US Politics Megathread

[Horsemen]

Except landlords don't have freedom to ask for higher and higher prices if tenants can rent more cheaply somewhere else????

[Dolan]

They do, they just cling to their asking price until they find a client desperate enough to rent. Competition doesn't work well on the real estate market, because there's little to no pressure on landlords to undercut other landlords. It serves their interests better if they all stick to their asking price. They don't even have to cartelise to act like this, it's more like a common mentality, a hivemind. Because typically they own more than one property and they can afford to keep one of them unoccupied. It's not like other markets, like manufacturing, in which the pressure is on the seller to get rid of their stock fast, before the products become obsolete or go off. Apartments, houses don't deteriorate and don't become obsolete if they aren't rented as soon as possible. So owners can afford to cling to their price until they find someone desperate enough to pay.

Supply in the real estate market is almost always lower than demand, there are always people interested in finding a place to live in. Just think of how many students come to a city to study, people who move to a city to find a job, immigrants, etc.

[n0el]

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

Rent control exacerbates the housing crisis by disincentivizing people from building new housing

That’s a talking point. Why would that be true? Set the initial rent at the correct level and there’s no issues.

[n0el]

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

It treats the symptom rather than the cause.

Sure but the cause is capitalism and no one wants to address that.

[lejend]

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

Supply and demand.

The law of demand states that the higher the price, the lower the quantity demanded in the market; and the lower the price, the higher the quantity demanded in the market.

The law of supply states that the higher the price, the higher the quantity supplied; and the lower the price, the lower the quantity supplied.

Eventually price and quantity will converge to an efficient market equilibrium, where it is impossible to make one person better off without making another person worse off.

Rent control is basically a price ceiling; a government price control that sets the maximum allowable price for a good. For a price ceiling to have any effect in a market it has to be below the market equilibrium price. A price ceiling might be put into place because the government believes the price of a good is too high and thus not affordable for certain people. However, the low price will lead producers to reduce the quantity they will supply and result in a shortage.

Rent control reduces the incentive for investors and developers to add to the housing supply, resulting in a decline of the available supply. As the supply declines, the winners are those who are already in housing which is controlled (or becomes controlled) and stay for a long time. Those who want to be more mobile, people moving into the state, kids moving out of their parents' houses - those will be the losers unable to find housing at any price.

That's why there is a total consensus among economists, from the liberal Krugman to the conservative Sowell, that rent control is a poor method of making housing more affordable. In fact, it's only likely to exacerbate the problem. From the Wiki article linked by Horsemen:

.

So, rent is high not because landlords are greedy, but because renters are bidding up prices due to limited supply. And supply is low not only due to rent control, but also because of things like zoning laws and regulations on apartment size. In other words, supply is low because of government intervention in the market.

Housing is one of countless examples of government messing with the market until it turns to crap, and then complaining about market failure and demanding deeper interventions to fix the problems that government intervention caused. It's all so tiresome, really.

[howlingwolfpaw]

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

It treats the symptom rather than the cause.

Sure but the cause is capitalism and no one wants to address that.

I've come to the belief its not capitalism or any "ism" at fault here. Capitalism is simply the concept of one reaps what they sow, and follows laws of supply and demand. On the flip side, communism seeks to reap what all have sown and distribute accordingly.

Both are capable of extreme abuse and inequality. it is more of a matter of how those models are run and by who is running them with what moral compasses they possess. Ideally both need to be a little more like the other to allow for freedoms, while also protecting and uplifting the lowest of the populace.

The problem is finances. That due to fractional reserve lending banks can lend out 10x their holdings which then inflates what they can lend out and people will take higher loans to get the quality housing they need, having to pay it back making money off higher rent.

That is fraud and is destroying the economy making for exponential debt due to imbalances in paying for the interest to the loans. (along with all money being loaned out from the federal reserve). The only thing that has been saving this from completely collapsing like it should have in 2008 is that the dollar is the world oil reserve currency and creates a huge draw for that debt to be loaded onto other countries that must trade resources and services to get dollars to buy oil, and pay back loans from the world banks that have trapped developing countries. Its a vicious cycle that is unnecessary if an economy is made that builds wealth from the work people do rather than motivate people with debt. Its a form of financial slavery.

