19 March 2017

What if condos weren't a scam?

Condos as a form of land tenure got invented in New York State to get around a new, strict, builder liability law.  If the builder of record is the condo corporation, all the liability falls on whoever bought in, rather than the actual builder, and so the actual builder -- on this scale, developer -- is safe from the legal consequences of their shoddy practices.

Note that the people "buying a condo" -- buying a share of the condo corporation that entitles them to live in a particular portion of the structure -- don't get design input.  The actual building is built to maximize the profit of the developer, and has almost nothing in it that referenced the preferences of the people who are going to live in it.  (Observe the increasingly tiny size of condos as the optimal small-investor-attracting price stays roughly constant and real estate markets get pricier and pricier as low interest rates shift the price associated with a particular monthly payment.)  There is basically no feedback from the people who are going to live there.

The other part of this is that there's not really a housing market; one of the things required for a market is buyer knowledge, and hardly anyone buys houses often enough to have the necessary knowledge.  People buying something to live in are not participating in a market.  (The building trades might be, but there you get issues of concentration and number of participants and functional monopsony.)  Houses, as a broad general class of things, are built right at the limit of the local building code in ways where the developer is seeking to maximize their profit at the expense of the building trades and the buyer gets all the liability for the result.  This sort of feedback can't give good results.

What could we do instead?

Well, let's look at where the collective structures are.  (The human trick is ganging up on problems; if you want to find the problem being solved, look for the co-operating group.)

There's a group of developers who exert political influence through the concentration of money.  There's a much more diffuse group who are complaining about the perverse incentives and unfortunate consequences of the developers seeking to "maximize their profit"[0] as a form of political opposition.  The second group is, well, losing.  Everybody[1] believes success means a house in a suburb with a lawn and a two car garage.

So part of this is PR (though keep in mind there's a chunk of the population who _likes_ knowing they're getting more out than they put in, and never mind how the system breaks in time), but part of it is finding some way for the people who live in the housing stock to provide direct feedback into what kind of housing stock it is, where it is, and what it does.

First off, it does need to be collective; hardly anyone has enough money to go buy a chunk of land and get just what they like built on it.  Secondly, it has to meet the needs of the people involved.  Thirdly, it should, from a public policy perspective, recognize that there's a housing density of less than one per ten hectares and a housing density of more than ten per hectare that make sense, but the stuff in the middle doesn't.  (It's ecologically unwise and it's expensive to service.  Remember that roads are a service.  So is sewage.)

So how many people does it take to have something that can build good housing -- the kind where the soundproofing between units is an insulated gap between concrete walls, and the plumbing has been put in with the expectation of paying for the next fifty years of maintenance, and so -- with some day care spaces and some senior assisted living spaces and just generally function, not as a condo, but as a really full service credit union; housing and child care and retirement planning/investment as well as financial and insurance services?  Most of your income would go into it; your taxes would have to fall as this means took over from current public means of meeting those needs.  And, yes, you have to deal with other people, but dealing with other people is a consequence of being a social primate.

If we want better communities, we must want better feedback, which means collective organization because individuals aren't communities and can't individually afford the services of communities.  That means we can't permit a system where the feedback is driven by developer profit.

[0] this means "shift as many costs on to the defenseless as possible" at least as much as it means "get the largest difference between our expenses and our income as we can"; many of the costs (infrastructure) of the most profitable forms of development aren't borne by the developer, but the tax base.  There's an argument that "most profitable" and "largest share of costs borne by the public purse" is an identity relationship.

[1] not literally everybody; it's generational.  Sure.  But the "don't tax me and I want more highways and less traffic and more convenience and services in my suburb" voter is a very reliable voter.

18 March 2017

My fellow Canadians...

The next Canadian federal election is in 2019.

Just exactly when solar got less expensive than coal as a means of generating electricity I'll leave to future historians; it might have been 2016.  It might be this year, or 2018.  It really isn't going to be later than that.  The Chinese are investing very large sums -- equivalent to hundreds of billions in USD -- and good for them.  They need to solve their smog problem.  Solar getting cheaper for everybody else in the process is hardly bad, either.

