Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

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Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Fri Feb 10, 2017 2:34 pm

That's my subtitle for Scott Alexander's Considerations on Cost Disease.

If you read one thing this week, make it this. Do it, then come back.













Read it yet? No? Go read it!











Okay, so construction, infrastructure, health care, education, and a lot of other things are getting more expensive way faster than inflation or wage growth and we don't know why. Alexander makes the point that most of today's contentious policy debates are really dancing around this fact:
Imagine if tomorrow, the price of water dectupled. Suddenly people have to choose between drinking and washing dishes. Activists argue that taking a shower is a basic human right, and grumpy talk show hosts point out that in their day, parents taught their children not to waste water. A coalition promotes laws ensuring government-subsidized free water for poor families; a Fox News investigative report shows that some people receiving water on the government dime are taking long luxurious showers. Everyone gets really angry and there’s lots of talk about basic compassion and personal responsibility and whatever but all of this is secondary to why does water costs ten times what it used to?
[...]
If we give everyone free college education, that solves a big social problem. It also locks in a price which is ten times too high for no reason. This isn’t fair to the government, which has to pay ten times more than it should. It’s not fair to the poor people, who have to face the stigma of accepting handouts for something they could easily have afforded themselves if it was at its proper price. And it’s not fair to future generations if colleges take this opportunity to increase the cost by twenty times, and then our children have to subsidize that.
So what the hell is going on? The available information suggests to a lot of depressing conclusions for a lot of different types of people.

First, let's make libertarians cry: markets don't work. Okay, to be fair, they can work for simple commodity goods and familiar comprehensible products where there aren't more than a handful of choices and where social status isn't a major factor. But when we start talking about anything else, it turns out that people have no clue how to evaluate things or how much they should cost, and even if they do, they often behave as if cost is irrelevant compared to status markers that probably are irrelevant (installing central air conditioning for $10,000 instead of four $200 window AC units, or ignoring the free college education in favor of the fancier school that costs $100,000 in student loan debt?). You can't easily comparison-shop for a lot of goods (emergency medicine), or most of the options are really non-options (living in a ghetto to save money on housing), and so on. Also, modern psychology understands human behavior better than ever and this information is ruthlessly used by institutions to manipulate people into professing preferences that aren't really theirs and acting against their own long-term interests. People are successfully manipulated into fearing all sorts of unlikely harms, leading to overconsumption of things like insurance, firearms, and houses in "good neighborhoods."

Liberals are right: without government regulation, people just get manipulated and exploited in these markets, and corporations end up doing reeeeeeally bad things like sponsoring coups in Latin America and dumping known toxins in everybody's water supply.


Now let's make liberals cry: government doesn't work. Fields that are heavily regulated or managed by the government like medicine, education, and construction, display the most dysfunctional behaviors, with spiraling costs, worsening outcomes, falling worker wages, and generally everything sucking a bit more every year. Regulations have compliance costs that trickle down everywhere, and a pervasive fear of lawsuits due to the proliferation of liability and IP laws make everyone defensive and encourages the growth and cost of of every type of insurance. And every "reform" makes things worse since it just increases complexity which is the root of the problem. Furthermore, the phenomenon of a growing number of non-payers being subsidized by payers is a huge contributor. The non-payers overconsume, and the indirect payment system destroys institutional accountability.

Libertarians are right: without market accountability, there is no systemic force to make anything better; government slowly strangles the host society in red tape and inefficiency and must be reigned in before it isn't cost-effective to do anything domestically. And conservatives are right too: there really was a mid-century golden age when you could see a movie for a nickel and work your way through college with a decent humane job and get a doctor to come to your house when you were sick for less than the price of a load of groceries.

I don't know if we can make conservatives cry here because honestly their actual preferences seem contradictory or incomprehensible, but most of what they say they want has more to do with culture and less to do with this how-are-goods-distributed-throughout-society stuff.

