Alice gives Bob some stuff. In exchange Bob gives Alice a thing. Then Alice has to give back the thing, and Bob gets to keep the stuff. Bob has profited at Alice's expense; Alice lost some stuff, and didn't get any thing for it. Why the hell would Alice put up with this? Because she has no choice; Bob has the thing that Alice needs to survive, so she either gives up her stuff and accepts the loss in order to buy herself a little more time, or she dies. (Or gives up the stuff to Charles instead, or Doug, etc, but same difference there).
It's not quite literal theft, but it's close enough.
People can have notable assets and low income. A lot of older people fall into this category, who managed to pay off a house and are now old and feeble and only make enough to barely cover their consumption. Thankfully they don't have to pay rent anymore. You start taxing their homes though, and now they are paying rent... to the government... on a house they supposedly own, and worked their whole life to pay for. (So now they either lose the house, or have to rent out a bedroom, and pass the buck to some younger schmuck, exacerbating the problem for someone else).
We should most definitely tax income from assets (rent and interest) heavily, and use it to fund a credit to the people paying that rent and interest in the first place. Other than that, if we have to tax at all, it's most just to tax people based on their ability to bear the burden, i.e. their income.
The landlords (a minority) amongst the natives are no longer poor. Their tenants (the majority) are still poor and now live in a place too expensive for them to afford.
Please try again why rich people are God's Chosen Few and deserve to exploit me for money my entire life without actually exchanging a single fucking asset for all that I pay them, so that they can lend it out again and again indefinitely and live a life of leisure off the product of my labor.
How the fuck is charging someone money to use your property, and getting to keep the property, "subsidizing"? That is one-hundred-percent pure fucking profit.
Are you another one of those fucking idiots who thinks "if I charge the same rent that I pay for the mortgage on the place, plus upkeep, then I'm just barely breaking even", ignoring the fact that SOMEONE ELSE IS PAYING THE MORTGAGE ON A HOUSE THAT YOU OWN, PUTTING ASSETS IN YOUR POCKET.
And why the flying fuck would anyone ever fucking throw money down a rent-hole when they could be PAYING LESS AND GETTING EQUITY TO THEIR NAMES by buying?
What I want would not screw other people, except the people who are currently screwing other people, who wouldn't be able to screw them anymore. People who want to "rent" would be able to keep doing effectively that (move quickly and pay small monthly payments with little down) under my system; they'd be exchanging one "evil" for another "evil", but if they're happy paying the price of those equivalent "evils" that's their choice. Other people would be freed from either of those "evils" and have choices they do not currently have.
The rest of your comments, again, are still importing a bunch of bullshit about the current way we handle housing, and so do not pertain to what I'm advocating at all. Maybe an easier way to think about it for you is: imagine that "rent" as we know it now still existed, but that, depending on how long you stayed, and how quickly you needed to move, and how much of the maintenance you were willing to handle yourself, and a bunch of other factors like that, when you leave, you can get a bunch of your money back (maybe all at once, maybe over time, again depending on factors). If you want to move a lot and quickly and have someone else deal with everything, it's just like rent now. If you just need a fucking place to live, and you stay there for a long time and take care of the place and put in the effort to find someone else who wants to live there to take if off your hands when you go, then it ends up looking a whole lot more like home ownership as we know it, and if you stay there long enough (or keep up that kind of pattern across a couple different places through your lifetime), eventually you do own some place outright and can stop paying.
You're thinking of "rent" as connoting the terms of payment, those being long and low (you pay small amounts per month, forever). I'm thinking of "rent" as connoting what you get in exchange for that payment, that being nothing. I'm saying that you can have your long and low payment schedule, so long as you're not actually getting nothing in return; which means, consequently, "forever" cannot be a payment schedule, and eventually it ends, so you don't end up with people who've paid over their lifetimes far more than the price of a house, and don't have any house to their names for that effort.
That's not a bad idea, but I'd much prefer to do it more directly, and tax unearned income derived from ownership, i.e. rent and interest income. If you've got huge assets and you also work your ass off doing legitimate work, I don't see why you shouldn't get to keep that justly-earned income. Likewise if you've got huge assets and you're selling them off for money to live off of, I don't see why you shouldn't keep that -- you're losing something in the process, redistributing your wealth to the working people you're paying. But if you've got huge assets and you make a huge income off of letting other people borrow them, then yeah, tax the fuck out of that. I would say tax that at 100% (and have the proceeds go to a tax credit for the people PAYING rent and interest), as that would effectively abolish rent. But let's ramp up to that a little more slowly, start off taxing it something small and reasonable, and then gradually bring it up to the point where there's no point in anyone renting, to give the market time to implement alternatives to rent, so everything doesn't just break when we suddenly get rid of it.
