Comment by NittLion78 | Hacker News Reader

Comment by NittLion78 | Hacker News Reader

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I always found this graph enlightening, but strictly on its face:

https://fee.org/media/17509/prices2-1.png?width=645&height=6...

I don't agree with the argument FEE is trying to make: "Consider each product or service shown. College is heavily subsidized, regulated, and exclusionary, and the costs are soaring. The textbook industry is hobbled by extreme copyright regulation, and can depend on captive buyers. Childcare is one of the most regulated industries in the country. Not just anyone can enter. Every aspect of childcare provision is controlled by the state."

To me, the point is the things that people truly need have risen steeply whilst things that are luxuries have decreased greatly in cost and I believe that's a failing of government to not correct where the market would not. If you're surprised that things like healthcare and childcare are regulated, you've likely never been anywhere they were not, but that doesn't mean the costs to end users have to be so exponentially exorbitant as time marches on.

The things that have seen large price increases are things that aren't scalable i.e. they still require the same amount of human input labor to produce

Childcare is constrained by the fact that each childcare worker by law (for better or worse) can only look after so many children at once. This ratio varies by state but it's usually around 4 children per childcare worker. The result is that it has to be expensive because (short of having robot caretakers) it always takes 1/4 of a person's labor.

Education is similar, but has gotten worse in the past few decades w.r.t. labor requirements. While class sizes have remained relatively constant, there are more administrators, special needs educators, counselors, etc. servicing the same group of students.

This isn't to say they shouldn't be regulated, or that there isn't room for improvement. College tuition and textbooks could certainly use some downward pressure.

Also see: https://en.wikipedia.org/wiki/Baumol%27s_cost_disease

What a load of tosh.

Textbooks are now distributable by e-books, easily scalable. Yet somehow capitalism has utterly failed to deliver it's supposed benefits.

College tuition is now distributable by remote learning, theoretically massively reducing costs. Again, capitalism has utterly failed to deliver it's supposed benefits.

Housing has massively advanced, with cheaper construction, high rises, etc. but laws have been crafted to ensure that doesn't happen to protect rentiers. No taxes on unoccupied land, restrictions on where you can build, massive consolidation of available land without any desire to actually build anything but expensive condos. Again, capitalism has utterly failed to deliver it's supposed benefits.

The cost of textbooks is not primarily in the distribution method, it's the labor of content creation.

The cost of tuition is not primarily in where or how people attend classes, it's the labor of developing curriculum, mentorship, and research.

The cost of housing is not primarily in construction, it's the scarcity of land. High density construction does address this, but you even mention that laws are obstructing this. How is this capitalism's fault when democratic governments enact laws that are literally stopping it from functioning freely?

"Capitalism" completely solved the textbook problem, it simply ignored universities and degrees and whatnot altogether. (How come coding bootcamps don't have expensive textbooks?)

I put the quotes there because (arguably obviously) it's also thanks to capitalism that intellectual property is extended so obscenely.

Anyway, no university (or higher-ed institution) is forced to use textbooks. They do it because they can. Because there's no market force pushing prices down, because captive audience, because the signaling value of degrees is still high (because nobody got fired for hiring the candidate with more degrees - that also happens to have a wealthier background, and maybe even also happens to be white). But it's changing (due to market forces).

Similarly, housing is not a market problem. It's about "preserving the character of the neighborhood", and most neighborhoods happen to be favoring those who happen to be wealthy and against building.

If this was remotely true then service and transportation costs would be astronomical. They are not.

I find it difficult to believe that the increase in university costs is significantly driven by increases in labor cost for the jobs actually related to delivering a university education. If anything I suspect there have been a significant decrease in the number of university employee-hours per student-credit-hour.

I'm not sure why it's difficult to believe. Universities are more than just faculty. In the past few decades, universities have become full service institutions that provide more than just education and have added an army of counselors and administrators.

see: https://www.forbes.com/sites/carolinesimon/2017/09/05/bureau...

This is explored in detail in "Why Are the Prices So Damn High?" [1]

"Education and healthcare are notable examples of sectors seemingly stricken by constantly rising prices ... At the same time, home appliances and telecommunications have become much cheaper. Why?"

[1] https://www.mercatus.org/publications/healthcare/why-are-pri...

Heathcare costs for workers spiraling out of control makes them expensive, so fields where you can't outsource the labor become disproportionately expensive.

> things that are luxuries have decreased greatly in cost

That's because we govern as if public luxury is the supreme law. Luxus populi suprema lex.

Curtis Yarvin talks about it here: https://graymirror.substack.com/p/4-principles-of-any-next-r...

Also, cars are a pretty well regulated industry, and it’s not like software and electronics aren’t impacted by copyright and patent issues.

This strikes me as a problem that escapes simple scapegoats.

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