5 ms·

I agree completely. Unfortunately the outcome is normally very different when the market has to route around it. Rent control here in SF only affects people in

by pelle 18y ago

I agree completely. Unfortunately the outcome is normally very different when the market has to route around it. Rent control here in SF only affects people in older buildings. One of many unintended consequences of this is the ridiculous state of Tenderloin. Back in Denmark where I own an apartment, rent control forces me to only be able to rent it out as a corporate apartment to foreigners. The official rent would pay less than quarter of the mortgage. No wonder it is hard to find a good apartment in Copenhagen. An example is the market response to the generations of social engineering started as the New Deal, which eventually led us to the very distorted issues we now see in the financial markets. Another example are the costs of health care in the US, that were caused directly by the deductions for employers created in the 40s. Instead of an efficient market, where people picked the most efficient insurance for their situation, it became an arms race of who could offer more benefits together with a bureaucracy to make sure their insured (who don't pay directly) don't abuse the system. Let Richard Branson or any other smart entrepreneur at the health system without the handicap of social engineering and it would be fixed within a year. Rather than fixing it all signs at the moment point towards further regulation and thus further distortion. The market will always route around social engineering no matter to what limits the regulators attempt to control it. The outcomes are rarely as good as if the market was just left to do its job. Of course when this happens like it has so obviously in the current crisis, people talk about it being the fault of the market run wild and want to bring in more regulation, when the regulation it self was what caused it to go wild in the first place.

davidw 18y ago
> Let Richard Branson or any other smart entrepreneur at the health system without the handicap of social engineering and it would be fixed within a year. Where "fixed" means that unprofitable/poor people die of or are crippled by easily and cheaply treatable diseases. That's what a pure market solution would do. Once you start including those people, it's "social engineering".
- pelle 18y ago
  Health care is no different than any other service. If you are able to increase the availability as well as lower the price it helps everyone. Including the poor.
  - davidw 18y ago
    There's always going to be a cutoff point, though, where people are unprofitable. Introducing some market oriented reforms might improve things, but you simply can't get around the fact that in a purely profit-oriented system, some people are not worth the money it would cost to save their lives or reduce their suffering. There are plenty of products where the market drives prices down, but doesn't make them free or available to everyone, and in most cases that's just fine. Some people and some societies take the view that in some way or another, things like food, shelter, and yes, at least basic health care ought to be available to everyone, even if it is not profitable. That's "social engineering".
    - mmmurf 18y ago
      True. I don't think anyone would object to helping the 1% of people who are actually in that category. The problem is that interest groups hijack the programs in order to win handouts for those who don't really need the programs.
      - loumf 18y ago
        Where does this 1% come from? As a back of the envelope calculation, I would guess that almost all senior citizens are unprofitable to insure -- that's way more than 1%. Even if I'm off by a lot, it's still way more than 1% -- and I haven't addressed the rest of the population.
        mmmurf 18y ago
        Only unprofitable if you decide that everyone deserves the latest, greatest, cutting-edge medical care. Healthcare prices have come way down in the past two decades, the issue is that nobody wants 1990 level care, which could be administered at a fraction of the price of delivering all of the latest advancements. The "healthcare costs are rising" meme is false. It's like saying "the price of supercomputers is rising". In non-inflation-adjusted dollars, the top-end supercomputer from IBM costs more than the top-end supercomputer from IBM cost 10 years ago, but the price per unit of computation has gone way down. Healthcare prices have done the same thing, but everyone wants the best possible at all times. (I want this too, but at least I try to appreciate that what I'm getting today is significantly better than 10 years ago)
calambrac 18y ago
I seriously doubt that the situation in the Tenderloin can be blamed squarely on rent control. There's only a small part that's genuinely scary, and that seems almost institutionally embedded at this point. Rent control or not, you're going to have a hard time convincing the affluent to move in next to the SRO's, liquor stores, porn shops, homeless centers, and methodone clinics. I think geography is to blame more than anything - it was completely destroyed in the 1906 earthquake, it's not downtown, not on a hill, and not near the bay (where the wealthy wanted to be), but it was close enough to all these things that the lower class that worked for and entertained the wealthy could set up. Throw in the flight to suburbia that hit most cities after WW2, and it's pretty understandable why that part of town is like it is.

by pelle 18y ago

davidw 18y ago

> Let Richard Branson or any other smart entrepreneur at the health system without the handicap of social engineering and it would be fixed within a year. Where "fixed" means that unprofitable/poor people die of or are crippled by easily and cheaply treatable diseases. That's what a pure market solution would do. Once you start including those people, it's "social engineering".

pelle 18y ago
Health care is no different than any other service. If you are able to increase the availability as well as lower the price it helps everyone. Including the poor.
- davidw 18y ago
  There's always going to be a cutoff point, though, where people are unprofitable. Introducing some market oriented reforms might improve things, but you simply can't get around the fact that in a purely profit-oriented system, some people are not worth the money it would cost to save their lives or reduce their suffering. There are plenty of products where the market drives prices down, but doesn't make them free or available to everyone, and in most cases that's just fine. Some people and some societies take the view that in some way or another, things like food, shelter, and yes, at least basic health care ought to be available to everyone, even if it is not profitable. That's "social engineering".
  - mmmurf 18y ago
    True. I don't think anyone would object to helping the 1% of people who are actually in that category. The problem is that interest groups hijack the programs in order to win handouts for those who don't really need the programs.
    - loumf 18y ago
      Where does this 1% come from? As a back of the envelope calculation, I would guess that almost all senior citizens are unprofitable to insure -- that's way more than 1%. Even if I'm off by a lot, it's still way more than 1% -- and I haven't addressed the rest of the population.
      - mmmurf 18y ago
        Only unprofitable if you decide that everyone deserves the latest, greatest, cutting-edge medical care. Healthcare prices have come way down in the past two decades, the issue is that nobody wants 1990 level care, which could be administered at a fraction of the price of delivering all of the latest advancements. The "healthcare costs are rising" meme is false. It's like saying "the price of supercomputers is rising". In non-inflation-adjusted dollars, the top-end supercomputer from IBM costs more than the top-end supercomputer from IBM cost 10 years ago, but the price per unit of computation has gone way down. Healthcare prices have done the same thing, but everyone wants the best possible at all times. (I want this too, but at least I try to appreciate that what I'm getting today is significantly better than 10 years ago)

calambrac 18y ago

I seriously doubt that the situation in the Tenderloin can be blamed squarely on rent control. There's only a small part that's genuinely scary, and that seems almost institutionally embedded at this point. Rent control or not, you're going to have a hard time convincing the affluent to move in next to the SRO's, liquor stores, porn shops, homeless centers, and methodone clinics. I think geography is to blame more than anything - it was completely destroyed in the 1906 earthquake, it's not downtown, not on a hill, and not near the bay (where the wealthy wanted to be), but it was close enough to all these things that the lower class that worked for and entertained the wealthy could set up. Throw in the flight to suburbia that hit most cities after WW2, and it's pretty understandable why that part of town is like it is.