That's what progressive taxes are, which we've already got (though not nearly as progressive as they could be), and I honestly thing that that's just a bandaid over the problem. Still, a bandaid is better than an open wound, and until the real problem (the mechanism by which ownership generates income -- rent) is fixed, I'm happy to apply such bandaids far more liberally than we already are. My preferred bandaid is to replace all taxes with a single tax of half the difference between your income and the mean income, plus the nominal per-capita tax rate. So if you make the mean income of about $50k, you just pay the nominal tax rate. If you make twice the mean income or $100k, you pay $25k, and then the nominal tax rate on the remaining $75k. If you make 20 times the mean income, or a million dollars a year, you pay $475k, and THEN the nominal tax rate on the remaining $525k.
And if you make half the mean income, which coincidentally is also about the median income, about $25k, then you GET $12.5k back first, and then pay the nominal tax rate on that combined $37.5. If you make nothing at all, you GET $25k, and then pay the nominal tax rate on that. So you get basically a Basic Income, which lets you get rid of all kinds of other programs like minimum wage, unemployment, social security, food stamps, etc, because it's guaranteed that nobody will ever make less than half the mean income; which less than half the country are living on right now, since the median is about half the mean.
There are arrangements that are possible to accommodate such people without them literally renting.
I'm not saying that there should be no housing of the form "I pay you a small amount of money every month with little down and can leave on relatively short notice". Such housing should certainly exist. I'm saying that people who live in place for decades and pay tens or hundreds of thousands of dollars for that privilege should, you know... get some housing to their name for that money. That "rent" money should not go down a hole, never to be seen again, that if you pay for housing long enough you should own a house at some point. The terms of payment are not at issue here, what you get for your money is. With rent, you get nothing, and that's inexcusable.
Also, fuck no I want nothing like the Soviets had. Also also, rent is already serfdom. There's a reason it's called a landlord. The formal arrangement between landlord and tenant is exactly the same as that between a medieval lord of the land and his... tenants. Rent is the modern vestiges of feudalism and serfdom.
And that'd be all fine and dandy if everyone in the impoverish country actually owned their own land, and had the choice of whether to stay there, or to take huge gobs of money and leave.
The problem is that most people in most countries don't own their own land, almost everyone for all of history has lived on someone else's property. So when the rich Americans come into impoverished Bumfuckistan and buy up all the land, the people who have to move aren't the ones getting the gobs of money; their landlords are, and the people who had been living there are just fucked.
That's the whole point. Rent is the cause of this problem. Without it there wouldn't be a problem.
Tell that to the feudal lords in the middle ages who had exactly this setup going for them. They owned all the land, they paid private guards to guard the land, and everyone else had to pay them for the privilege of existing on their land.
Of course you'll say "but they were the government!", because yeah, that's what happens when wealth concentrates into too few hands: the people who hold all the wealth have all the power and become a government, the free market breaks, and it all goes to hell.
Which is why things like rent that cause wealth-concentration are not part of a free market, they break the market and make it unfree.
You realize that this exact situation I'm describing actually existed, right?
In medieval times feudal lords owned all the land, had their own private guards, and you had to obey them and pay a big portion of your crop to them or else those guards would chase you off the land (at best). And since "off the land" was just onto someone else's land, you had the same situation there.
Yes, the medieval lords were effectively the government, but that's because that's all government is: the people who own the area and pay enough guards enough to enforce their ownership of it. Having no choice but to live on someone else's private property under their conditions is exactly the same as having no choice but to obey a government.
You only get rent and interest if you forego consumption and invest your money in things that produce value to society. If you consume instead of investing, or if you invest in things that don't produce value, you get nothing.
You're assuming everyone starts off with an equal distribution of assets and inequalities only arise due to differences in behavior thereafter. That's obviously not the case in fact; people are born into, and otherwise obtain by luck alone, different levels of assets, regardless of their work. (Not that work makes no difference, but it is not the only factor). The point is that rent exacerbates such differences, so that two people who work and consume exactly the same amount will gain or lose different amounts based only on who had more or less to start with.
Sorry, but that example makes no sense whatsoever. The value of money is determined by what people are willing to trade for it. In this case, person two would simply say "you have a lot of nice pieces of paper there, but I don't recognize them as having any value".
