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thegirl
Member
Username: thegirl
Post Number: 212
Registered: 04-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 11:33 am: | 
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Okay. I came back just to post this for all of the "you don't like it, get a different job" and "if you can't afford to buy a home/live where you work, it's not my problem". Local rag today:
PRICED OUT?
By john darling
Jackson County is a great place to live and work, but as wages lag farther and farther behind galloping housing costs, it could be a long-term drag on the local economy. And employers don't know what to do about it.
"What could possibly keep up with housing costs here? I don't see any connection between housing costs and salaries," said Michael Cavallaro, executive director of Rogue Valley Council of Governments.
The housing market is "being driven by people not involved in the job market of the valley," that is, by wealthy migrants — "not by people who work here, and we're falling behind dramatically," Cavallaro said.
From 2001 to 2005, the average wage in Jackson County increased 12 percent — from $27,224 to $30,502 — according to Ainoura Oussenbec with the Oregon Department of Employment in Medford.
In the same span, median home prices jumped 46 percent — from $183,657 to $268,100, according to Medford appraiser Roy Wright, who has kept such statistics for the real estate industry here for many years.
Average rental costs for the county in the same period increased 13.8 percent for a three-bedroom, from $868 to $988. For a two-bedroom, prices rose 8.8 percent, from $624 to $679, according to Cara Carter with the Jackson County Housing Authority.
The national Consumer Price Index in the same period went up 11 percent, according to the federal Bureau of Labor Statistics.
"Wages keep up with housing? Hell, there's no way. That hasn't happened in this county for 100 years," said Wright. "But it was possible 30 years ago, when I bought my first house here, to handle a down (payment) of $1,000 and develop equity, with payments of $85 a month. Today, there's no comparison. Young people face downs of $20,000 to $30,000 and need two jobs."
Typical is single mom Tina Wolfe, of Eagle Point, who faces rent of around $800 for a two-bedroom mobile home, while working a food services job at $9 an hour. (gee, isn't that a starting wage for most non-server jobs?)
"I definitely am not keeping up with housing costs and I feel landlords go ahead and raise rent, if they can, to weed out low-income people like me and get more successful ones," said Wolfe, who was just evicted. "I barely get by. We go without a lot. It's been a while since we bought groceries."
At Asante, salaries are "market based" (competitive within the industry) and match inflation with a 3 percent-a-year-increase, "but that certainly doesn't help when you need to buy a house, and housing prices have doubled in the last five years," said Asante Human Resources Director Mike Hancock.
"Those who live here, I'm sure they found a way to own or rent," Hancock said. "For new hires from outside the valley, we hear about the sticker shock. If we recruit someone for a high-salary position, they probably have a good house where they are, but here it would be astronomical. They don't want to buy down (step down in home size or quality) — and there's no way the employer can afford to raise their salary. It's not infrequent they turn the job down." (this is the local hospital group. They can't even keep nursing staff alive because of home prices)
Major valley employers and public sector leaders held a Workforce Housing Summit last spring, focusing on ways to provide affordable housing and lower loan costs for workers but "the problem is the lack of funds."
"I saw a lot of worry, a lot of interest and a desire to do something," said Hancock, noting that little focus was put on higher wages. Homeowners here have seen huge appreciation in their investments and "they don't want to see anything happen that would take that away from them."
Major regional employer Harry & David echoed the theme, with corporate relations Senior Vice President Bill Ihle saying it surveys the valley and "always wants to be competitive" with salaries.
"So far, it (housing cost) hasn't been a serious problem for us with candidates (for jobs)," said Ihle. "They have to balance that with schools, hospitals and other quality-of-life issues. If they come from California, they're not going to have the same sticker shock as if they come from elsewhere."
As an employer, RVCOG gives 3 to 5.5 percent annual raises to keep up with cost of living, but, said Cavallaro, "as far as I know it's not keeping up with a darn thing. The public sector isn't keeping up either."
