Comment by mschuster91 | Hacker News Reader

Comment by mschuster91 | Hacker News Reader

Everything, literally everything is being turned into a hellscape by the ever increasing demands of financialization - driven especially by the unique American decision to base their entire pension system on the stock and asset markets.

The sheer amount of money flowing into pension contributions needs some way to escape (i.e. to be invested), and that means that everything not "profitable" - like most third spaces are - gets priced out of existence. That park in the middle of the city? What a prime real estate location (see e.g. Berlin Tempelhofer Feld). That kindergarten in the next housing block? Creates noise, everyone complains, yeet it in favor of yet another overpriced restaurant that generates much more in terms of rent for the building owner, who is in more and more cases some huge ass REIT backed by pension funds. That youth center? Tear it down, it's all used only by migrants (yes, I've seen that take way too often for my liking), and replace it with yet another soulless office building in a city that already has too much of it.

It would be one thing if this issue were only limited to the US. They voted for it, they should suffer from their choices. But unfortunately, there is so much money in the system it spills over to Europe, and now US backed investment funds are buying up healthcare and real estate here as well.

Where are you meant to save retirement money if not the market? Not sure the European model of kicking the can down the road is better..

It seems like the problem is more that urban boomers/genx/millenials didn’t want more than one or two kids… which is the central thesis here, why does having four kids suck in cities. Which i think historically has always been true. So its just an unsolved problem across time and space.

> Where are you meant to save retirement money if not the market? Not sure the European model of kicking the can down the road is better..

Either a stock based system (US) or a rollover based system (RoW) has the problem someone needs to work in the future to provide for the pensioners. Stocks are just as much IOUs as straight cash, gold or "pension points" - you have to hope someone will be there in 30, 40, 50 or more years to take your token and exchange it for money that you can exchange for housing, food or other expenses.

No matter what, it is always kicking the can down the road.

Even the "oldest" way of just buying real estate and hoping to rent it out or sell it depends on there being someone in a few decades who wants to buy or rent it. Or the even older way of farms, it depends on you having kids and those kids surviving and for at least one of those kids willing to take over the farm. Many rural people got screwed over hard by rural flight.

>which is the central thesis here

No, not exactly. We're dealing with a historical confluence of long term changes in humanity. Before 1900 or so and some people had a lot of kids survive and others had a lot of kids die. The population rate increased very slowly, and not from a lack of trying. Then around the time I stated people figured out germs were real, chlorine in water was good, and washing ones hands was a swell idea. The population exploded.

Then you couple this with the technological revolution and the necessity of training huge amounts of the population for specialists jobs if they want to make a living and suddenly a boat load of kids doesn't make any sense at all. And it's getting to the point of the squeeze that having any kids doesn't make a lot of sense for a lot of people.

Interesting I was just saying it was easier to have children in the countryside in ancient Rome then in Rome itself. I doubt rome the city made replacement rate.

Economic hot take: That scale of saving is impossible. It can't happen. The ends don't meet, the numbers don't match up.

Think about what etiremnent savings means in the real economy. It means I have to store enough food to feed myself for 30 years. It means I have to store enough furniture too. And enough gasoline. And enough of everything else.

This is obviously not possible. So instead I store other things I hope I'll be able to exchange for gasoline and food. But no matter what form it takes, I have to store an absolutely enormous amount of stuff. Whether it's physical goods or abstract financial rights. There is no way for everyone to do this without creating massive economic distortion of some kind. Whatever people store is going to massively increase in value (house deeds! shares!) and crash later when they exchange it for food and gasoline.

But there's a simple alternative, we add a 20% tax and distribute it to people in the form of pensions. This is called a pay-as-you-go pension scheme. Optionally the scheme can keep some kind of weight value for each person based on how much tax they paid or any other metric. Since it doesn't store assets it doesn't distort the economy nearly as much. But, it's vulnerable to a future generation simply cutting it off. When the scheme turns on there's a generation who didn't contribute but still benefit and when the scheme turns off there's a generation who contributed and didn't benefit. This can't happen to people who store real assets because the assets are firmly owned by them, and the society can't easily just decide they aren't.

We can do an intermediate solution if we let people buy a share of future tax income as a financial asset. It doesn't distort the economy too much and your contributions are firmly your property. Treasury bonds are this.

Historically, before the twentieth century, the way it was mostly done was by living in extended families, and prehistorically, by living in small tribes. The whole family (grandparents, parents, aunts and uncles, and their children) worked together to take care of the family (or as I said, the tribe). It was the nuclear family and individualism, driven I'm guessing by economic forces, that destroyed all that.

Was that true historically in urban environments or just in the countryside?

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