About a quarter of everything, market-value-wise, sits on fossil carbon.  Thereabouts of 70 trillion-with-a-T USD.  Even if you completely ignore climate change[1], anthropogenic climate forcing with atmosphere dumping of (mostly) carbon, all of that 70 trillion is overvalued.  When the market puts a sustained excessive value on something, we call it a bubble.  This one is the Carbon Bubble.

It's going to pop before the next election.  It's, well, there's no reason to suppose it isn't going to make 2008 look like a modest price adjustment.  Trudeau's government will have low odds of re-election, because generally Canadians won't vote for the government if the economy is bad.

(On a scale from "downturn" to "abandon capitalism as a failed experiment", it's going to be much closer to "abandon" than "downturn".  Everybody's political energies for the next few years in most of the developed world[0] are going into trying to hang on to a vaguely tolerable status quo in preference to a neo-con death cult; the will and the ability to do something sensible about the economy isn't going to be there.  So we're going to go off the cliff.)

Are we going to vote for the NDP in 2019?  Well, it depends on the leader.  If the NDP elect another leader who is sober and respectable and runs to the right of Brian Mulroney, very probably not. Voting for the austerity candidate in an economic crisis is a terrible plan.  (Voting for someone out for moral purity of doctrine is a terrible plan, too.)

So it's somewhere between plausible and highly likely we're going to get a Conservative government in 2019,  EVEN IF the Conservative leader is some sort of seriously detached from the consideration of facts.  People will not let go of the expectation Conservatives are good at the economy, no matter how much contrary evidence they get.

March 27th is the last day you can buy (for 15 CAD) a Conservative Party membership[2], enabling you to vote for Conservative Party leader.  There's one choice -- Michael Chong -- who is engaging with facts[3].  The other dozen choices are at least as blessedly free of the taint of factual knowledge as a bunch of new-hatched chickens.  (They are, for example, nigh-all climate deniers.  What they think this will do for Alberta's bitumen economy after the Carbon Bubble[4] has burst I can't imagine.)

If you're Canadian and not particularly politically committed, I urge you to buy a Conservative Party membership and vote for Michael Chong.  We really don't need someone who can't do arithmetic or face facts running the country in a crisis, and that's otherwise what it looks like we'll be getting.

[0] Canada, too.  Both our largest trading partner and some of our federal politicians keep having what amount to excursions from consensus reality.

[1] DO NOT completely ignore climate change.  Food security goes first, and will go before the sea rises and the coastal cities drown because we can't move them uphill if civilization has collapsed due to starvation.

[2] don't use a pre-paid credit card.  There's an ongoing something-or-other with fraud being alleged involving pre-paid cards.

[3] in a worrisome "markets are great!" sort of way.  Markets _can_ be great, if they're properly maintained (which is to say, regulated); they don't get or stay great on their own.  Of course, if you're running for CPC leader, you had better not go saying you think markets require regulation to function, and let people read between the line in your policy papers to make up their own minds about whether or not you're sane.

[4] https://en.wikipedia.org/wiki/Carbon_bubble  Note that this is talking about "we can't burn it!" more than it's talking about "the markets are going to undergo a correction"; the plummeting price of solar is going to get there and cause the correction long before carbon pricing or other regulation driven by governments shall.

16 February 2017

The wretched miasma of politics

People keep presuming diversely on the net that Putin has compromising pictures of Trump.

I think this is unlikely.

Trump is reputed to have done this -- surreptitiously take compromising pictures of guests -- in Trump's own hotels, Trump has never lacked for low cunning, and it's about impossible to make pictures or video really stick these days. Any state actor can fake just about anything, and that possibility makes any kind of blackmail image doubtfully effective. It might work, but it might not.  It probably won't, given the GOP unwillingness to stop going La La La so long as they stay in power and get their tax breaks.

