Ah, Mr. Fugger, richest man in the world, the Catholic Church borrowed so much from him (and fleeced their followers so much in order to pay him back) that Martin Luther got so mad and nailed his manifesto to a church door and created Protestantism:
Luther did not first nail his thesis to the door, he mailed them first, and had no intention of starting anything. Nailing things to a church door was common practice so that others could read things (no newspapers). Also Luther was only one of thousands of priests, bishops and monks who complained the Popes at the time were ignoring the faith and the people (which they were). He didn't invent Protestantism, he's just more famous than the others.
Luther grew up in a mining community, where people where crass and confrontational. He had a frank, direct, and powerful rhetorical style that was forged in that environment. While he had several career options, a lightning strike made him get superstitious and become a monk. He was good at it. Take these 2 things - book smarts and an argumentative edge, and now a new twist enters the story...
The printing press!
The printers were in it to make money. His impact on history wasn't nailing a thing to a church door. The guy ran circles around the Church defenders because he replied quick, effectively, and he was the darling of the printers who controlled the medium.
It's not just about having the best argument, it's about fitting the format of the medium. Luther would deliver retorts in the space and time frame that the printers wanted. You can easily imagine how this would drown out the defenders of the Church (especially since it's salacious) and impact public opinion.
But that phase only lasted so-many years. Before long, the situation got out of his control, and that's kind of when you might say Protestantism started.
That explanation is fun, and not exactly wrong, but there were many factors brewing, and attempts at just about every part of what we call the Reformation had been attempted on some level in the hundred years preceding except perhaps the allied states' standard against the HRE. Most acute factors were probably the combination of the financial crisis, simony, absent bishops, Medici cultural and political influence over Rome, peasant revolts and prior attempts at schism or reformation, discontent between German princes and HRE, increasing prevalence and affordability of printing which promulgated new understandings of Aristotle and Augustine in addition to enabling more widespread publication of dissent. It's a rich topic, certainly worth reading extensively about; I'll be sure to check out the book you linked.
I was listening to some podcast episode from the author Patrick Wyman. He was doing an interview with Mike Duncan(?) in a very casual way.
I really latched onto a point about Martin Luther - that his personality traits directly affected the course of events toward the Reformation as we know it.
History is probably a lot more chaotic than we give it credit for. Whenever an upheaval happens and the world gets turned upside down, we can always go back and trace structural trends in that direction. This fails to capture how many transformations failed to happen.
Printing was getting more affordable, but the printers themselves couldn't stop going out of business. The technology arc of lowering costs, but that doesn't map directly to profits and they just kept going bankrupt.
I'm really fascinated by the role of pamphlets. We keep talking about the press in the context of books, but Luther's legacy wasn't in publishing full-length books. This has come up again and again through history. In the 1600s, pamphlets played a role in the English revolution, and it did in the French Revolution as a whole universe of revolution presses sprung up. Were these like newspapers? Or was it some shorter and more targeted form of political hit piece?
Luther came out dropping rhetorical bombs. I get how reading stuff can radicalize you. I've felt that energy in my own life, but overwhelming volume of media we get combined with our longer life spans does some intellectual inoculation. I can only imagine the anger that could be stoked with the written word at that time. It's not a forgone conclusion, because most people are garbage at writing convincingly.
Indeed. Newspapers felt like hit pieces then, too; many of the printers were radicals and the readership wasn’t mild and broad like today.
Some of Luther’s writing (good English translations, anyway) still feel electric. Even his Small Catechism, which is written simply and was legitimately intended for daily use in the home, contains self-examinations and positive formulations of the ten commandments which imply faithlessness on the part of bishops.
Not quite so new. At the time Luther published his 95 Theses in 1517 the printing press with movable types has been around pretty much as long as the computer has been around for us in 2021: for three quarters of a century.
That doesn't mean success, or those who succeed, aren't successful. Or don't serve as icons for the movements or initiatives they are known for.
There are many flaws with the Great Man theory of history. But reflexive rubbishing of it serves little use either.
Better is to have an understanding of what factors contributed to a breakthrough. And if that is chance, luck, timing, or a coincidental confluence of factors including emergent technologies, then yes, give those credit.
Real history is complex. It doesn't fit on postcards. Any less-than-comprehensive account is a map, not the territory.
Wiktionary lists as an interesting possible origin of the German equivalent "ficken" the sound it makes when two things rub against each other ("fffppp, fffppp, fffppp"). [0]
"To be eligible to live in the village, applicants need to meet three basic criteria: they must demonstrate financial need, have lived in Augsburg for at least two years and be of Catholic faith."
Absolutely. The German constitution mandates students be able to obtain religious education in public school as part of regular curriculum, prohibits the government from interfering in any religious organization and mandates that the government collect member tithes as part of tax collection for any religious group registered as a PLC at their request.
The ruling party of Germany is expressly religious, the Christian Democratic Union. There's religious pluralism in Germany and all religions have the same benefits, but the idea of what those religions may do is not so intuitive from us in North America.
Regarding the church tax, if you move to Germany you'll be ask what religion your are and unless you answer atheist you'll have to start paying a church tax and it appears to be quite a hassle to get out of it.
The same system exists in Switzerland. While living there, and after registering, a priest visited my home to investigate our nonbeliever status. My spouse inadvertently mentioned her Jewish ancestry, at which point the priest offered to send a Rabbi instead, before she could say that she wasn’t then and had never been observant.
> and it appears to be quite a hassle to get out of it.
Five minutes at the local courthouse, 20 Euros or so, and it's effective next month.
Of course, during Corona it can be more difficult to get an appointment, and the fee can vary from state to state, but all in all it's easy to get out.
You declare not being part of an officially recognised church, not being atheist. Muslims don't pay these taxes as these is no recognised Islam "church". Getting out is easy, depending on where you live. It took me about 10 minutes, signing a paper at the Standesamt, and out I was. Got a nice letter from "my" community priest giving me a chance to rethink that while threating me with hell, pretty directly so.
Slight clarification here, it is way less than 8-9% of your gross salary. I had a look when I was a church member, and it was 2% of my gross salary. It was indeed 8% of the amount of my income tax.
I think the way it is calculated (depending on the federal state your in): Gross salary -> income tax -> 8 to 9% of the income tax = church tax.
At least in Christianity, 10% is the traditional donation to the Church. So that doesn't necessarily sound out of line. On the other hand, some people split the 10% between the Church and secular charities which wouldn't be possible in this case.
But besides the money collection there are also the tax exemptions right? It looks lovely...
"The foundation deed specified that the housing complex was to exist “in perpetuity” and to be “further developed.” The philosophy behind it can be summarized as being to “provide assistance, not charity, to people in need so they can help themselves.” There are a total of nine foundations established by the Fugger family in Augsburg that have been in continuous existence since the 16th century. In addition to the Fuggerei, there are medical facilities, an infirmary, and a foundation to contribute to the salvation of the Fugger family, among others. According to an inscription on a tablet displayed at the Fuggerei, the Fugger family established the foundation to “reimburse God the money that he has generously bestowed upon the family.”