This is a non-sequitur. Money is any unit of trade, I never said it had to be paper.
Let's flesh the example out a little more fully then so you can't take that cop-out excuse. The only capital in question is land, to live and work on. The only currency in question is food, grown on that land. There is exactly enough land in this market to support two people. One of them owns 3/4 of it, while another only owns 1/4 of it. The one who only owns 1/4 of it thus doesn't have enough land to survive, and has to borrow land from the other one. The other one will only allow this if the first will give a share of his food grown from that work. So now, just because of the prior distribution of land ownership, two people who work the same amount and consume the same amount now have different amounts of product left over at the end of the day. Of course now the poorer one doesn't have enough food to eat, so he begs the richer one for some of his excess back; the richer one will only give it back if the poorer one will do more labor for him. So now they both get the same amount of product at the end of the day, but one of them has to do more work for it. Any way you slice it, it becomes impossible for the two people to work the same, consume the same, and profit the same from that identical behavior, just because one of them owned more than the other at the outset.
Of course, the poorer one could instead trade some of his dwindling land to the richer one in exchange for some food back, instead of trading labor, but then that just makes the problem even worse, the richer one owning more and more of the land, demanding more and more from the poorer one to borrow that more and more land, the poorer one having to work harder and harder to buy back what he had to pay to borrow it so he can eat, or else keep trading away his land, making the problem worse and worse until one of them owns everything, and the other has to do whatever that one says, or fuck off and starve to death.
Ok: Alice is a non-property owner who needs a place to live and some land to grow food on. She settled down on some OK-looking land and builds herself a lean-to and starts tilling and planting. Then some guys with guns come over and tell her this is Bob's land, and that if she wants to live and work here she has to do so under his conditions. She says no to those conditions because they sound like slavery to her, so Bob's thugs tell Alice to leave Bob's land. She tries to refuse and claim this is unjust so Bob's thugs pull their guns on her, and she begrudgingly leaves, walking across the border of Bob's land to Charlie's land. The same thing happens on Charlie's land, and Doug's, and Edwards', and so on, until Alice dies of starvation or capitulates and accepts someone's slave-like conditions to live on and work their land.
How exactly did those cops being paid directly by the property-owners make that scenario any better than it would have been for Alice if they had been paid by taxes instead?
The problem in my hypothetical scenario doesn't go away if the property-owners all have their own privately-funded police forces instead. If anything, it gets worse.
Mind you, I am a philosophical anarchist and so would like it if eventually police and courts as we know them were replaced by something much less authoritarian, but that in itself wouldn't solve the problem here. So long as someone is protecting the landowners' private property rights somehow —imagine whatever form of protection you like, devoid of any problems with the kinds we have now, however you can work that out — you still have the problem that nobody can survive without the landowners allowing them to live and work on their land, and they won't allow that unless you submit to conditions tantamount to slavery.
Maybe some people rent because they prefer that to buying, I keep hearing that's a thing though I can't fathom why you would really want that, but certainly not all people. Myself and many, many other people I personally know want nothing more than to escape from renting and move on to buying, and just can't save up a down payment to start buying because all the money they would be having has to go to paying rent instead. My parents have spent their entire lives paying for housing, hundreds of thousands of dollars, more than enough to pay off a nice house, and don't have a single square foot of land to either of their names because all that fucking money went down various holes to pay other peoples' mortgages instead. And I'm not looking to have much more of a chance than them.
If my savings stay at the level they are (which is much higher than they've been most of my life), I'll be able to technically afford a down payment by the time I'm 40, and so will probably die before I can enjoy the fucking point of home-ownership, the security of not having to pay for the right to JUST EXIST somewhere. Except, the rent on the money (interest on the mortgage) for the amount I would still need to borrow for that minimal down payment would be higher than the rent I would otherwise be paying, so really it will be more like 50 or 55 before I can star buying with a mortgage that costs less in interest than I'd be paying in rent. And then I'll definitely be dead before I ever finish paying it off so what's the fucking point? I'll be renting into the grave, be it rent on a house directly or rent on the money to buy one with.
Having to pay his own goddamn mortgage on the property he is getting equity in for every payment is not "losing thousands of dollars", it's merely not stealing thousands of dollars from his renters.
You probably believe the MAFIAA's claims that piracy "cost them millions" in hypothetical lost sales they were counting on, as though they were entitled to that money they hadn't made yet.
