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View Diary: Renters make good Democrats, and other demographic observations (129 comments)

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  •  Paid Off Mortgage = Renter? (0+ / 0-)

    29.3% of homeowners are fully paid off and truly own their homes. How are they renters?

    Taxpaid corporate welfare is bad, but how is it rent?

    Aren't the million other ways you reference also not rent?

    Yes, America has owners and workers. But "wage slavery" doesn't equal "rent". It's a bad metaphor, because the actual rents (obvious and otherwise) are their own different problem.

    "When the going gets weird, the weird turn pro." - HST

    by DocGonzo on Sun Mar 17, 2013 at 03:50:35 PM PDT

    [ Parent ]

    •  rent-seeking behavior is not limited to houses. (1+ / 0-)
      Recommended by:
      YucatanMan

      Anytime you pay to use someone else's property can be rent.

      Patents are a form of rent.

      -7.75 -4.67

      "Freedom's just another word for nothing left to lose."

      There are no Christians in foxholes.

      by Odysseus on Sun Mar 17, 2013 at 04:38:08 PM PDT

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      •  Yes, exactly. Any excess value paid is rent. (0+ / 0-)

        We pay rent to monopolies due to the excess prices they are able to charge due to their monopoly position.  

        Who benefits from monopoly profits?  

        The Owners. The top of the 1%. We pay them rent in many ways.

        "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

        by YucatanMan on Sun Mar 17, 2013 at 07:07:55 PM PDT

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      •  Yes (0+ / 0-)

        You're correct in your definition of rent.

        But not all rent is bad. Many who don't buy could buy, but use it anyway - so they rent. Not all rent is unjust: the owners work and spend to make and keep it rentable.

        Yes, some form of rent is unjust. Like patents: they're an artificial monopoly created by the government. The overriding of free expression by patents is justified in the Constitution on 18th Century economics, which is probably wrong for a lot of patents, especially on intangible inventions (like software, and certainly ideas like business processes). And then it's perverted beyond even the original justification of promoting progress by protecting a chance to return on investment for a limited time - the time when limited is far longer than necessary, and the time is often unlimited. Copyright is even worse, especially in its unlimited renewals. These monopolies protect unlimited profits, not progress. The rent they enable is unjust and counterproductive.

        But lots of rent is not unjust. And as I said, people whose mortgages are paid off are not renters.

        "When the going gets weird, the weird turn pro." - HST

        by DocGonzo on Sun Mar 17, 2013 at 07:51:28 PM PDT

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    •  You confuse "rent for a place to live" as the (0+ / 0-)

      sole view of "rent."

      Owners extract rent from Workers in many ways. You don't think taxing the poor to transfer that money to the rich is not rent?  Well, that's ok with me.  I'm not going argue with you.

      But there is another way of viewing it:  

      The concept of economic rent can be generalised as an unearned income and need not apply to physical land.
      The wealthy profit most from the beneficial conditions provided by public infrastructure, yet every trickle-down tax cut leads to the working people paying for more and the wealthy less.  That's unearned income too - profiting from an infrastructure which delivers to the owners, yet charges the workers to build it.

      There are many other ways of describing rent.  Still paying property taxes on your mortgage-free home?  Who benefits the most from those?  There may be a difference between red states and blue states.

      "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

      by YucatanMan on Sun Mar 17, 2013 at 07:05:42 PM PDT

      [ Parent ]

      •  That's Not Rent (1+ / 0-)
        Recommended by:
        MichaelNY

        Rent is not merely any "unearned income". In fact, plenty of rent is earned. Who paid to build that house I used to rent? Not me. Who paid to renovate it when I moved in, and fixed the plumbing? Who bought the oil, maintained the boiler? In fact, who bought it and raised their family in it when the neighborhood was so bad even I wouldn't have lived there, and I've lived in some pretty bad places? Not me - my landlord did. Since I didn't, and I wanted to live there, I had to pay rent. That rent wasn't unearned: the landlord took risks for years, and did work himself, both on the house and to get money to pay other workers, including recruiting and managing me.

        That's pure rent, and it's not unearned.

        There's other rent than that, including on residences and other real estate, that isn't as well earned. But the point is simply that "unearned income" isn't a good definition of rent.

        Rent is the cost of using something that you don't own. Earned or not, though if you don't own it the rent is earned by the owner because they own it and let you use it at your discretion. Only if someone expropriates property from you and rents it back could the rent be unearned, but it's the expropriation that's wrong. The rent is just a perverse consequence that underscores the wrongness of the expropriation.

        Taxes are not rent, either. The case of paying for the use of a country you don't "own" is not rent, because in fact you do own it. Just jointly with so many that you don't directly control it. You have to pay for its operations. Property taxes are pretty arbitrary, since they're based on old calculations of the productive value of the property that haven't been valid for at least several generations. But they're not rent. They're the shared cost of the shared property.

        Even though the cost of the property includes paying the people who disproportionately control the shared property. It's still not rent.

