Posted by prawn 4/4/2025
though of course it's not surprising, productivity is vastly higher in cities. but that's an argument for allowing and helping them to grow more.
urbanization started many hundreds of years ago, it's nothing new.
in fact, instead of committing to economically (and ecologically) sustainable high-density cities (and withdrawing from the crazy American Dream/Nightmare suburbs)
letting people piss away their lives in shitty none of the above places
The government could and should make an effort to spread growth around more.
Growth requires economic/business opportunities, infrastructure that can serve said growth, like-minded people to help manifest said growth, and ... that silly corporate thing, what was it, ah, synergies! Spreading all these things out leads to kick-ass local music scenes, but otherwise helps no one.
A total failure of the field of economics.
Just like economists insisted that the economy is doing badly because of vibes, they also insist that many people are part of the middle class based on an arbitrary threshold that isn't what it used to be.
Housing, energy, and education have increased astronomically compared to 30 years ago.
The cost of housing doubled in 10 years in my city. All while the schools got worse and the cost of college is astronomical. The cost of childcare doubled in 10 years as well. Energy bills also doubled in just 4 years.
What used to be a great stable income, we're even above the official line for what counts as middle class, is now just scraping by.
Being middle class used to mean that you were financially secure and could say have kids and a house. By that metric many people have fallen out of the middle class.
High costs of
1. Energy 2. Transport 3. Housing
Are the cause of low private and public investment.
The author treats the lack of public productivity growth as separate from the lack of public investment but the latter causes the former
Excellent piece about it here.
TLDR: "it is difficult to build almost anything, anywhere. This prevents investment, increases energy costs, and makes it harder for productive economic clusters to expand. This, in turn, lowers our productivity, incomes, and tax revenues."
Housing is probably the biggest culprit. More on that here.
https://worksinprogress.co/issue/the-housing-theory-of-every...
Blocking green energy investment is the biggest area of frustration. You cannot demand to never see a pylon and then turn round and complain about your electricity bills. The press/public are fundamentally unserious about this. I got mildly radicalized when I read that someone was trying to block an offshore connection using the presence of "grade 2 listed concrete anti-tank cubes" on the beach.
Edit: example of listed cubes https://historicengland.org.uk/listing/the-list/list-entry/1...
I'm not against protecting historical heritage, of course, but society should serve the people currently living there. Just because something is over a few decades old doesn't mean it's worth bending over backwards to protect 100% intact without any changes. Would it really be so bad if a building from 1910 gets some double glazing, changing the appearance slightly? I'd say it's not.
Add a crowdfunding frontend. Put the sponsor's name on the website next to the building. Have a little thing promoting all the unsponsored buildings. Run a lottery which pays back some of the collected fees to privately-held listed building owners to help pay for upkeep.
But if nobody cares enough to reach into their pocket and spend the equivalent of a mildly expensive restaurant dinner on keeping this building listed? Maybe it's not actually important or significant at all. Fewer, better-maintained historic buildings, rather than just having them with the owner quietly waiting for them to burn down so something useful can be built.
Government's job within a capitalist country in a lot of ways is to ensure stability, a stable populace and stable society leads to stable markets theoretically. But what do you do if there is not enough jobs to go around to ensure that stability?
Simple: you just make jobs up, you make busywork up, you increase the bureaucracy to subsidize people who would otherwise be destitute and rioting on the streets. Technical innovation has driven out so many people from jobs at this point that we're reaching a true crisis against the cultural expectation that everyone that's "useful" works a job.
GDP growth: basically 0% for years. You're stagnating and losing economic time. Bad news.
Unemployment looks to be rising but overall not terrible. Participation rate seems high, grandma and grandpa still working it seems?
Interest rate of 4.5% is rough. Housing is problematic.
Balance of trade is negative, you're getting poorer.
Govt debt to gdp is up against the 100% barrier. Looking at central bank balance sheet, it does look like you just avoided bankruptcy.
Consumer confidence hasnt been positive in 10 years.
corporate tax rate of 25%? personal income tax of 45%. sales tax of 20% Yikes.
Seems to me the UK government is holding the economy back with far too high taxes.
A country cannot go bankrupt. After the war the debt to gdp ratio was 250%, and from that position the government nationalised 20% of industry, built houses, create the NHS and welfare state and developed a nuclear programme.
> corporate tax rate of 25%
on profit yes, but if you are big enough you declare as little profit as possible.
> personal income tax of 45%
that's the highest band there is, payable only on income over £125,140
> sales tax of 20% Yikes.
well it's a tax on added value on every step thorough the retail chain, collectable by the end retailer. It's zero rate on food and child clothes and some other things.
Taxes are indeed on the wrong places in many cases: e.g. dividend tax on unearned income should be equalised with income tax, income tax thresholds should be increased in line with inflation / wages and not frozen as they currently are. but I don't think overall tax burden is the issue here.
Correct that there isn't a bankruptcy legislation, but there's a factor of cant pay the creditors and you just stop. Which mostly implies that retirees go back to work.
If you'd like to invent a new word for it, fine but bankrupt is what many western countries are right now.
>but I don't think overall tax burden is the issue here.
This is without talking about property, tv, etc taxes. The total tax burden is probably over 100% and you're feeding people into specific tax free things like food. Definitely total tax burden problem.
The problem comes up against thermodynamics. The longer you run taxes at these high levels, the worse things get. That includes roads and everything. Even though in theory taxation should at least maintain those things. So your country becomes poorer and poorer. Not sustainable.
in the UK case then £895 of the debt is owned directly by the bank of England. So in the case of about 1/3rd of the debt the 'creditor' is your own central bank.
The government can of course pay interest on gilts by simply issuing more gilts. It's one of the advantages of running a country, intergeneration debt.
> The total tax burden is probably over 100%
Compared to what? income? capital gains? GDP?
total tax in UK through all taxes is 36.1% of GDP.
Taxes are not high in historical terms. USA for example had much higher tax rates (90% top income tax band) while it was arguably undergoing its phase of highest development.
Roads (and everything) get worse if governments do not invest in roads, or they invest in roads, but have outsourced to multiple layers of contractors who end up extracting a lot of the investment in profit and squeezing of labour costs and not in quality of road building.
Most other affluent nations have some form of zoning instead, which make planning much much easier. Most other affluent nations have more central control over planning too, which makes consensus over megaprojects easier to reach.
If you want the extreme of "cheap and run down", some Eastern European countries fit the bill. If you want the other extreme of "expensive and well-kept", Switzerland.
But Britain is in a unique place of both "expensive and run down".
Why Britain doesn’t build (worksinprogress.co) https://news.ycombinator.com/item?id=36477481
The proposed recommendations to Starmer et al are also very vague, at least to me, Labour insiders or public affairs consultants might have obvious context to fill them in, I don't know.