Gyroscopic Investing

Here's an idea for a fantasy city with low crime. You have extremely high property taxes. 10% of home value. You provide no services for those taxes. The money is either burned or used for something like local conservationalism. No welfare. No low income housing. Terribly funded public schools to the point where no one sends their children there and it's whatever federally minimum required public school has to exist.

Poor people can't afford to live in this city. They'd get no benefit from living there even if they could. They'll keep their drugs and crime away.

Think of it like a country-club city.

Maybe the 10% property taxes goes to a very well funded police force that has minimal powers. No surveillance cameras or license plate readers. No cell phone interceptors. No SWAT trucks. They aren't even allowed to give parking or traffic tickets. But if they see someone burglarizing your car/home, you better believe that person is getting arrested and possibly shot in the process. And no one in the city will bat an eye, because we're all paying for the exclusivity of living here.

No public schools means private schools exempt from federal mandates on common core or whatever teachers union bullshit is being propagated at the time. Everyone pays for their own school on top of the 10% property taxes.

This post is half in jest and half in seriousness. It's what the liberals think Ayn Rand wants. But the more I think about it, it's where I want to live. I just want to keep out all of the shitty people. All of the people doing drugs and stealing. I think drugs should be legal, but I don't want to live amongst people who smoke crack and live on the streets and steal for a living.

What are you doing to improve your preferences about the society you reside in?

Like a city-sized gated community?

Funny, I was daydreaming this morning of a large building and an adjacent park that would charge $5 or $10 for entry for the day, thus keeping out unwanted elements. Inside, the building would merely have fountains, good lighting, and places to sit. The park would have, you know, flowers 'n' shit.

What I think you guys are getting at is the idea that public services only really work if you have a high-quality public. The shittier some percentage of the public becomes, the more everyone else will want to exclude them, causing social tensions and the desire for institutions with explicitly or implicitly discriminatory barriers to entry.

I think a better solution is physical separation and secession, myself. The more productive/wealthier/happier/cooler/whatever people establish their own society with borders that are designed to keep the shitty people out of the whole thing altogether, and then that society is free to have high-quality public services and institutions.

Come to think of it, isn't that the social model practiced by Australia, New Zealand, and the Scandinavian countries?

This is a series of overgeneralizations, but with a basic kernel of truth:  there is an underclass that significantly impacts the quality of life of the people who (ironically) are paying many of their expenses.  It's not necessarily true that poor = unwashed criminals, but there's no denying the association.

The idea of the high property taxes is exactly like paying a first class train fare:  it's the same cars & same services, but the higher ticket price keeps out the guys who haven't bathed in a week and sit there drooling on your shoulder.

Expensive home prices and high maintenance/HOA fees serve the same purpose as your property tax idea, and a gated community isn't necessary.  There are plenty of nice neighborhoods in Manhattan with very low crime rates and no eyesores, simply due to distance from the nearest area with "affordable" housing.  Instead of walling us off, city housing projects effectively concentrate these elements into small pockets that are not difficult to avoid.  And those areas continue to shrink as housing demand increases.  A recent major development here was a large private university expanding its territory into an adjacent cruddy neighborhood, thus forcing out many of the residents and starting a series of construction projects that will eventually make that area into a pleasant place to live and work.

I understand the intent here.  I get the idea of minimum responsibility filters that come with being able to afford to pay a certain amount.  But I personally reject the basic assumption that rich people are automatically better to live around, and I'd likely pass on the large scale gated community.  The idea of promoting money as the top social signal for good neighbors seems shallow to me, and is exactly what drives silly consumer culture and debt problems.  Where do you draw the tax line?  What percentage of society do you seek to avoid?

Also, one practical problem I see is the assumption that the high tax levels will eliminate the class you intend.  As pointed out in another thread, the rapidly rising real estate prices in California aren't chasing out the poor.  They're wiping out the middle class.  In my experience, that makes for a very insular society but not necessarily a better one. 

I'd much rather live somewhere that has no taxes at all and no "public services", i.e., all services are provided privately.

Tyler wrote: I understand the intent here.  I get the idea of minimum responsibility filters that come with being able to afford to pay a certain amount.  But I personally reject the basic assumption that rich people are automatically better to live around, and I'd likely pass on the large scale gated community.  The idea of promoting money as the top social signal for good neighbors seems shallow to me, and is exactly what drives silly consumer culture and debt problems.  Where do you draw the tax line?  What percentage of society do you seek to avoid?

