Commenting about 10 months after the article was written ...
I love all your articles. I started with the one on Cartels and am rabbit-holing my way through the others. Kudos and thanks for the great work!
That said ...
I don't buy the need to tax imputed rent as a panacea for bloated housing costs - a mortgage, which most owners have, is rarely less financially onerous than paying rent. Simply eliminating the deduction on mortgage interest will go a long way to eliminating the distortion between renting and owning.
Of course, if you're going to go after that mortgage interest deduction, you need to also whack corporates ability to deduct interest, or you will see homeowners turn into real estate investors by forming corporations and buying their single-family homes that way instead.
There will also likely be a huge re-adjustment in the corporate credit markets (and a massive tremor in the LBO business) if ever the corporate deduction on interest is removed, but once the adjustment is done, all will be well and Wall Street will continue to thrive, boom and periodically go (almost) bust and be bailed out.
As for eliminating distortions imposed by zoning, etc., good luck on that (Federalism, etc.) - one just has to let competitive dynamics between geos to attract business to locate in their areas do the trick, aided by the continuing advance (one hopes) of telecommuting options. That's helping the likes of Austin right now, but it hasn't as yet started to hurt NYC and SFO. As yet ...
Re your prediction in the article - I have to wonder if there's a coming backlash to remote work. I've been remote for a year now, and it's incredibly difficult to communicate complex ideas over zoom. I feel like a lot of roles in product and engineering will be push back to in person, especially for more senior employees.
Commenting about 10 months after the article was written ...
I love all your articles. I started with the one on Cartels and am rabbit-holing my way through the others. Kudos and thanks for the great work!
That said ...
I don't buy the need to tax imputed rent as a panacea for bloated housing costs - a mortgage, which most owners have, is rarely less financially onerous than paying rent. Simply eliminating the deduction on mortgage interest will go a long way to eliminating the distortion between renting and owning.
Of course, if you're going to go after that mortgage interest deduction, you need to also whack corporates ability to deduct interest, or you will see homeowners turn into real estate investors by forming corporations and buying their single-family homes that way instead.
There will also likely be a huge re-adjustment in the corporate credit markets (and a massive tremor in the LBO business) if ever the corporate deduction on interest is removed, but once the adjustment is done, all will be well and Wall Street will continue to thrive, boom and periodically go (almost) bust and be bailed out.
As for eliminating distortions imposed by zoning, etc., good luck on that (Federalism, etc.) - one just has to let competitive dynamics between geos to attract business to locate in their areas do the trick, aided by the continuing advance (one hopes) of telecommuting options. That's helping the likes of Austin right now, but it hasn't as yet started to hurt NYC and SFO. As yet ...
This is great writing - cogent and unique.
Re your prediction in the article - I have to wonder if there's a coming backlash to remote work. I've been remote for a year now, and it's incredibly difficult to communicate complex ideas over zoom. I feel like a lot of roles in product and engineering will be push back to in person, especially for more senior employees.
This is quality! Thank you.
Thanks for writing. This is so good.