That's exactly what I think it means. I think you're misreading either me or that article.
Economic rent is "due to its exclusivity or scarcity. Economic rent arises due to market imperfections; it would not exist if markets were perfect, since competitive pressures would drive down prices."
The problem is that person one isn't "risking" anything more than would have already been risked if the capital had been evenly split in the first place. Person one isn't doing anything more, he's just entitled to more by virtue of the prior distribution of capital.
And things like progressive tax structures and estate taxes are bandages over the problem of capitalism being rigged for people who already have capital. The kind of state socialism that is usually proposed as the alternative for a free market is only necessary at all because we have this capitalistic parasitism making the market not really free.
And it is hardly a beauty that society is divided into "owners" and "workers". Everyone should be both. Everyone should be an owner enough that they don't have to borrow from others and work extra hard to service that "privilege" which only exists due to a preexisting inequality; and nobody should be able to leverage ownership into not having to be a worker at all.
If you have borrow and you have to work, you're a lower-class worker, and that's bad -- for you, you're being taken advantage of.
If you don't have to borrow but you still have to work, you're middle-class, and that's good. Everyone should be here. There's a wide range of income and asset levels possible within this, so this doesn't mean everyone should have and make exactly the same.
If you don't have to borrow or even work, you're an upper-class owner, and that's bad -- on you, you're taking advantage of someone.
Free markets distribute capital according to how much people actually contribute to society.
Which is exactly why a market with rent and interest in it is not free. Rent and interest distribute capital according to who already has capital, not according to their contributions to society. That's why it's called "capitalism", because the prior capital distribution is shaping the market rather than the work of the people in the market.
Imagine a toy market consisting of only two people, who both do the same work and make the same money from that work. One of them has more capital than he's using, and the other doesn't have enough capital to use. The latter then has to borrow capital from the former, and pay the former for the privilege. Thus, though they both contribute exactly the same work, one of them accumulates more capital and the other loses it, only because the prior distribution of capital was different.
That is how rent breaks a free market and turns it into capitalism.
The point is that it's a problem when people who were born and raised in an area can't buy there, because the rents keep getting cranked up and they can't save to buy while also renting. It's just an even worse problem when the rents crank up so high that they can't even afford to rent there anymore.
The real estate investors who lost their shirts in the crash did so because they were also borrowers. Someone who owned a house outright and was renting it out wouldn't have been hurt for shit from that crash. Someone who was renting money from the bank to buy a house that they then rented out to people... yeah, they got fucked. By the banks. Just like renters get fucked by their landlords. Everyone downstream gets fucked and the people who actually have real capital at the top walk away laughing.
Renting a house ALWAYS costs more; how else would your landlord pay the mortgage otherwise?
He could own the house, and not just be a middle-man in you essentially renting indirectly from a bank. Or between the two, he could be paying down the principle himself and having your rent just cover his rent (interest) to the bank, which is not something I actually mind terribly (if you're getting fucked by rents yourself, passing the buck to someone else is fine with me, though it's still a problem that someone is getting fucked for someone else's profit, but the middle-man isn't to blame for that).
"Unearned income" is a technical term in economics, though it means pretty much what it sounds like: it's income gotten from something other than selling a good or a service. I realize now that I've actually been misusing it slightly, I've meant to say "economic rent", which is only one kind of unearned income, the other being capital gains. (Though I kind of dispute that capital gains should count, since that's really just buying and selling a good at different times for a profit, and so should count as earned income). Economic rent in turn is another technical term in economics which means, roughly put, income gotten from being the gatekeeper of something. Contract rent ("rent" in the ordinary sense) is only one kind of economic rent; things like holding a patent or copyright is another kind.
Basically, any time you get money just for being the person in a position to say whether or not someone is allowed to do something —like use your (rental) property, use a (patented) algorithm, or reproduce a (copyrighted) image — without having to actually do something yourself for them, or give them something, that is economic rent, a form of unearned income.
There should be a business, it could be called something like "Enterprise", or maybe "Hertz" or "Avis", that will sell you cars on affordable installment payments, and then buy them back readily in on lump sum, for less than they sell them for of course so that they can make a profit for this car-liquidity service. Of course if you like you can find someone else to sell to and maybe save a bit of money in the process but it sounds like you'd rather pay for the convenience. People who don't, however, don't have to, and after making monthly payments for long enough will eventually be able to stop paying for their car.
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I think you're replying to the wrong person; I was quoting someone else and rebutting them, not making that assertion myself.