Really tight proof of Trump's economic misdeeds -- it's not like Putin needs to be especially concerned for being prosecuted for any financial misdeeds on his own part -- is a possibility, but that can be disclaimed, too.  "State actor" calls into a great deal of question just what can be false-flagged about financial fraud claims.

What Putin can have on Trump relies on it being something Trump's staff wouldn't think of guarding against, which generally means something that requires a state actor; either the capability before it would have been generally known as a risk or to get away with doing it.  (Or both.) To be useful, it has to be an inescapable demonstrable material fact that's nigh-guaranteed to revolt Paul Ryan and Mitch McConnell beyond any question of political calculation.  (Plus a sufficient fraction of the right-wing media.)

So either Putin's kiting Trump with no actual kompromat -- not impossible, by any means; that appears to be what Bannon's doing -- or it's something that fits those two criteria.  It has to be a demonstrable material fact and it has to revolt Mitch McConnell and Paul Ryan.   It also has to be something Putin could get, that Trump would believe Putin had, and that Trump can't correct, obscure, or dispose of once Trump knows Putin has it.

There really isn't much in that category.  The only obvious candidate is the paternity of Trump's grandchildren, which is a horrible thought to think.

14 February 2017

I think people miss the significance of the 1950s

The point to the fifties was that the 1940s -- and to a considerable extent the 1930s -- had seen a big upswing in women's agency, if not formal rights.  Running munitions factories lead to getting the vote after the Great War -- you just can't claim someone who handles picric acid isn't capable of political decisions, not if you have any self honesty at all -- but after Hitler's War, all the progress was undone.  Women were removed from jobs and financial independence; the collective child-care (utterly necessary to factories staffed by women) was abolished; a whole lot of "you must stay at home for your child" propaganda got produced.  And it worked, in that time and in that generation.

I think the American hard right; the supremacists, the fascists, the deplorable and demented and delusional with no just claim to the name of a man, are really really into the fifties as imagery because it is indescribably important to them to put "women, cattle, and slaves" back into operation.  An environment when women can tell them no hurts too much to live in, and they don't want it.  (Even the white supremacy has a whole lot of forced-birth nativism in the supremacist mix; it's white male supremacy.  White women aren't meant to be anything other than a particular class of chattel.)  The fifties were time when a long period of increase in women's agency and rights were reversed.  Perhaps that can be done again.

I don't think such a thing is possible this time; I think given the choice between being returned to a condition of reproductive slavery, and killing a lot of people until the demand ceases to be made, enough of the current generation of women are going to pick killing a lot of people.  (And a lot of the millennial men, too, but the politically crucial thing is what the middle aged women chose to do.)

I really, really hope this doesn't happen. (Though it would be a better thing than putting "women, cattle, and slaves" back into operation.)  I very much wish I could believe the Pence wing of the GOP (or pretty much any but perhaps two of the Canadian CPC leadership candidates) recognized this as a possibility.  (Or, if they do recognize it, could imagine losing.)

15 January 2017

Open water

There shouldn't be that much open water in Lake Ontario in January.  Only "should" has moved.

11 December 2016

The end

It's the end.

Well, it's the events of the end; we can count 2017-01-01 or 2016-12-19 or 2017-01-20 if we want, or
something in the past year, or just wait until whatever future historians there happen to be come to a consensus.

The precise moment doesn't really matter. What matters is, yeah, it's the end.

Not the end of the Enlightenment; the Enlightenment died with Progress in the deicide of the Great War. Not the end of capitalism, because capitalism either began with accounting or was always a lie.  Call it the end of the Century of the Common Man, if you like.

It's clear that the upper classes really don't believe in the consent of the governed. It's clear that the articulation of need by the citizenry is broken. It's clear that the common existential crisis -- climate -- isn't going to be addressed because it hinders the certainty of an existing profit. (This is the distinction between capitalism and aristocracy; the capitalist of myth expects they might lose. The aristocrat is certain God did not produce so defective a universe as that.)

