies to work somewhere, the wages either go up or the job goes unfilled.
- willcipriano 3y ago
  When then starts happening the politicians start screaming about how we need more immigrants (who are willing to live 5 to a 1 bedroom apartment and suffer a brutal commute).
- sobkas 3y ago
  > In the case of the Boston cleaner, that seems to indicate the living costs can also drive salary. If nobody applies to work somewhere, the wages either go up or the job goes unfilled. When one job salary doesn't cover living costs, you are more likely forced to have two or three, not a raise in your current one. It also solves problem of unfilled jobs. Because there are cases when job is only economically feasible if performed in urban area with high population density, so you can't really change your location.
greenfield1 3y ago
> Why would you cook or clean in Boston when you could do it literally anywhere else in MA without the commute? Because that's where you have your social connections. Friends, family. That's where your home is, your parents lived there, your grandparents lived there, you grew up there. And you hold out for better times. And that's why you can be exploited like that. That's the "not rational" part. The humans participating in the market are not "rational", for some odd definition of the word. But if you think through motivations, they are rational, if you put value in the reasons why people do this kind of job in this kind of situation.
- willis936 3y ago
  No the "not rational" part is that wages are not commensurate with cost of living increase because short term thinking yielding record profit margins is addictive. Workers are leaving because they can't afford it, not because they want to stratify their families and leave their homes. For those thinking this is the market successfully working: has the market successfully worked in the Bay Area? How does SF look right now?
  - greenfield1 3y ago
    > No the "not rational" part is that wages are not commensurate with cost of living increase because short term thinking yielding record profit margins is addictive. Wages are where the two parties met. It's high enough so the seller of the good (employee) is ok with selling and it's low enough so the buyer of the good (employer) is ok with buying. As long as they do business with each other, they are apparently both deciding, rationally, that this is an acceptable deal. Better than the alternative. > Workers are leaving because they can't afford it, not because they want to stratify their families and leave their homes. Great that they are leaving! They should be leaving! Cause then, and only then, will businesses be driven closer to raising wages since the sweet spot in the above equilibrium moves upwards. > For those thinking this is the market successfully working: has the market successfully worked in the Bay Area? How does SF look right now? Well in the Bay Area, the market is highly distorted. Lots of NIMBY zoning rules preventing high density housing being built. People sitting on detached homes because they can't afford to move. This heavily distorts housing costs which then impacts salaries since all those tech workers need to live somewhere. Big tech and VC-funded not-as-big tech is floating in money, so can afford to push salaries/compensation higher and higher. It's the market, but it's not pretty and it's heavily distorted.

listenallyall 3y ago

The problem with your (and many others) "short-term thinking" argument is that the assumed long-term consequences -- you wrote "crash everything" -- doesn't happen. We went from 2008 to now, 15 years, with corporate profits and stock prices zooming straight up. Even shutting down the globe was just a temporary blip. Highly aggressive corporate activity, massive expansion of economic inequality, yet the longest non-recessionary period in this country's history.

jaggederest 3y ago
> the assumed long-term consequences [...] doesn't happen. It's not the fall that kills you, it's the sudden stop at the end. I would hesitate before saying anything categorical.
- listenallyall 3y ago
  I'm not claiming there will never be another downturn -- of course there will be -- but the fact that we just went through the longest non-recessionary period in this country's history, despite all the "short-termism" already indicates at least some flaws in the original hypothesis
  - jaggederest 3y ago
    I would question whether the measure we should be concerned with is "recession or not" - everything can be getting worse while simultaneously corporate profits are high. That's kind of by definition what short-term thinking gets you - cash in hand but ruined infrastructure and societal safety nets.
    - listenallyall 3y ago
      You can always find negative things if you go looking for them. The reason people care so much about "income inequality" rather than "poverty rates" is that poverty has declined dramatically around the globe. So doom-and-gloomers shifted the goalposts and ignore successful results. You can't accuse corporate CEOs of short-term thinking and then use infrastructure and "societal safety nets" as the measurements -- CEOs are responsible for the success of their company, not of the well-being of an entire society, that's the government's job.

andrepd 3y ago

>the rent, as always: https://en.wikipedia.org/wiki/Law_of_rent https://en.wikipedia.org/wiki/Law_of_rent And regarding efficient and just taxes: https://en.m.wikipedia.org/wiki/Land_value_tax https://en.m.wikipedia.org/wiki/Land_value_tax and https://en.m.wikipedia.org/wiki/Georgism https://en.m.wikipedia.org/wiki/Georgism It's amazing how people have figured this out in the 19th and 20th centuries yet we're still arguing with bunk neoliberal economics today.

refurb 3y ago

Yet rents dropped by 20% during Covid in San Francisco. Seems like companies and landlords do compete on price.