"Paupers or beggars are not eligible. A person that has been accepted for residence is required to say three daily prayers for the Fugger family"
I am sorry ...the business man in me...every time I see
the word foundation I see only one thing. Only business
vehicle where you are tax exempt... while at the same time
still benefiting from the foundation assets.
"Forget about the Gates Foundation. The world’s biggest charity owns IKEA — which is not only devoted to interior design."
That is true in theory but not in practice. To be recognized you need to be organized as a Körperschaft öffentlichen Rechts which isn't exactly trivial. In practice the Catholic church and the "Evangelical church of Germany" (a confederation of various mostly independent parishes, mostly Lutheran) are the two big ones and everything else barely passes as a rounding error (e.g. there seems to be only one Muslim organization and while they reflect a sect mostly originating in Turkey, they're hardly the largest Muslim sect in Germany).
Also for example the two primary public broadcasting channels ARD and ZDF have a Catholic and Lutheran bias (although this mostly manifests in a handful of very short theological opinion pieces paid for by the respective churches and clergy of the two religious orientations being invited every time ethical concerns are discussed).
Saying "all religions have the same benefit" is a lot like saying all people are equally forbidden from sleeping under bridges regardless of their income. It's not exactly an equal playing field and a lot of the influence of the churches comes down to not just the number of registered members but also feudal property rights and pre-existing contracts (e.g. the Catholic church is one of the few entities that legitimately "owns" land in Germany whereas normally legal subjects are only granted "ownership" conditionally).
And let's not get into public sector institutions like hospitals and schools being operated by one of the two churches and personnel being subject to church labor laws while the majority of the operating costs (in some cases even 100%) are footed by the state.
We only call it pluralism because Martin Luther was successful. Much like our so-called federalism (because Germany was still a lose collection of functionally mostly independent states until around the time of the American Civil War) it's really more of an accident of history that we later rebranded as something desirable.
I am sorry but I have a follow up question maybe you are able to elaborate as you mentioned: "There's religious pluralism in Germany"
Scientology has an IRS tax exemption in the US as another religion, but it seems in Germany the state has made their life quite difficult. Does German law provides for a clear specification of how to define a religion?
You will not find an advocate of Scientology in me :-))
But you will find an advocate of equal treatment under the law and the rule of law.
Apparently members have stronger restrictions than those applied to persons who express extreme right views:
"Scientologists in Germany face specific political and economic restrictions. They are barred from membership in some major political parties, and businesses and other employers use so-called "sect filters" to expose a prospective business partner's or employee's association with the organization."
As I said, not defending Scientology here at all, but from the wikipedia article found this case interesting:
"In 2019, the Munich Labor court sided with the director of personnel of Haus der Kunst, a well-known artistic museum. He had been removed from his position after working for 22 years because it was discovered that he was a Scientologist. The case was settled and the director of personnel was paid 110,000 euro as severance and received a full pension. Many Germany courts also ruled the legitimacy of Scientology as a religion. In 2019, Ahmed Shaheed and Fernand de Varennes who were UN Special Rapporteurs on freedom of religion and on minority issues wrote to Germany that, "discriminating against those who profess a certain belief is illegal under international human rights law, irrespective of whether the belief is religious or merely philosophical or cultural."
That sounds pretty fair to me. It's one thing to punish an individual for having a belief; it's another to give an organization a tax break for a Ponzi scheme based on that same belief.
In the case of political parties: they decide themselves. The large parties all have lists of clubs and informal organizations where membership is incompatible with party membership.
(No major party allows membership in another party, except european sister parties in other countries, but it's possible, and some smaller parties allow it)
in your quote, it says that private businesses and political parties are making these decisions. that's likely done as part of their regular screening processes.
That would be a violation of the general act on equal treatment (introduced 2006), and hence referred to the state's attorney's office. Scientology does not enjoy the protection of religion or worldview because the organisation is under surveillance from the federal office for the protection of the constitution because of their politically motivated crimes.
>Scientology has an IRS tax exemption in the US as another religion, but it seems in Germany the state has made their life quite difficult.
Scientology's founder has been quoted as saying: "You don't get rich writing science fiction. If you want to get rich, you start a religion.” German courts have argued that because of this (and the organization's behavior after he died) that it's actually a for-profit business organization masquerading as a religion.
EDIT: I probably should add that the US is rather extreme amongst nations worldwide in that it does tend to recognize personal conviction rather than only shared dogma/tradition as a form of 'religion'. It's unlikely but I could see the organization losing tax-exempt status. Even if this happened, the individuals couldn't be prohibited from practicing what they believe is a religion.
The US never affirmatively recognized Scientology as a legitimate religious organization. Rather, Scientology fought a prolonged, dirty war with the IRS and came out the victor when the IRS decided to settle. Because of anti-tax sentiment that daemonizes the IRS, the IRS doesn't have the stomach for prolonged battles that play out in the media. The public is too credulous when the defendant invariably plays the Samson & Goliath card. (Trump has also successfully used this technique. I once had a law professor who worked on an IRS case against Trump, and he had some interesting stories--not to mention strong opinions--regarding Trump's business practices. Actually, anyone of means caught in the IRS' cross-hairs will use this technique. But you have to be particularly bellicose, as in the Scientology and Trump cases, to flagrantly violate tax laws with the intention of taking the IRS to the mat.)
It's also worth pointing out that, unlike some other countries, the US doesn't really have a formal system for recognizing religious organizations. AFAIU, the closest thing we have is the IRS adjudicating in the first instance Federal tax exemption status. Otherwise, as a general matter, a religion is as a religion does, and it's usually up to agencies, municipalities, and ultimately courts to decide on a dispute-by-dispute basis whether an organization, group, or person is owed the benefit of some particular religious exception in law.
Side note, Jedi is the fourth largest religion in the UK. I wonder if Disney have considered registering it as an official religion to lower their tax bill there.
It's exactly because of it. This cooperative system gives the state significant control over the church, which was the original reason for this sort of semi-public funding. German priests are trained in public universities and the state has influence on the curriculum. Them most extreme form of religions you will always find outside of the system.
Indulgences were not the big money maker for people at the top, it was selling benefices that made Popes and other church leaders rich, i.e. selling Church offices for huge sums (hey you want your nephew to be a Bishop or Cardinal, sending in X ducats). Why fleece poor people when you can fleece the rich, they have all the money.
Well, yeah, but you wanted your nephew to be a bishop or a cardinal not just for the prestige, but because he could sell or rent lower positions in his own diocese, or collect indulgences himself. It's feudalism all the way down.
> The founder of the family was Johann Fugger, a weaver at Graben, near the Swabian Free City of Augsburg. The last name was originally spelled "Fucker".
> The first recorded reference to the family comes when Johann's son, also named Johann (or Hans), moves to Augsburg in 1367, with the local tax register laconically noting Fucker advenit, "Fugger has arrived".