But let's make everyone cry: the problem is us. We spend much less of our incomes on food and clothing now, but didn't save the difference or lobby for policies or laws to let us work less. Instead, we plowed it into things that don't actually increase our marginal happiness that much: bigger, fancier houses in neighborhoods with more respectable school districts; more bigger, fancier cars; more fancier college degrees; more gadgets and junk than ever before; prolonging the lives of miserable dying people by 6 months.

So... what do we do?
Last edited by Pointedstick on Fri Feb 10, 2017 4:06 pm, edited 1 time in total.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Fri Feb 10, 2017 2:45 pm

I also wonder if tech is a major culprit. 40 years ago, IT budgets were zero; they didn't exist. Today they're huge. A ton of money has gone into producing this totally new product field that didn't even exist and apparently wasn't needed (judging by human civilization's ability to go without it for the first 9,960 years or so). Another one of those "lots of money going into something that doesn't add much to marginal happiness" cases.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Kriegsspiel » Fri Feb 10, 2017 5:18 pm

But let's make everyone cry: the problem is us. We spend much less of our incomes on food and clothing now, but didn't save the difference or lobby for policies or laws to let us work less. Instead, we plowed it into things that don't actually increase our marginal happiness that much: bigger, fancier houses in neighborhoods with more respectable school districts; more bigger, fancier cars; more fancier college degrees; more gadgets and junk than ever before; prolonging the lives of miserable dying people by 6 months.

So... what do we do?
In reality there shouldn't be an expectation at this point that everyone CAN live like an affluent American. Maybe this is the economy starting to reflect that reality.

But at the level of ME? The closest thing to a solution is... don't do that stuff. As an individual. You can win by yourself, even if everyone around you is making dumb choices. Tyler Cowen and Marshall Brain may have captured the feeling of what the future will look like. Some of us stand a good chance of being the winners of the future; the competition is not very high.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Mr Vacuum » Fri Feb 10, 2017 6:05 pm

I was nodding along with the whole article except for the part that got really personal. Would I want my parents' healthcare at half the price of today's care? As the father of a joyful 5yo daughter who likely wouldn't be here today without open heart surgery at 5mo, I'll take the $120k surgery and annual $1k echo cardiogram. It's not all a waste. Could the same care be had for less in India? That sounds OK, too, but I do like living here and learning about their air quality improvement findings over the Internet.

The article raises excellent questions and data, though. The analogy with the choice of elderly people to save money but risk falling at home is particularly poignant.

It's almost impossible to even consider the idea that IT isn't worth it, given how ingrained is the idea of IT as inevitable and progressive, and that I make my living (and pay that health insurance) in it.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by I Shrugged » Fri Feb 10, 2017 6:18 pm

Haven't read the article yet.
In your short excerpt, he makes one glaring mis-characterization. Namely that the high cost of college isn't fair to the government, which has to pay ten times the cost it should.

The "government" has no money of its own.

I think that is an important point, and one that many people just don't get.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by I Shrugged » Fri Feb 10, 2017 6:34 pm

It is way too much hand-wringing. The average welfare recipient in the US lives way better than a king lived 500 years ago. Food, medicine, hvac, entertainment, comfort, clothing, safety, you name it.

20 years ago the book The Dilbert Principle had a big effect on me. It made me realize that people are not logical, and never will be. No amount of centrally-planned optimization if ever going to change that. People are going to do what they want to do, no matter what. If they want to spend themselves silly buying too much house and cars, they will. In consideration of that, I would say markets DO work. People get what they want, or if not, they get what they deserve. (Tongue in cheek quoting the political economist Bill Bonner.)

Government does NOT work, not when it ventures into central planning. Which today is most of government. It's always trying to manage actions and outcomes, and does not operate from truly good intentions but with an eye towards trading votes for money.

I posted a few weeks ago about being owned by money. A lot of people aren't. They get money, they spend it. "Whatever." They are still living high on the hog, compared to most in the world, ever.

I agree with Kriegspiel.

