In terms of GDP per capita, I live in one of the lowest income counties in a state that is well below the national average. I'm not sure if many of the points made in this article would be felt so viscerally by someone living in SF making $100k+/yr, but I found it very interesting.
It's worth noting that I have received exactly $0.00 in government subsidization (student loans, disability, unemployment, etc) - I've never applied for or received a penny of it. Perhaps the most interesting thing about rural communities like mine is that the people here who actually make money - farmers - are among the largest recipients of government subsidization in human history due to a subsidy program which was conceived when industrialized agriculture was still a nascent technology.
I feel there is a sort of cognitive dissonance when it comes to things like this in that many successful people are where they are in large part due to the governmental aid they've received,but these same people tend to be the most intense detractors of any legislation that would help everyone else.
I don't have any good answers and I sensed a bit of naivety in the article, but I feel it made some good points and asked a lot of very important questions.
I meant direct cash-in-your-pocket subsidies like the ones I mentioned, including food stamps. I get what you're saying, the point of that post wasn't woe is me... but the quality of roads, policing, and public education also tends to not be so high in lower income areas.
I'm not pretending to have all the answers, but I think we could do much better as a society.
Do we have to hash this out in every HN thread that touches on economics? These arguments are very weak.
Plenty of people don't believe in police. Plenty of people homeschool and / or don't like what government schools have done.
The "who will build the roads" trope is so tired that - and I'm not kidding here - one of the ice cream vendors at the Porcupine Festival has a best-selling flavor, "Who will build the rocky roads?"
Maybe we wouldn't have to hash this out in every thread if you'd explain how some people don't benefit from police or public roads (whether you "believe in them" or not).
The truths of which the masses now approve are the very truths that the fighters at the outposts held to in the days of our grandfathers. We fighters at the outposts nowadays no longer approve of them; and I do not believe there is any other well-ascertained truth except this, that no community can live a healthy life if it is nourished only on such old marrowless truths.
> I don't mean to be undiplomatic, but there's no way I'm going to encapsulate this is an HN comment. Books! You must read books!
Books are text. There is not actually anything preventing you from conveying the relevant information in an HN comment. Here, I'll do it from the other side.
There is clearly no physical law that says private companies can't hire construction workers to build roads. But private roads are economically inefficient.
Roads cost money to construct but not to use. Road maintenance costs are overwhelmingly dominated by natural forces (i.e. weather). Therefore the efficient price for road use is a fixed cost of construction/maintenance and ~$0 per mile.
But the typical private solution to paying for roads is tolls. Tolls don't match the efficient cost structure. They convert sunk costs into variable costs which inefficiently reduces usage of the valuable resource. This error compounds itself. If covering construction/maintenance costs would cost $.25/mile but that price deters some usage, then the price has to be raised to meet total costs against the lower usage, so the price goes to $.40/mile. That would deter yet more usage which increases the price to $.50/mile. The price stabilizes at quite a high price point that deters a large amount of productive use of the roads.
Another problem with tolls is that they don't match the value received from the resource. Someone who doesn't drive at all but once had to have an ambulance take them to the hospital will have derived the full value of the rest of their life from having the roads but will have paid hardly anything, which puts higher costs on everyone else and further compounds the inefficiency above. In a less extreme example, someone who ships a small quantity of high value freight over the roads is receiving the same value from them as someone who ships a large quantity of low value freight, but is paying significantly less.
So tolls are terrible, but what says a private group can't build roads and then charge a fixed annual cost to local residents for access to them? That actually works perfectly well, except that it's irresistibly coercive. Government-level coercive. Either you pay the "road tax" or you aren't allowed to leave your house and no one can visit you or deliver anything to you. It works for exactly the same reasons and in the same ways that government roads work because that's effectively what it is. The taxing power is derived from a monopoly on travel rather than a monopoly on force, but travel is important enough to make that a distinction without difference.