Alice gives Bob some stuff. In exchange Bob gives Alice a thing. Then Alice has to give back the thing, and Bob gets to keep the stuff. Bob has profited at Alice's expense; Alice lost some stuff, and didn't get any thing for it. Why the hell would Alice put up with this? Because she has no choice; Bob has the thing that Alice needs to survive, so she either gives up her stuff and accepts the loss in order to buy herself a little more time, or she dies. (Or gives up the stuff to Charles instead, or Doug, etc, but same difference there).
It's not quite literal theft, but it's close enough.
People can have notable assets and low income. A lot of older people fall into this category, who managed to pay off a house and are now old and feeble and only make enough to barely cover their consumption. Thankfully they don't have to pay rent anymore. You start taxing their homes though, and now they are paying rent... to the government... on a house they supposedly own, and worked their whole life to pay for. (So now they either lose the house, or have to rent out a bedroom, and pass the buck to some younger schmuck, exacerbating the problem for someone else).
We should most definitely tax income from assets (rent and interest) heavily, and use it to fund a credit to the people paying that rent and interest in the first place. Other than that, if we have to tax at all, it's most just to tax people based on their ability to bear the burden, i.e. their income.
Because it is exploitative and unjust.
While you're at it, why not get someone else to pay for your food in exchange for the service of not putting a bullet through their head?
The landlords (a minority) amongst the natives are no longer poor. Their tenants (the majority) are still poor and now live in a place too expensive for them to afford.
Please try again why rich people are God's Chosen Few and deserve to exploit me for money my entire life without actually exchanging a single fucking asset for all that I pay them, so that they can lend it out again and again indefinitely and live a life of leisure off the product of my labor.
How the fuck is charging someone money to use your property, and getting to keep the property, "subsidizing"? That is one-hundred-percent pure fucking profit.
Are you another one of those fucking idiots who thinks "if I charge the same rent that I pay for the mortgage on the place, plus upkeep, then I'm just barely breaking even", ignoring the fact that SOMEONE ELSE IS PAYING THE MORTGAGE ON A HOUSE THAT YOU OWN, PUTTING ASSETS IN YOUR POCKET.
And why the flying fuck would anyone ever fucking throw money down a rent-hole when they could be PAYING LESS AND GETTING EQUITY TO THEIR NAMES by buying?
What I want would not screw other people, except the people who are currently screwing other people, who wouldn't be able to screw them anymore. People who want to "rent" would be able to keep doing effectively that (move quickly and pay small monthly payments with little down) under my system; they'd be exchanging one "evil" for another "evil", but if they're happy paying the price of those equivalent "evils" that's their choice. Other people would be freed from either of those "evils" and have choices they do not currently have.
The rest of your comments, again, are still importing a bunch of bullshit about the current way we handle housing, and so do not pertain to what I'm advocating at all. Maybe an easier way to think about it for you is: imagine that "rent" as we know it now still existed, but that, depending on how long you stayed, and how quickly you needed to move, and how much of the maintenance you were willing to handle yourself, and a bunch of other factors like that, when you leave, you can get a bunch of your money back (maybe all at once, maybe over time, again depending on factors). If you want to move a lot and quickly and have someone else deal with everything, it's just like rent now. If you just need a fucking place to live, and you stay there for a long time and take care of the place and put in the effort to find someone else who wants to live there to take if off your hands when you go, then it ends up looking a whole lot more like home ownership as we know it, and if you stay there long enough (or keep up that kind of pattern across a couple different places through your lifetime), eventually you do own some place outright and can stop paying.
You're thinking of "rent" as connoting the terms of payment, those being long and low (you pay small amounts per month, forever). I'm thinking of "rent" as connoting what you get in exchange for that payment, that being nothing. I'm saying that you can have your long and low payment schedule, so long as you're not actually getting nothing in return; which means, consequently, "forever" cannot be a payment schedule, and eventually it ends, so you don't end up with people who've paid over their lifetimes far more than the price of a house, and don't have any house to their names for that effort.
That's not a bad idea, but I'd much prefer to do it more directly, and tax unearned income derived from ownership, i.e. rent and interest income. If you've got huge assets and you also work your ass off doing legitimate work, I don't see why you shouldn't get to keep that justly-earned income. Likewise if you've got huge assets and you're selling them off for money to live off of, I don't see why you shouldn't keep that -- you're losing something in the process, redistributing your wealth to the working people you're paying. But if you've got huge assets and you make a huge income off of letting other people borrow them, then yeah, tax the fuck out of that. I would say tax that at 100% (and have the proceeds go to a tax credit for the people PAYING rent and interest), as that would effectively abolish rent. But let's ramp up to that a little more slowly, start off taxing it something small and reasonable, and then gradually bring it up to the point where there's no point in anyone renting, to give the market time to implement alternatives to rent, so everything doesn't just break when we suddenly get rid of it.
