How did we create a society where we can’t afford to live in our own country?

http://blogs.harvard.edu/philg/2017/10/24/how-did-we-create-a-society-where-we-cant-afford-to-live-in-our-own-country/

by wslh • 9 years ago

212 242 9 years ago

blogs.harvard.edu

dannyw• 9 years ago

Just like student loans created the monster of exponentially rising college tutiton, it seems reasonable to suspect housing subsidies as a big cause of unaffordable housing (in addition to perhaps zoning laws).

freedomben2• 9 years ago

Agreed. Also not helped by sustained low interest rates.

crashedsnow• 9 years ago

It's confusing that it seems like more than 1% of the population in a given area are buying houses that demand you're in the 1% of income to be able to afford; until you realize there are no restrictions (or easily circumvented ones) on foreign ownership. There are LOTS of wealthy people in the world.

diogenescynic4• 9 years ago

Has way more to do with lack of new development and the massive increase in costs to build new homes because of ridiculous housing laws. Look at all the cities with high housing prices and look at how few of homes they built in the last 30 years.

pixl973• 9 years ago

By not allowing a housing collapse to occur when it should have.

freedomben2• 9 years ago

I agree. It's better to bring the pain now, than delay it later when it's much more intense.

It would also be great if we would quit blowing huge bubbles in the market with poor monetary policy and attempted centralized control of something we don't understand.

TheSpiceIsLife2• 9 years ago

A housing collapse hurts and could have unintended consequences.

There's no guarantee that allowing a collapse to happen would be better than what we have now. It's a very blunt instrument of economic management.

There may be other ways to sort out the problem. I believe we should focus on those.

opportune2• 9 years ago

What was done to prevent a housing collapse? I am under the impression the government focused on preventing a banking institution collapse, which is different. That money was given to offset the liabilities caused by the housing collapse. If Bob was foreclosed, he was foreclosed because he didn't make his payments, at which point his house was put on the market. The banks collapsing wouldn't put more houses on the market than before, it would just mean that a different financial holding company would be selling the houses. So to prevent a housing collapse the government would have to make it easier for Bob to make his payments, but as far as I know the government didn't do that.

Or perhaps you are talking about something other than the bailout like interest rates, in which case I would still be curious what you think would have caused the collapse

derefr3• 9 years ago

My understanding: the government themselves bought a large portion of the housing CDOs (i.e. people's mortgages) from the banks during the credit freeze, to both give the banks money, and give the CDOs a value to get them trading again.

If the government had not done that, and had instead just given the banks money, the banks would have had the breathing room to sell their CDOs off for pennies on the dollar, devaluing the mortgages and thus the properties themselves.

exabrial3• 9 years ago

"affordable housing without a government subsidy is becoming extinct."

Was recently in LA, had a very excited Uber driver tell he just bought a house near Topeka, KS and it was 4 bed, 3 bath, unfinished basement, 2 car garage for $95k, on a 3/4 acre. He was extremely excited about moving. That's a massive house. There is plenty of cheap housing elsewhere in the USA, you have to be willing relocate.

The title should be "How did relatively small areas in California in the grand scheme of the USA make housing so expensive most people can't live there?"

Top19• 9 years ago

Local control of housing and zoning should be taken away and placed at the State level or above. Over time that will probably become just as corrupt and it will need to revert to the local level again. I am amazed what people will complain about on my Nextdoor group. There is not one ounce of sacrifice in these people for even a 30 second increase in traffic or a change in the student:teacher ratio from 21:1 to 21.3:1. Maybe we’d have more money for schools if we didn’t keep having to deal with all the externalities developed by expensive housing and long commutes.

Reminds me of that lady in SF who opposed a housing development recently because she said it blocked the sunlight to her zucchini garden. Now many YIMBY groups are adopting the zucchini as their logo...

xapata2• 9 years ago

That lady may have purchased her place in order to have a sunlit garden. It's frustrating there's not an easy way for that housing development to simply compensate the gardener fairly for her loss of sunlight, along with everyone else nearby who is adversely affected. Of course, she could also be charged a fee for the benefits of increasing density -- more restaurant options, etc. -- according to how much she appreciates them. It's tough to calculate these things.

So many aspects of our society seem forced to either-or situations when some compromise would benefit all parties more.

whyenot• 9 years ago

I'm not sure it's a good idea to take away local control of zoning and other planing just because the result is something that YIMBY groups don't like. There is something very undemocratic about doing that. More housing and more density doesn't always make communities better. The people who live in an area, are voting in local elections and are paying local taxes should have a say in how their communities develop. Shouldn't they? Isn't that how our system of government is supposed to work?