Also, one practical problem I see is the assumption that the high tax levels will eliminate the class you intend.  As pointed out in another thread, the rapidly rising real estate prices in California aren't chasing out the poor.  They're wiping out the middle class.  In my experience, that makes for a very insular society but not necessarily a better one.

Tyler, your comments reminded me of something my Pastor said; he had served in a few "underpriviledged" congregations before coming to ours.  He said the only difference between those in the ghetto and those in affluent suburbia is money - the corruption, sin, sleaze, immoral behavior, and such, are much the same; the richer folks just have more money to cover it up and look good in their external appearance - like in the movie American Beauty - and the ghetto folks are more "what you see is what really is truth for us all".

... Mountaineer

MangoMan wrote:

Mountaineer wrote: ...the only difference between those in the ghetto and those in affluent suburbia is money - the corruption, sin, sleaze, immoral behavior, and such, are much the same; the richer folks just have more money to cover it up and look good in their external appearance - like in the movie American Beauty - and the ghetto folks are more "what you see is what really is truth for us all".

... Mountaineer

Yeah, that's like saying all politicians are corrupt criminals, and the only ones in jail are those that are dumb enough to get caught.

Yep!  Although I'd probablly say "most" instead of "all".

... Mountaineer

Tyler wrote: Also, one practical problem I see is the assumption that the high tax levels will eliminate the class you intend.  As pointed out in another thread, the rapidly rising real estate prices in California aren't chasing out the poor.  They're wiping out the middle class.  In my experience, that makes for a very insular society but not necessarily a better one.

What's happening in California is exactly what got me to thinking about starting this thread. Because what's happening in California is ridiculously high taxes/cost of living/real estate, which is being used to pay for services for the poor. Free healthcare. (Hint: Look at a county hospital in LA or SF. Their budget for a single hospital is in the BILLIONS of dollars per year. BILLIONS!! For ONE hospital! No exaggeration). Low-income housing benefits paid for from taxes. etc.

The middle class are leaving because it's too expensive and they aren't cutting a cut of the tax pie. The lower class is staying because they are getting a piece of the pie. And compared to other parts of the country, that's enough reason for them to stay because they are best off there.

I propose keeping the middle and upper class and getting rid of the lower class.

I can see the argument for strict immigration policies that weed out criminals and freeloaders and prioritize people with skills who help society as a whole. I just think wealth is a poor proxy for these qualities.

Giving payments to the poor is probably the worst thing you could do to them.  If they have to work for a living, they have a strong incentive to reform themselves, improve their interactions with others, and find a positive way to cope with their traumatic personal histories.  Then at least some of them will form friendships and enter marriages with people of higher economic strata, which will improve their descendents' lives.

Charles Murray has talked about this at length, I believe.  In the US the poor are being cut off from social interaction with the wealthy, which may lead to negative economic and genetic outcomes.  This is not only because the poor are deprived of the incentive, but also because there has been an ideological shift among the wealthy, who now rationalize the choice to wall themselves off from the poor.

There is a quote from Hawthorne, which I wouldn't know had I not seen The Departed.  "Families are always rising and falling in America."  That goes to the dynamism of our country, which is what enabled us to achieve the greatest feats of industry and technology.  In part that dynamism is enabled by the character of our gov't, or what that character was, but it is also enabled by intermarriage among social classes.  Good ideas don't always come from the social elite, but those ideas rarely make it unless those elites are ready to listen.

I don't normally post more than a little bit at a time, but I am going to keep going about this, because it pulls at my heart strings.  It makes me profoundly sad to think that my country is turning into a place where there is a recognizable upper class.  I don't mean that I resent the upper class, because they will always exist, and ought to.  There will always be people who are better than others, and that is fine.  However, it is not fine that the upper class be recognizable, in its segregation.

That is not likely to be salutary either for the rich or the poor, and it certainly is not stable.  History and the present world are full of countries like that, which are prone to civic unrest and revolution.  I have been reading some of Nassim Taleb's work recently, and one of his consistent themes is that certain arrangements grow stronger in the face of uncertainty, and some grow weaker.  A segregated upper class seems a perfect example of the latter.

An unstable society is not what I want for my descendents, or for anybody at all.  I don't know the answer to difficult questions, like how you protect your family from criminals, but still have exposure to the poor and less educated.  I acknowledge that is a hard problem, but it needs to be solved.  From what I am told, this used to be a country where people and ideas got a fair shot, whether they came through the university sorting machine or not.  Somewhere along the line that changed, and I have got to think that our stagnating economy is the result.