> To be eligible to live in the village, applicants need to meet three basic criteria: they must demonstrate financial need, have lived in Augsburg for at least two years and be of Catholic faith. ... checks church registers to ensure they're Catholic
So, standard economics at work: If prices are rigidly set at a low level, there will be rationing. There is the non-price rationing.
> Roughly 160 residents live in the Fuggerei ... there are about 80 people on the waiting list ... applicants could be waiting years for a callback.
It does makes me wonder how low the price of social housing can go while still being sustainable either to be subsidized by the government or payable by tenants.
Land use policies, that is transportation and housing makes up about 30% of the cost in the average American budget, which suggests living in America is pretty expensive.[1]
Will point out that this housing is hardly sustainable, it's paid for from the remainders of Fugger's wealth (he is the richest man in the world, accounting for currency changes and inflation) as well as donations from the church (probably in order not to be dragged to court for late debt payments, the church borrowed a lot from Fugger).
I wonder how strictly they check up on your mass attendance. I'm not sure the ethics of lying to pass an unethical religious-based test for housing, but it strikes me that there must be at least one resident that is not as dedicated to the church as most.
> Social worker Doris Herzog is the first point of contact for most applicants. She checks church registers to ensure they're Catholic and interviews them on their living situation.
Those things happen in markets with price signals too. Rationing and persistent shortage are happening in housing markets around the world broadly.
It's kind of a given that any social housing like this is going to have a limited number of rooms. And as a result, only so many people will be able to live there.
That's not some clear proof of market theory. Because the other half of market theory - about how price signals drive behavior of rational actors - doesn't hold up.
Do you have an example where rationing is occurring without price controls? I don't have experience outside of the US, but in the two US markets with probably the biggest housing shortages (SF, NYC, maybe Austin nowadays?), if you give me 8k a month I'll find an apartment tomorrow.
It is also unfair to blame market prices for the situation in NYC and SF as largely the price increases and shortages are driven by insane zoning and other regulations that makes building, maintaining, and turning over housing near impossible.
That is not market forces, that is government controls
Good luck going to Mount Athos
https://en.wikipedia.org/wiki/Mount_Athos#Access
Money is not an issue. But unless your a man, you can't get in, period.
Oh, you mean you want to live there. No problem, just change your religion.
"Residents on the peninsula must be men aged 18 and over who are members of the Eastern Orthodox Church and also either monks or workers"
OK, so here we once again have a situation where the price mechanism is not allowed to operate. For a moment, I thought this was a private gated community in San Fransisco.
> Mount Athos (/ˈæθɒs/; Greek: Άθως, [ˈa.θos]) is a mountain and peninsula in northeastern Greece and an important centre of Eastern Orthodox monasticism. It is governed as an autonomous polity within the Hellenic Republic. Mount Athos is home to 20 monasteries under the direct jurisdiction of the Ecumenical Patriarch of Constantinople.
Oh, another religious membership test.
How is this at all pertinent to the functioning of the price mechanism? Especially when it is government enforced?
> Although Mount Athos is legally part of the European Union like the rest of Greece, the Monastic State of the Holy Mountain and the Athonite institutions have a special jurisdiction which was reaffirmed during the admission of Greece to the European Community (precursor to the EU).[5] This empowers the Monastic State's authorities to regulate the free movement of people and goods in its territory; in particular, only males are allowed to enter.
How would raising the rent change the wait time for ground floor housing? By forcing poor people to move out because richer people want to move in?
That doesn't sound like a good thing.
According to standard economics, since there's a demand, why isn't there other, new housing along these lines - where costs are paid for by investments and entrance fees rather than rents?
Economics 101 often fails to convey the crucial fact about rationing: under any rationing system that isn't a pure random lottery, the only effect of rationing a good is to change the currency in which that good is priced. [1]
For example, I live in Canada. Our healthcare system is single-payer [2], which is isomorphic to saying that it is rationed. So it would not be accurate to say that your access to healthcare in Canada is priced in dollars. But it would be accurate to say that your access to healthcare in Canada is priced in your ability to navigate bureaucracy, the flexibility of your working hours (to snag last-minute appointments), and your family connections who are embedded in the healthcare system as administrators or physicians.
Depending on your personal values, you might consider it good or bad that access to healthcare in Canada is priced in these units. What makes dollars unique is that if you inject more dollars into the free market for a good, then ceteris paribus, you will cause more of that good to be produced. Whereas if you injected more bureaucratic know-how into the Canadian patient population, you'd merely cause more intense competition for the same fixed number of physician-hours.
That is: by repricing a good in non-dollar units, you've removed a lot of the flexibility that would have allowed your system to make more of the good if lots of people wanted it. There are situations when this might make sense to do, and there are legitimate debates to be had around it. But this is the tradeoff you're making when you ration.
People often mistakenly think that if the price of a good is opaque, then the good must not have a price. This is incorrect. What's more, if you believe it, then you're almost certainly getting over-charged. And very unfortunately, this mistake tends to be most common among less sophisticated folks — who are the very folks that rationing was intended to protect in the first place.
>I personally find it very comforting that (at least at in principle) both the rich and poor wait in the same line.
That's rarely the case. For stuff like consumer goods (ie. getting the iphone on launch day, a few years ago) the rich person can buy it off a scalper, or pay someone to stand in life for them. For healthcare they can just fly to a private clinic.
There’s a lot of ways in which the cost of healthcare in US is inflated due to restrictions and monopolies. Don’t form an opinion on the premise that healthcare is intractable expensive.
> Economics 101 often fails to convey the crucial fact about rationing: under any rationing system that isn't a pure random lottery, the only effect of rationing a good is to change the currency in which that good is priced. [1]
Isn't it often worse than that?
Unless rationing can be perfectly enforced (e.g. require consumption of the entire resource under observation of enforcers, which is actually most tenable with housing by frequently checking to make sure only the authorized people are present) then secondary grey/black markets form when there is an opportunity for arbitrage.
> People often mistakenly think that if the price of a good is opaque, then the good must not have a price. This is incorrect. What's more, if you believe it, then you're almost certainly getting over-charged. And very unfortunately, this mistake tends to be most common among less sophisticated folks — who are the very folks that rationing was intended to protect in the first place.
Note that this is one of the problems in the US too. Health care prices are pretty opaque, it definitely has a price - which you'll find out after you get something done, and I would argue people get overcharged - evidenced by the fact that insurance companies can come in and slash the bill to a fraction of what it was (literally saying "you aren't allowed to charge this much").
> What makes dollars unique is that if you inject more dollars into the free market for a good, then ceteris paribus, you will cause more of that good to be produced.
Markets don't actually work this way in practice. That's the theory, the theory rarely actually pans out. We could look at US healthcare, which is an insane mess, but it's pretty easy to argue that it's not actually a market due to insurance and opaque pricing and all the same problems. We've kind of got the worst of all worlds over here. But dental and vision care, which are closer to real markets don't actually work any better. They're still expensive, in accessible, and pretty non-responsive to price signals.
