Burnaby Updates

[Jebby]

As usual, Caliplanner does not address a single one of my arguments against rent control and just blathers on about income inequality and other social justice causes. It's also quite sad that he can't put together the fact that the policies he advocates cause and exacerbate the conditions he rails against. On top of that, he puts words into my mouth or distorts what I say to mean something else.

The only point I will address right now is this one because it shows his fundamental misunderstanding of how the world works:

Originally Posted by Caliplanner1

As for the owners of production capital, their capacity to hoarde wealth does not automatically equate with investment opportunities

When a business (or even an individual) saves money they don't tend to keep it under their mattress. Any smart (and even not so smart) businessman will "hoard" his money in a productive form (or at least in a form that will not destroy it's value to to inflation), such as in a CD or in bonds or in another interest-bearing investment vehicle. That money doesn't just sit there idly waiting to be used by it's owner. It's used by the bank in loans, or used by the bond issuer for a capital project, or local/state government in an infrastructure project...

[Caliplanner1]

Originally Posted by Jebby

As usual, Caliplanner does not address a single one of my arguments against rent control and just blathers on about income inequality and other social justice causes. It's also quite sad that he can't put together the fact that the policies he advocates cause and exacerbate the conditions he rails against. On top of that, he puts words into my mouth or distorts what I say to mean something else.

The only point I will address right now is this one because it shows his fundamental misunderstanding of how the world works:


When a business (or even an individual) saves money they don't tend to keep it under their mattress. Any smart (and even not so smart) businessman will "hoard" his money in a productive form (or at least in a form that will not destroy it's value to to inflation), such as in a CD or in bonds or in another interest-bearing investment vehicle. That money doesn't just sit there idly waiting to be used by it's owner. It's used by the bank in loans, or used by the bond issuer for a capital project, or local/state government in an infrastructure project...

To kill your shallow argument once and for all, please explain/list the INTERCONNECTED causes of economic depression/recession etc.,.........which of course will ultimately affect affordable housing.

I'll give you a start...falling consumer demand/rising consumer debt (as a function of growing income inequality via in part labor saving/production boosting technological innovation) lead to falling prices which lead to falling profits/investment and employment. All graduates of LSE understand this deflationary (business/economic) cycle.

[Prometheus]

Originally Posted by Caliplanner1

Jebby, the concept of housing affordabiliuty lies in the domain of diminishing consumer purchasing power due to inflation (re: the Time Value of Money Principle) as a function of market scarcity as well as just the redundancies precipitated by evolving/advancing industrial production technologies.

For workers to fully benefit from advancing technologies they would have to own such technologies or else they will see their jobs/income cut (if for no other reason than falling prices and profits as output/production rises on the basis of increased efficiency).

As for the owners of production capital, their capacity to hoarde wealth does not automatically equate with investment opportunities because if you understand that the economy is finite and thus limited in terms of the scarce existence of wealth (the premise of economics 101 at LSE) then you'll understand that weak market demand (as experienced say during the Great Depression) will prove a disincentive for investment spending thus opening up a need for government intervention (ala Keynesian New Deal economics and communism etc.).

Do you know what the post World War II role of the IMF and World Bank are in terms of opening up and expanding market access for Western firms as Western governments sought to eliminate the market restrictions that helped fuel their Great Depression? Hence we see a global government system via the IMF seeking to promote "free market" capitalism/trade given the natually built-in economic imbalances of global trade based on the value added paradigm (which you can't dismiss).

Originally Posted by Caliplanner1

BodomReaper, I will not waste time on answering his many disjointed individual assertions because he has no grasp of the broader subject of economics. For an LSE graduate how can he dismiss the reality of scarcity (and growing income inequaltiy etc.) as realities in the market place...thus the market mechanism of supply and demand which sees wealth (creation) being the domain of scarce/restricted market access (as opposed to free trade)....

There seems to be a misunderstanding as to the essence of growing income inequality and affordability for most. Whether it is the young family/individual whose earning power is suppressed by a lack of work experience (outside of the growing number of unemployed on welfare) or our growing senior citizen population on fixed incomes etc., growing income inequality affects the housing market in ways that private sector developers have little propensity to correct.

Any LSE graduate of economics should know that general economic collapse/economic depressions etc. (like housing bubble bursts) is ultimately the result of fast falling consumer prices/profits and EFFECTIVE demand, all as a function of income inequality and attendant debt (in an organically slow economy).

