Not only that by having a large number of people buying rental properties it pushes out first home buyers who are forced to rent. Its effectively a wealth transfer from the young to the old who were lucky enough to be around when house prices were cheaper. Not only that, foreign investors (mainly chinese) are forcing up entry level apartment prices, and extracting rent from them.
As well, because a lot of business owners have a mortgage on their house to keep their business going, house prices can't be allowed to drop because it will have a knock on effect, and drag the businesses down with it.
The whole system has been propped up by increased immigration creating demand on housing, this has been government policy for some time. Now there are no immigrants and all the tourists are leaving, its just a matter of time.
Without bail outs we have the potential to see many more properties bought by the largest companies, who are often far harsher on tenants then small mom-and-pop owners.
> Who would you suggest should own the property instead of landlords? Should all housing be state owned instead?
Why would state ownership be their first choice? There are obviously other, more moderate options that solve the landlord issue, such as having housing units owned by their occupants.
What does your property value look like after riots, looting, and societal breakdown? How much is your house worth burned down to the ground?
Pensioners everywhere are powerful. You'll never sacrifice them. They'll eat the young whenever they get a chance. Your only hope is to get in as close to the ground floor and then eat as many young yourself.
And the US won't be able to forever either, but our politicians will just keep doing it until it's no longer viable.
The "triple lock" just means it's being increased annually by 2.5%, CPI or average earnings growth, whatever is highest. There is talk about scrapping the triple lock - but it doesn't have a huge impact - difference in cost is 1% of GDP by 2060.
It will be a difficult balancing act for the next couple of years, trying to bring the economy back, keep employment up and figure out how to pay for the increased borrowing as a result of the pandemic. I think large scale debt relief will be the only way out of this.
I believe that if, big if!!, the public would cooperate, that a plan like Hong Kong’s makes a lot of sense. Sure businesses are less profitable and some will not survive, but it would get things restarted quickly.
Trouble in the USA is a lack of patriotism: people are into their own selfish thing and they feel put upon and don’t do what is right for both public health and starting up the economy again.
It seems to be mostly young people in my town who act irresponsibly and will thus likely ruin the economy for a long time.
A long term failed economy is full-stop the fault of people unwilling to be decent human beings and do what needs to be done, and, of course, the fault of our federal government leadership which has so far been poor.
We are just getting started with changing health practices and public interactions and we are just getting started understanding what the long term economic consequences will be. There is no quick fix here.
But for sure, we need less selfish and entitled behavior, and protect people who need extra protection, and be willing to pay a little more to businesses and totally cooperate with more distancing in public places and businesses and of course apply maximum social shaming pressure on people who are so incredibly selfish as to not wear masks when appropriate. It is like some people have no sense of shame.
But, that doesn’t exempt people from blame if they don’t do their part.
On top of that, the FDA and CDC have 100% botched testing from the beginning.
Americans are highly pragmatic, but we want good information not orders.
I live in a small town in Arizona that is a tourist destination. Especially on weekends, we get flooded with people from out of town. I would estimate that less than 10% of out of town visitors wear masks in stores, etc. To a lesser extent, I see lots of locals who also don’t wear masks in stores.
Our governor just reopened the state so I expect people’s willingness to do the right thing will decrease.
I totally agree that WHO and CDC really screwed up on their bogus advice for people to not wear masks.
Pick two or three groups to save: workers, landlords, bankers, or businesses? Not everyone can be saved, and the political positioning of these classes makes this battle all the more impactful. This author chooses to sacrifice the banks and the landlords, and makes a pretty good case for why.
The wrong answer could spell the end of capitalism, at least as we understand it today. Maybe "wrong" isn't the correct word here, I don't know. I've never seen such huge decisions laid bare like this before.
The word "epic" is overused a lot - but not here. It's chilling to think about how historically significant each passing day is going to be.
