What if the problem of poverty is that it’s profitable to other people? • Hacker News Board

Re: What if the problem of poverty is that it’s profitable to other people?

#401

Post by webXL » Mon, Apr 11, 2016, 4:09 PM UTC

jernfrost wrote: post #351

mantas wrote: post #253

Earlier quoted context omitted.

What is basic housing? Today's poor housing would look like a damn luxury 100 years ago. Today's luxury housing will probably look bellow standards after 100 years

Adam Smith, father of free market economics, pointed out already 300 years ago the fallacy of this argument. He has a passage about how an Englishman was expected to wear leather shoes while a frenchman could walk barefoot without being ashamed. Further he talks about how in his day a linen shirt if considered a necessity even for the poor while the ancient greeks and romans could do well without it. So the point is…

Poverty may always be a relative phenomenon (even in Cuba) but there has been no better system to lift people out of the life-threatening effects of abject poverty than capitalism. In fact, you cannot have a success with socialism without a large number of wealthy (or well-off) people to tax, and a society cannot tax itself to prosperity.

> I live in a smaller house and have no car. But I have no financial worries like them. I have long vacations, I am not constantly overworked. I don't worry about health care insurance, saving for college education to my kids, getting fired.

In America, we trade stability for social mobility (probably truer before the WWII), and our government promotes car and home ownership, but I doubt those were tradeoffs you made for longer vacations and "free" health care and education. We became more socialist and fascist after WWII and during the Cold War, but we've still managed to maintain steady income growth for average Americans, despite what the media would have you believe with "household income": http://politicalcalculations.blogspot.com/2012/12/the-discov...

Poverty will always be with us, but there are plenty of things our bureaucrats can give up to fight it better. Our federal government has more or less the same number (very few added in the last 100 years) of representatives despite our population tripling. This system has become more susceptible and beholden to corporate interests, including media corporations that promote stories like this one and the problems and divisions in our society without any context of our achievements and commonality. This promotes bandaid and politically expedient half-measures that only make the problem worse in the long-run.

Re: What if the problem of poverty is that it’s profitable to other people?

#402

Post by collyw » Mon, Apr 11, 2016, 4:10 PM UTC

tamana wrote: post #189

StanislavPetrov wrote: post #112

Earlier quoted context omitted.

Except your fantasy of a free real estate market doesn't exist. FED policies, by their own admission, serve to artificially drive up real estate prices, which punish the poorest, who don't own property and are forced to rent. This is a direct subsidy to property owners with the size of the subsidy equal to the amount of property owned. These FED efforts (MBS purchasing, ZIRP, suspension of MTM, QE1-3) to prop up hous…

Fantasy or not, free to not, landlords don't control the Fed.

Not sure about the Fed, but plenty of UK politicians own buy to let property, so hardly a free market when they have such vested interests in keeping prices high.

Re: What if the problem of poverty is that it’s profitable to other people?

#403

Post by ebiester » Mon, Apr 11, 2016, 4:25 PM UTC

wolfgke wrote: post #384

ebiester wrote: post #354

Earlier quoted context omitted.

That's the problem. The places that are affordable don't have jobs, and the places that have jobs don't have affordable housing. As soon as a place has jobs, the affordable housing disappears. This sounds like supply and demand, but is exacerbated by investment concerns changing the dynamics of the market.

> This sounds like supply and demand, but is exacerbated by investment concerns changing the dynamics of the market. This rather sounds like the lack of jobs that allow remote work is the fundamental problem.

Jobs like retail, laundry, hotel service... The jobs at the lower end of the spectrum, in general (ignoring call-center type work), can't be done remotely.

Re: What if the problem of poverty is that it’s profitable to other people?

#404

Post by vkou » Mon, Apr 11, 2016, 4:40 PM UTC

Consultant32452 wrote: post #347

vkou wrote: post #206

Earlier quoted context omitted.