Nationally, more job seekers are looking for some form of "employer-assisted housing" as part of the hiring package, he added, "but in the Rogue Valley, that's not part of the game. It's minor. I doubt we'll see an explosion of wages here. This has traditionally been a low-wage part of the country. People come here for other reasons and put up with the housing costs."
What are the housing choices for the newcomer or young person starting out?
"Live in outlying areas, check out a co-housing strategy, get substandard housing — or move out to where housing is affordable, like the Midwest," said Cavallaro.
In a service (retail, food service, etc.) economy like the Rogue Valley's, if the hourly workers move out, who's going to do the work?
"We're going to be in some trouble," said Cavallaro. "Retirees need services. If you price the low-wage workers out of the market, and don't have public transit to outlying areas and the trend is away from government providing social services — then you're in a bind. There will be pockets of substandard housing, maybe some companies that can provide housing and you'll have a dearth of the middle class."
John Darling is a freelance writer living in Ashland. E-mail him at jdarling@jeffnet.org.
Guess what?
Even if every server here took a "normal" job...they still can't afford to live here without some type of help.
And that negates all the arguments about "if you don't like it, find a job that pays more hourly". Even the nursing staff at the hospital can't afford homes here.
So, trolls...where does that leave us? If all the "service workers" quit...who does the work?
"Life's gonna suck when you grow up"
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eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 134
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 03:10 pm: |
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Even if every server here took a "normal" job...they still can't afford to live here without some type of help.
And then commuting was invented. And when people start hating the commute, they either get a pay raise or move to a different city. |
hacinta
Senior Member
Username: hacinta
Post Number: 1278
Registered: 01-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 03:26 pm: |
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Public transportation is not available often times in rural type living. Where I live it not exactly metropolitan, there is limited public transportation. Then we have the $3.10 a gallon gas prices as well as the need for a relatively new car to make the dreaded commute. So by the time you add up car payment and gas, tires, heck insurance even goes up if you travel many miles to work. Where does that leave you? It may just be better to pay for the higher housing, but thats right the jobs dont pay enough to accomodate that rent, mortgage. I guess the wages wouldn't make up for the commuter costs either.
As we all know it takes money to move. If a family is barely scrapping by how are they going to save for that, even if they do put it on a charge card, they probably cannot afford to make the monthly payments with interest.
Formerly Jammie
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thegirl
Member
Username: thegirl
Post Number: 213
Registered: 04-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 03:44 pm: |
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Eeyore, you missed the whole point as usual.
If you price the lower wage workers out of the market, who's going to do the work?
Also, the cost of the commute can be as much or more as a mortgage. If you can't afford the mortgage, how the hell can you afford the commute?
And hacinta's right...there is very little in the way of public transit here.
But go on sitting in your ivory tower...just don't get a nosebleed.
"Life's gonna suck when you grow up"
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tricky
Member
Username: tricky
Post Number: 182
Registered: 05-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 04:36 pm: |
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And then commuting was invented. And when people start hating the commute, they either get a pay raise or move to a different city.
Besides the fact that you're missing one the main points of the article - that the town's economy is based on the service industry, but nobody can afford to do the service industry jobs and live close enough to commute to them - why in heck would you suggest people lengthen their commutes in our current environment?
Shouldn't we be suggesting to people to work as close as possible to their homes, to minimize our dependence on foreign oil (as W puts it). Or, in my head, ensure that we don't run out of oil before we've figured out how to survive without it. |
eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 140
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 06:52 pm: |
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If you price the lower wage workers out of the market, who's going to do the work?
Perhaps no one. Then the citizens will get pissed that they don't have restaurants, etc. In order to meet that demand, businesses will raise their wages. If the citizens need an Applebees that badly, they can pay for one.
Look to places like Vail, CO, Jackson, WY, and Park City, UT for examaples. Restaurants (among others) voluntarily pay more because the market demands it.
the town's economy is based on the service industry, but nobody can afford to do the service industry jobs and live close enough to commute to them - why in heck would you suggest people lengthen their commutes in our current environment?