That's what progressive taxes are, which we've already got (though not nearly as progressive as they could be), and I honestly thing that that's just a bandaid over the problem. Still, a bandaid is better than an open wound, and until the real problem (the mechanism by which ownership generates income -- rent) is fixed, I'm happy to apply such bandaids far more liberally than we already are. My preferred bandaid is to replace all taxes with a single tax of half the difference between your income and the mean income, plus the nominal per-capita tax rate. So if you make the mean income of about $50k, you just pay the nominal tax rate. If you make twice the mean income or $100k, you pay $25k, and then the nominal tax rate on the remaining $75k. If you make 20 times the mean income, or a million dollars a year, you pay $475k, and THEN the nominal tax rate on the remaining $525k.
And if you make half the mean income, which coincidentally is also about the median income, about $25k, then you GET $12.5k back first, and then pay the nominal tax rate on that combined $37.5. If you make nothing at all, you GET $25k, and then pay the nominal tax rate on that. So you get basically a Basic Income, which lets you get rid of all kinds of other programs like minimum wage, unemployment, social security, food stamps, etc, because it's guaranteed that nobody will ever make less than half the mean income; which less than half the country are living on right now, since the median is about half the mean.
There are arrangements that are possible to accommodate such people without them literally renting.
I'm not saying that there should be no housing of the form "I pay you a small amount of money every month with little down and can leave on relatively short notice". Such housing should certainly exist. I'm saying that people who live in place for decades and pay tens or hundreds of thousands of dollars for that privilege should, you know... get some housing to their name for that money. That "rent" money should not go down a hole, never to be seen again, that if you pay for housing long enough you should own a house at some point. The terms of payment are not at issue here, what you get for your money is. With rent, you get nothing, and that's inexcusable.
Also, fuck no I want nothing like the Soviets had. Also also, rent is already serfdom. There's a reason it's called a landlord. The formal arrangement between landlord and tenant is exactly the same as that between a medieval lord of the land and his... tenants. Rent is the modern vestiges of feudalism and serfdom.
And that'd be all fine and dandy if everyone in the impoverish country actually owned their own land, and had the choice of whether to stay there, or to take huge gobs of money and leave.
The problem is that most people in most countries don't own their own land, almost everyone for all of history has lived on someone else's property. So when the rich Americans come into impoverished Bumfuckistan and buy up all the land, the people who have to move aren't the ones getting the gobs of money; their landlords are, and the people who had been living there are just fucked.
That's the whole point. Rent is the cause of this problem. Without it there wouldn't be a problem.
Tell that to the feudal lords in the middle ages who had exactly this setup going for them. They owned all the land, they paid private guards to guard the land, and everyone else had to pay them for the privilege of existing on their land.
Of course you'll say "but they were the government!", because yeah, that's what happens when wealth concentrates into too few hands: the people who hold all the wealth have all the power and become a government, the free market breaks, and it all goes to hell.
Which is why things like rent that cause wealth-concentration are not part of a free market, they break the market and make it unfree.
You realize that this exact situation I'm describing actually existed, right?
In medieval times feudal lords owned all the land, had their own private guards, and you had to obey them and pay a big portion of your crop to them or else those guards would chase you off the land (at best). And since "off the land" was just onto someone else's land, you had the same situation there.
Yes, the medieval lords were effectively the government, but that's because that's all government is: the people who own the area and pay enough guards enough to enforce their ownership of it. Having no choice but to live on someone else's private property under their conditions is exactly the same as having no choice but to obey a government.
You only get rent and interest if you forego consumption and invest your money in things that produce value to society. If you consume instead of investing, or if you invest in things that don't produce value, you get nothing.
You're assuming everyone starts off with an equal distribution of assets and inequalities only arise due to differences in behavior thereafter. That's obviously not the case in fact; people are born into, and otherwise obtain by luck alone, different levels of assets, regardless of their work. (Not that work makes no difference, but it is not the only factor). The point is that rent exacerbates such differences, so that two people who work and consume exactly the same amount will gain or lose different amounts based only on who had more or less to start with.
