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> Oftentimes in capitalism, things look really, really bad. But from a macro point of view, things work out better in the long run.

There is no evidence that things deterministically "work out better in the long run" in an unregulated capitalist system. This is just an unexamined belief that prevents us from taking action against injustice in the short run.

Note that things are also working out pretty well under market socialism (the Nordic model), and under state capitalism (Singapore, China).

This unfounded belief that it always works out for the best "in the long run" is very similar to the belief that life on Earth may be full of pain, injustice and misery, but "in the long run" it will all be great in heaven.

It's a powerful way to keep people from taking action to improve their circumstances right now.

The long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is past the ocean is flat again.

http://en.wikiquote.org/wiki/John_Maynard_Keynes

You're missing the key detail. In most cases, scum landlords aren't really soaking the tenants, they are soaking you, as poor folks are often recipients of aid where a local or regional housing authority is paying the rent.

Rent seekers always behave badly, subject to market conditions. They behave badly because there is no incentive for them not to.

In my city, the "prevailing rent" for a two bedroom apartment in a rough neighborhood with open retail drug sales and other issues is about $1200/mo. Apartments that don't qualify for section 8 subsidies (because the buildings should be condemned) are a bit less.

A two bedroom in a suburban style complex 8-10 miles away with covered parking, good schools, and pool is $1250-1350.

The solution IMO is to make life as difficult and onerous for larger landlords as possible through regulation and fees for negative outcomes, and use subsidies to get tenants into a position where they can own a their home or a 2-3 family home.

> In most cases, scum landlords aren't really soaking the tenants, they are soaking you, as poor folks are often recipients of aid where a local or regional housing authority is paying the rent.

The local authorities are also responsible for the rents going up, by not allowing the construction of new parks to answer for the high demand.

That's a factor in some places, but not all. In my city, we have about 1,000 multi family vacant properties and a tight rental market.

In SFO or similar places, it definitely a core part of the problem.

scum landlords aren't really soaking the tenants, they are soaking you, as poor folks are often recipients of aid where a local or regional housing authority is paying the rent.

Which is a play on the Walmart wage model.

But on the other hand, this is capitalism.

Is it? Capitalism is the private ownership of the means of production. Is somewhere to live a "means of production"? Sure, it's necessary to live, but it's not "producing" anything. There's no partnership involved. Capitalism is about someone owning the "machine" [1] of production, and someone else being employed to operate that machine, and the owner and operator splitting the profit. In theory, the two of them working together in this way produces more than either would on their own, so everyone benefits.

I see the sort of thing in this article referred to as "rentier capitalism", although it's generally meant to be derogatory; a way of marking it out from the beneficial form of capitalism.

Oftentimes in capitalism, things look really, really bad. But from a macro point of view, things work out better in the long run.

I think you're confusing capitalism with exploitation and rent seeking. They're not the same thing. Not at all.

As an aside, I'm sure this use of the word "capitalism" is something Chomsky used to talk about. Now that it's very broadly accepted that capitalism is ethically good and correct and there is effectively no discussion about capitalism, people can gradually move bad behaviour into the definition of capitalism and society will protect that bad behaviour, even against its own interests.

If we do want to redefine "capitalism", that's fine, of course, but at that point we have to re-examine its status as "ethically good" or "correct", and judge it in light of this rent-seeking exploitation that produces no value or wealth. In my verdict, under this new definition, "capitalism" comes up bad.

[1] Which of course could be an actual machine, but could be just any form of capital that is necessary to produce the output goods.

It's clear that regulation is the problem. There aren't enough mobile home parks to meet demand, because authorities don't allow new ones to be built. It says it in the article.

Allow them to be built, supply will meet demand, rentors will have options, and the prices will go down.

But, in typical Amero-European fashion, when you see a problem caused by regulation, your go-to solution is more regulation.

The problem is not "there is not enough mobile home parks", the problem is that people only can afford mobile home parks

Living in a mobile home is actually pretty decent. It's generally going to be nicer, and much more private, than living in the type of apartments that would be within range of someone at that income level. And the article mentions this---there is a reference to children who prefer the mobile home park over apartments. I also know this because my aunt and cousin used to live in one. I wouldn't mind living in one myself, as long as the neighbors are decent (and that can very well be the case).

I get it. That's not good enough either---you want to force wealthy Americans to subsidize "really nice" housing for everyone. Unfortunately, that would significantly decrease net production, because you're diverting resources that would be used for producitve purposes to housing that is merely consumed. In the long run, everyone's standard of living would go down---most of all, the poor, who depend on cheap products and marginal jobs that have a low productivity level. You can't have your cake and eat it, too. You can't have more guns and have more butter. Resources are limited.

I get it. You've already heard this, but it's not how you want reality to be, and for some reason, you think you can put your wishes over the facts and get away with it. There's no way I can talk you out of that since persuasion presumes a mutual acceptance of reality.