I mean I empathize with the YIMBY point of view -- I make about $56,00 a year as staff at a state university. That's right on the edge in the bay area. There will come a time when I can no longer afford to live here. I'm OK with that. That's how the market works. I don't think you have a right to live in San Francisco, or Malibu, or Los Gatos, etc. if you can't afford to live there. Everyone can't own a Ferrari. Everyone doesn't get to live where they want to.

jseliger• 9 years ago

That's true and Tokyo is a good example of this: https://www.vox.com/2016/8/8/12390048/san-francisco-housing-...

downrightmike• 9 years ago

Zoning would be the ultimate gerrymandering. Don't like your voters? Not only can you define specific areas to give your party the advantage, but you can now control who lives there, if anyone does at all.

tdb7893• 9 years ago

I think a lot of it is that pay scales on cost of living. It allows prices to go to crazy amounts and also disincentives moving to cheaper areas. If pay didn't scale on cost of living then tons of people would move from those high cost areas. I'm making 70k a year but I'm putting 14k into my 401k and investing an additional 14k each year (saving up for a down payment on a house) and that's while having hobbies and travelling some

derefr3• 9 years ago

"Affordable housing" implies that there is a job at the destination that can pay a wage that can pay the mortgage. Sure, $95k isn't a lot—but what do jobs in Topeka pay, and how many of them are there?

kasey_junk• 9 years ago

Following the ‘normal’ 3x wage, gets you an anticipated 32k needed yearly income.

For a double income family that’s right around the federal minimum wage.

Now minimum wage jobs don’t actually support a house of that price due to health care, child care, crap hours, etc. but the idea that there aren’t jobs that allow you to easily buy that house in Topeka is ridiculous. To the point where I want to say “leave California” to you.

ryanx435• 9 years ago

This, my friends,is a prime example of coastal elitism.

Does derefr really think that there are no jobs in the capital city of Kansas that pay enough to afford a house under 100k? Not a single job?

Lol.

Edit: Ha ha downvotes for pointing out that high paying jobs exist outside of California. Nice.

justherefortart• 9 years ago

I make roughly 80% of what I did as a software engineer in Oklahoma that I did in San Francisco.

My life is exponentially better. I hate the politics here but I hated them in SF as well. Seems there's no middle ground for someone that's moderate, just extremes on both sides.

My mortgage is roughly the same as a parking space in SF, and yes I have to live in Oklahoma. I'll cry myself to sleep on my yearly european vacations, rental properties, retirement accounts and working every other year at most while doing my own self funded startups.

pxeboot2• 9 years ago

I was (and still am) amazed at how cheap housing was when I started looking away from the West coast. While places with really depressed home prices likely don't have any jobs, there are still plenty of cities with growing economies and cheap housing. I moved to Texas last year and meet people all the time that moved here specifically for the low cost of housing.

Teknoman117• 9 years ago

We've actually had a few people where I work transfer to the Texas office because they wanted to buy a house. Can't say I haven't thought about it myself to be honest.

justboxing• 9 years ago

Topeka, KS.

Almost all the jobs I see in Topeka are in retail "Sales Associates" = glorified title for minimum wage jobs. https://www.google.com/search?q=Topeka,+KS+jobs&oq=Topeka,+K...

How does this cabbie intend to make a good wage so he can continue to live in his huge house? Or does he not care, since he bought a HUGE house for $ 95K -- assuming it was all cash. If not, he has a mortgage to pay like everyone else, once a month.

astura2• 9 years ago

Not to mention huge houses have significant ongoing costs - maintenance, insurance, utilities, repairs, taxes, HOA fees, etc. Even if you owned your house free and clear you need cash flow to be able to keep it.

QuantumYeti• 9 years ago

Are you being sarcastic? Of course all the jobs in Topeka, KS aren't minimum wage. He probably plans on getting one of those. Just like everybody else who lives in a decent sized (not huge) house in Topeka, KS.

charcoal233• 9 years ago

Topeka is the capital of Kansas. There are jobs with the state government and jobs in businesses connected with the state government. It's also a city of 125,000 people with the usual mix of jobs. Not extremely vibrant economically but not particularly depressed either. Just an ordinary small Midwestern city.

