this post was submitted on 07 Dec 2023
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[–] SCB 2 points 11 months ago* (last edited 11 months ago) (1 children)

The point was to make a quick joke and introduce some levity.

Schools of economic theory no longer exist, in practice - though, post-covid, some new divisions are beginning to arise. Where they aren't arising is in the efficacy of rent control.

Rent control criticisms aren't "Austrian school" - they're just economic orthodoxy. We have tons of data, we've seen the impacts.

In my experience, people mostly argue their support rent control emotionally. They assume that wanting to do away with rent control means lack of empathy for the poor or not wanting the government to assist the poor in being housed, which is the exact opposite of how critics of rent control actually feel.

I want people housed and fed. I support initiatives that work, like just giving poor people cash. Our disagreement is in how effective different programs are, which is why I don't understand the hostility.

I responded to the hostility with a light joke, in an effort to defuse it. You don't need to agree with me, and you're free to hold a counter-opinion, but calling me a "piss drinker" is absurd, so you get some absurdity as a response.

[–] [email protected] 0 points 11 months ago* (last edited 11 months ago) (1 children)

Given that you claim schools of economic theory no longer exist, hypotheticals should prove useful (this is a silly thing to say).

Let's say you do ascribe to the theory that UBI under democratic socialism is an effective means of decreasing human suffering. What would stop landlords from simply increasing rents in proportion to incomes, as they are seen to do in places like SF, LA, and Seattle for example?

A policy reccomendation like a land value tax is something I think may possibly enable said ideological position, but you don't appear to be advocating for that.

Also, claiming that critics of rent control universally "feel" bad for the people they are rent seeking from is a strange position.

Opponents of rent control include the most dastardly machinations of corporate rent seeking. Opponents of rent control include real estate speculators who benefit from ever increasing property values due to artificial scarcity. Opponents of rent control include bloodthirsty businessmen who seek to pay unlivable wages lest the poorest worker be made homeless by the reserve army of labor.

Rent control makes it such that the only way a developer may increase their profits is to build more housing, a thing I believe you want to have happen.

You claim to talk about economic orthodoxy, yet you haven't even read Adam Smith?

There is a real difference between classical economics and neoclassical economics, and the disagreements between Smith and modern economists is one of the best examples of this contradiction.

So what gives? Where's the piss?

To quote the economist J.W mason from this article (its not dense like the smith quote, I swear) from 2019... In direct response to articles like the ones you quoted from the 70s and the 90s.

https://jwmason.org/slackwire/considerations-on-rent-control/

Among economists, rent regulation seems be in similar situation as the minimum wage was 20 years ago. At that time, most economists took it for granted that raising the minimum wage would reduce employment. Textbooks said that it was simple supply and demand — if you raise the price of something, people will buy less of it. But as more state and local governments raised minimum wages, it turned out to be very hard to find any negative effect on employment. This was confirmed by more and more careful empirical studies. Today, it is clear that minimum wages do not reduce employment. And as economists have worked to understand why not, this has improved our theories of the labor market. Rent regulation may be going through a similar evolution today. You may still see textbooks saying that as a price control, rent regulation will reduce the supply of housing. But as the share of Americans renting their homes has increased, more and more jurisdictions are considering or implementing rent regulation. This has brought new attention from economists, and as with the minimum wage, we are finding that the simple supply-and-demand story doesn’t capture what happens in the real world. A number of recent studies have looked at the effects of rent regulations on housing supply, focusing on changes in rent regulations in New Jersey and California and the elimination of rent control in Massachusetts. Contrary to the predictions of the simple supply-and-demand model, none of these studies have found evidence that introducing or strengthening rent regulations reduces new housing construction, or that eliminating rent regulation increases construction. Most of these studies do, however, find that rent control is effective at holding down rents.

EDIT_01: also, the hostility is because not everybody is a bystander in arguments like this. Some people are forced to live a grusome and crushing existence under our system of landlords rights to profit over peoples right to live.

EDIT_02: typos, apologies

[–] SCB 2 points 11 months ago* (last edited 11 months ago)

First, let's just own this - there's nothing inherently bad about landlords. That shit is meme-tier crap. Landlords have incentive to provide more, clean, livable housing. You take that shit away and you get project housing. Republicans exist. All the good intentions in the world mean jack shit when you can't guarantee Republicans don't just fuck everyone in the mouth.

That being said, building straight up projects everywhere and having the State run them would literally be better than rent control. It would be more effective, would immediately provide supply, and would aid the poorest. Problems there are, we have a small window before the GOP just nukes the program from orbit, and we'd have to find places willing to build that housing

Those are both significant challenges.

Secondly, yeah LVTs are dope. In my fantasy world, we gut zoning regs, build dense, maximize public transport, and pass a LVT as well as additional taxes on suburbs to cover their externalities. I say this while living in a suburb.

But that's a fantasy world. The real world requires us to make good decisions to claw for progress because 30+% of the country believes at least some aspect of QAnon and like 80% of Republican voters say the 2020 election was stolen. These are not serious people and they are not serious about solutions.

Rent control is a bad idea right now because it provably raises rents across the area that aren't controlled, lowers quality of housing because why would a landlord give a shit about doing a good job, suppresses building new housing, and will basically make every possible aspect of this bad situation worse for everyone involved.

Rent control makes it such that the only way a developer may increase their profits is to build more housing, a thing I believe you want to have happen.

Not only is this effect not seen worldwide, because of the obvious disincentive of low profitability compared to difficulty in permitting, building restrictions, etc, rates are the highest in decades, further exacerbating that disincentive. Rent control will stifle building when we are already facing an uphill climb

I agree there's a lot of noise on the system - which, honestly, is being extremely charitable to the bias of that economist writing an opinion piece that, at minimum, plays down his own understanding of the noise. He's not dumb enough to miss that things like min wage arent distortionary because min wage is on the fucking ground and wages were suppressed prior to 2020 due to excess of labor. Rising wages and lots of savings, combined with pent up demand, was the initial cause of our inflation. These are basic economic truths.

This current housing crisis exists because we can't build enough housing of any type to keep up with demand. The noise in the system he knows he is describing is because of already-distorted markets, same as wages.

We have other options. We should use them. State govs need to change their laws so local towns can't block necessary projects. We need to remove restrictions on density everywhere the ground is stable enough. We need to gentrify the entire damn country, to use hyperbolic language for effect.

These are solvable problems, and it is borne out by evidence that rent control is among the worst proposed solutions. I'd literally rather the gov just pay the difference until housing can go up.

Additionally, stop this kinda shit.

You claim to talk about economic orthodoxy, yet you haven’t even read Adam Smith?

I clearly know wtf I'm talking about. I just disagree with you.

The idea that, because I oppose rent control, im either ignorant or don't give a shit about the poor is offensive, and quite dumb. I've been that person. Ive dedicated my entire adult life to helping people get out of the situation I was in. I most assuredly care.