Instead, take something like food, where it's a commodity. That's a place where markets should be the cleanest and most responsive to price signals. We produce 1.6x the amount of food the world needs. And food is some thing where there's a literal cap on the ability of any individual to consume it. Our stomachs are only so big, there's literally only so much each of us can consume in a day. By market theory, prices for food should be almost negative and no one should be with out food given those facts. But that's not how it works out. As always, there are too many confounding factors and the profit motive causes rent seeking at every layer.
By market theory, there should be over production of food, which should cause everyone to have food and food producers to drop out of food production until prices rise to equilibrium where everyone has food and the people producing food have a good living.
Has that happened anywhere? No. Instead, you have corporations standing between producers and eaters finding ways to make food more expensive through value add and marketing. You have producers struggling to get by, buried under a mountain of debt, and often effictively in indentured servitude to the processors. And you have hundreds of millions of people food insecure, tens of millions even in a rich country like the US that massively overproduces food. Because markets in real life don't work according to the theory.
And that's why we can't just approach economic problems with the idea that we can just throw more markets at them. And why we have to think about when systems like single payer, for all their faults, are better than what we'd end up with through markets.
Trust me, if you'd ever had to deal with the American health care system, you would long for the Canadian one.
> Instead, take something like food, where it's a commodity. That's a place where markets should be the cleanest and most responsive to price signals.
There are a whole lot of distortions on every side of the market for food which interfere with a properly functioning market. There are incredible subsidies paid to farmers to produce specific things (which then cause over-production in those items). There are tariffs to protect privileged farmers. There are actual import and sometimes export quotas. Then, rich countries dump the over-production as in-kind food aid to poor countries undermining poor farmers there.
Case in point is Nebbia v. New York[1] where the supreme court affirmed state interference in free markets by setting a price floor on milk to protect a select few milk producers.
Going back to my first comment. The mechanics are clear. An effective price ceiling leads to too few units being offered relative to the units demanded resulting in perpetual shortages and non-market mechanisms end up determining who gets the benefits of the existing units. Persistent price ceilings lead to chronic reduction in investment producing the thing.
Similarly, effective price floors (minimum price of milk, minimum wage etc) lead to too many units being offered to the market leading to persistently wasted productive resources.
Both reduce the total productive capacity of an economy.
But that's the point. There are always going to be distortions. And only some of those distortions come from the government. Perfect markets don't exist and can't exist. They don't line up incentives as advertised, the incentive for the producer to take as much as possible from the consumer drives all kinds of insane and harmful unexpected behavior. And market competition doesn't keep that incentive in check as the theory holds, because all producers share the same incentive and their interests align. Government distortions are sometimes self serving as you've pointed out, but just as often they are attempts to counter act the distortions created by the markets themselves.
Economic theory has never been predictive to any reasonable margin of error. And a theory that cannot predict outcomes is not a valid theory.
Perfection is good to have in models to demonstrate limiting cases, but not necessary to know the difference between situations where prices are allowed adjust and where prices are not allowed to adjust.
The "markets are not perfect" crowd loves to imagine the existence of a "perfect" and benevolent social planner who will always act according to their wishes. Let me know when you find one. (I know, "#realsocialism never been tried).
> Economic theory has never been predictive to any reasonable margin of error. And a theory that cannot predict outcomes is not a valid theory.
I find it ironic that you make this statement in the context of a clear cut demonstration of what happens when prices are not allowed to adjust.
There are a zillion markets across the world where one does not need to depend on the benevolence of the proprietor to get what you want or the benevolence of the customer to earn a living. Those get conveniently ignored.
If price controls worked so wonderfully, Uber, which was only an improvement on what was there before it and nothing close to "perfect", would not have become so popular. I would have loved for them to run a continuous double auction, but then nobody every gave me a billion dollars to burn.
> distortions created by the markets
By definition, distortions are created by interventions in markets.
> We produce 1.6x the amount of food the world needs. [...] By market theory, prices for food should be almost negative
Can I get a source for the 1.6x figure? I suspect it's 1.6x on the field, but doesn't factor in losses in transport/processing. By the same logic, we generate 110%[1] the amount of electricity that the world demands (at the power plant, 10% is lost due to transmission losses), therefore electricity prices should be negative as well.
So being able to get something after a wait is worse than not being able to access it at all by being priced out? That's a hot take.
Just because something is "priced" in a different quantity doesn't mean that it isn't cheaper or higher quality overall. That requires a more sophisticated argument than a simple observation that there's still some cost.
> the only effect of rationing a good is to change the currency in which that good is priced
This just sounds like an instance of the fact that a sufficiently abstract system of reasoning can be always be forced to described any particular patch of the world. Though typically at the cost of considerable contortions of the terms that makes no sense in other bits of the world.
For example, you may well say that "ability to navigate bureaucracy" is a currency. But it's hard to understand how you put that currency in a bank, in which sense this currency splits into perfectly equivalent units, or how it represents equivalent value at many different physical locations since the specific bureaucrats are tied a specific location.
By the way, picking an instance of cheating as some sort of general argument of why a specific system is not to be trusted is just a straw man, since the problem of cheating is independent on the exchange mechanism. Alternatively, accept this argument: scammers on Amazon prove that free market mechanisms don't reliably give a fair price.
Since this is not a public service, then no rationing is not bad. In the US, a lot of the homeless shelter are faith based and each only have so many beds to go around each night.
There are not more since someone has to put up the money for the investments. And entrance fees would not likely work for anything new and not novel. Only the government can spend more than it makes.
I don't think you would be permitted to have a faith-based test for entry into a homeless shelter in the US, though, even if the shelter were faith based. I'm not a lawyer but I've seen enough fair housing act noticed when buying, selling, and renting housing.
Interesting, but since no money is changing hands I wonder if there are exceptions. I mean I can see some people preferring people sleep on the streets than see a faith-based test allowed to exist, but surely those people's irrationality doesn't prevail?
I mean, you could ask the same question for a race-based test, and come to the same basic conclusion: that it is "irrational" to prevent it.
I think you have to leave look a little deeper to reach a correct conclusion. Namely: I don't think significantly more free housing would in fact be offered without these regulations. So it would not be rational to allow this type of discrimination. The regulation in essence provides an anchor "price" for free housing, while not distorting the "market" very much. This is a good type of regulation to have.
Yes. When a good or service is always available to anyone who can pay the price, all one needs to do is find the money and one can get it.
When prices are set artificially low, both current and long term go down which results in perpetual shortages. Since getting the thing now depends not just on being able to come up with the cash, but relies on the pen of a bureaucrat, corruption seeps in and becomes endemic.
This charity is able to get it done by requiring adherence to a specific religion which serves both as a selection and an enforcement mechanism.
If one is tempted to think of generalizing this, I would recommend reading about both Western socialists waxing poetic about USSR's "solutions" to housing shortages and the reality of housing in the Soviet Union. Unfortunately, city & urban planning programs as well as architecture schools tend to produce a lot of credentialed people who parrot the former.