        The workers who build it are not charged to build it. They're paid to build it. They do also pay to have it built, but that payment is by definition a fraction of what they're paid to do anything, a fraction of the fraction that is the tax fraction of their income.

        Yes, our tax system is unjust, taxing people more who work more, rather than taxing the capitalists who might or might not work as much but who do get more out of the system, financially and otherwise. Yes, economics have forced more property into the hands of fewer owners, while more people rent what they use instead of owning it. But not all rent is unjust; not all rent is involuntary or the only or best choice; and not all unjust economics is rent.

        As I said, paid-off home owners are not renters, even though they might pay taxes. They might even rent things like cars, but most do so because they don't get the value out of the property that makes the overhead of actually buying (and even maybe reselling) it worthwhile. Some people would be better off buying what they rent, but don't - but most have the choice, and don't take it.

        So I'm not going to just call economic injustice "rent" and stop thinking. The real problem is the bigotry and preferentiality of credit that's based on factors other than demonstrated risk of repayment. Many who rent can't get loans to buy, though they're lower risks than others who get loans. That's a bigger, more root problem than the renting.

        "When the going gets weird, the weird turn pro." - HST

        by DocGonzo on Sun Mar 17, 2013 at 07:46:04 PM PDT

        [ Parent ]

        •  There is an entire branch of economics (1+ / 0-)
          Recommended by:
          skibum59

          devoted to economic rent.

          You insist on tying it to property, but we are all in fact paying rent to the owners, regardless of having a mortgage or not on a house, owning a car outright or not, etc.

          It seems we are on different levels regarding the use of the word.

          Consider that bank profits are almost entirely taxpayer money.  

          The banks own this government and extract rent from us. You might not like the use of the word, but what happens to us if we refuse to pay the rent?  Off to (debtors) prison! How does "owning your home" save you from that?  

          It doesn't because you owe rent, regardless.

          Please see: Why the Rich Act the Way They Do - about economic rent.

          "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

          by YucatanMan on Sun Mar 17, 2013 at 08:48:01 PM PDT

          [ Parent ]

          •  That's Not Rent (1+ / 0-)
            Recommended by:
            YucatanMan

            There is indeed a lot of talk about "rent". There is a lot of economics in there. A lot of economics, not just in this rent talk, is just talk - no value, no real sense. Our economy is managed by legions of economists whose quality is reflected in the terrible state it's been in for generations.

            You point at "Why the Rich Act the Way They Do" as explaining "rent". Well, that points to "rent seeking behavior" for its definition of "rent seeking behavior", which in turn points to a Wikipedia article "rent-seeking". That article is not about the rent itself, but about the political economics of rent seeking: eg. bribing Congress to require people pay someone else without people deriving value from that someone else. It's about the bribing, not even about the payment without getting value. BTW, that article also says

            A simple definition of rent seeking is spending resources in order to gain by increasing one's share of existing wealth, instead of trying to create wealth. The net effect of rent-seeking is to reduce total social wealth, because resources are spent and no new wealth is created.

            Which is false, because the resources spent are paid to someone else, so the net "social wealth" (undefined, but evidently just net wealth) is the same, not less. So that whole article is both riddled with bad economics (and invalid logic), and an irrelevant derivative of the actual topic, rent. That's not rent, and building a series of DKos articles on it as the basis for an argument delivers a dwelling in which I wouldn't let my understanding live, even if offered free.

            Now it turns out that in your latest comment you made the distinction of economic rent. Which makes it clear that you are simply conflating two kinds of rent: economic and contract. All the rent I have described is contract rent, the default meaning of  renting. That is simply payment for use of property one doesn't themself own.

            If you want to use Wikipedia as your definitions, you'll have to stick close to

            Economic rent typically describes the difference between the amount paid for the inputs to a production process and the amount that would be paid for those inputs assuming a unitary (or greater) elasticity of supply.

            Economic rents use control of the resource to drive its price beyond the cost of its use to its owners. It's artificial pressure on the supply/demand ratio. It sounds unfair, but it is the basis of all profit, including the inconvenience of finding and negotiating with yet another supplier. While profit is any retained exercisable value beyond mere bare subsistence.

            So yes, some economic rents are unfair. And they lead to rent seeking, which is inherently economically unfair. And indeed we all are subject to many economic rents when we interact with our economy, which even paid off mortgage holders do, and indeed all taxes are economic rents.

            But:
            1. That is not the rent I have been talking about in specific terms, which you have been saying is economic rent. The rent you're referring to is not the rent I have been. And your rent is quite obscure compared to my rent.

            2. Not all economic rents are either unfair, or unnecessary, or incompatible with progressive values. Taxes are progressive - when they're progressive, meaning some are, meaning some economic rent is progressive.

            So owning your home protects you from contract rent, as I said (though I didn't specify "contract", because that is the common meaning of "rent" when talking about home ownership, and what I described is "contract").

