Comment by Tichy | Hacker News Reader

Comment by Tichy | Hacker News Reader

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If you are happy, who am I to argue with that. Maybe you just really like your landlord.

"living in it now a world in which everyone else did things like this -- looked out for each-other, helped each-other up, cleaned up and improved the things around them, and invested in great little bistros and sandwich shops and bookstores and parks and such because they recognized the value of having such things in their community."

I like that, except for the part where the house still belongs to the landlord, not to the community or you. I would pick up trash in the mountains, because the mountains belong to everyone (or the government, which in theory is everyone).

With the sandwich shops, I think capitalism could deliver: if people would realize the value of having sandwich shops in the park, they would perhaps be willing to pay for sandwiches, making it profitable to build nice sandwich shops.

Sandwich shop owners as well as people living near the park would be motivated to keep it nice, as it would improve both the sandwich shop and the value of the houses around it.

Maybe there are aspects of what you are doing that I don't see, though. As long as the landlord lets you live there, maybe you get to live in a nice place for a low rent. If you ever have to move, your landlord might write you a glowing letter of recommendation and make it easy for you to find another nice place. Then again, as they seem of the "not caring" kind, maybe they won't :-/

I want to finish this conversation with just one point, which I'll try to make as clearly as possible. I started this thread with a post that included the question, "Why don't more poor people clean up their neighborhoods?"

I was being rhetorical, but your comments here are a fine example of one of the reasons why they don't: lack of a sense of ownership.

Let's set aside for a moment all of the other factors into why poor neighborhoods tend to be run-down and crime-ridden -- lack of resources, hunger, hopelessness, crime, drugs -- and imagine a neighborhood filled with perfectly rational poor people.

We'll take Bob as an example. Bob rents a house for slightly less than he can afford from a landlord that, for whatever reason, is not interested in fixing the place up and demanding a higher rent. Maybe it's because the landlord also doesn't have the funds; maybe it's because all the other places in the neighborhood are run down too, so the landlord could never realize as much value from improvements.

In Bob's neighborhood, none of the houses are freshly painted, because it's in nobody's best personal interest to do it, because they don't own the places. None of the yards are weeded or landscaped, the plumbing leaks, and the wiring is hazardous. Bob commits as little of his own resources to his house, because it doesn't belong to him.

Eventually, the neighborhood becomes the victim of its own disrepair, and is no longer worth investing any money in at all. Bob, being perfectly rational, simply moves into a similar situation at another neighborhood.

A wealthy investor shows up, purchases the homes for the rather low amounts that they command, from landlords happy to be rid of them and getting anything at all for them, and kicks out the tenants who simply move into other neighborhoods and repeat the pattern. The investor razes the miserable houses to the ground, which is probably the right thing to do at that point, and builds whatever their market research firm tells them is most valuable there -- a shopping center, parking, condominiums.

This, indeed, is a cycle that is being played out every day all over the U.S.; I've personally seen it in more places than I could easily recall.

But, I question that system. I think, if Bob weren't a rational actor, if instead he moved into a community and decided to behave as though it belonged to him as much as anyone else there, and subsequently started fixing little things here and there -- and then his neighbors did the same, because they didn't want to suddenly have the worst place on the block, and so on -- then, perhaps, poor people could discover that they can afford to live in nice neighborhoods after all.

G'night.

I hope it is clear that I don't mean to attack you, I am just trying to understand.

We seem to agree that sense of ownership is the problem - and to me it is real, as those poor people really don't own the place they live in.

You are right that there could be a problem with people staying poor indefinitely and things only getting worse over time.

On the other hand, maybe the problem isn't "how can poor people live in nice places" but "how can poor people be less poor"? For example, apparently the poor people in your story seem to be good at renovating houses. Why shouldn't they be paid for it and hence become less poor (equivalently, be allowed to live in a nice house with lower rent in exchange for renovating said house). It seems it would cost the landlords nothing to give them a job, it is a win win situation.

I do think, or rather fear, that capitalism (or any real world instance of it) has some loopholes which might lead to the whole system collapsing, that is, everything belonging to just a few and the rest being poor. I am not sure that scenario is really happening (I just don't know), but there seem to be some signs of it.

> I hope it is clear that I don't mean to attack you, I am just trying to understand.

I didn't feel attacked at all. :-) Thanks for the conversation.

> In Bob's neighborhood, none of the houses are freshly painted, because it's in nobody's best personal interest to do it, because they don't own the places. None of the yards are weeded or landscaped, the plumbing leaks, and the wiring is hazardous. Bob commits as little of his own resources to his house, because it doesn't belong to him.

> But, I question that system. I think, if Bob weren't a rational actor

The above tells us more about your definition of "rational" than anything else. You're envy driven.

The guy above defines "rational" differently - he's greed driven. He fixes up the place that he rents because of the value that he gets.

IMHO, you're too concerned about what someone else gets. You don't even see how anyone else can think differently, hence your label "rational".

Envy is the stupid sin. It's the only sin that doesn't get you anything.

Envy driven? It sounds to me like he's driven by altruism and a simple desire to make the place he lives more pleasant.

I really don't know where you got envy from.

Reread the exchange. ("The guy above" is not Bob.)

I'm responding to someone who thinks that it's irrational to fix up one's own house when others get significant benefit.

The person who is doing the fixup is doing it because he gets significant benefit, regardless of what other people get. The person criticizing thinks that Bob, who won't do work that benefits others without being compensated, is rational.