Not having access to temporary credit means that any hiccup in your finances has you facing eviction, late bill penalties, and in the case of unpaid fines, possibly jail time. Having access to temporary credit means that same problem, but next month.

Having access to incredibly high interest temporary credit means having the same problem next month and this new problem of having to pay off the high interest credit bill. You're generally not going to be evicted for a temporary hiccup. Late bill penalties are almost certainly going to be less than the payday loan fees. I have mixed feelings about the making bail bit.

My bounced check fee is $30 from my landlord, $30 from my bank.

My late rent fee is $30.

My late utility fee is $5, but if I paid by a bounced check, that would be $35. In other cities, it could be much higher.

The fee for not paying a fine on time can be a weekend stint in jail, whereby you will get charged for room and board.

The fee for not being able to pay for car repairs is losing your job.

The fee for not paying for needed medical attention when you aren't on insurance (Which, despite obamacare, many poor people lack) can be crippling.

Poor people, in aggregate, aren't stupid - they wouldn't use payday loans if the alternatives weren't worse. Yes, it shifts the problem a month out, and puts you in debt for ~$100 dollars. So would juggling your missed payments (Meanwhile, giving you a black mark against your landlord).

That's still better then having the problem today. And who knows? Next month, you may be a millionaire. Or dead. Better worry about that next month.

If you want to kill payday loans, the best way to do that is by giving everyone a living wage/income.

Re: What if the problem of poverty is that it’s profitable to other people?

#405

Post by darawk » Mon, Apr 11, 2016, 5:01 PM UTC

TheOtherHobbes wrote: post #297

darawk wrote: post #257

Earlier quoted context omitted.

Don't get me wrong, i'm not saying it's not plenty profitable. I only mentioned the higher rents thing to illustrate the point that the landlord does not have an interest in keeping these people poor. This article is suggesting that these landlords are causing poverty, but then it goes on to not even try to make that case. They may be making money from poor people, and they may even not provide them the level of serv…

>This article is suggesting that these landlords are causing poverty The landlords are causing poverty by increasing rents to the maximum level the market will bear, removing money from the system and - usually - moving it offshore. Because slum property is so immensely profitable, there's no incentive whatsoever to invest the profits in anything riskier. So you end up with wasteful non-projects like this: http://www…

If this had any economic truth to it, there would be a market in undercutting these overpriced rents. If this were true at all, you should go to your local bank, get a loan, snap up some property, and undercut your local slumlord by 10%.

By your logic, you'd have plenty of profit to spare, and you'd be providing an enormous social good.

But my guess is that you will not do this. And you will not do this because your analysis of their margins and business is not actually correct, and you and everyone else in the market knows this.

Re: What if the problem of poverty is that it’s profitable to other people?

#406

Post by darawk » Mon, Apr 11, 2016, 5:04 PM UTC

collyw wrote: post #399

thecopy wrote: post #264

Earlier quoted context omitted.

>In the sense that he or she is charging 70% of their monthly income for rent. No. He or she is charging an absolute amount, not a percentage of their payslip. >And it's coercion alright if the alternative is being left homeless. Coercion /koʊˈɜːrʃən/ is the practice of forcing another party to act in an involuntary manner by use of intimidation or threats or some other form of pressure. There is no coercion here. Po…

I am pretty sure there would be legal threats as soon as the rent isn't paid.

That doesn't make it coercion. That is just enforcing the agreement that was entered into voluntarily. Or do you think the poor should be exempt from rent?

Re: What if the problem of poverty is that it’s profitable to other people?

#407

Post by iofj » Mon, Apr 11, 2016, 5:21 PM UTC

These discussions always end up the same way. We don't know a solution to the problem of poverty, so people advocate just using the government to force a solution to the problem.

This won't work. Now don't get me wrong : that doesn't mean you can't make it work through investment for a while, potentially even a long while. But you can't make it work over long periods of time.

The only way to solve poverty is to find something for huge numbers of unskilled labour to do that's economically positive (ie. makes a profit for whoever is the boss). That can last. And yes, we'll have to do it again, and again, and again.