[Dolan]

That's why there is a total consensus among economists, from the liberal Krugman to the conservative Sowell, that rent control is a poor method of making housing more affordable.

I bet that in 2006-2007, if you conducted a poll among those economists, they would have also expressed a consensus that the economy was doing great and was headed for the blue skies.

So, rent is high not because landlords are greedy, but because renters are bidding up prices due to limited supply.

Is there any economic good that is not in limited supply? Does an economic good being in limited supply preclude the possibility that renters are increasing prices out of greed? There's no contradiction between supply being limited and renters hiking prices because they just want to cash more.

And supply is low not only due to rent control, but also because of things like zoning laws and regulations on apartment size. In other words, supply is low because of government intervention in the market.

Meh, this sounds like typical bullshit you hear from libertarian-republican talking points: it's dah gubbermint that is at fault for anything bad that happens in the economy. They even managed to blame the gubbermint for the 2008 crisis, by using similar logical sleight of hand.
The government typically has regulations that specify safety standards for civilian buildings, they don't really tell you that if you own a huge plot of land you're not allowed to build a huge bungalow. Nobody can forbid such a thing. You can build on your property pretty much any kind of building you want at whatever dimensions, as long as you abide by certain safety standards and your architectural plan is approved by the local municipality. They're not going to allow you to build something that generates too much environmental noise or destroys natural resources like groundwater streams. But that's perfectly reasonable and doesn't have much if anything to do with the greed of property owners.

Housing is one of countless examples of government messing with the market until it turns to crap, and then complaining about market failure and demanding deeper interventions to fix the problems that government intervention caused. It's all so tiresome, really.

Who said this can only be fixed by government intervention in the market? How about taking housing outside of the market? Like banning any real estate market. Let public authorities develop projects and put them up for renting/buying at rates which only cover the costs of development, nothing else, no profits involved. It's an idea I've just come up with on the spot, I bet there can be plenty others even more viable.

[Amsel_]

That's probably the case in the USA. From what I've seen here, landlords typically own the properties they rent. In Europe, typically people don't live on debt, and their properties are not mortgaged. So there is a class of people here who live comfortably off renting. They don't even have to work, they own like 4 flats and they're able to live well only with the proceeds they get from rent, after clearing their taxes.

Yeah, banking and real-estate are hopelessly intertwined here. But it's actually much more productive an industry that way. (despite rentors being... rentier) It allows people to leverage credit and make investments that gain them equity at a faster rate than if they had used their money in a non-leveraged investment. The loan/insurance/maintenance expenses and the rental income usually cancel each other out, and the land lord makes his money based on the increase in equity. (this means he can either sell for a profit, or refinance and use that equity to acquire another property) This is super, super useful for driving class-mobility. It's essentially the gold-standard for middle-class people trying to move into the upper or upper-middle class. Without it, people would be a lot more "stuck." Even an idiot can become a millionaire in real-estate.

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

It treats the symptom rather than the cause.

Sure but the cause is capitalism and no one wants to address that.

Can I ask what aspects of capitalism are the "cause?" And what alternative do you recommend?

[Amsel_]

Imo price controls aren't intrinsically bad, they're just situational. If the government needs price stability, the sellers need money, and the consumers need cheapness, and they all get together and agree on a price that's acceptable to all of them - that's fine. (the U.S. used to have a system set up like this) If it's just the government REEEEEEing and demanding people arbitrarily sell things for a lower price then yeah it's not going to work out too well, and at a certain point people are just going to close up shop once the opportunity cost gets too high.

[n0el]

Show hidden quotes

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

It treats the symptom rather than the cause.

Sure but the cause is capitalism and no one wants to address that.

Can I ask what aspects of capitalism are the "cause?" And what alternative do you recommend?

Profit maximization? I’m not sure what the answer is, I’m just suggesting it’s not an easy solution, and maybe we can try rent control? Surely that would be more appealing then going back to the gold standard as some here seem to be suggesting. Also, there seems to be a lot of variables you could play with to see where it fits. Sanders proposed 3% I believe, California’s new law is 5%. As has been mentioned here, real estate doesn’t work on a price competitive marketplace. It acts more as a monopolistic market, which by the way is the natural outcome of a capitalist system.