"all one needs to do is find the money" is the mechanism that keeps some people out of the housing market, or at least makes their lives pretty hard. Middle-class families can find the money, but the poor do not and usually cannot (for whatever reasons) raise their value on the job market enough.
A case can be made for rationed housing at extremely low prices. If you let anyone in, you would get a cash-flow problem and distort the market, but not if you limit it to the poor.
> Yes. When a good or service is always available to anyone who can pay the price, all one needs to do is find the money and one can get it.
This sounds nice but breaks down because shelter is a human need, it is not a new iPhone.
I am aware that the solution to housing crises is build build build, and that the more profit is in developing housing the more there is being built, but pretending a place to live is like any other common good is cold and wrong.
> pretending a place to live is like any other common good is cold and wrong.
Does it help if you pretend that it's not? Do you get more investments into housing, and in the end, more houses, if you consider housing different from other markets?
I am not pretending anything, I am merely pointing out that shelter, like food an water, is a basic human right (although judging by HNs donwvotes, they'd be fine with starving and dehydrating people as long as someone is making a massive profit).
I think many here disagree with you about it being a human right, because unlike the earlier human rights, it's not "leave people be" at its core, it's "you have to do X for people". If anything, it's a human entitlement, but that doesn't have the same ring to it, I suppose.
And then there's the next part: how good and how much? What's the housing that everyone supposedly has a right to? 100sqft? 500? 1000? And of what quality, and where? Do they get to choose the location?
> If anything, it's a human entitlement, but that doesn't have the same ring to it, I suppose.
This is nonsense you just made up. Positive and negative rights are both rights, as is common understood in English but especially as defined within political science and philosophy. [1]
> Due to the fragile nature of the formation and the large number of people wishing to visit it, a daily lottery system is used to dispense only ten next-day permits in person at the Kanab visitor center. Additionally, ten online permits for each date are available four months in advance of a planned trip.
There will be a perpetual shortage.
This is not a bad thing ... unless you don't care about preserving things for the future.
Do you still think rationing is bad? Or is my example not a case of rationing?
Bavaria is majority Catholic. "Demonstrate financial need" is likely a much stronger selection mechanism.
You didn't answer my question about why, if there's a wait list for this place, and since it's proven to be economically sustainable, other housing isn't built along these lines.
> corruption seeps in and becomes endemic
After 500 years, is the Fuggerei endowment fund corrupt?
Corruption can seep in whenever the person making the decision isn't the person making the profit. Even in a free market.
>Bavaria is majority Catholic. "Demonstrate financial need" is likely a much stronger selection mechanism.
According to wikipedia bavaria is only 49.6% catholic. I'm not sure how excluding more than half the population on the basis of religion can be justified.
German Catholic is pretty strong still. Church runs a lot of hospitals and kid/youth things, daycare and so on. They require Catholic employees, they frown upon non married couples and so on.
My point is that the requirement to demonstrate financial need is likely a significantly stricter criterion than the requirement to be Catholic, so the latter shouldn't be singled out.
It’s not obvious to me that this is economically self-sustaining, that is to say it could be recreated starting from scratch today (without the initial grant from the Fuggers).
After 500 years, is the Fuggerei endowment fund corrupt?
I do not know about their internal workings. As I said, in this special case, verified adherence to the rules of a specific religion may help. However, history is filled with examples of catholic clergy dispensing with favorable judgements in exchange for things of value. How do you know if a more "deserving" person was not passed over for someone else who may be had a good connection or promised personal favors etc.
Regardless, I was referring to the situation when someone tries to replicate something which seems to work in a 160 person case at a grand scale.
You implied the corruption was inevitable. Either the endowment fund is corrupt already, or your assertion about 'inevitable' is meaningless.
History is filled with lots of examples of corruption. Including in free markets.
You were referring to the existence of a years-long waiting list, as if it were a meaningful evidence they should raise rents in order to avoid the artificial scarcity you think is universally bad.
Thank you very much - I think that shows that (for the US):
- in 2015 there were an estimated 118,290k housing units
- in 2017 there were an estimated 121,560k housing units
- in 2019 there were an estimated 124,135k housing units
(note that the majority of these -- more than 70,000k in each case -- are single, detached houses)
Those are quite useful starting factors - roughly one housing unit per three persons in the population, and roughly 5% growth in capacity over four years.
The next few steps would be to match those against population and property price trends, check for correlations, and perhaps narrow and regionalize the data to look for any notable outliers.
(not sure when I'll get to those, but it'll be a good learning experience I'm sure)
Well, I'm aware that there are people that believe this stuff today. But Jakob Fugger, if you actually read about his life, does not appear to have a moral bone in his body in the Catholic sense. That informed my comment. I personally suspect the village was done for show or as some sort of appeasement, not out of genuine faith.
Separately, I don't think we as a society that strives to be rational, should be open to claims of belief based on faith. I think they should be immediately discarded as arbitrary claims. Just an FYI, let's steer away from that particular topic (i.e. the legitimacy of believing some part of Catholic doctrine).
You are absolutely misunderstanding the medieval mind, and many modern religious minds.
Many people today believe in the power of prayer for the dead to help the state of the souls of the departed. Not a majority, but enough that you probably know a few who don't speak about it precisely because of the incredulity people express when people actually believe their religion, especially Christianity.
Including the people who manufacture the sale of indulences for their own personal profit? Do they really believe in the tenet of having living people pray for the dead? Is the medieval mind capable of such cognitive dissonance? More importantly, is the modern mind capable of it?
If shortage means it "doesn't work", it's not clear to me how exclusion based on income is any better, or indeed if these are actually substantially more than just two names for the same fundamental shortage problem.
I have a feeling you're being sarcastic, but that's exactly what I'm arguing for. If your city only has enough housing for 100,000 people, but there are 150,000 people who want to live there, there's going 50,000 who can't get a house. In other words, a shortage. That's bad, but that number is going to be the same regardless of how you're redistributing it. The question then becomes, can we make the best out of a bad situation? Distributing by price has benefits that I mentioned. What benefits does giving giving it for below-market prices to people whoever's first on a waiting list provide?
It only works though if income distribution is somewhat sane and people actually buy the housing to live or for renting out. The issue is that a small part of the population is so rich that they can afford many apartments/houses without living in them or renting them out. Those individuals have often enough market weight that they can distort the market all by themselves. Creating an arbitrary shortage to drive up prices for example
Except, if you'd ever paid any attention to housing markets in any major city they don't work this way. There are too many other factors and incentives at play. Not least of which is that the profit motive drives developers and landlords to keep costs as high as they possibly can, and they all share that motivation, so you end up with convergent price fixing - where they all just naturally compete on things other than price with out actually colluding to do that.
They do though. It's just that there's so much regulation and other problems that they can't adjust fast enough.
I've lived in Hamburg, Germany, adjacent to an expanding hipster area. Rents rose steadily and every vacant lot was being built upon, industrial zones were repurposed for more housing etc. It's just that that still only gives you a fraction of the apartments you'd need to satisfy demand.