            Nothing protects anyone from economic rent. And not all of it is unjust. Unless you're comparing to say a pure communist or pure libertarian society, which you might as well compare to Oz or some other magical place.

            I think we disagree only in semantics. But the distinctions between economic rent and contract rent, and even moreso between economic rent and rent-seeking, are important. Conflating them sees us disagreeing, or not even comprehending each other.

            Maybe if we can get the respective terms applied properly to their respective definitions we can finds something worth disagreeing about :).

            "When the going gets weird, the weird turn pro." - HST

            by DocGonzo on Mon Mar 18, 2013 at 07:22:00 AM PDT

            [ Parent ]

            •  Yes, we agree. Almost always, actually! (1+ / 0-)
              Recommended by:
              DocGonzo

              I think the Owners are always conspiring to squeeze more money from the Working people in every way possible.  

              The times we live in are not so economically different from Feudalism.   The serfs pledge allegiance to their giant corporations (lords) and the lords pay as little as possible. Currently corporations hold record profits and record amounts of cash on hand, but there have been precious few raises in wages.

              Small business and independent workers all are beholding to banks and suppliers, which all end up being Owners in the final analysis (Owners are those very few people who do not have to work for a living.  They live only upon the rents they collect whether interest on loans they've given, investments, actual real estate, etc)

              I don't think I'm stopping my thinking. I just see it as a different perspective regarding "rent."

              Of course, I agree with you as to real property, but I also think it carries on to "economic rent" which is money transferred from the working class to the ownership class in my view.  

              For over 30 years, policy has intentionally funneled money to the owners.  That is what has to change, but there is no sign that it is going to.  After watching video of Obama's neoliberal economics speech, I'm sorta depressed.

              "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

              by YucatanMan on Mon Mar 18, 2013 at 10:16:06 AM PDT

              [ Parent ]

              •  More Mutual Correction (0+ / 0-)

                Yes, we're on the  same side. I appreciate a dialectic argument: hones both the point and the sharpening tools.

                I suppose that "economic rent" is "rent" since it's a cost paid to someone else who controls what's rented, and it's "economic" since it's a consequence of the economics (eg. a labor monopoly or a government tarrif increasing costs down the line), that's "economic rent". But that is so different from "contract rent" that economists should use a word different from "rent", and any modifier not as redundant as "economic". Semantics is not negligible when it confuses.

                BTW, why "YucatanMan"?

                "When the going gets weird, the weird turn pro." - HST

                by DocGonzo on Mon Mar 18, 2013 at 12:36:06 PM PDT

                [ Parent ]

                •  Yucatan! I'm there much of the time. (0+ / 0-)

                  And soon, perhaps, full time.   Not Cancun or any of the crazy and crazy-priced resort towns.  (A Ben& Jerry's ice cream is more expensive in Cancun than New York City).

                  Over in the opposite, sane and violence-free corner of the peninsula is the capital of Yucatan.  One million people, strong city services, excellent health care.

                  And then, the Maya.  And history. And no cold winters. and.....

                  "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

                  by YucatanMan on Tue Mar 19, 2013 at 02:09:36 PM PDT

                  [ Parent ]

                  •  Yucatan (0+ / 0-)

                    I spent an equinox in Chichen Itza, and I honeymooned in Tulum, had a gravitational hallucination on the beach at Progreso. Never bothered with Cancun. I banged around Merida with a middle aged character out of a Jimmy Buffet song who claimed his father had been governor for a long time. Yucatan is my favorite part of Mexico.

                    "When the going gets weird, the weird turn pro." - HST

                    by DocGonzo on Wed Mar 20, 2013 at 07:06:26 PM PDT

                    [ Parent ]

        •  P.S. There's a top of the front page story (0+ / 0-)

          about this right now which is related:  Market didn't redistribute wealth upward, it was deliberate policy

          For example, trade policy was quite explicitly intended to place segments of the U.S. workforce in direct competition with low paid workers in Mexico, China and other developing countries. The predicted and actual result of this policy has been to push down the wages the bottom 50-70 percent of the workforce to the benefit of those at the top. [...]
          Unearned income.
          The government has also helped management against labor by having laws that asymmetrically punish workers and management. If workers have a strike that is ruled illegal, the case can immediately go into court and the leaders of the strike can be thrown in jail. By contrast, when management breaks the law to prevent workers from organizing, the case goes to the National Labor Relations Board, where it can be dragged out for months or even years. Management will almost never face imprisonment as a result of its lawbreaking.
          Unearned income.
          In the last three decades the government has allowed banks to merge and grow large enough so that they enjoy an implicit guarantee from the government. This guarantee provides a subsidy to the big banks that has been estimated to be as large as $80 billion a year.
          Unearned income.

          Who pays the costs and who benefits?  
          Rent is money extracted to pay the cost and Ownership benefits.

          "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

          by YucatanMan on Sun Mar 17, 2013 at 09:01:41 PM PDT

          [ Parent ]

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