> Living in a mobile home is actually pretty decent. It's generally going to be nicer, and much more private, than living in the type of apartments that would be within range of someone at that income level.

It often isn't, but you're right that it definitely can be a nice place if set up properly. There's a mobile home community near me that is strictly for retired people with no juvenile children in the house; it's safer and cleaner than even some of the "nice" subdivisions in the area.

There's also a great place I stayed at on vacation in Florida several years ago. It's set up as a combination mobile home community and beach house rental business, where owners can lease their mobile homes via the management company to weekly beachgoers. Some owners live there year round (mostly retirees), others live there seasonally, and yet others just use it as a vacation home for a few weeks a year, and lease it out the rest of the year.

I have an answer.

Buy the trailer park. Sell it to the tenants. Their rent payments become mortgage payments, in effect. When they finish buying the property en masse, it becomes controlled by a tenant-run cooperative.

This is, obviously, a money-losing proposition for whoever buys the trailer park in the first place. That's why it should probably be a government entity.

If the trailer park residents can do it by themselves -- and in several locations, they have -- that's great. But it would be preferable to have self-owned communities over slums, even if you have to have the government provide the initial loan and organization.

Is it socialism? Sure. The good kind.

See also: Community Land Trusts http://community-wealth.org/strategies/panel/clts/index.html

There are a lot of ways to hack our legal and financial systems to literally make the world a better place. Problem is: they don't make anyone rich.

If a mortgage was a good plan for them, they probably wouldn't be in a trailer park...

Renting has value that is appropriate for some people. Ownership is not always the answer.

Sure, mortgage on a house isn't good for these people, because they don't have the money for a down payment, or the money to pay for a regular house. Give them the opportunity to purchase a small house on a small plot of land, though, and it could work. Mortgage for a house is about equal to the average rent in many places, and people living in trailer parks usually don't have the problem of not intending to stay very long (like apartment dwelling often do).

Exactly. I was raised poor, as were my parents, and my grandparents on both sides before them. I learned a lot of bad financial habits from them which screwed me up in my 20s, but I've unlearned most of that and I'm on the right track now.

One thing I learned from them that turned out to be beneficial is to think small; don't buy something I can't afford. Six years ago I made my first house purchase at the age of 32, and while it's not a McMansion in an upper-middle-class subdivision, it's a practical and affordable home. My mortgage payment including taxes and insurance fees is less than $400/month for a three-bedroom farmhouse on half an acre of land. I'm not in a subdivision so I'm not subject to my neighbors' whims about curtain colors and such, and in five years I'll have it paid off (and our vehicles are already paid off).

My health isn't the best, and if I end up having to retire early it will be comforting to know that my family will have a paid-for home and cars, and we won't have to choose between making a house payment or buying groceries in a given month.

A house and half an acre for 20k!? Where?

He appears to be from Paulding County, GA (based on his website). It's about 15 miles west of Atlanta.

http://www.realtor.com/realestateandhomes-detail/147-Mill-Cr... shows a mobile home on 0.49 acres in the area. Zillow shows several recently sold homes in the area for $25k and under.

You can actually find similar deals in a lot of small towns. I picked a couple of small towns I happen to have family connections to -- Hillsboro, KS and El Dorado Springs, MO -- and found houses listed in both places for $20k or less.

Actually the property was $43k, it's a 30 year loan I plan on paying off extremely early. And the other reply is correct, it's in Paulding County, Georgia.

I would point out they can buy their own unit already if that works for them.

Sure, but owning the entire property is a superior option because it means they are not paying anyone for the privilege of living there (minus taxes to the government).

You can buy a little parcel of land to put your mobile home on too. Mobile home parks are not the only place they can be put.

Yeah, but the original idea was a social welfare plan. The target isn't those who will take initiative to find and buy a tiny parcel for their trailer (tiny parcels are a very hard thing to find), but the people stuck in a rut of trailer living. Its not about the opportunity already being there, it needs to be presented as a realistic option.

There's proof that this solution works :

Something similar was done for a large percent of housing in Israel , in the 50-80's. Israel was a newly formed state, with massive immigration coming with pretty large economic challenges. And yet it worked out pretty well - and housing wasn't a big problem - and everybody could get a place to live.

Housing for Israelis isn't a big problem; housing for the dislodged Palestinians is a different question.

Living in a maabara is considered good housing? Have you been in a rakevet building recently?

Yes i know what a rakevet building(long building with say more than 5 entrances) is.They might not be that beautiful but functionality wise they are pretty decent. And many would prefer to have the option of living in such building than the current mess that is Israel housing today.

The US already has FHA loans that allow you to buy property with as little as 3.5% down, with the rest paid back over 30 years. They're backed by the government, so it isn't risky for the banks to give out the loans. My interest rate was 3.2%

I remember hearing that before this program was put in, you had to put 50% down on a house with the rest at 9-12% interest paid back over 5 years.