Adding: I'm not saying the points are not valid. Deep down I agree with most of it. But I'm saying this is the human condition, and the desire to improve the world by planning and force is both omnipresent and fraught with bad unforeseen outcomes. Society figures itself out.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Fri Feb 10, 2017 7:23 pm

I Shrugged wrote:Haven't read the article yet.
In your short excerpt, he makes one glaring mis-characterization. Namely that the high cost of college isn't fair to the government, which has to pay ten times the cost it should.

The "government" has no money of its own.

I think that is an important point, and one that many people just don't get.
I think it's fairly obvious that fiscally speaking, "the government" is a synecdoche for "taxpayers." If the government has to pay ten times too much for something, that just means that the taxpayers eventually have to either pay ten times too much for that, or forego something else to afford it that they might prefer their government to spend the money on (e.g. fixing or rebuilding some of those public bridges that are classified as structurally unsound).
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by whatchamacallit » Fri Feb 10, 2017 7:52 pm

After a little thought, is it as simple as debt payments being baked into the cost of those things?

http://www.macrotrends.net/1381/debt-to ... ical-chart

I wonder if local governments and corporate debt would look similar.


I wonder if it was as common historically as it is today for localities to take on debt for schools and infrastructure instead of saving for it.

Edit: Another thought related to debt. Maybe inflation really is a lot higher than we realize due to the wealth inequality. There is a lot of pent up wealth that does not get spent.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Libertarian666 » Sat Feb 11, 2017 12:23 am

End the fed, restore sound money.

Did you not realize that all the fake money had to go somewhere? You just named where it went.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by WiseOne » Sat Feb 11, 2017 9:51 am

Thank you for the article PS!! Great Saturday morning reading over coffee.

Regulation has a lot to do with these cost increases, but at least for college tuition and health care the biggest factor is an extremely perverse form of competition. The free market in these cases is about attracting patients and students to your organization - particularly ones with money who can be leaned on to make nice, fat donations. And that usually doesn't happen because of cost, in fact, higher costs are often interpreted as evidence of higher quality services. People are more likely to want to go to an expensive university hospital than a cheap, local private practice, since the former is much better advertised and they pay the same in either situation.

A major factor is the university's or hospital's rank on the US News and World Report. For colleges, criteria are things like graduation rates, diversity, student life, and levels of research grant funding. For hospitals, it's patient satisfaction (determined by everything from how nice the waiting room is to how often they get stuff they ask for even if it's unnecessary or even harmful) and (you guessed it) research grant funding. Both universities and hospital centers are thus incentivized to splurge on gorgeous new buildings, expensive, high profile services, and high profile researchers who will bring in lots of federal grant money.

So deregulating may not be enough. You'd have to fix the US News and World Report ranking criteria to include a measure of cost efficiency, and even then that might just increase costs further because such things would have to be measured. And as with all measures, it would be an imperfect reflection and would cost a lot of money and effort to pull off. Maybe the problem is that we have all come to expect a layer of glitz and luxury on everything, and the best possible this and that even when we're not sure what that means.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Kriegsspiel » Sat Feb 11, 2017 11:58 am

If you look at the things that are inflating out of control, they're mostly financial technology (bonds, stocks, insurance, etc), or things that can be financed with debt (houses, college, cars, medical bills, transportation infrastructure).

It seems like at some point in the semi-near past, there was a realization that growth is not possible when living "within one's budget," and future production was increasingly pulled into the present (with debt). At first, it was physical things (the aforementioned houses, cars, boats, subdivisions). This required natural resources like timber, fossil fuels, minerals. In a non-full world, with vast resources and not many people, it was possible to mine/cut/dig enough raw materials to make things, and people were productive enough to trade whatever they were making for someone else's stuff.

People were able to get their hands on a fridge, stove, inside lighting, indoor plumbing. This is all reflected in increasing standards of living worldwide, decreasing poverty. But like Gordon showed in The Rise And Fall Of American Growth, full saturation has pretty much been achieved for all of the best and most useful inventions for everyone who's ever going to have them. Eventually, the world became more full. American saturation was reached long ago, back before the massive debt explosion. There was a quote in The Age Of Stagnation, by Das, where (I think) a CEO of a manufacturing corporation intimated that he could borrow a billion dollars tomorrow, no problem. The issue was, what was he going to do with it? So now, in order to achieve growth, non-physical, abstract things, are being purchased with debt (the big one being college), Americans take on larger debt obligations for traditionally financed things like housing and infrastructure, and Americans are also pulling future production into the present for things that are wasteful. Like suburbs, car-based development, since pretty much none of those things pay for themselves.