Lawrence is the home of the University of Kansas, and is only 30 minutes down the road from Topeka. Quite a few opportunities there, including startups. Kansas City is about 40 minutes away down the turnpike with the opportunities of a 2+ million metro area.

No, he's not going to make the sort of money you do in California, but he's not moving to some economic wasteland either. He won't have too much trouble pulling in 50-70,000 in some white collar job and, considering the cost of living, he'll be quite comfortable. Probably more comfortable than a 100k job in SF or LA.

rndmwlk• 9 years ago

That was just a single example, the greater point being - housing isn't expensive everywhere.

Also, you can't honestly believe that the ONLY jobs in Topeka are "Sales Associate" jobs. Your extensive 10 second google search was probably not all encompassing.

pjc507• 9 years ago

recently in LA, had a very excited Uber driver tell he just bought a house near Topeka, KS

The 1,500 mile commute sounds like rather a pain, though.

exabrial3• 9 years ago

Still faster than going from San Fernando to Santa Ana

zip1234• 9 years ago

It has never been easier to move across the US and settle somewhere else. The internet has made it much easier to research locations, jobs, housing, etc in advance before moving.

hycaria3• 9 years ago

Who needs this ? Hasn't everyone gotten the message to spend less ressources yet ?!

AznHisoka• 9 years ago

Not sure what your underlying message is but when you want to spend 1 million dollars on a home in la or nyc it feels like money down the drain if you are just getting a 500sq foot studio with no kitchen.

eli_gottlieb• 9 years ago

When spending more ecologically costs orders of magnitude less money than spending less? Hell no! Of course, that just means the ecological pricings-in have completely failed to happen.

rayiner4• 9 years ago

I had a cab driver in Austin tell me that he and his friends all bought $150k houses in the suburbs, with great schools, pools, etc., on 15-year mortgages that many had paid off already.

ikeyany6• 9 years ago

Spending 15 years in a cultural wasteland (even with your own pool) isn't appealing to everyone.

Sounds like the issue is that our cities aren't liveable in the first place.

BeetleB• 9 years ago

I don't think you can do that in Austin any more...

jrumbut2• 9 years ago

We raised our standards of what constituted housing not out of an overflow of love for our fellow human beings, but because we got tired of cholera outbreaks.

Pack people together again, relax the code on plumbing, watch the people who make our salads pick up some still very dangerous and painful diseases.

diogenescynic4• 9 years ago

What hyperbole. It’s not like everyone is living in a McMansion with modern amenities...

TheSpiceIsLife2• 9 years ago

It is possible to have high density and good plumbing and waste management.

jrumbut2• 9 years ago

Look at the article, he's talking about what changed from 100 years ago. I'm talking about why it changed.

badmin_• 9 years ago

I only skimmed the article, but would creating something similar to the homestead act, but with regards to low population residential areas be a workable solution? Population dispersal seems like an interesting topic.

twobyfour6• 9 years ago

The homestead act worked at the time because family farming was a route to economic stability and even success in the economy of the time. Today it's a route to deep poverty.

The route to success today (for all but the few fortunate and motivated entrepreneurs) is to participate in a thriving economic engine - and those engines and the jobs that provide opportunity to do anything other than scrape by while accumulating credit card debt - are concentrated in certain cities. Which in turn is why people are flocking to those cities and housing prices are skyrocketing.

Businesses in turn gravitate to those cities because that's where the smart ambitious employees are concentrating themselves, and it's easier to hire capable employees in areas where they're densely concentrated than to try to attract them to a lightly populated area where you're the only opportunity, or to tease out the few people stuck in that area for family reasons from the rest who simply lack the skills or ambition to do the jobs that people are moving to the cities to seek.

Robotbeat2• 9 years ago

Population dispersal would reduce economic productivity, leading to poverty: https://ideas.repec.org/a/aea/aecrev/v86y1996i1p54-70.html

"Using data on gross state output, the authors find that a doubling of employment density increases average labor productivity by around 6 percent. More than half of the variance of output per worker across states can be explained by differences in the density of economic activity."

Areading3143• 9 years ago

This article is trash and I'm stunned that it would be hosted on a harvard.edu domain. Whoever posted this should be ashamed of themselves.

Fallacies, lies, and generally ignorant opinions include * Pretending the US was a more market-oriented economy in the past (which is not true)

* Comparing the housing situation 100 years ago to that of today. There are many reason why america in 1917 is very different than the america of 2017

* Literally cites a Wall Street Oasis forum post as a source on why we should not subsidize housing for the poor

* Income inequality is (obviously) a huge component of housing not being affordable (especially in urban centers) and this is dismissed using an obvious straw man argument.