Sorry, but that example makes no sense whatsoever. The value of money is determined by what people are willing to trade for it. In this case, person two would simply say "you have a lot of nice pieces of paper there, but I don't recognize them as having any value".
This is a non-sequitur. Money is any unit of trade, I never said it had to be paper.
Let's flesh the example out a little more fully then so you can't take that cop-out excuse. The only capital in question is land, to live and work on. The only currency in question is food, grown on that land. There is exactly enough land in this market to support two people. One of them owns 3/4 of it, while another only owns 1/4 of it. The one who only owns 1/4 of it thus doesn't have enough land to survive, and has to borrow land from the other one. The other one will only allow this if the first will give a share of his food grown from that work. So now, just because of the prior distribution of land ownership, two people who work the same amount and consume the same amount now have different amounts of product left over at the end of the day. Of course now the poorer one doesn't have enough food to eat, so he begs the richer one for some of his excess back; the richer one will only give it back if the poorer one will do more labor for him. So now they both get the same amount of product at the end of the day, but one of them has to do more work for it. Any way you slice it, it becomes impossible for the two people to work the same, consume the same, and profit the same from that identical behavior, just because one of them owned more than the other at the outset.
Of course, the poorer one could instead trade some of his dwindling land to the richer one in exchange for some food back, instead of trading labor, but then that just makes the problem even worse, the richer one owning more and more of the land, demanding more and more from the poorer one to borrow that more and more land, the poorer one having to work harder and harder to buy back what he had to pay to borrow it so he can eat, or else keep trading away his land, making the problem worse and worse until one of them owns everything, and the other has to do whatever that one says, or fuck off and starve to death.
Ok: Alice is a non-property owner who needs a place to live and some land to grow food on. She settled down on some OK-looking land and builds herself a lean-to and starts tilling and planting. Then some guys with guns come over and tell her this is Bob's land, and that if she wants to live and work here she has to do so under his conditions. She says no to those conditions because they sound like slavery to her, so Bob's thugs tell Alice to leave Bob's land. She tries to refuse and claim this is unjust so Bob's thugs pull their guns on her, and she begrudgingly leaves, walking across the border of Bob's land to Charlie's land. The same thing happens on Charlie's land, and Doug's, and Edwards', and so on, until Alice dies of starvation or capitulates and accepts someone's slave-like conditions to live on and work their land.
How exactly did those cops being paid directly by the property-owners make that scenario any better than it would have been for Alice if they had been paid by taxes instead?
The problem in my hypothetical scenario doesn't go away if the property-owners all have their own privately-funded police forces instead. If anything, it gets worse.
Mind you, I am a philosophical anarchist and so would like it if eventually police and courts as we know them were replaced by something much less authoritarian, but that in itself wouldn't solve the problem here. So long as someone is protecting the landowners' private property rights somehow —imagine whatever form of protection you like, devoid of any problems with the kinds we have now, however you can work that out — you still have the problem that nobody can survive without the landowners allowing them to live and work on their land, and they won't allow that unless you submit to conditions tantamount to slavery.
Maybe some people rent because they prefer that to buying, I keep hearing that's a thing though I can't fathom why you would really want that, but certainly not all people. Myself and many, many other people I personally know want nothing more than to escape from renting and move on to buying, and just can't save up a down payment to start buying because all the money they would be having has to go to paying rent instead. My parents have spent their entire lives paying for housing, hundreds of thousands of dollars, more than enough to pay off a nice house, and don't have a single square foot of land to either of their names because all that fucking money went down various holes to pay other peoples' mortgages instead. And I'm not looking to have much more of a chance than them.
If my savings stay at the level they are (which is much higher than they've been most of my life), I'll be able to technically afford a down payment by the time I'm 40, and so will probably die before I can enjoy the fucking point of home-ownership, the security of not having to pay for the right to JUST EXIST somewhere. Except, the rent on the money (interest on the mortgage) for the amount I would still need to borrow for that minimal down payment would be higher than the rent I would otherwise be paying, so really it will be more like 50 or 55 before I can star buying with a mortgage that costs less in interest than I'd be paying in rent. And then I'll definitely be dead before I ever finish paying it off so what's the fucking point? I'll be renting into the grave, be it rent on a house directly or rent on the money to buy one with.
Having to pay his own goddamn mortgage on the property he is getting equity in for every payment is not "losing thousands of dollars", it's merely not stealing thousands of dollars from his renters.