If there was no incentive for investment, I'm sure we'd see even fewer new houses being built, because there's no incentive for the state to move, neither fast nor at all.
In a price defined shortage, there are always alternatives, it's not so black and white:
- you can get a smaller apartment
- you can get a not so nice apartment, but with space
- you can get an apartment further away from points of interest, meaning it's cheaper but you have a longer commute
This is very similar to free market for groceries: in communism you don't get groceries on the shelves. You get them only if you are lucky enough to be around when a delivery is made.
In capitalism, some groceries might be more expensive, but you can always buy cheaper ones, or travel longer to buy from cheaper stores.
You talk about these options as if they are selection dilemmas rather than an optimization problem, and discussing trading time and effort for price as if time and effort are unlimited resources. If you're going to pretend time and effort are unlimited, why not pretend funds are, also?
time is not unlimited, where did I say that? But you can commute 1 hour away and get much cheaper rents in almost any location on Earth. You trade off one extra hour each way for some cash.
You're right. That is a flaw with the free market. A rich person mildly wanting something will outweigh a poor person desperately wanting something. That said, the alternatives aren't much better. A wait list doesn't have any concept of neediness. self-reporting is unreliable (everyone will just say they really want it). A neediness assessment (ie. auditing each applicant's neediness) could theoretically work, but requires time/resources, and still has biases (eg. people with "visible" problems probably will look more needy than someone with hidden ones). Moreover, none of other distribution methods incentivize further supply. A sibling comment covers this:
>What makes dollars unique is that if you inject more dollars into the free market for a good, then ceteris paribus, you will cause more of that good to be produced. Whereas if you injected more bureaucratic know-how into the Canadian patient population, you'd merely cause more intense competition for the same fixed number of physician-hours.
>What makes dollars unique is that if you inject more dollars into the free market for a good, then ceteris paribus, you will cause more of that good to be produced.
If the video card shortage has taught us anything, it's that this is not always true.
I think you need to factor in timeframes here. The demand shock for silicon started less than 2 years ago. The time it takes to bring a fab online is much longer than that. More of the goods will be produced eventually, but the market can't materialize it out of thin air.
I certainly hope that is the case, but I remember the Nvidia CEO (it has been a while so things may be different now) saying they would not increase production because they were worried the demand surge was temporary. So long as crypto is profitable I don't see where any amount of production increase is going to stabilize the price. Maybe Ethereum PoS will fix this? Or will another PoW cryptocurrency just take its place?
The article made no such claims of being able to solve any housing crisis, merely that 160 people can live in a way they otherwise wouldn't be able to.
I think their point is that this isn't really social housing, it's a perk for a very exclusive group of people. Not all that different from a waiting list for membership to an exclusive golf course.
Things that don't cost to buy at least as much as they cost to make, are not sustainable by definition and will be riddled with systemic problems like shortage, rationing, etc.
One requirement is to do a "Fürbitte" aka a prayer for the fugger so he can get forgiveness and remain in heaven/ leave purgatory. At least that is what i ve heard.
> Original residents of the Fuggerei were asked to offer three prayers a day for Jakob Fugger and his family. …
> "Jakob Fugger says they have to pray for him. Our administrator always says he is in heaven and will see if you do that. You are responsible for that," said Herzog.
> In other words: that part of the deal is between residents and God.
In a world with ubiquitous housing, there is no need for social housing, because that which is ubiquitous (oxygen) is affordable.
In a world with scarcity, social housing protects the poor against unaffordability. That's commendable. However, scarcity also means there is not enough for everyone.
Inevitably that means you get a group of poor winners (who obtain a social home) and a group of and poor losers (who remain on a waiting list for a social home).
Those on a waiting list are relegated to the non-social sector: paying market rates. The more social housing there is, the smaller the private housing market is, the higher the rent prices.
Thereby, the scarcer the situation is, the more unaffordable housing is, the bigger the calls for social housing, and the more the differences between winners & losers is exacerbated.
That's what we see develop in many cities . Some pay absolutely nothing, others pay way too much. The winners and losers group is often partially arbitrary. The benefits of rent-control are distributed unequally, some receiving rent-controlled benefits for decades, others remain on a waiting list for decades, while earning just as little. In many European cities waiting lists are >10y, in Amsterdam for example it's about 14y.
Second, the benefits of rent-control take away various healthy market-based incentives. My dad for example lives on welfare in an apartment with 3 bedrooms, by himself in the capital city, and pays 1/3rd of the market rate. He has no incentive to seek out smaller housing which suits his needs just fine. Similarly, he does not make much use of the cultural offerings in the capital city that makes this place popular and expensive: theatre, bars, cinema, restaurants etc, he would be fine living in a smaller town without them. Yet, he has no incentive.
A market based rent for my dad would indeed make it unaffordable for him. At the same time, the market price is a way to allocate supply & demand efficiently. My single retired dad has no demand for the size and location of his home, yet it is in extreme demand by others. The high market rate rent of say $2k a month, if applied, weeds out those who're unwilling to pay the price of $2k worth of opportunity costs (high value for my dad) in return for 3 bedrooms in the capital city (low value for my dad, who'd decide to move in), and lets those who's calculus is different (high value for young urban professionals) move in. Rent-control destroys that efficiency.
Second, it obviously puts a cap on prices and rental returns. Price elasticity of supply is at least somewhat elastic (more in the US than say, the Netherlands, but still). If industry X has fixed prices and industry Y doesn't, ceteris paribus you'd expect most investments in production/supply of industry Y because the returns aren't capped. Rent-control in this sense can limit housing construction, exacerbating the problem further down the line. (This is less applicable to Europe which has more high-density built up areas that are more land-constrained than the US. As such, higher prices don't always translate into more construction, which means the downsides of rent-control are smaller in this respect).
I'm a big fan of rent-control, but it has to be balanced with (partial) incentives. There seem to me some easy mechanisms that should be applied to bring more balance.
1) Rent-control is not enjoyed permanently, such as in many countries is the case. Instead, one gets 8 years of rent-control, after which you must move, or pay market rate. This brings balance to the current situation where one person has a rent-controlled apartment forever, and another is on a waiting list for 16 years. While de facto forced eviction after 8 years is obviously bad, it's a lesser evil compared to the above distribution of scarce rent-controlled units.
2) If a rent-controlled unit has 3 bedrooms and you live there alone, you lose some of the rent discounts. It's okay to live as you like, alone or with others. It's not okay to live alone in a home that can house multiple people, and expect others (the government/taxpayer or landlord) to subsidise you, while there's people on waiting lists for decades. We actually have a lot of real estate, in almost all countries the number of people per home has been dropping for decades, while the average home size has been increasing for decades. Yet there is a scarcity of housing, in part because people occupy larger homes than they need. Particularly if the home is subsidised and rent-controlled, that shouldn't be acceptable.