[howlingwolfpaw]

Show hidden quotes

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

It treats the symptom rather than the cause.

Sure but the cause is capitalism and no one wants to address that.

Can I ask what aspects of capitalism are the "cause?" And what alternative do you recommend?

Profit maximization? I’m not sure what the answer is, I’m just suggesting it’s not an easy solution, and maybe we can try rent control? Surely that would be more appealing then going back to the gold standard as some here seem to be suggesting. Also, there seems to be a lot of variables you could play with to see where it fits. Sanders proposed 3% I believe, California’s new law is 5%. As has been mentioned here, real estate doesn’t work on a price competitive marketplace. It acts more as a monopolistic market, which by the way is the natural outcome of a capitalist system.

What is wrong some some kind of gold standard? do you realize how unstable and fraudulent our money system is? all the problems we face are symptoms of fiat currency, fractional reserve lending, and private for profit centralized banks.

[n0el]

It doesn't work with the current system, so its not like you can just say, lets go back to the gold standard. its a fundamental economic policy shift, which I agree is needed.

[howlingwolfpaw]

It doesn't work with the current system, so its not like you can just say, lets go back to the gold standard. its a fundamental economic policy shift, which I agree is needed.

I agree basing it off gold alone is out dated, that is why I was conceptualizing a monetary system based off all forms of goods and services.

[spanky4ever]

I propose USA take 10% of their military budget (75 billion dollars) and build affordable housing all over the USA That would probably work
How many affordable houses can you build with 75 billion dollars a year How many jobs would that create

[spanky4ever]

What I try to say here, it that the system could be good, but the money in politics makes it really bad. If you get that money who is currently working for the super-rich, OUT. The system may be good enough. The USA has more than 800 military bases all around the world.
What is its purpose? Other than to rage wars all over the freaking planet? or to control everything and everybody?
I am really sad that a candidate like Tulsi Gabbard was thrown out of that last debate, because you, and the rest of the world, need to hear her voice up there; speaking of non-interventional wars and curbing the military budget. Then you would have plenty of money to handle your housing crises and your crumbling infrastructures.

[occamslightsaber]

I propose USA take 10% of their military budget (75 billion dollars) and build affordable housing all over the USA That would probably work
How many affordable houses can you build with 75 billion dollars a year How many jobs would that create

Lol, you wish we had only 75 billion dollars in defense spending. It’s closer to 700 billion actually.

Trump is doing what you say (taking money from the DoD’s pockets) but he’s building a beautiful wall instead.

[spanky4ever]

I propose USA take 10% of their military budget (75 billion dollars) and build affordable housing all over the USA That would probably work
How many affordable houses can you build with 75 billion dollars a year How many jobs would that create

Lol, you wish we had only 75 billion dollars in defense spending. It’s closer to 700 billion actually.

Trump is doing what you say (taking money from the DoD’s pockets) but he’s building a beautiful wall instead.

If you read my post, you will see I said 10% of your military budget ONLY 10%

[occamslightsaber]

I propose USA take 10% of their military budget (75 billion dollars) and build affordable housing all over the USA That would probably work
How many affordable houses can you build with 75 billion dollars a year How many jobs would that create

Lol, you wish we had only 75 billion dollars in defense spending. It’s closer to 700 billion actually.

Trump is doing what you say (taking money from the DoD’s pockets) but he’s building a beautiful wall instead.

If you read my post, you will see I said 10% of your military budget ONLY 10%

Oops, my bad. My second point still stands though.

[occamslightsaber]

By the way, if you or anyone wants to know why we have some 800 military bases around the globe (although your question was probably rhetorical), it’s because they are mostly remnants of the Cold War. The US used to position troops as a “tripwire” in vulnerable countries to dissuade commies from attacking them, since few hundred dead US soldiers would be more than enough to bring the US to war and start WW3. After the Cold War, they were useful for bombing terrorists and the host countries didn’t exactly mind having the world’s most powerful country to protect them.