Oh my lord. Since truth is a necessary condition of knowledge, it is clear you know virtually nothing about economic history, as distinguished from one particular (and demonstrably false) view of economic history. It is obvious you have made no good faith effort to study, let alone coherently answer, the historical works of those thinkers who have refuted your ossified views time and time again, an omission which disqualifies one from the rightful title of scholar. If you have actually had any responsibility for the tutelage of young minds, then I am afraid you share some degree of culpability for the intellectual bankruptcy of our age.

[Jebby]

Originally Posted by Caliplanner1

To kill your shallow argument once and for all

My shallow argument against rent control which is shared by economists across the political spectrum, from Paul Krugman to Gregory Mankiw to George Stigler to Milton Friedman to Joseph Stiglitz to Thomas Sowell?

FYI, 4 of those mentioned above are Nobel Prize winners and the other two teach at Harvard and Stanford.

[Caliplanner1]

Originally Posted by Prometheus

Oh my lord. Since truth is a necessary condition of knowledge, it is clear you know virtually nothing about economic history, as distinguished from one particular (and demonstrably false) view of economic history. It is obvious you have made no good faith effort to study, let alone coherently answer, the historical works of those thinkers who have refuted your ossified views time and time again, an omission which disqualifies one from the rightful title of scholar. If you have actually had any responsibility for the tutelage of young minds, then I am afraid you share some degree of culpability for the intellectual bankruptcy of our age.

Really!! Then you explain the structural essence of economic weakness/recessions (which can and do affect affordable housing and the need for such during say World War II) instead of just making verbose statements lacking established economic paradigms.

In NYC historically the elderly World War II workers/veterans etc. enjoyed rent control protections because the private sector generally lacked the propensity to accommodate the working poor.

This problem (of providing housing for the W.W. II poor who were also coming out of the Great Depression) is diminishing with time however and should end within a decade,..then mostly the rich/well-to-do will get to live in certain desired areas like Manhattan.

Here are some facts: At one point in the early 1950’s there were over two million rent controlled apartments. The 1993 Housing and Vacancy Survey (HVS) reported 101,798 rent controlled apartments. The 1996 HVS reported 70,572. The most recent HVS, from 2014, found about 27,000 rent control apartments remaining in NYC.

BTW...you're the one who spoke to regurgitation? Let me remind you in being an educator that all of us who have been to school (K-university etc.) engage in varied aspects of regurgitation....just that some of us stay stuck at the kindergarten/rudimentary level while others progress to the research tertiary level of regurgitation.

[Caliplanner1]

Originally Posted by Jebby

My shallow argument against rent control which is shared by economists across the political spectrum, from Paul Krugman to Gregory Mankiw to George Stigler to Milton Friedman to Joseph Stiglitz to Thomas Sowell?

FYI, 4 of those mentioned above are Nobel Prize winners and the other two teach at Harvard and Stanford.

Krugman is not a left-wing economist by world standards. Folks from Europe or Latin America/the third world would take this American (pro capitalism) idealist (and his colleagues) with a grain of salt.

That said....let me again state that New York (Manhattan in particular) is at the moment experiencing a housing/apartment construction boom even in light of rent controls. None of this boom has made it any more affordable for the working class to live in the city as housing stock gets snapped up by local and intenationally wealthy buyers (keeping in mind that site location ultimately limits the supply criteria that boosts housing prices) .

And by the way,..the number of rent controlled housing units is falling precipitously across New York every few years (as a function of decaying World War II rental laws) leaving a growing number of working folks out of affordable housing options in the city.
http://www.nydailynews.com/life-styl...icle-1.1984448

[Caliplanner1]

Originally Posted by Jebby

My shallow argument against rent control which is shared by economists across the political spectrum, from Paul Krugman to Gregory Mankiw to George Stigler to Milton Friedman to Joseph Stiglitz to Thomas Sowell?

FYI, 4 of those mentioned above are Nobel Prize winners and the other two teach at Harvard and Stanford.

Here you go Jebby et al...high rental level is given as the impetus for private sector rental housing construction boom in NYC: http://www.bloomberg.com/news/articl...tan-like-rents

How does this promote affordable housing I may ask???