There's also nothing stopping people from pooling money together, investing in an apartment complex, and converting it to condominiums. You'd have to deal with people who don't pay, but I imagine you could get a lender to help you out if you had an entire community ready to pay them back.

Loans will never fix the housing market.

The only real fix is for some entity to flood the market by building and selling houses at a fixed price.

What housing loans do is simply inflating and re-inflating property bubbles.

There are lots of barriers actually. These folks are usually poorly educated and pretty clueless about ownership and financing. These are folks using check cashing, payday loans and title loans.

They are caught in a cycle of learned helplessness and poverty. You need to give them support in the form of counseling and other things to get them to be successful owners.

> That's why it should probably be a government entity.

Or, you know, a non-profit organization.

Look up the chattel crisis of the early 90s. Most of these people do not have the funds for a mortgage and can't be underwritten.

Well similar to the Bay Area, government is restricting supply: "local authorities are very reluctant to grant permission for new parks"

So the landlords are using their natural oligopoly to rake in cash. A truly free market is supposed to prevent that kind of situation.

I agree though that raising the rent on a disabled pensioner who then has to walk around collecting cans for small change is pretty disgusting. If there's a good argument for rent control, it's for people in exactly that kind of situation.

>And yet, criticisms aside, I don't know if any municipality in the country has figured out a good solution from the regulation side of things. In fact, I'm skeptical if regulation can solve this problem. It feels like greedy slumlords are just going to be greedy slumlords no matter what rules we put into place

A land value tax would eliminate this. It would simply divert the rental streams from the wealthy to the government (who can then reinvest it back into the community instead, unlike the wealthy who will just siphon it off).

Raising property taxes would help, too, which every municipality can do.

You seriously think the US (or local) govt has a good track record with reinvesting tax revenues into low income communities? And be careful with advocating property tax hikes; property taxes can be very regressive for low income home owners.

>You seriously think the US (or local) govt has a good track record with reinvesting tax revenues into low income communities?

Compared to the 1%? Fuck yes. Does the 1% dole out social security? Build schools? Roads? I don't think so.

>property taxes can be very regressive for low income home owners.

Not unless it's designed to be regressive (e.g. a poll tax instead of based upon the value of the property).

Property taxes are naturally progressive - the more your property is worth, the more you pay in tax.

Are you familiar with the impetus behind Prop 13? (Not the side effects, but the motives.) A lot of homeowners were priced out of their homes because they couldn't afford the property tax rates. Sure they can sell, but then they're stuck as renters.

Sure. That was the sales pitch. It was spearheaded by a guy who owned and rented out apartments.

He also promised that rents would go down (which, of course, they didn't).

A lot of California home owners are now sitting on gold mines thanks to this proposition.

Prop 13 kicked in in 1978, so 37 years ago. I wonder if there's any way to find out the percentage of homes purchased after 1978. My intuition tells me that most home would have churned by now, since most people who owned prior to 1978 would be in retirement or close to it.

Also, Prop 13 still allows for increased assessments; they're just capped at 2% annually unless the property is sold. Considering the housing boom/bust cycle in CA has been pretty bad, 2% seems equitable.

>Also, Prop 13 still allows for increased assessments; they're just capped at 2% annually unless the property is sold. Considering the housing boom/bust cycle in CA has been pretty bad, 2% seems equitable.

The boom/bust cycle was exacerbated by capping it at 2%.

Property taxes are not raised or lowered, incidentally. They're a flow of income that is redirected from homeowners to the state or back again. Of course, home values increase substantially if homeowners can capture that stream of income derived from the value of the land. Hence the crazzzzzy house prices in California.

And for renters as well. Don't presume that you can tax rental property without that tax showing up in the rent...

One issue with "a genuine, good-faith attempt at improving the properties" is that unlike single family homes, trailer homes are actually a depreciating asset. A 30 year old trailer home isn't worth much since the cost to do meaningful improvements is likely more than the home is worth. This means an owner can only make a profit on the rent as opposed to a mix of rent and equity like most real estate.

Trailer parks on the other hand are appreciating assets and is where the real money is made by renting plots of land to the trailer home owners or tenants.

Making money off land is actually more feudalism, not capitalism.

My guess is that trailer parks leverage a loophole in property taxes to make all their money. If property tax rates were matching the normal values paid by other home owners, then owning a trailer park would not be a lucrative venture for so many investors and they would actually have to weigh the negatives of increasing rent.

Home owners pay higher property tax because they own the lot plus the house on the lot. With trailer parks, the owners only own the lot plus outbuildings etc. The trailers are owned either by the tenants outright, or leased/rented by a third party.

It seems to me there is a fine line between providing a valuable service for low income people and being a slum lord.

Rent control for mobile home parks.