That situation arises in places like resort areas all the time. People commute and get paid more for it. People commute to Jackson, WY from nearby places in Idaho, for instance. People commute to Park City from Salt Lake City and its suburbs.
Also, the cost of the commute can be as much or more as a mortgage.
Then, if they are to keep their services, they'll have to increase the wages commensurately. That's one of the reasons many suburban cops in the Bay Area get paid in the high five-figures to start.
Shouldn't we be suggesting to people to work as close as possible to their homes, to minimize our dependence on foreign oil
Maybe. But people need market incentives to do that. Otherwise you end up with messes like the rent control seen in NYC and Santa Monica. Complaining about wages and even boosting them via minimum wage laws isn't going to get people to move into even more expensive areas if they'd rather trade lost commuting time and expense for better housing. |
thegirl
Member
Username: thegirl
Post Number: 214
Registered: 04-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 07:03 pm: |
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This is hardly a resort area.
This is quickly becoming an economically depressed area as there really is nothing here to create that kind of artificial/seasonal economy.
Apples and oranges, donkey.
And for the record?
Service workers here all get $7.25/hr. plus tips.
"Life's gonna suck when you grow up"
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eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 143
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 07:06 pm: |
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This is hardly a resort area.
Resort areas are more expensive, and they still manage. In other words, you're saying the problem is smaller in your non-resort area.
This is quickly becoming an economically depressed area as there really is nothing here to create that kind of artificial/seasonal economy.
Then people should leave. But you're going to have a hard time claiming that it's becoming economically depressed at the same time housing prices are increasing. |
thegirl
Member
Username: thegirl
Post Number: 215
Registered: 04-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 07:13 pm: |
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Housing prices are increasing because we had a huge influx of out of state retirees and investors...mostly because our home prices were far lower than the national average...ie, on track with the average income.
And no. The problem is not smaller. It's proportionally larger as there is nothing to support inflated prices, such as a tourist season.
I doubt you have ever lived in a resort area...as a service employee. I have. Many of my friends managed thanks to government assistance.
But hey! Keep your tips since you'd rather not "subsidize" someone's job...they'll just get it through your taxes later.
Just a thought.
"Life's gonna suck when you grow up"
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thegirl
Member
Username: thegirl
Post Number: 216
Registered: 04-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 07:17 pm: |
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And just to refresh your short memory:
The housing market is "being driven by people not involved in the job market of the valley," that is, by wealthy migrants — "not by people who work here, and we're falling behind dramatically," Cavallaro said.
So, please to explain to me once more how it works that service workers are supposed to survive when the housing market is being artificially inflated?
And, once we all move (and I'm moving in 3 weeks), who does the work?
"Life's gonna suck when you grow up"
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eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 145
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 07:46 pm: |
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please to explain to me once more how it works that service workers are supposed to survive when the housing market is being artificially inflated?
They are voluntarily awarded higher incomes or they seek greener pastures.
And, once we all move (and I'm moving in 3 weeks), who does the work?
I already answered that question. My previous answer starts with "perhaps."
The problem is not smaller. It's proportionally larger as there is nothing to support inflated prices, such as a tourist season.
It, obviously, would be supported by permanent inhabitants as opposed to temporary inhabitants.
Many of my friends managed thanks to government assistance.
That's too bad. The government shouldn't be in the business of subsidizing the playgrounds of the wealthy by artificially reducing the cost of labor.
Keep your tips since you'd rather not "subsidize" someone's job...they'll just get it through your taxes later.
I'll save more in tips than they get from my taxes. Tippers have to pay taxes, too. |
thegirl
Member
Username: thegirl
Post Number: 217
Registered: 04-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 14, 2006 - 08:03 pm: |
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That's too bad. The government shouldn't be in the business of subsidizing the playgrounds of the wealthy by artificially reducing the cost of labor.
The government doesn't. Supply and demand is the reason for all this, and you know it. It is the general rule for tipped employees, thereby making it the status quo...not an artificial devaluation of labor.
You don't want to tip, fine. Don't. But don't complain about the number of people on food stamps and other forms of assistance. Don't complain when everyone's taxes are raised because of the high enrollment.