So since there isn't much more physical growth to be had, we (stupid people)1 are financing things that shouldn't cost this much in order to keep achieving growth. Because without growth, our economic system fails.

"Too many accumulations of money are seeking ways to grow exponentially in a world in which the physical scale of the economy is already so large relative to the ecosystem that there is not much room left for growth of anything that has physical dimensions"
- Daly, Beyond Growth

Thoughts?2

1. I think my previous point stands, individually you can opt out of/inure yourself from this game to a large extent.
2. I've been drinking.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Xan » Sat Feb 11, 2017 2:28 pm

Interesting ideas, Krieg, but I'm not sure just what it means to be "pulling future production into the present". Things are being produced now because there's demand for them now. The fact that it's something called "debt" rather than anything else being used as a medium for exchange doesn't change the fact that present production matches present consumption, right?
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by I Shrugged » Sat Feb 11, 2017 4:56 pm

Libertarian666 wrote:End the fed, restore sound money.

Did you not realize that all the fake money had to go somewhere? You just named where it went.
That's a great observation.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by I Shrugged » Sat Feb 11, 2017 6:23 pm

The writer Matt Ridley advances this idea:

We have six basic needs: food, clothing, health, education, shelter, and transport. In most countries the market supplies food and clothing, the state supplies healthcare and education, and shelter and transportation are of mixed supply.

The costs of food and clothing have gone down over the past decades.
The costs of health and education have gone steadily up, accompanied by much concern about the quality (less so of healthcare in the US).
Some costs of shelter and transport have favorable trends, such as deregulated air fares, and home building. The government infrastructure costs have risen greatly.

He sees a prima facie case that government involvement makes things cost a lot more.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Sat Feb 11, 2017 11:54 pm

TennPaGa wrote:I view the "pulling future production into the present" phrase as shorthand for:

"Well, dang, we've got a whole lot of people sitting over here, and a whole lot of real resources over there, and we know how (are are pretty sure we can figure out how) to build machines that will turn those resources into useful things that will last and make people's lives easier, and we're not doing it because we lack money?! We're not that stupid!"
Of course, when we use up that pile of resources now, it despoils the environment and it isn't available later, so the price goes way up for people later. You see this in construction. All the good wood was used up a few generations ago and now houses are built out of fast-growing fir and pine which rot and mold and get eaten by termites, instead of the really hard slow-growing hardwoods of yore that lasted forever. It seems tempting to use up the pile of resources now, but maybe that weird money thing is trying to tell us something about sustainability--a topic we don't often associate with it.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Sun Feb 12, 2017 12:02 am

TennPaGa wrote:General comments:

* A fascinating article. Thanks for posting, PS.

* That primary education discussion was quite mind-blowing. Cost per pupil is a factor of 2.5 higher, and yet test scores have not budged! But teachers are being paid the same! Where is the money going?!
Makes you want to support abolishing the department of ed, huh?

"Where is the money going?" Is indeed the big question. I asked a bunch of my policy-minded Facebook friends this question recently about health care and we reached the following conclusions:

* Over-treatment, over-care, over-consumption, and unnecessary visits and procedures
* Price gouging in retail pharma and medical devices
* Denser administration, more bureaucracy and overhead
* Hospital mal-investment in pricey fixed costs with under-utilization; costs passed onto payers
* More end-of-life care

So basically what you would expect: irrationality, inefficiency, waste, etc.