One of the biggest housing subsidies is the mortgage interest deduction which is almost entirely captured by wealthy homeowners and financial institutions. It also definitely pushes up housing prices. If the author of this post had any knowledge of the housing market they would have brought this up.

fanzhang• 9 years ago

It sounds like you have an affirmative theory of what the housing shortage is caused by. If so why not share it?

Areading3143• 9 years ago

As with most shortages the issues are related to supply and demand of (desirable) housing:

Supply side:

* Zoning restrictions. Many cities are slow to up-zone because their voters enjoy the high prices (nimbyism).

* Lack of, or insufficient infrastructure limiting size of desirable areas.

* Generally high crime rates in urban areas, due to underfunded police departments and public services, also limits size of desirable areas

* Poor education opportunities also contributes to the limited amount of desirable housing, leading to extremes in home values

Demand side:

* US is the worlds #1 tax haven. Foreign investors buy US real estate as a means of wealth storage and speculation, which increases demand.

* Mortgage interest tax deductions for homeowners are essentially a wealth transfer from taxpayers to banks and homeowners.

* Artificially low interest rates greatly increase the amount of capital chasing homes. For example a $2000/mo mortgage at 4% finances $420k, but at 6% only finances $333k. (People buying homes right now should think about the implications of this).

* Irrational societal obsession with homeownership.

* Historical trend of price appreciation has fostered a false impression of home ownership being a good investment, despite the great risks and expenses involved.

Consultant324523• 9 years ago

Income inequality is exacerbated by low income housing programs. If wages in NYC are so low that people can't afford to live there, then those people should leave. If we must have a government program, then let's create one that helps people relocate to greener pastures. By decreasing labor supply, wages will rise until incomes and housing prices are in parity. Low income housing programs do the opposite, they artificially increase the labor pool of people who can accept lower wages which of course applies downward pressure on wages.

mortgage interest deduction

I agree we should get rid of that.

pjc507• 9 years ago

"Remove all the poor people" is a policy that's been tried before with considerable social costs; it breaks up communities and tends to move people to places that are cheaper because they are worse. The city is the greener pasture - that's where the jobs are.

Low income housing does tend to act as a subsidy for landlords and low pay employers. Perhaps we could shortcut the misery of a whole bunch of people having to move and just raise wages directly, e.g. via a rise in the minimum wage?

Tying minimum wage to some function of house price and interest rates would be amazing.

averagewall3• 9 years ago

A problem with that is people will be desperate enough for those now higher-paying jobs that they'll spend hours commuting from distant cheaper places. All that time spent commuting is equivalent to getting a lower hourly wage. We've already figured out that having no minimum wage lets desperate people suffer worse.

That's the argument against "let the market solve it" as I've heard it applied to London. Not sure if it's actually valid or not.

Alex3917• 9 years ago

Whoever posted this should be ashamed of themselves.

When reading Philip's posts, keep in mind that he's probably 10x smarter than you.

Areading3143• 9 years ago

I looked up who he is. You can be smart and ignorant at the same time, something I see all the time in tech.

kelukelugames• 9 years ago

Harvard Business Review is almost as bad as Buzzfeed. I guess everyone need to compete for clicks.

sokoloff6• 9 years ago

This is not an HBR article.

It's on a Wordpress site open to anyone with a harvard.edu, radcliffe.edu, or hbs.edu email address.

pjc507• 9 years ago

Yes, he's glibly wrong about a lot of things.

"Can we blame rich people stealing all of society’s wealth? Again, wealth inequality was very high 100 years ago. In any case, a rich person may cause us to become sick with envy but he or she doesn’t usually occupy 50 apartments at a time. So it doesn’t make sense to blame rich people for reducing the housing supply, does it?"

Actually, yes. This is certainly a problem in London, rich people buying houses that they remove from supply but then don't occupy. Everything from empty mansions: https://www.theguardian.com/society/2014/jan/31/inside-londo... to empty luxury flats https://www.theguardian.com/money/2013/sep/27/one-hyde-park-... to empty flats built by evicting the previous occupants: https://www.vice.com/en_uk/article/qkq4bx/every-flat-in-a-ne...