[Caliplanner1]

Originally Posted by Prometheus

Oh my lord. Since truth is a necessary condition of knowledge, it is clear you know virtually nothing about economic history, as distinguished from one particular (and demonstrably false) view of economic history.

Evidence that increasing housing supply does NOT necessarily/automatically lower prices in support of affordable housing for the masses/workers of NYC.


http://www.bloomberg.com/news/articl...attan-s-condos

...all while homelessness is increasing in the NYC: http://www.nytimes.com/2014/10/31/ny...-new-york.html

[Jebby]

Originally Posted by Caliplanner1

...all while homelessness is increasing in the NYC: http://www.nytimes.com/2014/10/31/ny...-new-york.html

Studies do not show any measurable effect of rent control in reducing homelessness.

[Jebby]

Originally Posted by Caliplanner1

Here you go Jebby et al...high rental level is given as the impetus for private sector rental housing construction boom in NYC: http://www.bloomberg.com/news/articl...tan-like-rents

Yes, when there is demand the market will supply. Pretty basic stuff.

Originally Posted by Caliplanner1

How does this promote affordable housing I may ask???

If we go back to one of my previous posts (which, as always, you ignored the content of):

Originally Posted by Jebby

A few points that seem to have gone straight over your head:

• Not only is there no economic incentive to create new affordable rentals
• the existing stock of rent controlled apartments is decreasing as condo conversions are far more profitable
• those apartments that remain rent controlled are in poor state because there is no incentive for proper maintenance (and in many case no funds as the low rents can't cover the cost)
• it lead to higher rents in uncontrolled units

[Caliplanner1]

Originally Posted by Jebby

Studies do not show any measurable effect of rent control in reducing homelessness.

....of course you're right here because rent control is a diminishing (bureaucratic) reality across American cities including New York. It is unregulated high housing prices that contributes homelessness for the majority working poor.

So Jebby,...why do you think homelessness is rising in NYC??? Is it because of rent control which causes a dearth of cheap housing,....or is it the pressures of NYC's high priced housing/real estate market in support of wealthy clients who push out the poor?

[Caliplanner1]

Originally Posted by Jebby

Yes, when there is demand the market will supply. Pretty basic stuff. If we go back to one of my previous posts (which, as always, you ignored the content of):

If we go back to one of my previous posts (which, as always, you ignored the content of):

Quote:
Originally Posted by Jebby View Post
A few points that seem to have gone straight over your head:
Not only is there no economic incentive to create new affordable rentals
the existing stock of rent controlled apartments is decreasing as condo conversions are far more profitable
those apartments that remain rent controlled are in poor state because there is no incentive for proper maintenance (and in many case no funds as the low rents can't cover the cost)
it lead to higher rents in uncontrolled units

Your highlighted assertion that rent control leads to higher rents in uncontrolled apartments has no universal evidence Jebby.....pure speculation. Remove the rent control and you might very well see ALL apartment rent go up significantly in a given building as private sector owners seek maximum profits from all units given demand (by the relatively FEW well-to-do over the majority poor) as is now being realized in NYC!

[Caliplanner1]

Originally Posted by Jebby

Studies do not show any measurable effect of rent control in reducing homelessness.

To better understand the NYC unaffordability issue let's take this discussion back to Burnaby. There is no rent control here (like NYC) and yet we similarly see horrendous levels of housing unaffordability (due to a greater propensity for real estate developers to focus on the wealthy client not the working poor)....what gives!?

[cornholio]

Originally Posted by Caliplanner1

You know,...what amazes me with right-wing (pseudo?) intellectuals who try to debase the (market stabilizing) role of government is that they fail to realize that government is the conerstone of (human) civilization and ultimately the modern nation-state (as we know it). Markets thus are a feature of government/the nation-state and hence cannot exist without said government to protect/sustain it.

It's funny because if Jebby looks around impoverished Mexico he'll realize that the numerous/VAST third world slums/shanties seen are a product of little or no government intervention and the (poverty generating) free market at work.

In contrast the FEW upscaled Mexican neighborhoods are shaped by government initiated/monitored urban planning rules/regulations/laws. Without such proactive government control we would have spatial (urban) chaos more so.

This is very well said and spot on. I say this as a outsider who has spent lots of time in many of Mexicos main cities and someone who has lived in Brazil. Mexicos whole problem is a lack of government control and effective regulation, and its gross wealth and income inequality that ensures it stays that way. After-all a efficient government allows the status quo to change, and that does not benefit those that have been at the top for generations. Brazil is exactly the same thing (wife is also Brazilian), lack of efficient government.

