I agree, with exception of housing. Most people can't buy home with cash, and for many this is a necessity. But homes are an appreciating asset, which cannot be said about cars or food - this is an investment, actually. But for everything else - cars, phones, electronics, food, subscriptions, jewelry - I 100% agree. Consider two people:
* One person has $10k saved, invested into something safe and liquid. Then buys something for $10k, earns and invests that $10k back, and because of investing is a bit up (let's say now they own $10.3k)
* The other person borrows $10k, and repays $11k over time.
This buy-and-earn cycle will repeat, and each time the person that fronted $10k is $1.3k up (and due to interest, this is only growing with time). The difference quickly becomes staggering. Tragic, and a classic rich-get-richer situation. And the only difference is the starting $10k and some discipline.
Personally, I think we should have all rent-extracting industries nationalized.
Land, like in China, should be available only under a 99-year lease (perhaps with a modest homestead exemption). The government should own radio airwaves, natural resources, and banking. This doesn't mean that it couldn't hire private contractors to do the work (e.g. bidding on oil extraction), but Chevron and Exxon shouldn't own the oil field.
And I think the government should provide very basic, minimal, Soviet-grade housing free to everyone.
If you'd like your kids to have their own bedrooms, you pay. If you're happy with a 2-bedroom for a family of four (kids room, adults room), or dorm-style housing for adults, you can live there for free.
Having a free option would, in fact, drive costs down for everyone.
More broadly, we should rationalize what's nationalized. For example, a lot of parts of education make sense with a lot more open competition.
It's a little bit different. "The projects" were only available to the very poor, and often by lottery. They often turned into a ghetto.
I'd like a baseline option open to everyone.
If you just finished Stanford, and want to bootstrap a startup, teach kids, or do a non-profit, you should be able to move into a "project" too while getting things off the ground. If you're a student and want to save a bit of money, you can move in too.
If you want to upgrade at some point, great.
If not, you've got a safe bed to sleep, and a roof overhead.
Part of the difference, too, is if open to everyone, voters can push for improvements. A lot of what went wrong with the projects wasn't due to a lack of resources, but due to mismanagement of resources. For nationalized goods to be well-managed, voters need a stake. A more extreme example of this is prisons.
But the critical thing is at that point, for-profit housing has competition. I might gladly spend $500/month to have better housing, but I might not be willing to spend $5000/month (insert your own numbers for single/family/income/etc.). That prevents some of the most exploitative practices.
> But the critical thing is at that point, for-profit housing has competition.
So that's your premise, that private housing has no competition. But clearly it does: itself. It's not one monolythic actor but many. Your premise is simply wrong, but let's say you could be right: can you back that up with data or the like?
Chapter XI, The Rent of Land, is pretty quaint at this point, but gives a compelling counterpoint to your argument. It begins:
"Rent, considered as the price paid for the use of land, is naturally the highest which the tenant can afford to pay in the actual circumstances of the land. In adjusting the terms of the lease, the landlord endeavours to leave him no greater share of the produce than what is sufficient to keep up the stock from which he furnishes the seed, pays the labour, and purchases and maintains the cattle and other instruments of husbandry, together with the ordinary profits of farming stock in the neighbourhood. This is evidently the smallest share with which the tenant can content himself, without being a loser, and the landlord seldom means to leave him any more."
The basic analysis of the chapter can be translated from 1780-era industries into 2025-era industries, and explains much of how housing markets work.
If you would like contemporary data, I would recommend looking at the impact on the price of housing of European cities which offered nationalized below-market housing.
A central fallacy in most of the libertarian space stems from the difference between industries which are not zero-sum (e.g. manufacturing, software, writing, etc.), and rent-collecting ones (e.g. literal rent, much of finance, mining, etc.). Here, I use "rent" as economics jargon, not common meaning. You can look it up.
Being used to operating in domains like software -- which has literally zero marginal cost -- there is a natural tendency to want to extrapolate the same dynamics to other industries.
However, economics works out differently in industries like that. For the most part, if there is a finite amount of stuff, it makes sense to divide it fairly to avoid dynamics like that. If you're producing stuff, it makes sense to divide it according to how much you contribute.
Your lecture is not even remotely responsive. Please explain how there is no competition in the private market for housing. Because right now someone I care about is moving because their landlord jacked up the rent in the middle of a down market for rents, so they are moving somewhere better and cheaper, and that looks for all the world to me like competition. I know that you mean competition from not-private providers, but that's not explaining why a not-free provider is good. Why not just nationalize all housing?
You argue that housing has a finite supply, but that's true of cars and steel and everything: there is always a finite supply. I couldn't buy more of anything than is currently available no matter how much money I have. You probably mean that housing stock grows too slowly, but even this isn't true. (Where I live rents are falling fast because housing was overbuilt, so it's not even true that excess housing is never built.) Clearly if housing stock were growing at half the rate of the population then we'd have a huge homelessness problem, but we don't.
> You can look it up.
So can you, but you are the one making exceptional claims. So please post some links. Your superior attitude doesn't help your position. For example:
> If you would like contemporary data, I would recommend looking at the impact on the price of housing of European cities which offered nationalized below-market housing.
Links?? And no, I'm not going to look it up. You look it up.