>The wrong answer could spell the end of capitalism
I've been seeing a lot of Capitalism/Socialism stuff, and 100% of the time it feels like the concepts aren't fully developed in the speakers mind. They aren't binary opposites, they're gradient opposites. Essentially private vs public empowerment.
If I trade vegetables with my neighbor, that's private and therefor capitalist. If the gov builds a road, that's public and therefor socialist. If you add up everything the people and their government do, you'll find where things are on the spectrum.
Every single government is a mix of capitalist and socialist. You literally can not have so much as a tribe before the two begin to exist. Neither of them are going away ever, and they're both good for different things.
Literally the only way for capitalism or socialism to end would be for there to be no communicating humans left.
The UK doesn't really have capitalism, it has financialisation.
The older people who hector young graduates about paying back their student loans are precisely the people who voted for deficits with no intention of ever paying off the debt.
Really? It seems more like companies been capturing more of the productivity gains since the 70s, and paying it to shareholders...
Regardless of the internal cause of slowing productivity growth, it did slow and maintaining the same debt to GDP ratio as before 1980 would have required accepting a standard of living that rose more slowly than it did. (GDP growth slowdown due to demographics washes out on a per capita basis.)
It seems the most likely cause for the 1970s productivity slowdown was the oil shocks and the most likely cause for the 2000s productivity slowdown is the falling marginal return on research expenditures.
The policies that are implemented in this environment will not be thought out. Until this crisis ends it will be an ugly free-for-all to find out who has political power at the moment and can implement all their long-standing agendas with no special regard for current circumstances apart from some extraordinarily big handouts.
When the right to vote became available to everyone/most people, the landowners shifted to using their wealth in order to influence government/politics in their favor. This has worked out well for them, since as a general rule people either are too naive or politically apathetic to come together to outvote the landowners. Despite being grounded into dust by them, the common person still feel that they have much to lose by going against them. This reminds me of a fictional gambling game from an anime I've watched called E Card.
"The game is starts with each player holding five cards, four of which are Citizens and the last being either a Slave or an Emperor. Who holds which card is decided beforehand, and is played like that for three turns before switching. The game lasts for a total of twelve turns, meaning each side gets to play Emperor twice. The players choose one card from their hand (Emperor side lays first) and place them face-down on the table. They are then flipped over to reveal the winner of the match.
The three card types are Citizen, Emperor and Slave.
The Citizen card represents the common man, and cannot defeat the Emperor who sits at the top. It can, however, defeat the Slave, who resides at the very bottom of the system. Two citizen against each other results in a tie.
The Emperor represents the one at the top of society. This card can defeat the citizen, but will lose to the Slave.
The Slave is presented as the one at the very bottom of society. Seeing as how it has nothing to lose, it can overthrow the Emperor in one last attempt at revenge. This card will lose to a Citizen, but will win against the Emperor card."
My thought is that we have a large population of people who have been fooled into thinking they are the Citizen, when they are little more than Slaves. They believe that they are different, more than Slaves. So they have something to lose. Thus they can never go against the Emperor, and in fact, play their role as the Citizen in keeping down the actual Slaves who could do something about that Emperor if they actually got together.
Now do I think people will wake up and realize they are the Slave? Probably not, but there's a non-zero chance, depending on how the government decides to act during this crisis. Most likely though, the Citizens are going to be given some scraps, just enough that they have something to lose and keeps them under the illusion that they are more than a Slave.
"Richard Murphy lays out the case for whose interests need to be sacrificed for the economy to have any hope of surviving under the conditions being imposed on businesses to keep workers and customers safe. Unfortunately, his well-reasoned recommendation, that landlords, banks, and pensioners need to take hits to save jobs and businesses, is not likely to find support in official circles. But Murphy’s argument, in essence, is that these groups are toast under any scenario, and they can’t be allowed to weigh down the productive sectors of the economy."
(summary courtesy https://www.nakedcapitalism.com/2020/05/people-and-jobs-or-w...)