"Not only are all of the buyers of the new South Gardens foreign investors; from the 51 bought so far, many appear to be offshore – untraceable and untaxable. Every single one of the 51 purchases made is listed as "care of 2 Tower Street, WC2H 9NP". Helpfully, that's Riseam Sharples' office address."

krallja• 9 years ago

Philip Greenspun is one of the original webloggers -- http://philip.greenspun.com/bboard/q-and-a-fetch-msg?msg_id=...

Not to imply anything about the quality of the article; I just think it's fun to make historical connections to our Internet elders.

dangjc• 9 years ago

I'm not generally anti regulation, but for housing it's ridiculous. New housing should be granted by-right permission. NIMBY's have a major empathy gap and should not have a veto.

vfulco• 9 years ago

Inflate away the debt, let the financiers figure out another way to ensure lifetime financial slavery.

rainbowmverse• 9 years ago

The government in the US tried this. Wages didn't keep up. The predictable result: a stagnant, demand-starved economy where no one can buy anything without taking on more debt.

twobyfour6• 9 years ago

Is this sarcasm? My detector seems to need recalibration today.

nickgrosvenor• 9 years ago

Something that is never brought up, the lack of recessing property values for property tax purposes.

It really punishes new young families.

example. say an old couple lives in a home presently valued at 2.5 million dollars in California, say they bought the home for 75,000 in the 1970's. So they pay about 750 bucks a year in property tax.

New family, buys the exact same home today, owes 25,000 in property tax a year. Over 2k a month just in property tax that doesn't exist for the older home owners that have been grandfathered into to low property taxes on a house whose value hasn't been reassessed for years.

Why isn't this talked about more?

New families get killed by this.

vadym909• 9 years ago

ofcourse it is talked about, but is a losing proposition as most homeowners wouldn't stand for it. Renters don't make up enough to oppose it. https://en.wikipedia.org/wiki/California_Proposition_13_(197...

In some cases this keeps rent low as homeowners with 2 houses paying low property taxes can afford to charge lower rents.

dba7dba2• 9 years ago

It however has the unintended consequences of making housing unaffordable for their CHILDREN when they grow up and have their own families.

But I don't think many house owners stop and think about that when trying to avoid that property tax.

wolfgke• 9 years ago

It really punishes new young families.

The mistake rather is to found a family under such circumstances.

pixl973• 9 years ago

The mistake rather is to found a family under such circumstances.

Eventually this kills your city.

jaggederest• 9 years ago

It's related to Balmol's Cost Disease [1]. Everything that is not technology is increasing in price relative to what employing those people in a high-productivity-multiplier industry would, and of course physical real estate is the ultimate in non-substitutable, non-automatable goods.

This is the same reason that education, healthcare, and other human services are eating more and more of the GDP: anything that can't be automated becomes dramatically more expensive by comparison with things like industrial automation and information technology.

[1] https://en.wikipedia.org/wiki/Baumol%27s_cost_disease

m0llusk• 9 years ago

Cost disease primarily applies to markets where much of the product is labor. Construction has been slow to automate, but there has been considerable progress especially recently. Most of the excessive cost of properties comes from land rights and acquisition costs and not construction. Over long periods housing markets revert strongly to medians.

dredmorbius2• 9 years ago

No.

BCD applies to costs of production in which a given factor (typically labour) hasn't had its productivity increased, but because it competes for other employment, the price paid for it if any of the resulting good is to be provided must keep pace.

The interesting part is what BCD doesn't describe, which is the amount of the good provided. The canonical case is the string quartet: you need four performers, no matter how much technology you've got. But: the total demand for string quartets need not remain constant. Tastes could change favouring other forms of music, recordings or broadcasts can increase the productivity of the four essential players, etc.

(The evolution of popular music from self-provisioned to big band to amplified orchestra to amplified three- or four-piece rock groups, to synthesizer, to disco, rap, house/hip-hop, and now extensive one-person sampling acts, is one example of the type of shifts that can occur.)

The "factors of production" in housing are raw materials, housing, and land. Land itself is the original rent-seeking good, for various reasons that ... modern economics fails to explain very well. My argument is that land is a network of control points (owning land gives you control in the right to exclude others), and with varying access costs to other useful capabilities (manufacture, employment, trade, education, entertainment, ag, etc.). The characteristic of economic rents is that the prices they command rise to include part, or all, of the consumer surplus. This contrasts with commodities and labour in which prices generally fall to costs. That paired relation is David Ricardo's famous two observations: the Iron Law of Wages, and the Law of Rent.

(This is why I see both a rent tax and some mix of UBI / employer of last resort with a living wage guarantee as a probably necessary economic policy.)