3) Rent-controlled rates should have market-based foundations. In the Netherlands for example, a rent-controlled unit in Amsterdam or a shrinking village of 500 people, is governed by the same maximum rental rates. Despite the fact that market rates might be 4-5x as high in Amsterdam. It's important to subsidise the poor. It's also important not to take away every single incentive, and create 1 price for a thousand different locations which are all in wildly different demand. If homes in city A and B are priced similarly due to rent-control, but many want to live in A, those who're indifferent to living in city A will occupy homes unnecessarily. If minor price differences are allowed and A is slightly more expensive than B, it'd incentivise those living in A who're indifferent to A or B, to move to B due to the lower prices, freeing up in-demand homes in A. Rent-control is commendable but it should allow for some level of market rates, still.
Hope the post makes sense as some of it is written from an EU and even national/city-level perspective that doesn't apply everywhere in the same way.
To make the economics clearer: the Netherlands has a national rent ceiling of €737 for social (rent-controlled) housing (and very long waiting lists in all the cities). In Amsterdam, the market rent for a 3 bedroom is probably around €1500 to €2000 (tough social housing are usually worth a bit less due to somewhat lower quality). Your dad is subsidized in-kind by probably around €800/months, but he's forced to consume it in the form of a very specific dwelling which he apparently doesn't value all that much. If he had the choice, he'd probably rather take the €800 (or even less) in cash and move somewhere else. But that option is politically infeasible due to the bad optics, even though economically it would be a Pareto improvement.
"If he had the choice, he'd probably rather take the €800 (or even less) in cash and move somewhere else."
This is how Section 8 vouchers work in the US. But unlike most welfare programs, the vouchers are limited and only a small portion of people who are eligible can get one.
> In a world with ubiquitous housing, there is no need for social housing, because that which is ubiquitous (oxygen) is affordable.
> In a world with scarcity, social housing protects the poor against unaffordability. That's commendable. However, scarcity also means there is not enough for everyone.
And in a world with landlords, housing can be both ubiquitous AND scarce! (At least in the USA, the number of vacant homes greatly outnumbers the number of homeless people in the country)
This is a repeatedly debunked myth that does not stand up to the slightest scrutiny.
First, the number of vacant homes. The vast majority of these at any given time are vacant because they are on the market, someone has signed a lease but not moved in yet, or they are undergoing repairs. Of the homes that are legitimately vacant, many of these are in very poor shape, and in areas where no one wants to live. Suggesting that these homes are a solution to homelessness means that you want to send homeless people to live in condemned structures with no running water an hour outside of Detroit.
Second, the number of homeless. The number used in this factoid is only the number of chronically unhoused, often mentally ill homeless. These people need a lot of support and medical treatment. Sending them to live in a random vacant home, much less one with no running water an hour outside of Detroit, is not going to help them. But people spouting this factoid don't actually care about the homeless. They are simply a prop for a cute political point. If you counted the true number of homeless, sheltered, and housing-insecure folks, this dumb factoid wouldn't sound as good.
Third, the entire concept. Vacancies are lowest in the areas in the country with the highest homeless populations. So the entire implication that some evil (probably foreign) real estate investors are causing homelessness is baseless. The reality is that vacancies are mostly associated with how competitive the real estate market is, which is associated with the economic opportunities in an area vs the supply of housing. Higher vacancies means it is easier to find a place, which means that landlords get nervous and drop the rents. There was a very clear demonstration of this in San Francisco during 2020 when a lot of renters left. Rents dropped by 1/4 or more, while vacancies rose.
It's a joke to suggest housing is ubiquitous in the US. The number of vacant homes in most metros in the US is less than one year's population growth, and as a fraction of housing stock at historical lows.
Correct. Landlording introduces additional competition in the housing market, making buying and renting costs go up, and that's why it's profitable even when a lot of homes stay empty and a lot of people struggle to survive.
Add to that a political system that takes the side of large investors...
This is the most basic economics. You introduce additional, artificial competition for buying homes from a group wealthy people and - surprise - the prices go up.
You mean the demand goes up and supply does not change? That is not really an increase in competition, more like less competition in the market...AFAIS
>Second, the benefits of rent-control take away various healthy market-based incentives. My dad for example lives on welfare in an apartment with 3 bedrooms, by himself in the capital city, and pays 1/3rd of the market rate. He has no incentive to seek out smaller housing which suits his needs just fine.
Whereas if you allow market rate on all apartments you've given landlords collecting rent an incentive to impede all kinds of property development which might bring rents down with NIMBYism.
If they are leveraged landlords who risk going underwater on their mortgage if too much supply comes on the market you've created a veritable NIMBY zealot who will show up to every town planning meeting and throw sand in the gears of new development and vote down every social housing program that might impede supply.
Will your dad? Doubtful.
Rent control wasnt ever a clean, ideal fix (land value taxes are) but they're a band aid solution to rent seeking driven evictions - especially of the frail and elderly.
>Whereas if you allow market rate on all apartments you've given landlords collecting rent an incentive to impede all kinds of property development which might bring rents down with NIMBYism.
that assumes rent control actually brings down rents (overall), and landlords aren't baking it into the price. When the government forces landlords to give tenants an indefinite call option on housing (ie. rent control), I doubt landlords are just going to carry on business as usual. The call option has a cost, and that will be incorporated into the cost of future tenants' rents.
> I'm struggling to see why you think landlords would be able to charge above market rate once rent control ends.
It won't be above market rate, but the market rate will go up to account for the call option. It's like if the city mandated all landlords to install AC (assume for this example this is for a region where most units don't have AC). Since this cost is applicable to most landlords, the landlords collectively will raise their rent because their costs have gone up.
As far as I can see it's exactly like being mandated to install AC - in that it would not change supply of housing and it would not change demand for housing.
That is, unless there was a non-negligible number of landlords who would be so infuriated with spending, say, $2k on installing AC that they would take their house off the market (but not sell it) and therefore willingly forego, say, $2k of rent every single month.
I don't see that as plausible, though. If you have an unsold rental unit doing nothing but collecting dust you're wasting money. In rent controlled cities like SF/NYC almost by definition rent is high, so these theoretical landlords would be leaving a lot of money on the table so if you think this effect is real you are obligated to assume that these landlords are behaving in an irrational manner.
the pre-AC prices are already in equilibrium. mandating AC increases the cost of supplying housing, so it disturbs that equilibrium. who actually absorbs that increased cost depends on the elasticity of demand. for highly elastic goods, the producer/seller loses more of their surplus (ie, they cover most of the cost increase). but with a highly inelastic good like housing in a desirable location, it is much more likely that the consumer covers the larger part of the cost increase.
this is basically equivalent to the effect of elasticity on tax incidence. you can view the cost of AC or forgone rent from rent control as a sort of tax.
another good example of an inelastic good is gas. people who commute can't easily change the amount of fuel they consume. if the gas tax goes up, or a barrel of oil becomes more expensive, your local gas station doesn't just make it up from their margin. they increase their prices, regardless of how accustomed people were to the previous price.
tl;dr: the fact that a landlord can charge more after being forced to install AC does not imply that they could have just increased rent in the first place if they weren't so stupid.
