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Comment by shittyadmin | Hacker News Reader

This is basic price curves - make more affordable housing for the underemployed, people come to you for it or stay for it. Just like most anyone I know prefers buying the cheapest tolerable toilet paper or dropping the price on a fast food meal attracts more customers or buying certain meats and veggies at the grocery store because they're cheaper that week.

I don't see why this wouldn't also apply to low-income housing demand in this case - it's a fairly well proven economic model and if you want to say it's false in this case, I don't think it's unreasonable to expect at least a semblance of evidence.

Given that this model demonstrates the issue as well as the lower tax contributions based on property taxes and higher demand for social services in low income areas, well, it seems like a reasonable model.

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You seem to have forgotten what the original statement to which you responded was. Let me remind you.

"To Forrester, low-income housing was an especially egregious example of a “counterproductive” urban program. According to the model, these programs increased the local tax burden, attracted underemployed people into the city, and occupied land which might otherwise have been put to more economically healthy uses. Housing programs aimed at improving the condition of the underemployed, Forrester warned, “increased unemployment and reduced upward economic mobility” and would condemn the underemployed to lifelong poverty."

This involves six claims.

The creation of affordable housing would, per the quote:

1. Increase the local tax burden 2. Attract underemployed people 3. Foreclose a more profitable use of the land 4. Increase unemployment 5. Reduce social mobility 6. Condemn the underemployed to lifelong poverty.

You seem to be focused on only one of them, the least contentious and consequential - (2).

That would do nothing to support the claims you made in your last post, about the entire model following - "logically and mathematically" - from basic economics.

Those mainly follow from attracting underemployed people - I don't think it's particularly contentious to say that a low-income person paying less in property tax means that a higher income person must pay more in tax to offer the same level of services - this answers number 1. Number 3 I also feel is straightforward - the city could make more profit and charge lower taxes by having higher income people there, often on the same land. If you admit 2 is true then 4 is likely to be true at least within the bounds of the city - again, I don't feel it's particularly contentious to suggest that low income people are more likely to experience long term unemployment issues.

As for 5 and 6, yes, I agree those absolutely would demand more evidence, but it also seems like they're tertiary to the usefulness of the model here.

I'm not intending to defend it so much as I'd like to see why it should be struck down. As someone else pointed out here, some cities in higher tax areas attract more people than cities in lower tax areas - factors like that are what I'd like to have seen more of in the original post.

Let's just take your first claim (I don't have all day). Hopefully that's enough to indicate that nothing that you're talking about is the obvious or natural result of basic economic logic, as you seem to think it is.

Point 1: Increase the local tax burden

Your response: "I don't think it's particularly contentious to say that a low-income person paying less in property tax means that a higher income person must pay more in tax to offer the same level of services".

This depends on the assumption that there is a zero-sum competition between rich and poor people. Every X number of poor people in a city, represents a subtraction of an equivalent number of rich people. Because rich people are presumably in a higher tax bracket, they pay more per person that do poor people. But there's no reason to think that there is a zero-sum competition between rich and poor people. That depends on complex empirical questions like the division of labour in the city, the availability of land and housing, if low-skill labour will attract businesses, and so on. And the fact that a poor person might not pay as much in taxes as a rich person does not make them a tax "burden" in any sensible use of that term - they may be net contributors.

I hear what you're saying, but if someone's not paying for the services they're using in taxes, they're a burden being carried by other tax payers. No need to consider land or housing issues or view the whole thing as a zero-sum competition at all. You're bringing in a lot of things that don't really factor into the cost of property taxes at the end of the day.

> Every X number of poor people in a city, represents a subtraction of an equivalent number of rich people

No such logic like this is required - the more people who live in a city but don't contribute their share of taxes, the higher the taxes are for everyone who does. I'm talking strictly about people who are not net contributors - I think you'd be hard pressed to find people in low-income housing projects who are, the housing alone has significant cost and upkeep of it often falls on the city.

That's not to say it has no benefits of course, bringing people out of poverty can be powerful and useful economically, but if I were to state the opposite is true - that we should be decreasing taxes by building more low income housing, you'd look at me like I'm crazy unless I presented some seriously compelling evidence.

You are making your point by definitional fiat, i.e. poor people are people who pay less in taxes than they take (which is not the implication of the statement in your previous post). But it's not at all clear that most people on low incomes do that. You would have to show it.

On the tax front it is empirically wrong. See eg California and New York, which have growing economies despite high taxes to Kansas and Nevada, which have low or no taxes.

See - that seems like it has some validity - that's exactly the kind of data I'm talking about - why couldn't the author have brought this kind of thing up in the original post?

Instead they seemed to critique it with no data...

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