> You argue that housing has a finite supply, but that's true of cars and steel and everything: there is always a finite supply
Land is a finite supply. With zoning (and with exponentially rising costs for skyscrapers over one-story homes), so is housing on land. At least in places where housing is expensive (e.g. major cities like SFO, NYC, Tokyo, Shanghai, etc.), this is a limited, rent-extracting resource.
The Earth's crust is about 5% iron. Cars are limited by our capacity to produce them.
> I know that you mean competition from not-private providers, but that's not explaining why a not-free provider is good.
No, that's not what I mean. I would recommend taking a basic econ course to understand jargon like "free good," "scarce good," and "rent." I won't fix that in a web post.
Khan Academy is not bad for this kind of basic economics.
> So can you, but you are the one making exceptional claims.
Ah yes. The great controversy of Adam Smith and basic economics.
I gave one link, which you clearly didn't bother to even click through.
> Links?? And no, I'm not going to look it up. You look it up.
Fine. Wallow in ignorance. I won't be responding further.
The human population of this planet is set to have big drops in the next 100 years, yet there will still be complaints like yours because the stock of housing will never far outstrip the stock of humans, as unoccupied housing will simply be demolished. We could have only 100 million humans and you'd still have this complaint. I just don't see how you can be made happy on this. Governments building housing doesn't change anything you said about the cost of building it. The market is building enough housing.
> No, that's not what I mean. I would recommend taking a basic econ course to understand jargon like "free good," "scarce good," and "rent." I won't fix that in a web post.
Terms you did not even use. Where is the misunderstanding? Or are you simply trying to be superior?
> I gave one link, which you clearly didn't bother to even click through.
To the Wealth of Nations. The paragraph you quoted applies to ownership via mortgages just as well as to rent (since having a mortgage is renting capital), but also it does not address supply at all. Nor do you address the assertion that we need a non-private provider.
But did Smith say anything like:
> And I think the government should provide very basic, minimal, Soviet-grade housing free to everyone.
or
> Personally, I think we should have all rent-extracting industries nationalized.
which you did?
Does basic economics -Adam Smith's no less!- say anything like this? What basic economics treatises other than socialist or communist ones say anything like this?
Certainly you should not respond, nor should I, any further since it bothers you so much. But I do wonder if telling people they're wrong and then taking your ball home works well for you.
I am so so happy we live in a democracy. Because if your ilk managed to take power, it would only have been possible through violent authoritarian revolution
No you can definitely vote this stuff in, especially if you let capitalists extract money from vulnerable populations for long enough.
People have a misunderstand of protections or government spending. The New Deal isn't socialism, it's the perfect capitalist policy. If we never had the New Deal, there's a good chance we would be a socialist democracy today. We got really, really close.
When things get bad you have to throw people a bone in order to maintain the current systems. Our newest generations of the ultra-rich and ultra-powerful don't seem to understand that. Ultimately we, the working class, hold everything together. We're the majority and it's not even close.
If we wanted to change things for our own selfish benefit, we could.
Just think. If the capitalist soul sucking robber barons weren't hoarding every morsel of wealth they possibly could, policies like this wouldn't cross anyone's mind in the first place.
Part of the trick is to foist on us the economic priests that tell us of the fire and brimstone that will fall on us if governments ever use their currency issuing power for social improvements.
I'm not so sure. I can describe some of the paradoxes in our social systems in-depth, but it's often the poorest people saying we can't afford social improvements.
The USA has the global reserve currency and we have monetized our social welfare through advanced mechanisms of currency debasement. To say we aren’t printing currency to finance our lifestyle is absurd - we have been doing that through various mechanisms since WWI
A major goal of policy is to set incentives to which people optimize.
The "capitalist soul sucking robber barons" are doing exactly what the incentives we set up push for. If they didn't, boards of directors / shareholders would vote them out. And if those didn't, competing businesses would crush them. No one has any real choice; it's the free hand of the market.
There are nice books about this (Dictator's Handbook comes to mind).
Many would prefer to be less exploitative personally, but need legal frameworks to be able to do so. And indeed, in history, you often saw the "capitalist soul sucking robber barons" see the harms they were causing and push for that regulation. Most people would prefer to provide safe food, safe medicine, etc. than sell poison and snakeoil. But you can't really resist market forces.
So you need to work to set up socially-constructive market forces.
And it's all better than serfdom and 1500-era systems regardless.
Housing being an appreciating asset is a social ill. It means that housing can never be affordable, and that as it appreciates it locks out progressively more people.
This is true unless wages are also always going up, which is not the case unless it’s all just inflation in which case nothing is really appreciating.
Houses themselves don't really appreciate in and of themselves, not the way a stock might. It's more that the land price goes up, as does the cost of replacement due to materials and labor prices also increasing.
If you have two identical lots side by side, and you build a house one one and 10 years later build the identical floor plan next door, they will not sell for particularly different prices.
I think without mortgages most people would rent or rent-to-own, rents wouldn't be dragged up by housing appreciation, and affordable/social housing would be cheaper to provide because of lower opportunity cost.
* One person has $10k saved, invested into something safe and liquid. Then buys something for $10k, earns and invests that $10k back, and because of investing is a bit up (let's say now they own $10.3k)
* The other person borrows $10k, and repays $11k over time.
This buy-and-earn cycle will repeat, and each time the person that fronted $10k is $1.3k up (and due to interest, this is only growing with time). The difference quickly becomes staggering. Tragic, and a classic rich-get-richer situation. And the only difference is the starting $10k and some discipline.