They are voluntarily awarded higher incomes or they seek greener pastures.
Riiight. Because that's feasible and finacially possible for everyone. </snark>
I already answered that question. My previous answer starts with "perhaps."
I'm glad that's how things work in your fantasy, but not how things work here in the real world. Try again. You'll be served, and poorly, by high schoolers and undertrained individuals; shorttimers who are just trying to make enough to bail out of here.
It, obviously, would be supported by permanent inhabitants as opposed to temporary inhabitants.
Again, nice wish. There are many resort areas with high unemployment rates in the off months.
I'll save more in tips than they get from my taxes. Tippers have to pay taxes, too.
So do servers. And I'm sorry that you would rather have someone on assistance than pony up $5 as a tip.
That's pathetic.
"Life's gonna suck when you grow up"
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eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 149
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Tuesday, August 15, 2006 - 01:17 am: |
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The government doesn't.
WRONG. Minimum wages are government intervention. Government programs -- THE VERY KIND YOU MENTIONED IN YOUR POST -- are government intervention. Government assistance subsidizes industries who would otherwise have to pay more.
Supply and demand is the reason for all this, and you know it.
Then kill the minimum wage.
It is the general rule for tipped employees, thereby making it the status quo...not an artificial devaluation of labor.
What does "artificial devaluation" have to do with anything? I mentioned subsidies via governmental support.
But don't complain about the number of people on food stamps and other forms of assistance.
Thanks to the welfare reform Clinton began in 1996, they get booted off welfare, and there are more stringent work requirements.
Riiight. Because that's feasible and finacially possible for everyone.
Sorry. This isn't a utopian socialist paradise. People don't all get what they want. Some people end up failing in economic terms. But if a city gets expensive and they can no longer afford to live there, they're better off moving somewhere cheaper.
You'll be served, and poorly, by high schoolers and undertrained individuals; shorttimers who are just trying to make enough to bail out of here.
If that's all the community is willing to pay for, fine.
There are many resort areas with high unemployment rates in the off months.
That's fine. Many are happy with that. I had friends who worked in resort areas for about 8 or 9 months and then lived on their unemployment checks for the balance of the time. That's precisely what they wanted. And their group of acquaintences had tons of people like them. |
tricky
Member
Username: tricky
Post Number: 184
Registered: 05-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Tuesday, August 15, 2006 - 09:54 am: |
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Shouldn't we be suggesting to people to work as close as possible to their homes, to minimize our dependence on foreign oil
Maybe. But people need market incentives to do that. Otherwise you end up with messes like the rent control seen in NYC and Santa Monica. Complaining about wages and even boosting them via minimum wage laws isn't going to get people to move into even more expensive areas if they'd rather trade lost commuting time and expense for better housing.
Yeah, you're not really all there, are you?
Doing the environmentally conscious thing won't be the most market-friendly. We can't let it be market-driven, or we'll run out of resources long before we've figured out how to create our electricity without them.
It's no longer about theoretical free markets. It's now mostly about ensuring that we won't have rolling brown and black outs in twenty, fifty, eighty years because we're a consumption society.
The government needs to do something; encourage businesses to do the environmentally responsible thing. Encourage people to use mass transit, to live where they work, to walk and bike more.
Otherwise our descendants will be sitting in the dark, breathing smoggy air, drinking unsafe water, cursing our wastefulness. |
tipqueen
Intermediate Member
Username: tipqueen
Post Number: 297
Registered: 03-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Tuesday, August 15, 2006 - 02:12 pm: |
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hmmm....wonder what they do in Bahgdad?!?! |
hacinta
Senior Member
Username: hacinta
Post Number: 1283
Registered: 01-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Tuesday, August 15, 2006 - 05:49 pm: |
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Suffer
Formerly Jammie
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eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 152
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, August 16, 2006 - 06:58 am: |
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Doing the environmentally conscious thing won't be the most market-friendly.
Bitching about housing prices and tinkering with minimum wages isn't "environmentally conscious" either.