So whatever future we get -- and however much of it -- it's not going to look like the past of living memory. 2016 was the Last Normal Year.

Me, I cope by accumulating hand tools. It's not likely to help but it involves feeling less helpless.

04 December 2016

So why was the TPP so important to Obama?

This has been bugging me for awhile; Obama is widely reputed to be a smart guy, and certainly has way better information sources than I do. So if they're strongly for something I think is an obvious bad idea, I tend to wonder what I've got wrong.  (The TPP is, or was, obviously a terrible idea; extra-national profit-guaranteeing tribunals?  Urgh.)

And then the clue hit.

About four-fifths of the value of the US economy is IP of some kind.  It's very hard to tell how much of that is the intangible output of creatives -- new music, new design, new chemistry, materials, medicine, and biology -- and how much is rents extracted by the power of the American empire.

So let's consider a piano.  A piano is nigh-useless unless you know how to play it -- which someone smart can figure out -- and without the music you play on it, which is an accumulation of skilled people over time.  If you lose the accumulation, you can't get it back; it's contingent on events.  (If you restart the universe, you don't even get humans; you certainly don't get Bach's music.  If in ten thousand years your rising civilization finds a pipe organ in a buried hockey arena and builds a reconstruction, no one is going to re-invent Bach at that remove, either.)

So there's a bunch of questions about what should be charged for the music (above and beyond the material costs of making copies) and who gets the money.  There's also the question about what you pay a performer and what you pay a composer of new music.  (What the piano tuner gets paid and whether it's worthwhile to make more pianos and how much effort you put into making better piano wire for strings are all defined by the answers to that first set of questions.)

Those answers are cultural.  Which means contingent; the answers we have now are not the answers we would get if we did it again.

The current answers greatly benefit the US and somewhat benefit the satellite states of the unofficial empire; that's for a lot of reasons but that state persisting in the present comes down to "change is risky and the current situation isn't intolerable".  (Establishing the current answers is some mix of a very strong economy, getting nuclear weapons first, and being the only non-devastated major combatant at the end of the Second World War.)

I think it's really hard to tell how much of that four-fifths-is-IP is rent extraction.  I very much doubt the people doing economic intelligence for the Obama White House cannot put a number on it, or that the number isn't tolerably accurate.  Is it half?  I could easily believe half.

Anything that forces change leaves the situation open to ending up who-knows-where.  And wherever that is, it's worse for the US.  The TPP was a means to make significant change more difficult so it was less likely.

Completely open change as the current trade arrangements -- which are certainly showing both economic and political strain -- fail is nigh-certainly going to be produce something systemically simpler.  The influence of the US will be greatly reduced.  (It's much much harder to recreate a position of military dominance without the empire's economic dominance than it is to have a historical condition of military dominance acknowledged as persisting while the economy which created it persists.  Guns don't turn into butter.)

The greenback ceasing to be the reserve currency with no replacement available isn't good.   Two fifths of the value in the US economy going away in a short period of time -- rents the empire is no longer able to exact -- doesn't have an adjective.  Even one-fifth, because the current long supply chain situation doesn't have a graceful way to shorten the supply chains or collapse into domestic production.  (Compare the US domestic production of shoes with demand, just as a for-example.)  A depression is what happens when the mechanism is all there and the price signals get messed up.  This would be what happens when the mechanism collapses and has no immediate replacement.

Obama's basically a conservative.  Given a choice between trying to create a new set of economic mechanisms, and trying very hard to be sure the current set will persist, of course Obama would pick "persist".

Trump's approach looks like it's going to be status-quo-by-autarky, aka the worst possible choice; the status quo depends on the empire (which autarky abandons unrecoverably) and the autarky removes anyone else's interest in the "mutually beneficial" part of any new trade structures.  (Trade is a good thing as a means to greater general prosperity.  The problem isn't the idea of trade, it's using the necessity of trade as a means to obtain a political guarantee of profit that's the problem.)