That's envy-talk.

Envy is worrying about what other people have/get. Greed is worrying about what you get. A greedy person will do things that benefit himself even if other people benefit without paying. An envious person won't.

Just for the record, you got that about as wrong as you possibly could -- to such an extent that I'm scratching my head at your interpretation of what I wrote -- but I can't clarify it any further because I've already made this as clear as I can.

edit: it sounds like you may not be aware that "rational actor" means a specific thing in microeconomics. See also http://en.wikipedia.org/wiki/Rational_choice_theory . Specifically, in order for Bob to qualify as a rational actor, he must act in such a way as to maximize his benefit, where his benefit is defined in objective terms of monetary value. i.e., "I like having flowers in my yard" does not qualify as a benefit, thus a rational actor would not spend money to put flowers in their yard. The entire point of all that was to describe, in as simple of an example as I could construct, why I think that behaving only as rational actors -- i.e., measuring our benefits only in terms of monetary value -- can lead to undesirable outcomes, and why acting irrationally -- again, in the sense of microeconomics -- can lead to better outcomes for all involved.

I can't figure out where I went wrong in stating all that the last time 'round.

"Specifically, in order for Bob to qualify as a rational actor, he must act in such a way as to maximize his benefit, where his benefit is defined in objective terms of monetary value. i.e., "I like having flowers in my yard" does not qualify as a benefit"

If that truly is the definition of rational, then sorry, economics is sorely mistaken. Or at least the people who conduct economics that way. I always assumed it was clear that "monetary gain" is simply a placeholder for value gained. Of course "I like having flowers in my yard" does qualify.

Thinking in terms of monetary gain really makes no sense, especially since money doesn't actually have any value. It only has value if you can use money to put flowers in your yard, if you so desire.

I am not an economist but a mathematician by training, so I am not sure what economists are thinking. But they can't (all) be that stupid. Mathematically it is obvious that using such a strict definition of value (monetary gain) is unnecessary and hence should be done away with.

That said, I have problems following the "envy driven vs greed driven" argument.

>>"Specifically, in order for Bob to qualify as a rational actor, he must act in such a way as to maximize his benefit, where his benefit is defined in objective terms of monetary value. i.e., "I like having flowers in my yard" does not qualify as a benefit"

> If that truly is the definition of rational, then sorry, economics is sorely mistaken.

You're too kind - if that's the definition of "rational" that economics uses, economics is fundamentally useless.

> That said, I have problems following the "envy driven vs greed driven" argument.

My apologies.

"Greed" is concern with what you have. "Envy" is concern with what other people have.

A greedy person will do something that benefits himself regardless of whether it benefits others. An envious person will not do something that benefits himself if he thinks that other people get too much benefit from that thing.

I'm seriously amused by your last paragraph. It actually made me smile, because, despite explaining precisely why I'm doing this kind of stuff, you're still looking for the "angle", and that's the best example of why I find this attitude so difficult to communicate in an effective way to so many other people (and why I've all but given up at it).

Yes, I am now living in a place with lower rent than I might be otherwise, but the rent is not lower than the total amount of money and time I have put into it; yes, the landlords might write an amazing letter of recommendation, but my experience so far has been that it's nearly impossible to wrest any kind of letter out of a landlord, no matter how good your relationship.

As far as capitalism goes ... y'know, I don't dislike it, but I don't think it's an answer to everyone's needs, either. In order to work, capitalism requires that everything have a measurable, monetary value, and that most people agree on that value. Talk about the Mona Lisa to a capitalist, and the capitalist will tell you that whatever is spent on insuring and protecting the Mona Lisa is representative of its value; talk about the Mona Lisa to an art expert, and they'll use a term that is utterly foreign to a capitalist: "priceless".

If people had money to spend at capitalist parks, and capitalist parks realized that they could rent space to vendors (and make some money too), then capitalist vendors would move in and compete for the same spaces, and discerning customers would visit the best vendors, and everyone would be happy! ...except, the story doesn't end there, because eventually the capitalist park realizes that it has developed more value in its space by drawing people to a park where there's great food, so they raise the fees on the vendors, and the vendors realize that they can make more money by advertising more aggressively, or, better yet, by opening up side-businesses and operating those in the same park also ... eventually, this system corrupts itself and the park is no longer a park or the people can no longer afford to go there or any of a number of outcomes. For real world examples, look no further than the article that spawned this whole thread, or the huge number of empty commercial spaces that are still asking for ridiculous rents.

So, I am skeptical of capitalism's ability to be anything more than a better economic model than anything else that's currently viable.

And, the house does belong to the community, in a way, because it's a part of it, and it belongs to me, in a way, because I live in it.

I think when I said "value", I was thinking of something different than what you were when you read it.

"In order to work, capitalism requires that everything have a measurable, monetary value, and that most people agree on that value."

It is the job of the market to determine the value. Corruption of capitalist parks might be a problem, although I did not say the park has to be owned by a company - just the people living around it need to own their houses.

Presumably the cafe in question here will be replaced by something even more worthwhile. Who would be willing to pay the higher rent, if they can not put it to good use?

One problem I have with your model is that it leads to blaming people for being lazy and anti-social. That might sound not so bad, but in communism this blaming went so far as to put people against the wall and shoot them. They couldn't explain why their system wasn't working, so they only explanation seemed to be "sabotage" as in people not being social enough.

I just feel basing a system on selfishness (win-win) is more stable.

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