So, thanks for the opportunity to play with some economic concepts, but Baumol's got nothing to do with this. Your men are Ricardo and George.

SilasX• 9 years ago

What the sibling posters said -- it's not related. Cost of production itself is actually going down because we get ever better tools to make the houses and they don't have a fixed "human content requirement" to the labor.

Costs are spiraling up because of restrictions on building -- both the density, and the transit that could handle it.

wheresmyusern6• 9 years ago

i have been looking into buying land and building a house on it -- ive been reading and researching intensely for a while now and i am simply astonished at how affordable it is to have your own land and a house, all while being well within commuting distance of the city. the thing about owning land is that instead of paying for your landlords luxury car and his wifes boob implants, you only have to pay property tax. if you make other simple efforts to reduce your expenses, you can bring your total operating costs down to insanely low levels without sacrificing any quality of life. i feel like this is some kind of conspiracy -- i have no idea why people seem to be oblivious to the wonders of cost reduction. it takes monumental effort to increase your income but its pretty much trivial to reduce your expenses which accomplishes the exact same outcome. rent is currently 80% of my expenses and there is nothing i can do to change that, except buy land. even if i lived in a super crummy part of town (i dont want to do that) it would still cost a fortune compared to property tax for land and a modest house (modest but still a thousand times better than most apartments).

sokoloff6• 9 years ago

you only have to pay property tax

You have maintenance/depreciation and insurance expenses, and have the opportunity cost of whatever capital you have tied up in the property.

I think home ownership is a great choice for many and I own slightly more than 50% of the house we live in [the bank owns the rest right now]. But there are very real costs to ownership and they don't stop at property tax IME.

wheresmyusern6• 9 years ago

besides tax, what are ongoing costs composed of? i think that you will find that a house can be made in such a way that besides tax, there isnt much cost. and you dont have to have insurance to own a house, people think that because lenders force you to buy insurance. and, once again, if the house is designed properly, there isnt any need to buy insurance for it. and bringing up depreciation and op cost makes absolutely no sense.

pjc507• 9 years ago

simply astonished at how affordable it is to have your own land and a house, all while being well within commuting distance of the city

This depends on the city and its planning regime. I'll agree that in many cities ownership+mortgage is much cheaper than rent, but I'd be interested to know where you can "just" buy land and build a house.

(Also, not having buildings insurance, which is not actually all that expensive, is a very big bet on your fire safety)

cies3• 9 years ago

How did we[1] create a society where we[2] can’t afford to live in our own country?

[1] TPTB a.k.a. the 0.1%, a.k.a. the majority of the owners of the majority of private property.

[2] The people that have to work to sustain their livelihood, or are not even that fortunate (jobless, impaired, etc.).

Interesting how the article compares the US of today with the situation in the year 1900. The country as a whole has become sooooo much more wealthy in that period, but still is not able to take care of it's population's basic needs. And it seems to be getting worse.

But it's a democracy, so the 99.9% should have the power to fix this, right? Well...

"If voting changed anything, they'd make it illegal" -- Emma Goldman

pandemi2• 9 years ago

Voting has the possibility of changing zoning laws. For some reason it's just not happening. If these few areas in California and North-East had similar density to cities in other countries it would help a lot.

cies3• 9 years ago

This issue is much bigger then zoning. It's about redistribution of wealth. Currently there is very little of this happening, yet is it constantly mentioned and threatened to be reduced even further.

Concentration of wealth in the hands of few: this is actually being promoted by all administrations the US has seen in the last decades. If only 80% of the insane military budget could be used to house, feed, cloth and educate EVERY citizen...

Bartweiss2• 9 years ago

For some reason it's just not happening.

A major part of that issue is the voting population. Only people who have already overcome the "getting housing" hurdle are permitted in the elections that shape zoning laws.

There's still some variance there: homeowners profit from high housing prices, while renters profit from low ones. But even for renters, who theoretically want zoning laws relaxed, it's often not a top issue. Given that "weaken zoning laws" is a broadly conservative position here, weak-zoning candidates are usually blocked by the general liberalism of urban areas.

(And at least where I live, technocratic Democrats who might support progressive policies and weak zoning get crushed by entrenched Democrats with more funding and union endorsements. A viable candidate would need to be technocratic only on zoning laws.)

chrisbennet2• 9 years ago

At least in some places, the root cause of high housing prices is their proximity to work. In those cases, why not address the root cause?