Some relevant sources:

http://theincidentaleconomist.com/wordp ... roduction/
http://theincidentaleconomist.com/wordp ... razypants/
http://jamanetwork.com/journals/jama/fu ... le/2594716

Also notable: women consume a significant amount more medical care than men.
Simonjester wrote: wheres the money going? have you seen the movie "the cartel" 2009 ? its an interesting look as school funding and results. (or lack of) in NJ...
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Sun Feb 12, 2017 9:22 am

Something that was brought up in the common thread is that the "minimum choice" has gotten a lot bigger; it isn't just that things have gotten bigger, they've also gotten "better" (scare quotes intentional).

Like nowadays even the cheapest car comes with with air conditioning, anti-lock brakes, airbags, power windows and doors, a 200 horsepower engine, etc. There's no longer an option to buy a bare-bones 60s' style beater that a teenager you could tinker with on weekends and afford with a part-time job.

Similarly, you pretty much can't buy a new house without 2,000 square feet of space, central air conditioning, tile in the kitchens and bathrooms, front-loading washers and dryers, and stainless steel kitchen appliances. Nobody is building cottages and '50s-style bungalows. Did you know that the original Levittown suburbs featured houses that were 900-1100 square feet? Hard to believe now.

Not only that, we're buying more of these things. It's now common for a family to own 2 or 3 cars--or more. Many solidly middle-class people own a vacation house or other second dwelling.

You can spot the trends of bigger and more all over the place once you start looking. Restaurant meal portion size and number of restaurant meals eaten; TV screen size and number of TVs; road width and amount of roads; college building grandiosity and percentage of the population with a degree; the list goes on.

Everything is bigger and (theoretically) more luxurious--but certainly even more expensive than simple inflation alone would suggest.

Part of the problem is the government imposing higher minimums. Part of the problem is us--our propensity to consume and our psychological manipulability. Part of it the corporations, who manipulate us and the government. And part of it is debt-backed fiat money growth capitalism, which doesn't seem to work in a steady-state environment and subtly, systemically drives all the preceding factors.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by moda0306 » Sun Feb 12, 2017 9:30 am

As someone who is a quasi-Keynesian but hates spending money and is a pretty big environmentalist, I'm fully aware of my little paradox, but it forces me to ask questions about how we account for certain economic happenings than others.

On top of this "shit breaks and nobody knows how to fix it" is the fact that now you have plastics in metals in a junk yard at a rate far higher than they would have needed to have been if we had bought a higher quality product.

A lot of this has to do with faulty accounting at the individual level. If something's going to last me twice as long and work twice as well (think a blender), it's worth way more to me than the alternative. What's more, it has less of a negative environmental externality impact. And accounting for externalities, while certainly difficult, is obviously an under-appreciated process. Not to mention, part of the reason China can offer cheaper products is that it can pollute more than we can here in the U.S. So once you account for those two items, I do wonder how "cheap" foreign-made products are.

Mind-you, I don't think this is a cogent argument for taking what is essentially an automation problem and turning it into one of "Dey took ourr jeerbs!!" I think we're rearranging deck chairs on the Titanic by trying to use immigration and reversing free trade as the tip of our collective swords, but I wholeheartedly agree that we're not properly measuring economic and social/familial "externalities" in our economic calculations.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Sun Feb 12, 2017 9:38 am

Moda, that's actually the flip side of what we're talking about. The goods that are low-priced today (clothing, electronics, food) are all so historically cheap because of unpriced externalities, or slave labor, or something like that. I had a 90-minute phone conversation with my mother last night about immigration and really rattled her by talking about illegal immigration as essentially a supply of slave labor that the republicans tricked the democrats into accepting by letting them believe it would lead to a future demographic majority (it didn't).

What's weird is that all this cheap stuff made by exploited people encourages people to consume a ton of it... but we also consume more of things that are unprecedentedly expensive. You can understand a family with 3 TVs and half a dozen smartphones at $200 a pop, but 3 new vehicles costing $20-50k in a $300k particleboard McMansion? That's what's really killing us. Why do we do this?