We can't let it be market-driven, or we'll run out of resources long before we've figured out how to create our electricity without them.
Your economics knowledge is either simply wrong or, more charitably, out of date. I suggest you look up things like tradable emissions permits. There are all sorts of ways free markets can be used to clean up the environment better than the old, blunt government tools.
The government needs to do something; encourage businesses to do the environmentally responsible thing.
Bitching about housing prices and raising minimum wages isn't it.
Otherwise our descendants will be sitting in the dark, breathing smoggy air, drinking unsafe water, cursing our wastefulness.
I'm not saying the environment isn't important. I'm saying that the process by which you attempt to solve the problem matters a whole hell of a lot. And government mandates alone almost always royally suck. |
tricky
Member
Username: tricky
Post Number: 186
Registered: 05-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, August 16, 2006 - 11:53 am: |
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Your economics knowledge is either simply wrong or, more charitably, out of date. I suggest you look up things like tradable emissions permits. There are all sorts of ways free markets can be used to clean up the environment better than the old, blunt government tools.
It's my opinion that those tradable emissions permits don't really work because the system is too easily corruptible. |
rev_rund
Member
Username: rev_rund
Post Number: 224
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, August 16, 2006 - 12:24 pm: |
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tricky, I couldn't agree more. I live in Ohio, and smoke and mirror attempts like tailpipe emmission standards and emission permits have crippled the northern part of the state. The environmental damage done over the last 100 years left massive cleanup (you might be too young to remember that our Cuyahoga river caught on fire - twice!).
Rather than using "blunt government tools to force the issue. We have used county emission credits. What ended up happening is that the rural southern counties with no polution sold their credits to the heavy industry northern counties. The air quality as a whole isn't any cleaner because the northern counties bought enough credits to operate at normal levels, and the southern counties had no levels anyway. The added bonus was the cost of business in the north went up (someone has to pay for those credits) so most work left town. Now we have a shrinking economy, our air and water are still poluted, and less money to deal with the problem due to the shrunken tax base. And all this because we didn't want to make one large painful push and force uniform cleanup. |
teleburst
Senior Member
Username: teleburst
Post Number: 1123
Registered: 06-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, August 16, 2006 - 03:22 pm: |
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"There are all sorts of ways free markets can be used to clean up the environment better than the old, blunt government tools".
If they choose to. In most cases, big business has to be bludgeoned to do the right thing. It's sort of like a person who knows that tipping is a de facto system of paying most restaurant employees. Apparently, they don't have to "do the right thing" because there's no compulsion. It's the same with big business. Altruism loses almost every time, unless there's some random congruence between doing the right thing and the bottom line. |
teleburst
Senior Member
Username: teleburst
Post Number: 1124
Registered: 06-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, August 16, 2006 - 03:23 pm: |
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"I had friends who worked in resort areas for about 8 or 9 months and then lived on their unemployment checks for the balance of the time. That's precisely what they wanted. And their group of acquaintences had tons of people like them".
To the chagrin of "taxpayers" like you.
I hope you told them where to go... |
bistroy
Member
Username: bistroy
Post Number: 110
Registered: 01-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, August 16, 2006 - 07:36 pm: |
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"The government needs to do something; encourage businesses to do the environmentally responsible thing.
Bitching about housing prices and raising minimum wages isn't it."
Well then, by us saying that tipping is the responsible thing, shouldn't you quit bitching about the reason for tipping? You know it's the right thing, but won't admit it, without some "concrete" evidence.
Go away, master of all choad-masters. |
eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 160
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, August 19, 2006 - 06:47 am: |
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Tricky says: "It's my opinion that those tradable emissions permits don't really work because the system is too easily corruptible."
What do you mean? |
eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 161
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, August 19, 2006 - 07:02 am: |
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What ended up happening is that the rural southern counties with no polution sold their credits to the heavy industry northern counties. The air quality as a whole isn't any cleaner because the northern counties bought enough credits to operate at normal levels, and the southern counties had no levels anyway.