Now you've got a counterargument to make. The road company could have competitors. If they're doing a crappy job then someone else can build different roads and people will sign up for the other one. It would have to be a really, really crappy job because it would have to justify the cost of a second road network, but in theory it's possible, right? But not in practice. The "tax local residents for access to the roads" model is the most efficient one because it most accurately tracks the operator's actual costs. If someone is operating under that model, they're going to win in the market against someone who isn't. They're going to capture every customer whose road usage if charged per mile would put them over the fixed annual cost. But the per-mile competitor still has the same fixed costs, so for every switching customer they then have to increase the per-mile price, while the annual-price competitor can lower the annual price. In every iteration, the heaviest using customers who still use the per-mile roads realize that the new per-mile price puts them over the annual price, switch to the annual price company and cause another iteration, until the annual price company has 100% of the customers. Because their pricing model is more efficient.
So OK, both competitors can charge a fixed annual price, right? And then the same thing happens but the advantage goes to the one with more customers to start with. They have the same costs but more customers to amortize them over so they can charge lower prices and the lower prices attract more customers, creating a feedback loop that destroys the competitor. Or, if the competitors are willing to set prices that won't allow them to recover their maintenance costs, it creates a price war that, again, destroys one of the competitors (whichever one has the smallest cash reserves) and reinstates the monopoly. Which is why roads are a natural monopoly.
So the only efficient way to have "private roads" is to have a monopoly road company that collects periodic "road fees" from basically everyone regardless of how much they use the roads. But it's still a monopoly and monopolies can be very abusive if unchecked. So maybe what we need to prevent that is to make sure the local residents own the company, so they get a vote in how their road fees are used and how the roads are maintained. Do you see where this is going?
Jeez you're cogent, diplomatic, polite, and helpful.
Thanks for this reply.
In general: I don't object to text as a medium, but to threaded posts as a format.
Thinking outside the box of owned land property - and how roads might be done better, for example - takes a lot more volume and research than is practical here.
I take it you are privileged enough to spend most of your time in areas served by fairly complete road systems. You could be responding to someone who does not, especially since that person lives in "one of the lowest income counties in a state that is well below the national average". There are no "roads" as you would identify them in many such places. They do have jeep trails etc. but no government built them.
It really doesn't matter. All the modern (not literally home made from the raw materials) goods and commodities they have were delivered in very large part on mainstream infrastructure. Roads, railway, through airports and cargo ports, etc. That includes every vehicle they drive, the fuel they burn, clothes they wear, food they eat. The electricity they use, even the fuel they use to run generators if they're off the grid (and the generators themselves). The cost of all that has to some extent been subsidised.
Modern economies and technological supply and support chains are so massively integrated that this is unavoidable. Yet most of us are obliviously unaware that they even exist.
Yeah that's fine but we've really moved the goalposts here. OP mentioned that OP had never received student loans or disability payments. Somehow that inspired a rude comment based on some very developed-world assumptions concerning public infrastructure. Yes, in most situations we see, it's good for public infrastructure to be built using public money. That doesn't mean that someone who e.g. purchases a kerosene lamp to light her home at night should feel thankful toward the government officials who haven't yet nationalized and dismantled the container port that offloaded it, who haven't yet closed the dirt road over which it was hauled by truck, whose military hasn't yet run the local store that sold it out of business for insufficient bribery. Hell, all the infrastructure we're discussing might well have been built during a previous government that was violently overthrown by the current one! Who should she thank in that case?
When I was last in a "developing" nation, back in January, my hosts observed that the only existing paved road outside a large city, over which bus, truck, and agricultural traffic was solid day and night, was built and maintained by the federal government rather than the provincial one, because otherwise the money just disappeared. When we reflexively castigate those with questions about the use of public money (or frankly, in this thread, who are misunderstood to have posed such questions), we're protecting those who are glad for no questions to be asked. That's true in both "developing" and "developed" nations.
It's worth noting that I have received exactly $0.00 in government subsidization (student loans, disability, unemployment, etc) - I've never applied for or received a penny of it. Perhaps the most interesting thing about rural communities like mine is that the people here who actually make money - farmers - are among the largest recipients of government subsidization in human history due to a subsidy program which was conceived when industrialized agriculture was still a nascent technology.
I feel there is a sort of cognitive dissonance when it comes to things like this in that many successful people are where they are in large part due to the governmental aid they've received,but these same people tend to be the most intense detractors of any legislation that would help everyone else.
I don't have any good answers and I sensed a bit of naivety in the article, but I feel it made some good points and asked a lot of very important questions.