Example: If you wanted to start a business that would consume more city resources than city infrastructure could support, say sewage/water/parking/etc, the city would deny a permit to build.

Why not restrict the number/size of businesses in a location based on how many people/workers could reasonably afford to live there?

averagewall3• 9 years ago

Solutions are the easy part. Getting people to agree with it when it hurts their financial interests is the hard part. The same NIMBYs that are keeping prices high in those areas with strict zoning rules would also never allow any such changes that will reduce prices. They depend on too many jobs and not enough houses.

chrisbennet2• 9 years ago

Restricting further businesses wouldn't decrease their property values so it might be a lot more palatable.

Robotbeat2• 9 years ago

Because this would make the business less competitive and thus reduce both jobs and growth.

Density tends to increase economic productivity and spur growth. Being close to other businesses, services, and population essentially reduces latency.

jokoon• 9 years ago

Nobody is going to like what I am going to write, but I have the opinion that homeless people are generally happier in modern developed country when you compare to other countries.

As long as there are minimum efforts done to take care of the poorest, meaning charities and a minimum of a justice system, things are relatively good enough.

I think the debate rather belongs to why do we constantly need to use carrots to run a society? As long as society has rules that are in agreement with our natural instincts, meaning self preservation, things will be easily managed, but not easy for everyone.

When we will understand that "go get that income by yourself, joe!" cannot always function properly, maybe things will change a little. I have never understood the undying belief that "work is necessary for society to function". It is not. Humans have constantly worked to avoid human labor, but for some weird reason, people still want to work and mooching has a bad reputation.

We are just approaching a weird, dystopian future where food is everywhere, but for some reason humans cannot agree to find a relevant system to feed and shelter everyone properly. Capitalism is not the problem, it is just that nobody can agree on helping each other, and I sense that everyone is afraid of letting government be more gentle because it would somehow resemble communism or socialism.

Go figure.

eksemplar• 9 years ago

Capitalism as an economic system may not be a problem, but capital in politics is. You shouldn't be able to pay the political system to allow you to essentially destroy the planet with pollution.

But good luck fixing that. :)

amorphid• 9 years ago

I've been homeless in the United States. It sucked big time. Saying homeless people in developed countries are happier than other countries might be true. But that feels kind of like saying most people would rather get stabbed in the leg by a short knife than shot in the chest by a 44 magnum. Homelessness, at least the involuntary flavor, stinks, and I wouldn't wish it upon anyone.

gnulinux2• 9 years ago

I agree with everything you said except the last bit. I wonder if you actually made some research about your own words and ideas. For example:

When we will understand that "go get that income by yourself, joe!" cannot always function properly, maybe things will change a little. I have never understood the undying belief that "work is necessary for society to function". It is not. Humans have constantly worked to avoid human labor, but for some weird reason, people still want to work and mooching has a bad reputation.

Believe it or not, this is one of the core arguments of Marx. I wonder what was your reasoning to conclude "Capitalism is not the problem". I'm very interested to discuss this.

I think talking about "capitalism" and "communism" is the worst thing we can do at this point, since these words are extremely politicized and they have no meaning at all. Like, today "communism" refers specifically to USSR's Ideology (state capitalism, centrally planned anti-consumerist economy etc...), a Stalin and post-Stalin form of Marxism-Leninism, which has pretty much _nothing_ to do with Marx's original ideas. Anyway, we should start talking about concrete things, like private property. And, it seems to me that, one logical conclusion of your reasoning is that private property is at least a problematic concept for our society.

kiliantics3• 9 years ago

Thank you. Everyone seems to think they know what they're talking about but there is so much disinformation about the concepts of capitalism and socialism.

The problem is absolutely capitalism. That system is what causes people to behave the way they do. "Human nature" is a product of our environment more than it is any kind of inherent and unchanging thing. Otherwise humans could not have survived and evolved to changes in surrounding nature as they did.

And the solution is certainly not Soviet style state socialism. But there are so many other options. I'm most interested by the attempts at a new social order that were made in revolutionary Catalonia and other places. Similar attempts are being made right now in Syrian Kurdistan - aka Rojava - where they are doing remarkably well despite the ongoing crisis. They call it democratic confederalism.

stephengillie• 9 years ago

Homeless people in the USA may be relatively more opportunities and benefits than homeless people in other countries. But having been homeless - and not knowing who's going to give you your next meal - working in almost any nation is better than being homeless in the USA.