Originally Posted by Jebby

Completely the opposite. The vast slums and poverty in Mexico are precisely due to the fact that Mexico has never experience free market capitalism or the enshrinement of basic rights such as the right to private property. From the times of Spanish rule of mercantilism and the caste system, to the destructive retributions and "empowerment" policies of the Juarez years, to the autocratic centralization of Porforio Diaz, then to the socialist redistribution and kleptocracy of the post-Revolution era, and even up to today's corporatism protectionist system...free markets have never existed in Mexico.


Actually, the upscale neighborhoods in Mexico are almost exclusively privately developed with very little input from the government. If you look at the Polanco and Lomas de Chapultepec neighborhoods in Mexico City(the two wealthiest neighbhoords in the country) they were completely built out before zoning laws were put into place. One is a European-style high density neighborhood, the other is a covered in huge mansions.

The upper-middle class neighborhoods that have sprung up in the last 2-3 decades (notably Santa Fe, Interlomas, Bosque Real, etc) are also all private developments built mostly without zoning or urban planning. They were mostly massive empty lots surrounding formerly poor town outside of city limits which were purchased and developed en masse by private developers with little to no input from city government.

All I have to say to this is that my birth country that I lived in under communist rule (though I was young) is not one of the top 3 countries for wealth equality and income equality today because of capitalism. As a result the is one of the safest and most stable countries on this planet. Not that I support communism, I did hop the border in the 80's and came to Canada with my family as political refugees. But I have a healthy respect for it.

Lastly. To say rent control is harmful is insane. Shelter is a UN human right for a reason, it requires government regulation. If the market cant exist under regulation then it can move fully into government hands, like say police services and water distribution.

[rofina]

This discussion is humours for a multitude of reasons, most important of which is that both posters are sowing grains of truth.

Unfortunately both are stuck in a black/white, us/them, wrong/right paradigm. Typical given the current state of politics across the globe.

Few points that should be acknowledge by both sides;

- Markets can only exist in a framework provided and protected by a Government.
- There can never exist an incentive to create anything affordable in purely capitalist society, it will never be most profitable.
- The current system is mathematically unsustainable - endless growth is a broken idea.

[Blease]

Originally Posted by Caliplanner1

....of course you're right here because rent control is a diminishing (bureaucratic) reality across American cities including New York. It is unregulated high housing prices that contributes homelessness for the majority working poor.

So Jebby,...why do you think homelessness is rising in NYC??? Is it because of rent control which causes a dearth of cheap housing,....or is it the pressures of NYC's high priced housing/real estate market in support of wealthy clients who push out the poor?

Glad you're concerned about the working poor, those individuals stuck between the better offs (who're comfortably able to pay market rates) and the welfare collectors. My view is that the welfare class (most of whom are unlikely to transition to a self-supporting lifestyle anytime soon) should move to cheaper rural areas and their support payments should be based on them having to move. Large urban centres have enough problems without having a permanently entrenched, sullen, anti-social criminally prone population of entitled benefits collectors. No doubt many of you are scandalized by this view and know fentanyl addicts with a heart of gold, but sadly that's not the experience of most people. And yes, it's a pipe dream but this would go someway in improving life for the working poor, who (along with their children) are the ones most exposed to the toxic environment created by the welfare class. Working people, whether middle or working-class often face the sharp-end of market intervention schemes like rent-control as most never get any of the benefits but find themselves displaced into less and less desirable areas. It always makes me smile when politically correct, NDP voting friends talk about "desirable neighbourhoods", pretending they're talking about amenities when it's really the demographics they're furtively most concerned about.

[Caliplanner1]

Originally Posted by rofina

This discussion is humours for a multitude of reasons, most important of which is that both posters are sowing grains of truth.

Unfortunately both are stuck in a black/white, us/them, wrong/right paradigm. Typical given the current state of politics across the globe.

Few points that should be acknowledge by both sides;

- Markets can only exist in a framework provided and protected by a Government.
- There can never exist an incentive to create anything affordable in purely capitalist society, it will never be most profitable.
- The current system is mathematically unsustainable - endless growth is a broken idea.

