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Culture War Roundup for the week of August 12, 2024

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New homes and end to price-gouging: Harris sets economic goals

The Democratic presidential nominee's plans build on ideas from the Biden administration and aim at addressing voter concerns after a surge in prices since 2021.

The campaign's proposals include a "first-ever" tax credit for builders of homes sold to first-time buyers, as well as up to $25,000 in down-payment assistance for "eligible" first time buyers, a move that her campaign estimated could reach four million households over four years.

She has also called for capping the monthly price of diabetes-drug insulin at $35 for everyone, finding ways to cancel medical debt, and giving families a $6,000 tax credit the year they have a new child.

She is supporting a federal law banning firms from charging excessive prices on groceries and urged action on a bill in Congress that would bar property owners from using services that "coordinate" rents.

Though analysts say some of Harris's proposals, such as the ban on price-gouging, are likely to be popular, they have also sparked criticism from some economists. Bans on price-gouging already exist in many states, applied during emergencies such as hurricanes. But economists say the term is difficult to define and widening such rules could end up backfiring, by discouraging firms from making more at times of short supply.

Everyone likes free money, right? Building houses is good, having kids is good, paying less for life saving medications is good, taking power out of large landlords hands is good. But maybe trying to apply emergency price gouging laws to non-emergency situations is not so good. Maybe write a law that you have to lower prices when things are good as quickly as you raised them when they weren't so good. What are Trump's plans?

With populism ascendant in both parties, that cost has not dissuaded Trump's choice for vice president, JD Vance, from backing an even bigger tax credit expansion.

Economists predict that increased drilling would have limited impact given the global nature of energy markets and have warned that Trump's pledge to impose a tax of 10% or more on imports would drive up prices.

We're already producing a boatload of oil, but with russia somewhat out of the picture our european friends might appreciate it. Not sure about bringing down prices though.

What can she promise to boost the supply of housing instead of subsidizing demand? As long as cities have downtowns, you are limited by the driving distance and the quantity of roads and parking downtown.

She can't promise to raze and rebuild the cities with decentralized offices.

She can't promise to found new cities to allow first-time buyers to buy new homes cheaply.

She can't promise to upzone existing suburbs.

Even if she can somehow double the supply of housing, this will destroy housing as an investment. Which is also something people very vocally do not want. It's not like Trump can do anything about housing either. Maybe when the US population finally starts to dip...

Even if she can somehow double the supply of housing, this will destroy housing as an investment.

I am slowly becoming convinced that this is eventually necessary, but will be incredibly painful for many. There still are places we can build -- home prices in Texas are mostly down from two years ago, and California is trying statewide zoning changes that might work somewhat.

But we seem stuck with the choice of following other Anglosphere countries in making housing cost a lifetime or more of wages, or burning a whole lot of folks who thought it would be a nest egg. IMO the best course is probably to spread the hurt over a generation or so rather than rip off the bandaid into a culture where housing isn't expected to appreciate (Japan, somewhat?), even though that will probably hit my net worth too.

Of course housing should be destroyed as an investment. Living in a house is consumption. It causes wear and tear on the house. A twenty-year-old house is inherently less valuable than a brand new house. In a healthy economy, a house should depreciate in value like a car, albeit more slowly.

If my house burned down, I could then sell the charred frame for over $1 million.

I bought the house and the land it is on for much less than $1 million. My wear and tear on the structure and the aging waterheater and whatnot are round off errors in the property value.

So long as tech jobs remain hyperconcentrated in a few areas, housing prices will have to increase within commuting distance of those jobs. Unless we start making Chinese style housing blocks and Chinese style hard restrictions on urban car ownership.

My wear and tear on the structure and the aging waterheater and whatnot are round off errors in the property value.

Exactly. Amount of people I know who renovate and then try to claim that the 5% appreciation in their house's value in the time it took them is value added instead of just underlying market fluctuations is insane to me

This might not be the case in every city but in Toronto when the market was super hot plenty of homes would have increased in value if they burnt down to a pile of ash.

The people who make "heritage building" designations are quite overzealous since it doesn't cost the city anything. It just puts obligations on homeowners.

A pile of ash means that they don't have any justification to stop an owner from building a new home.

San Francisco famously maliciously designates random buildings historic in order to block development. You can't replace a dumpy laundromat with housing, it is "historic" you see. Multi-year legal battles trying to make some apartments. If the local government did nothing, then more housing would create itself all on its own. But instead they fight like cornered animals to prevent it.

https://missionlocal.org/2018/06/the-strange-and-terrible-saga-of-san-franciscos-historic-laundromat-represents-the-worst-of-planning-and-development-in-this-town/

Anyways, I bet that ""historic"" laundromat owner wishes that a freak tornado or lightning stike would have ruined that building so he could make an apartment complex out of it.

The sorts of people who own laundromats seem more likely than average to arrange for a "freak lightning strike" to cause a fire.