Either you don't understand tradable permits, or that's the most fvcked up system run by the most retarded state ever.
There's no point in doing tradable permits if the pollution cap isn't at least as low as the prior pollution levels. (But it's not clear from your post whether pollution actually got worse. It could be that nothing really happened.)
The way tradable permits work is that a pollution cap is set. Let's say that in 2005 the Ohio government allowed 100 tons of Bad Stuff into the air. In 2005, the 10 polluting factories were required to pollute no more than 10 tons of Bad Stuff each, and they'd be fined for polluting more than that. In 2006, they decide to switch to tradable permits. For the first year, the cap is still 100 tons of Bad Stuff. And each factory gets a permit worth 10 tons of Bad Stuff. However, some of the factories found ways to pollute less. Some of the factories are still struggling. The ones who found a way to pollute less then sell their permits to the ones who are still struggling. As long as the cost of the permit is less than the cost of the fines (or whatever consequences there are), then society is better off. We just maintained pollution levels at the 2005 level and spend less money to do it. We also gave the companies an incentive to innovate with respect to pollution because now they can sell their permits.
And it turns out that you can tighten the caps faster than you otherwise would be able to because the companies innovate on pollution control faster than they otherwise would have.
Now we have a shrinking economy, our air and water are still poluted, and less money to deal with the problem
That doesn't make any sense. They wouldn't have bought the permits if polluting and getting fined was cheaper. And they would have gotten fined before the permits were put in place, so the permits couldn't have been the cause.
In most cases, big business has to be bludgeoned to do the right thing.
They don't need to be bludgeoned if they're given the right incentives.
To the chagrin of "taxpayers" like you. I hope you told them where to go...
I made fun of them a lot. |
teleburst
Senior Member
Username: teleburst
Post Number: 1126
Registered: 06-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, August 19, 2006 - 07:31 am: |
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"In most cases, big business has to be bludgeoned to do the right thing.
They don't need to be bludgeoned if they're given the right incentives".
<sarcasm> Yeah, right. The $7.2 BILLION in tax encentives and governmental perks didn't help the poor employees of Enron, did it? And that's just one recent example. History hasn't shown big business to be anything other than totally self-serving. The examples of "enlightened" companies is but a handful out of the masses. One can only look at the horrible state of pensions as a simple example. And don't get me started on health care, hostile takeovers and the like. |
tricky
Member
Username: tricky
Post Number: 187
Registered: 05-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, August 19, 2006 - 10:40 am: |
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The government has to set an acceptable level of pollution. They have to "guess" at how much pollution is safe. They're guessing based on what we know, but we don't know everything. Resesarch is still underway and probably always will be.
They sell X permits. Those X permits guarantee the companies that bought them that they may create Y pollution.
Then, new research suggests that really, it's not safe to allow that much pollution. Our standards were actually inflated, and should have been 75% of where they were set. But, we've already guaranteed the companies the right to pollute, up to and including Y, so they do. We know we're allowing business to harm our people but we can't legally do much about it.
Additionally, if we find out that really a specific pollutant isn't as dangerous as previously thought and decide to loosen controls, those who bought more permits than they really needed, intending to sell them to someone else at a profit, have an incentive to prove that that pollutant is harmful. Otherwise they stand to lose money they've already spent. If that's not corruption, I'm not sure what is.
The best way to get a company to do as much as possible to protect the environment is to hit them in the pocketbook. Taxing them based on the amount of pollution they create, and fining them when they exceed standards. (The arbitray standards might be the same as above, but they are far more easily changed since the business pressure only hits when they need to be raised. At least lowering standards isn't also a business issue.) Each company is then, at all times, incentivized to be as environmentally conscious as possible. Businesses exist solely to make money. We need to create a situation where they make the most money when they are the most environmentally aware.