TennPaGa wrote:

Lowe wrote: Giving payments to the poor is probably the worst thing you could do to them.  If they have to work for a living, they have a strong incentive to reform themselves, improve their interactions with others, and find a positive way to cope with their traumatic personal histories.  Then at least some of them will form friendships and enter marriages with people of higher economic strata, which will improve their descendents' lives.

Charles Murray has talked about this at length, I believe.  In the US the poor are being cut off from social interaction with the wealthy, which may lead to negative economic and genetic outcomes.  This is not only because the poor are deprived of the incentive, but also because there has been an ideological shift among the wealthy, who now rationalize the choice to wall themselves off from the poor.

There is a quote from Hawthorne, which I wouldn't know had I not seen The Departed.  "Families are always rising and falling in America."  That goes to the dynamism of our country, which is what enabled us to achieve the greatest feats of industry and technology.  In part that dynamism is enabled by the character of our gov't, or what that character was, but it is also enabled by intermarriage among social classes.  Good ideas don't always come from the social elite, but those ideas rarely make it unless those elites are ready to listen.

+1

There have been other societal changes which, IMO, have contributed to this.

For example (and I believe it was MediumTex who I first remember raising this point)... Women had far fewer employment choices 50 years ago than they have today.  However, this also means that 50 years ago, the caliber of women in those fields was far greater than it is today.  In other words, 50 years ago, a woman with the necessary aptitude and drive could not become a CEO, or even an engineer or physician.  But she ended up being a damn fantastic teacher, which might have been better for society overall.

I have mentioned that before, although I'm not sure it was here.
This is actually an illustration of the Peter Principle, since if someone can't rise to the level of their incompetence due to external restrictions, they are likely to remain in a job where they are competent. If this is common, the average competence level will be higher.

IIRC, his example was the civil service in India under British rule, where Indians couldn't get above a certain level in the bureaucracy, so if they got to the top level they could achieve without reaching their level of incompetence, they had to remain in a job where they were competent.

One of my Canadian cousins said that it wasn't too many years ago that they would just take the homeless out of the nicer areas and put them on a bus to Manitoba. It took them a long time to find their way back, if they chose to do so.

dualstow wrote: One of my Canadian cousins said that it wasn't too many years ago that they would just take the homeless out of the nicer areas and put them on a bus to Manitoba. It took them a long time to find their way back, if they chose to do so.

Oh, but that just sounds so mean! It would never fly in Libtopia. In fact, the homeless in San francisco even get welfare payments. It never ceases to amaze me how unwilling American liberals are to do the kind of necessary things that Canadian and European liberals are to make their socialist societies actually work.

Pointedstick wrote:

dualstow wrote: One of my Canadian cousins said that it wasn't too many years ago that they would just take the homeless out of the nicer areas and put them on a bus to Manitoba. It took them a long time to find their way back, if they chose to do so.

Oh, but that just sounds so mean! It would never fly in Libtopia. In fact, the homeless in San francisco even get welfare payments. It never ceases to amaze me how unwilling American liberals are to do the kind of necessary things that Canadian and European liberals are to make their socialist societies actually work.

I think every member of Congress, SCOTUS and the POTUS should adopt a minimum of 10 homeless people and have them live in their households ... along with 5 "undocumented" aliens.  Maybe only 4 and 2 for all their appointed minions.  I expect our problems would soon be self-correctiong.

... Mountaineer

I have a relative in a small smokestack city in central IL.  Several years ago they received an influx of displaced Chicago Public Housing residents.  It ruined their city's schools, for one thing.

I Shrugged wrote: I have a relative in a small smokestack city in central IL.  Several years ago they received an influx of displaced Chicago Public Housing residents.  It ruined their city's schools, for one thing.

Jeez, they're still doing that!? A similar thing happened to me when I was a kid growing up in central IL. The good public school I was attending became dangerous and violent after they bussed in a bunch of miscreants from a shitty school on the other side of town. The predictable result was white flight to the private and religious schools, transforming the formerly quality public school into a violence-ridden pit.

I know a lot of Illinois...ians? And they all say the same thing. Luckily, there's really no reason to go there, so I'm not too bummed that it sucks.

Just for fun:

http://gyroscopicinvesting.com/forum/ot ... oes-wrong/

MangoMan wrote: In Chicago, the notorious Cabrini Green housing projects were ripped down and the residents disseminated to the suburbs, outlying towns and other projects when its location became too valuable for redevelopment purposes.
http://en.wikipedia.org/wiki/Cabrini%E2%80%93Green

I Shrugged wrote: I have a relative in a small smokestack city in central IL.  Several years ago they received an influx of displaced Chicago Public Housing residents.  It ruined their city's schools, for one thing.

Oh man, they were artificially re-inseminated!