A careful reading of my previous comment should make it clear that I alluding to precisely that, in fact. Also it was explaining why it would 90%+ fall on the landlord in high rent locales like NYC/SF.
Why you think it shouldn't fall on the landlord in high rent markets just because the supply of property is relatively inelastic isn't so clear to me.
do you not agree that housing demand in nyc/sf is highly inelastic then? the rest kinda follows from that. or are you arguing that the supply itself is even more inelastic than the demand?
I think part of the problem with this example is that $2k is just not very much money compared to rental income in those areas. I agree, it is hard to imagine landlords dropping out of a market where they can rent a studio for $2500+/month over a one-time $2000 expense. I argue it would still happen at the margins, but it might result in a market rent increase that is below the noise floor.
still, it is a mistake to assume that all HCOL landlords are making money hand over fist. places with high rents tend to also have high price-to-rent ratios. landlords with recently purchased, mortgaged properties might not be making much profit, even with sky-high rents. if a lot of landlords are in this situation, the supply could be surprisingly elastic.
>do you not agree that housing demand in nyc/sf is highly inelastic then? the rest kinda follows from that. or are you arguing that the supply itself is even more inelastic than the demand?
Relatively inelastic, but not as inelastic as supply. There are people who would gladly move to NYC tomorrow if rents were cheaper and vice versa.
>I think part of the problem with this example is that $2k is just not very much money compared to rental income in those areas. I agree, it is hard to imagine landlords dropping out of a market where they can rent a studio for $2500+/month over a one-time $2000 expense.
Ergo why the incidence falls squarely on the landlord.
This also explains why they bitch the most about things like property tax hikes and building regs while renters do not care. A double whammy of it hits their net profit and hits the value of their property because it reduces the profit it can generate.
>still, it is a mistake to assume that all HCOL landlords are making money hand over fist.
Right. If they're not it's because they're leveraged in which case there is even LESS reason to suppose that they would be the cause of a drop in supply because instead of not making as much as they could by not renting their apartment out, they'll be LOSING money hand over fist.
I do agree that property prices will likely bake in the cost of having to install aircon or having to abide by rent control regulations. It might be the proverbial "last" straw for some who might sell up but that won't reduce supply because they'll sell it on to somebody else who will rent it out (or live in it).
I also believe that what say may be right in, say, rural Alabama where rent control might well disincentivize the construction of new housing where land is not at a premium. But, NYC is a different kettle of fish.
> Whereas if you allow market rate on all apartments you've given landlords collecting rent an incentive to impede all kinds of property development which might bring rents down
This incentive still exists if only some of the apartments are market rate, right?
Political power? Numbers. How else did you think development gets canceled in city planning meetings? When one person turns up out of 70 to impede development or when 50 do?
Hm I'd never considered that angle. I buy that it is an effect, but I'm not confident it's general or stronger than other effects (often in the other direction).
For instance, in my neighborhood, (market rate) landlords generally want new residential development, because it's seen as something that will have a gentrifying effect on the area and bring up property values in general. That mentality presumably doesn't apply to neighborhoods that are already rich, though.
Speaking of land value taxes, I fully understand that homeowners do not want to be kicked out but there has to be a middle ground.
A progressive land tax would tax owner occupied housing less but then collect the shortfall when the owner sells his land. If for any reason the owner cannot pay, he can apply to defer taxes for 5 years which then result in eviction if the taxes are still due and the property will automatically be upzoned to prevent future evictions.
Land owned by companies does not qualify as owner occupied to prevent share deals.
Property investors will face increasingly higher land value taxes the more land they own in a single location. The idea is that instead of investing in thousands of plots in the same top 10 cities they will have a presence in multiple different cities. This should result in competition between landlords instead of regional consolidation like ISPs have done in the US.
And now the cherry on top. Deduct paid land value taxes from taxable income of the tenant or owner occupant. Finally, lower income taxes across the board and remove the deduction.
Ok, enough about land value taxes. The reason why I personally am against rent control is actually the reason why a minimum wage works. Supply and demand aren't perfectly inelastic. Raising the minimum wage turns the government into a union. But the real question is, who does this hypothetical union serve? People imagine that it will help minimum wage workers but that is just a story to sell the policy. The truth is that it works because the only people impacted by the policy are the poor. Any market distortion that the minimum wage achieves primarily benefits those who are below the previous level. If corporations are cash rich they can simply afford the higher wages so unemployment isn't as big a deal as the theory tells us. The downside of losing jobs that pay less than minimum wage may be overstated because those jobs merely save the government a few dollars on welfare but do not contribute to a meaningful existence.
Now, if a minimum wage has an impact on the poor then who does rent control have an impact on? Rent control is a price ceiling. Who is paying the most for rent? Of course, those who can afford high rents. There are lots of high end apartments that are simply not meant for low income people in which reliable and affluent tenants live in. Yet rent control starts with the most expensive housing first. Poor tenants are usually paying bottom or mid end housing. It doesn't reach them at all. What often happens as a result is that landlords raise rent on low and mid end housing to compensate for losses on high end housing. In my opinion people who advocate for rent control simply do not understand the policy they vote for.
It's a ban on renting in a market that badly needs more rental units.
Hey I live just a street down from there. It's an interesting place and Fugger was certainly one of the more interesting people to grace the face of the earth, though it looses it's charm if you see it on your daily commute.
BeWelcome is like CouchSurfing but free and open-source. I heard about the Fuggerei from Paul, a guy in Singapore, a few months ago, who I met at the Asia-Pacific weekly meetup (every Thursday, 23:00 NZDT = 6 pm Jakarta = 7 pm UTC+8).
It's so interesting to hear the same topics coming up. Although I'm not Catholic, and the idea of segregating housing based on religious views bothers me, I like the idea of investing in a community by sharing freely. The Fuggerei outlasted several political forms in Germany!
My guess: the poster did a copy&paste mistake (the URL up to the last / is valid and shows the Afghanistan article), but the CMS used by CBC only looks at the last part, so it's still successful.
It's just how the site works, not a mistake by OP. If you go to the Afghanistan article and click to the link to the article you'll get the link that was posted to HN.
I'm not sure why the previous page is tracked like this but I guess they have their reasons.
The Fuggerei is really nice to visit and walk around. There's also a little museum house so you can have a look inside one of the rather small houses and a permanent exhibit in the old bunker of the Fuggerei.
Keeping it up and running is cross-financed by the entry fees.
Also the 1 Euro is not the whole truth. Residents will have to pay so called "Nebenkosten" (auxillary costs) for electricity etc. like with any other flat.
Compared to Augsburgs rent levels it's still very cheap to live but I'd prefer not to do so.
I was still expecting that Wikipedia would list the historical currencies in the area, and they did list some. Presumably there was continuity of culture over the centuries despite political bodies and boundaries.
https://nypost.com/2015/07/26/meet-historys-richest-man-who-...
I wonder if his name is the origin of the swearword...