The gutter between upper class and poverty is nothing like the chasm between poverty and homelessness.

smt88• 9 years ago

Nobody is going to like what I am going to write, but I have the opinion that homeless people are generally happier in modern developed country when you compare to other countries.

You're smart and self-aware enough to have this thought. Why go on and contribute your uninformed opinion? Why not research whether homeless people really are happy or ask people who've been homeless?

As long as there are minimum efforts done to take care of the poorest, meaning charities and a minimum of a justice system, things are relatively good enough.

Happiness and hope don't come from other people's "minimum efforts".

gaius2• 9 years ago

Country? No the country is fine, the problem is that so many want to live in hotspots. In the U.K. Central London is super expensive but there is plenty of cheap property in the North.

ictoan• 9 years ago

What is the problem with people want to live in hot spots? Cities are where you can have diverse communities, walk around, and be able to interact with people outside of your immediate family. The problem with the country is it is extremely car and gas dependent. The auto industry and oil companies have screwed up public transportation. People who live in smaller cities out in the Midwest are disconnected. They can only going to movie theaters, the mall and fast food restaurants. Everything else is super far away. How do I know this? Because I grew up in the Midwest. It is tremendously boring and once you realize your life is much more than shopping malls, that's when you want to move into cities.

gaius2• 9 years ago

What is the problem with people want to live in hot spots?

Because hotspots need to be fairly small for the reasons you say, and the demand for that space exceeds the supply.

eximius2• 9 years ago

It's very curious that we are so focused on housing because it's a problem in relatively few areas driven by demand surging because of increased job centralization. It isn't surprising and it's hard to fix because it's complicated to incentivise lower density cities.

But what about food and clothes? What about books? For all our wealth, everything in the US is dozens of times more expensive than in some poorer countries. Can we develop a society that produces these products at a similarly low cost while sustaining our lower classes in other industries (since the ultimate floor for costs of goods in the US is the cost of paying laborers 'living' wages)?

kharms• 9 years ago

Most immigrants I know, including myself, get sent "shopping lists" by our families abroad because the US is a notoriously cheap place to be a consumer. Especially compared to poor countries.

soneca• 9 years ago

Not sure if you are talking about cost of production or price of the products, but comparing to Brazil, clothes, books and electronics are usually cheaper to buy in USA.

eximius2• 9 years ago

Hm, maybe I should have considered for a little longer that my experience in China may be hugely different than other nations.

the_watcher• 9 years ago

Can we blame income inequality? Supposedly it was higher 100 years ago and poor people were able to afford crummy houses back then.

Zoning is a huge factor here - many of the "crummy" dwellings 100 years ago were in buildings/conditions that would today be illegal. Whether that's a good or bad thing (and what to do about it) is a separate question, but it shouldn't be ignored.

Bartweiss2• 9 years ago

My "favorite" statistic about this is that Somerville, MA has 80,000 inhabitants, but only 22 legal-today residential buildings.

To be sure, a lot of Somerville is steep-staired, not-handicapped-accessible, and so on. But the most punishing regulations are also the silliest: high floorspace-to-inhabitant ratios, mandatory closets in bedrooms, punitive frontage and lawn space requirements.

At a certain point this doesn't look like a mystery: redeveloping in cities is inherently expensive, and conforming to elaborate regulations means only luxury housing (or sometimes, no housing at all) can turn a profit.

smileysteve• 9 years ago

relevent https://www.theguardian.com/us-news/2017/sep/05/hookworm-low...

arca_vorago• 9 years ago

Number one root cause: The (non)Federal Reserve system.

The big things as a result of it are what caused it. Debt is inversely proportional to freedom, and the wealthy have gobbled up so much of what allowed us to prosper in the first place.

People that always go on about taxes or the budget deficit etc need to realize the fed is a root causal issue here.

Also, two more points. I think the fed is unconstitutional, and I think Hammurabi had it right that such a system requires regular debt jubilees.

whipoodle• 9 years ago

I think I’ll probably be ok, mostly because I won’t have children. I don’t understand how people do that these days, unless they have a lot of help from the grandparents. Suddenly you need a bigger house and it needs to be in a good school district, or pay out the ass for private schools. And then it all just gets worse from there.

zgramana• 9 years ago

I’m surprised that the article and the discussion here don’t assess the impact the booming short-term rental market has on keeping otherwise available inventory off the residential market. Many cities have a lot of empty dwellings on any given day, yet seemingly face a scarcity of inventory.

How did we create a society where we can’t afford to live in our own country?

Related Stories