@firstklassriot This is a good question, and I meant to answer it, but got distracted by real life. My apologies. Essentially, I think the health care market has certain market failures that the housing market doesn’t. Elaboration below in the following tweets:
@firstklassriot 1) Imagine I’m a renter, and I’m in a loose housing market, so vacancy rates of 7-10% or greater. If my landlord tries to raise my rent, it’s relatively easy to find an equivalent home nearby for what I was paying before. So I just move.
@firstklassriot Now sure, that’s a nuisance and a bit costly for me, but the cost for the landlord - who now has to keep the unit on the market for awhile while they try to find a new tenant, and is unlikely to find one if they’re charging above the market rate, is greater.
@firstklassriot So my landlord, being a reasonable and self interested individual, doesn’t raise my rent in that case. Or raises it only as much as the rest of the market raises rents.
@firstklassriot 2) if I was in a tight housing market, so vacancy rates of 2-4%, it’s much harder for me to find a place to move. So if my landlord raises my rent, I don’t have a credible threat to move. The landlord thus raises my rent as much as they can get away with/I can pay.
@firstklassriot Now, we could try to solve this by imposing rent controls - but that makes the housing market tighter, so it’s even more expensive for me to move (if I wanted to), and it’s horrendous for a new renter if they’re trying to find a place to live.
@firstklassriot (Two good papers on this: 1) Diamond McQuade Qian 2019 aeaweb.org/articles?id=10… and
@firstklassriot So the obvious solution is to get more housing, so that’s it’s relatively cheap to move, and relatively costly to raise rents. Now the big question is: does it matter what type of housing is added to the market? If we built a lot of luxury housing, would that help or hurt?
@firstklassriot Well, Mast 2019 tackles this question head on and finds that building luxury housing lowers the rents for nearby low income housing. It seems that filtering works! The solution to high rents is more housing. econstor.eu/bitstream/1041…
@firstklassriot How does this compare to the healthcare market? I, as a renter, can easily compare different housing options. The pricing is transparent, and the attribute I care about: location, state of repair, noise level, etc are easy to check and verify.
@firstklassriot And as a renter, I know what sort of housing I need. I’m not going to suddenly need 10x as much of the housing.
@firstklassriot As a patient, I don’t know the care and pricing I need are much less transparent, and much less obvious to me. I don’t know if I’m going to get cancer or not next year. And I have know idea how much that, or any other medical emergency, should cost.
@firstklassriot And when in the emergency room for a heart attack, I don’t have the luxury of comparing options. If a doctor says to me “you need open heart surgery in the next fifteen minutes or you’ll die”, I’m not in a position to make a choice.
@firstklassriot So for healthcare, what I need is some predictability - I need to know my costs will remain the same month after months year after year, regardless of what emergencies happen.
@firstklassriot Since, in the US, we decided that no one can be turned away for emergency services back in the 1980s, we have a universal health system - just a very poorly designed one with a lot of holes in it. There’s multiple ways to design a better healthcare system.
@firstklassriot One option would be like UK’s NHS. The government pays for everything, and hires all the doctors, and the people pay for it via taxes.
@firstklassriot Another option would be like Germany - where everyone is required to buy insurance, the insurance is offered for reasonable prices by publicly owned companies, and the government pays for about 77% of the bill.
@firstklassriot There are many more options! But the crucial common denominator is that they are universal - they cover everybody - and there’s a clear government role to ensure that everyone is covered, and the prices they pay are reasonable.
@firstklassriot They don’t, necessarily, require getting rid of health insurance companies. Though that is an option.
@firstklassriot Coming back to housing, government does have a role in ensuring there is enough housing on the market to keep rents reasonable. There’s many way they can do this, but ultimately they all require the same thing: more housing!
@firstklassriot You bring up Sweden as an example of having solved “housing insecurity,” but it really hasn’t. There’s a huge housing shortage in Stockholm, and a massive black market in apartments.
@firstklassriot Singapore, on the other hand, has done a good job with housing. But not by public housing, I.e government owning housing and renting it out. Instead, the government builds a ton of housing, then sells it, relatively cheaply. That’s a good model too! noahpinion.substack.com/p/a-singapore-…
@firstklassriot And the result is something that, aesthetically, is what many Californians seem to complain about when it comes to the building at the top of this thread: dense, multi-family, high rises. If Sacramento wants to do this, go right ahead - I’m in favor of it.
@firstklassriot But if Sacramento or California is not going to start building massive high rises filled with housing to sell cheaply to the public, then I’m favor of private developers building dense housing to add to the housing supply and increase vacancy rates, thus lowering rents.
@firstklassriot Tl;dr: We need more housing, and we need universal healthcare. Neither of those things necessarily precludes private companies from participating.

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