You probably believe the MAFIAA's claims that piracy "cost them millions" in hypothetical lost sales they were counting on, as though they were entitled to that money they hadn't made yet.
That's exactly what I think it means. I think you're misreading either me or that article.
Economic rent is "due to its exclusivity or scarcity. Economic rent arises due to market imperfections; it would not exist if markets were perfect, since competitive pressures would drive down prices."
The problem is that person one isn't "risking" anything more than would have already been risked if the capital had been evenly split in the first place. Person one isn't doing anything more, he's just entitled to more by virtue of the prior distribution of capital.
And things like progressive tax structures and estate taxes are bandages over the problem of capitalism being rigged for people who already have capital. The kind of state socialism that is usually proposed as the alternative for a free market is only necessary at all because we have this capitalistic parasitism making the market not really free.
And it is hardly a beauty that society is divided into "owners" and "workers". Everyone should be both. Everyone should be an owner enough that they don't have to borrow from others and work extra hard to service that "privilege" which only exists due to a preexisting inequality; and nobody should be able to leverage ownership into not having to be a worker at all.
If you have borrow and you have to work, you're a lower-class worker, and that's bad -- for you, you're being taken advantage of.
If you don't have to borrow but you still have to work, you're middle-class, and that's good. Everyone should be here. There's a wide range of income and asset levels possible within this, so this doesn't mean everyone should have and make exactly the same.
If you don't have to borrow or even work, you're an upper-class owner, and that's bad -- on you, you're taking advantage of someone.
Free markets distribute capital according to how much people actually contribute to society.
Which is exactly why a market with rent and interest in it is not free. Rent and interest distribute capital according to who already has capital, not according to their contributions to society. That's why it's called "capitalism", because the prior capital distribution is shaping the market rather than the work of the people in the market.
Imagine a toy market consisting of only two people, who both do the same work and make the same money from that work. One of them has more capital than he's using, and the other doesn't have enough capital to use. The latter then has to borrow capital from the former, and pay the former for the privilege. Thus, though they both contribute exactly the same work, one of them accumulates more capital and the other loses it, only because the prior distribution of capital was different.
That is how rent breaks a free market and turns it into capitalism.
The point is that it's a problem when people who were born and raised in an area can't buy there, because the rents keep getting cranked up and they can't save to buy while also renting. It's just an even worse problem when the rents crank up so high that they can't even afford to rent there anymore.
The real estate investors who lost their shirts in the crash did so because they were also borrowers. Someone who owned a house outright and was renting it out wouldn't have been hurt for shit from that crash. Someone who was renting money from the bank to buy a house that they then rented out to people... yeah, they got fucked. By the banks. Just like renters get fucked by their landlords. Everyone downstream gets fucked and the people who actually have real capital at the top walk away laughing.
Renting a house ALWAYS costs more; how else would your landlord pay the mortgage otherwise?
He could own the house, and not just be a middle-man in you essentially renting indirectly from a bank. Or between the two, he could be paying down the principle himself and having your rent just cover his rent (interest) to the bank, which is not something I actually mind terribly (if you're getting fucked by rents yourself, passing the buck to someone else is fine with me, though it's still a problem that someone is getting fucked for someone else's profit, but the middle-man isn't to blame for that).
"Unearned income" is a technical term in economics, though it means pretty much what it sounds like: it's income gotten from something other than selling a good or a service. I realize now that I've actually been misusing it slightly, I've meant to say "economic rent", which is only one kind of unearned income, the other being capital gains. (Though I kind of dispute that capital gains should count, since that's really just buying and selling a good at different times for a profit, and so should count as earned income). Economic rent in turn is another technical term in economics which means, roughly put, income gotten from being the gatekeeper of something. Contract rent ("rent" in the ordinary sense) is only one kind of economic rent; things like holding a patent or copyright is another kind.
Basically, any time you get money just for being the person in a position to say whether or not someone is allowed to do something —like use your (rental) property, use a (patented) algorithm, or reproduce a (copyrighted) image — without having to actually do something yourself for them, or give them something, that is economic rent, a form of unearned income.
There should be a business, it could be called something like "Enterprise", or maybe "Hertz" or "Avis", that will sell you cars on affordable installment payments, and then buy them back readily in on lump sum, for less than they sell them for of course so that they can make a profit for this car-liquidity service. Of course if you like you can find someone else to sell to and maybe save a bit of money in the process but it sounds like you'd rather pay for the convenience. People who don't, however, don't have to, and after making monthly payments for long enough will eventually be able to stop paying for their car.