[spanky4ever]

By the way, if you or anyone wants to know why we have some 800 military bases around the globe (although your question was probably rhetorical), it’s because they are mostly remnants of the Cold War. The US used to position troops as a “tripwire” in vulnerable countries to dissuade commies from attacking them, since few hundred dead US soldiers would be more than enough to bring the US to war and start WW3. After the Cold War, they were useful for bombing terrorists and the host countries didn’t exactly mind having the world’s most powerful country to protect them.

how many bases does Russia have then, if that is your defence of having 800+ military bases

[spanky4ever]

I am not trying to put my foot in your face here @occamslightsaber but get real. The 750 billion could very well be 1 trillion if you include all that is going to the military.

[Amsel_]

Show hidden quotes

Any one care to make a reasoned argument against rent control policies or are we just going with socialism, communism, etc....

It treats the symptom rather than the cause.

Sure but the cause is capitalism and no one wants to address that.

Can I ask what aspects of capitalism are the "cause?" And what alternative do you recommend?

Profit maximization? I’m not sure what the answer is, I’m just suggesting it’s not an easy solution, and maybe we can try rent control? Surely that would be more appealing then going back to the gold standard as some here seem to be suggesting. Also, there seems to be a lot of variables you could play with to see where it fits. Sanders proposed 3% I believe, California’s new law is 5%. As has been mentioned here, real estate doesn’t work on a price competitive marketplace. It acts more as a monopolistic market, which by the way is the natural outcome of a capitalist system.

Forgive me if I'm misinterpreting, but did you just say that capitalism is the problem but you don't know why?

What is wrong some some kind of gold standard? do you realize how unstable and fraudulent our money system is? all the problems we face are symptoms of fiat currency, fractional reserve lending, and private for profit centralized banks.

Gold-standards fail to meet the demand for money, and cause deflation. Only deficit spending in large amounts can meet this demand for money. It's why gold-standard countries had so many depressions, and it's why the Eurozone is declining. Also, have you heard of C.H. Douglass' Social Credit?

What I try to say here, it that the system could be good, but the money in politics makes it really bad. If you get that money who is currently working for the super-rich, OUT. The system may be good enough. The USA has more than 800 military bases all around the world.
What is its purpose? Other than to rage wars all over the freaking planet? or to control everything and everybody?
I am really sad that a candidate like Tulsi Gabbard was thrown out of that last debate, because you, and the rest of the world, need to hear her voice up there; speaking of non-interventional wars and curbing the military budget. Then you would have plenty of money to handle your housing crises and your crumbling infrastructures.

You can complain about the size of our military, if you'd like. But I'm sure you'll still cry your heart out when regional powers like Russia, China, and Iran start invading and controlling weaker nations around them - nations we were protecting. Unless Norway intends to develop and install interceptor missiles in Romania and park an entire naval fleet in the strait of Taiwan?

[spanky4ever]

@Amsel_

You can complain about the size of our military, if you'd like. But I'm sure you'll still cry your heart out when regional powers like Russia, China, and Iran start invading and controlling weaker nations around them - nations we were protecting. Unless Norway intends to develop and install interceptor missiles in Romania and park an entire naval fleet in the strait of Taiwan?

If you are not tone depth, or totally unaware of the last 60 years of war history, you should know that USA is the aggressor, or supporting despots all over the world, with a few exceptions

[spanky4ever]

just google it @Amsel_ like I did

[Amsel_]

@Amsel_

You can complain about the size of our military, if you'd like. But I'm sure you'll still cry your heart out when regional powers like Russia, China, and Iran start invading and controlling weaker nations around them - nations we were protecting. Unless Norway intends to develop and install interceptor missiles in Romania and park an entire naval fleet in the strait of Taiwan?

If you are not tone depth, or totally unaware of the last 60 years of war history, you should know that USA is the aggressor, or supporting despots all over the world, with a few exceptions

I don't necessarily mind being the aggressor, so long as it suits our national interest, or the aggression is done against someone who deserves it. But in the past 60 years specifically, we have been rather reactionary. We helped the defenders in Korea and Vietnam. We liberated Kuwait from an Iraqi invasion. We thought we were protecting the world from nuclear proliferation. We were attacking the people who did 9/11.

I don't see this pattern of aggression you speak of. And if you don't care for despots, then I assure you that there would be a lot less democracies in the world if it weren't for the United States. A lot of countries only even try to appear democratic because it helps maintain relations with the West. Without that, you would see a lot more Kings and Supreme Leaders.