As others have mentioned, debt has to be part of this: tricking our monkey brains to overvalue the smaller upfront price and discount the higher overall long-term price, which encourages prices to slowly creep higher over time to capture more of people's incomes.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by flyingpylon » Sun Feb 12, 2017 9:49 am

Xan wrote:Interesting ideas, Krieg, but I'm not sure just what it means to be "pulling future production into the present". Things are being produced now because there's demand for them now. The fact that it's something called "debt" rather than anything else being used as a medium for exchange doesn't change the fact that present production matches present consumption, right?
But without debt, there would not be the level of demand or consumption that there is now. People are buying things today that they will not pay for until tomorrow.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by WiseOne » Sun Feb 12, 2017 10:03 am

I think the observations about government subsidies & debt driving up costs are right on. If student loans were more difficult to get, universities simply wouldn't be able to charge such high tuition, unless they want a highly polarized student body composed entirely of exceedingly wealthy students and heavily subsidized minorities. If routine health care went back to the cash payment that was the norm in the 1960s, and insurance were relegated to big-ticket items like hospitalizations and some chronic conditions, prices would immediately start to come down. My mother talks about taking us to the pediatrician for everything from ear infections to chicken pox and paying cash for visits. My father's salary at that time was not high, maybe $6,000/year, but it was all manageable.

Anyone think there's a role played by the mass incursion of low-skilled immigrants? In general, they cost far more than they can ever contribute, especially in those 6 basic service areas. Those costs have to be borne by the rest of us, and the proportion of the population who can help pay the bill is steadily decreasing as the number of low-skilled newcomers increases. This has a direct effect on pricing, since universities and hospitals have to recoup the costs of non-payment and financial aid (respectively), but there are also increased indirect costs e.g. property taxes which is a big driver of increased rents.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Pointedstick » Sun Feb 12, 2017 10:17 am

WiseOne wrote:I think the observations about government subsidies & debt driving up costs are right on. If student loans were more difficult to get, universities simply wouldn't be able to charge such high tuition, unless they want a highly polarized student body composed entirely of exceedingly wealthy students and heavily subsidized minorities.
That's exactly what a lot of universities do look like these days (especially the private liberal arts colleges). It's why college campuses are such tinderboxes of strife and bitterness.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by WiseOne » Sun Feb 12, 2017 10:31 am

I was actually thinking as I was typing that such a student body might be precisely what many colleges are desperate for. How depressing.

Neither of those groups (super wealthy, minorities) are going to provide much in the way of academic superstars though. Which means that the Ivies and similarly high ranked schools are surviving on those students who are willing to run up enormous debts in order to get the academic pedigree they need to get the head start you need for certain careers. And in addition to providing most of the reputation of these schools, these high-debt students are subsidizing the students that allow the school to score high on "diversity" in the US News and World Report ranking.
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Libertarian666 » Sun Feb 12, 2017 10:37 am

WiseOne wrote:I was actually thinking as I was typing that such a student body might be precisely what many colleges are desperate for. How depressing.

Neither of those groups (super wealthy, minorities) are going to provide much in the way of academic superstars though. Which means that the Ivies and similarly high ranked schools are surviving on those students who are willing to run up enormous debts in order to get the academic pedigree they need to get the head start you need for certain careers. And in addition to providing most of the reputation of these schools, these high-debt students are subsidizing the students that allow the school to score high on "diversity" in the US News and World Report ranking.
"Things that cannot continue will end." The question, as always, is timing.
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Kriegsspiel
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Re: Everything costs too much and everybody is wrong about it and who the hell knows how to fix it?

Post by Kriegsspiel » Sun Feb 12, 2017 11:41 am

flyingpylon wrote:
Xan wrote:Interesting ideas, Krieg, but I'm not sure just what it means to be "pulling future production into the present". Things are being produced now because there's demand for them now. The fact that it's something called "debt" rather than anything else being used as a medium for exchange doesn't change the fact that present production matches present consumption, right?
But without debt, there would not be the level of demand or consumption that there is now. People are buying things today that they will not pay for until tomorrow.
Yes that's what I meant. Actually, pretty much everything you guys wrote is what I think too, ya'll are really smart.
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