Rofina, I'm not stuck in an absolute black or white mode. I am showing that classic economic arguments are dialectic and thus yield counterintuitive outcomes at a higher level of reasoning. Counter intuitive reasoning is the stuff of doctoral work (not undergraduate ones).....so simply arguing that government price controls automatically harms supply thus driving up black market pricing to hurt the poor is indeed black/white reasoning.

Again, to understand my arguments you have to understand the economics of the Great Depression (which is really where World War II induced housing rent control starts since the war is an outgrowth/consequence of the immediate Depression era when housing construction and consumer housing demand were both low).

Upward spiralling home prices (within the wider context of growing income inequality/debt etc.) tend to collapse as bubbles burst plunging the banking system and wider economy into crisis (a big part of the 2008 Great Recession narrative in the states). In the case of such economic recession/depression-based house price collapse only a hand full of super wealth can really afford to take advantage of house buying cheap houses given that most workers in the economy will be unemployed or underemployed etc. (and in fact won't be even able to effectively rent). I have taught BSc. students to be critical thinkers when trying to apply classical economic paradigms in the real world.

Finally, let me share another economic myth with you (as per critial thinking) which is counterintuitive. If you ask a rigid right-wing thinker if high taxes hurts the private sector economy and growth he will tell you a resounding YES!!! But if you look back at the data on the U.S. economy you'll find an interesting revelation in that during the REPUBLICAN Eisenhower administrations of the 1950s the United States had both the highest taxes and economic growth/PROSPERITY ever! The problem/hypocrisy here is that jingoistic American teaching of economics (especially during the Cold War era which was vehemently anti-communist) did everything when possible to discredit the positive role of government --think McCathyism/Reaganism here.

[Caliplanner1]

Originally Posted by Jebby

Studies do not show any measurable effect of rent control in reducing homelessness.

Which studies Jebby.....ones by capitalism/private sector supporting researchers? Rent control gave affordable housing to the working poor in World War II related industries during the 1940s and persisted even into recent times as a function of high (Cold War era)economic inflation/high interest rates during the 70s and 80s (to help the poor with affordable housing).

In today's global economy just removing rent control will NOT automatically result in more affordable housing for the the local working poor (as seen in NYC where wealthy local and foreign investor have pushed out the ordinary worker as their obscene effective demand fuels a housing construction boom there).

Now who is regurgitating in simplistic black/white fashion here....??

[Caliplanner1]

Originally Posted by Blease

Glad you're concerned about the working poor, those individuals stuck between the better offs (who're comfortably able to pay market rates) and the welfare collectors. My view is that the welfare class (most of whom are unlikely to transition to a self-supporting lifestyle anytime soon) should move to cheaper rural areas and their support payments should be based on them having to move. Large urban centres have enough problems without having a permanently entrenched, sullen, anti-social criminally prone population of entitled benefits collectors. No doubt many of you are scandalized by this view and know fentanyl addicts with a heart of gold, but sadly that's not the experience of most people. And yes, it's a pipe dream but this would go someway in improving life for the working poor, who (along with their children) are the ones most exposed to the toxic environment created by the welfare class. Working people, whether middle or working-class often face the sharp-end of market intervention schemes like rent-control as most never get any of the benefits but find themselves displaced into less and less desirable areas. It always makes me smile when politically correct, NDP voting friends talk about "desirable neighbourhoods", pretending they're talking about amenities when it's really the demographics they're furtively most concerned about.

Blease it's always easy to blame the poor and let them pay the price of perceived failure (re: the expense of moving to jobless rural areas etc.)...but if you objectively visit the data it is the wealthy few who have actually received the lions share of government (corporate?) welfare protections........not the majority working poor,......hence they the workers are relatively poor!

[Caliplanner1]

Originally Posted by Prometheus

Oh my lord. Since truth is a necessary condition of knowledge, it is clear you know virtually nothing about economic history, as distinguished from one particular (and demonstrably false) view of economic history. It is obvious you have made no good faith effort to study, let alone coherently answer, the historical works of those thinkers who have refuted your ossified views time and time again, an omission which disqualifies one from the rightful title of scholar. If you have actually had any responsibility for the tutelage of young minds, then I am afraid you share some degree of culpability for the intellectual bankruptcy of our age.

Here's another example from across the pond how unregulated housing markets hurt the working poor: http://www.breitbart.com/news/englis...o-30-year-low/