Now should we use the government to bridge people over between jobs ? To help them out in periods where their economic utility is low ? In my opinion absolutely. But we should NOT make the mistake to assume that this can be anything but a very temporary measure.

Re: What if the problem of poverty is that it’s profitable to other people?

#408

Post by jakobegger » Mon, Apr 11, 2016, 5:48 PM UTC

madaxe_again wrote: post #317

jakobegger wrote: post #266

Instead of giving money to poor people, who then have to spend it all on rent, why not provide affordable housing? In Linz we have something called "housing cooperatives" (the German word is "Wohngenossenschaften"). These cooperatives build apartments, and to rent them you become a member of the cooperative. The goal of these cooperatives is not to make a profit, but to provide affordable housing. And it's amazing ho…

We used to have something like this in the UK, but then under "right to buy", the vast majority of the council funded housing was sold off to private landlords (council tenants usually did not have the funds to buy themselves, so were offered deals by large private landlords like "we'll give you £10k, you can keep living there for 10 years, we'll give you the money to buy it, you then sell it straight on to us"), and…

Yes, there was also a big scandal when a state owned cooperative was sold by our corrupt minister of finance several years ago, but that doesn't mean cooperatives are a bad idea; it probably just means that government-owned cooperatives should be avoided. Ideally the cooperative should be fully owned by the tenants, so nobody can go and sell it off (however, I am not sure how exactly that would work from a financial / legal perspective)

Re: What if the problem of poverty is that it’s profitable to other people?

#409

Post by thecopy » Mon, Apr 11, 2016, 5:58 PM UTC

collyw wrote: post #399

thecopy wrote: post #264

Earlier quoted context omitted.

>In the sense that he or she is charging 70% of their monthly income for rent. No. He or she is charging an absolute amount, not a percentage of their payslip. >And it's coercion alright if the alternative is being left homeless. Coercion /koʊˈɜːrʃən/ is the practice of forcing another party to act in an involuntary manner by use of intimidation or threats or some other form of pressure. There is no coercion here. Po…

I am pretty sure there would be legal threats as soon as the rent isn't paid.

Does that not happen to everyone? I am honestly confused how you can think that makes it coercion.

Re: What if the problem of poverty is that it’s profitable to other people?

#410

Post by pink_dinner » Mon, Apr 11, 2016, 6:15 PM UTC

fucking_tragedy wrote: post #383

pink_dinner wrote: post #223

Earlier quoted context omitted.

sigh do we really need to have this discussion and dou you actually think communism would ever work? The problem is that pesky human nature gets in the way.

The same problems that plague capitalism plague communist implementations. In power structures, things are great if you're part of the class that receives political favors and not so great if you're not. In capitalist societies, capital owning classes have the time and resources to be the political class. In previous communist societies, party and administrative members were the political class.

"In capitalist societies, capital owning classes have the time and resources to be the political class. In previous communist societies, party and administrative members were the political class"

This sounds like theory. In practice, capitalism beats communism in pretty much every way. Of course there are people that own capital. Private ownership is one of the main tenets of capitalism.

Capitalism works because it is on the correct side of human nature. It pushes people to earn more capital, which in turn, helps the rest of us.

Do you think our technology would have advanced this far if we didn't have capitalism? The only reason computers, phones, the Internet are getting better and better is because of competition. The more competition in a market, the cheaper the price is to us, the consumer.

Communism, on the other hand, makes everyone a slave to the state. Why would you want to compete and earn more when it will just be taken away from you by the government?

There were many experiments in the 1970s with communism. People created their own small communities and shared everything. Everyone was equal. The end result was always a disaster: jealousy always fueled the collapse of the group.

Would you want the person in school that never studied for his tests and partied every day to earn the same amount as you, who studied for every test and did well? I sure wouldn't.

Communism, in any form, is a failure. I don't know how much death, poverty, and famine we need to go through for some people to learn this.