How Do We Sort This Mess?

Economics Political Theory
1

OK, I need some advice of “practical” Austrian economics about a very serious issue in my hometown and surrounding area.

A few years ago, the housing boom started. Since this used to be a very nice area not too far from a major city, first property values skyrocketed, then building began in the earnest. Both my hometown and the neighboring towns went on a building spree we likes of which were never seen before.

This of course has led to all sorts of problems. The prexisting roads are exactly the same, though population has increased so much. The result is they are overcrowded, more dangerous and maintenance has been cut back. The sewage and drainage system is insufficient for our needs, resulting in serious flooding on lots of new homes earlier this year. And since we are a mountain town, landslides are becoming a major concern: my neighbors had to spend tens of thousand to have their house repaired after some huge cracks appeared in their basement.

It must be understood the local councils have all to gain from a housing boom around here: property taxes are only paid for houses over a certain value and by non-residents, but each time a house is built, radically renovated or torn down to make room for more “micro-apartments”, the council gets good money. In short asking them to stop the housing boom is like asking a soot to shoot his moonshiner. They get cash for doing nothing more than stamping some paper.

And as Austrian economics tell us, easy money leads to malinvestment. Instead of improving the road network or the sewers, the local councils blew it all on completely needless “public” buildings, like that eyesore that is the “Palace of Culture” in my hometown. The only useless thing missing is the Springfield Monorail. In spite of the present depression (which has left far too many “for sale” signs), building activities go on like nothing happened. The neighboring town has whole rows of unsold houses, just sitting there: little chance they’ll sell anytime soon because prices are astronomical.

In spite of the flood of money, local councils are broke. They are even resorting to speculation to raise some cash: buy an agricultural lot for pennies, turn it residential, build on it. Even if they don’t manage to sell anything the houses are considered assets and hence help the council staying afloat.

In short to quote The Mogambo Guru “We Are Freeking Doomed”.

I am what may be called “a concerned citizen”, and there are many older residents like myself. We are just sick and tired of seeing our land turned into a Soviet style “barracks town”, with lots of identical houses, no private services (no shops) and Third World-style roads. All of our attempts at making an impression have failed, mostly because far too many persons still believe they only need to vote for the “right guy” to turn things around. This is not Texas and there ain’t no Ron Paul, just small town crooks.

So I am turning to you. Short of migrating to France (mostly for the roads) what can we do?

2

Sounds identical to where I live.

I sympathize, I really do… Unfortunately, we cant turn back the hands of time.

our land

I hear many locals say the same thing… I try to remind them that its not their land. If they don’t like what is being done with the land they should put their money where their mouth is and buy it up. But of course none of us have the money, so we just have to accept what the owners of the property decide to do with the land.

turned into a Soviet style “barracks town”, with lots of identical houses

I personally cant stand tract housing. I grew up out in the country and the idea of living on 1/8 ac lot is repulsive… but to millions of people that is the American dream.

3

Skip town! Such massive moral hazards cannot be solved but need go down in flames.

PS: How could anyone contemplate willingly moving to France?

4

You could write up a flyer with an easy-to-understand text (including some high quality references) and hand it out to everyone.

5

Take care of yourself. Move somewhere with a better community outlook. You can’t reform people, certainly not in the short term.

6

Thank you all for your replies.

Yes, I’ve recently started considering moving away because it seems us of the “concerned citizens’ movement” cannot make the slightest impression. Last year we managed to give the boot to the Socialist-Communist-Environmentalist coalition which has run this place since 1948. The new administration started on the right foot, then they discovered debts amounting to hundreds of thousand hidden in the budget. Instead of cutting expenses like we recommended (for example by stopping subsidizing and directly funding sports associations), they set out to find new revenue sources to keep up “crazy spending” levels. It’s the same story everywhere, isn’t it? Last week they even bought a page on the local newspaper to say something on the lines “the council is not broke… in fact it’s richer than ever!”. It failed to convince anyone but the most gullible cretins.

Why have I considered willingly moving to France ? Very simple: first, their small towns are still small towns. Exit the big cities with their terrible banlieus and endless slums and you get some serious elbow room. Second, and I won’t lie to you, France has some of the finest roads in the world. I simply could not live without some good rides in the neigborhood. I know, I am spoiled…

7

It’s the same story everywhere, isn’t it?

Actually here local government hasn’t build anything since, gosh, since the commie days back in 1990. They limit themselves to cartelizing the construction business. My neighborhood in particular is a splendid case of spontaneous order. Originally it was just marchland but win the last 4 years it has become the coolest neighborhood in Tirana. No ugly old standard buildings but all new constructions, with some aesthetic sense too. Unfortunately it only worked as long as the Major left us alone. Now that we’re being included in Tirana proper, good times are over for good.

Man, I’d like to secede!

8

Anyone from New York State? Upstate in particular? Between the reckless taxes and regulations passed in Congress, Albany has done a fine job to use its own bureaucratic clout to make it next to impossible for good jobs to exist. Worse yet, b/c of NYC’s huge population relative to the state, the legislature is practically owned by downstaters. In my community, we had the particularly unique distinction to have our local taxes increase by over 50% last year to boot. I’m outta here at the first opportunity I get …

9

Where are from, Kakugo?

And Germany is a safer place than France when economic wise with great roads. But you would need to learn German…

10

Vitor, take a map of Europe. Look in the Alps between the Lake Garda and Lake Como in Northern Italy. My fortress of solitude is somewhere in there.

I know Germany has some nice roads, but the only European country that comes even close to France (or to be more specific, Provence) is Austria and, to a lesser extent, Trentino, which is really just a stone throw away. This year I had to cancel my holidays because of the strikes in France only to be later informed by a friend who lives in the countryside near Aurillac that only big cities were affected.

Rant over.