Take Wal-Mart for example. While they are cleaning up their act in this arena, they have a horrible environmental track record. Wal-Mart (in the 90s) had a bad habit of drafting environmentally harmful construction plans. Once the plans were rejected by the EPA, they'd submit new plans that met EPA standards. They'd get approved to build their building, and then build according to the earlier, harmful plans. The EPA would fine them and Wal-Mart would pay the fine. The EPA fines were lower than the increase in cost to build an environmentally-conscious building, parking lot, etc...
If the EPA actually had any enforcement power and could have fined large retailers appropriately, Wal-Mart would have had no incentive to cheat.
It is only after that information came to light that Wal-Mart has begun to clean up their ways. They were charged, tried, convicted and strung up by the court of public opinion. Sure, free market controls "worked", but the environment isn't a renewable resource; we don't have the luxury of allowing other companies to behave in the same way... |
rev_rund
Member
Username: rev_rund
Post Number: 228
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, August 19, 2006 - 02:40 pm: |
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~..., or that's the most fvcked up system run by the most retarded state ever. ~
Yes it is the most retarded state ever. Ohio is a borderline third world country run by an inbred fourth generation political hack (he's either the great nephew or great grandson President Taft) Stay away from here at all costs. |
eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 167
Registered: 06-2006
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Votes: 0 (Vote!) | | Posted on Saturday, August 19, 2006 - 07:58 pm: |
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Then, new research suggests that really, it's not safe to allow that much pollution. Our standards were actually inflated, and should have been 75% of where they were set. But, we've already guaranteed the companies the right to pollute, up to and including Y, so they do.
That's one of the reasons the allocations are adjustable yearly. It's also the reason some permits expire after a certain amount of time.
The best way to get a company to do as much as possible to protect the environment is to hit them in the pocketbook.
The best way to get a company to do something is to play off their motivations. Fining only allows you to use half of the toolbox (namely, disincentives). It provides no incentives to get better. Tradable permits offer incentives, too. And the incentives offered by permits are better than effluence taxes because, in part, permits can vary their price in real time along with the ease or difficulty of abating the pollution. Taxes only adjust every year (at most). They're slow to respond to changing conditions.
Taxing them based on the amount of pollution they create, and fining them when they exceed standards.
Effluence taxes are better than simple caps, but they aren't as good as tradable permits. Effluence taxes. If one company has a really hard time reducing their pollution levels, effluence taxes keep nailing them with fines. Eventually the company will go out of business, people will lose jobs, etc. If another company is really good at reducing its pollution, it can only reduce its tax level. But tradable permits allow the same reductions in pollution while allowing the good companies to make money by taking up the slack from the bad companies.
I don't know what your Wal-Mart example has to do with tradable permits. Your Wal-Mart example is an instance of a privately efficient violation of the law. Wal-Mart did what was economically rational for them. And the enforcement problem applies to all pollution control systems (whether tradable permits, effluence taxes, caps, or whatever). People can cheat more easily under any system if the enforcement is weak.
Your Wal-Mart example isn't very applicable to the situation of tradable permits because there's no trading going on. |
tricky
Member
Username: tricky
Post Number: 188
Registered: 05-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Sunday, August 20, 2006 - 11:18 am: |
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That's one of the reasons the allocations are adjustable yearly. It's also the reason some permits expire after a certain amount of time.
Great, but until the expiration, they're allowed to potentially cause cancer. Not good in my book. Obviously we have different opinions on the situation.
The Wal-Mart example is supremely applicable, because it shows that the only thing a company cares about is its bottm-line. How much money something can make them. If a company can ultimately make more money by exceeding the pollution they're allowed to create and paying the fine, they're going to do it anyway.
All tradable permits do is encourage people who pollute little to buy more permits than they need and sell them for a profit. Those people have a vested interest, and will at all costs sell to someone else at the highest price - a price which is market-driven. No pollution is really decreased, the "polluting" company just pays a little more for the permit they didn't get for the government. They're still not hurt in the pocketbooks. |
tricky
Member
Username: tricky
Post Number: 189
Registered: 05-2005
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Votes: 0 (Vote!) | | Posted on Sunday, August 20, 2006 - 11:18 am: |
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from the government not for the government |
eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 175
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Sunday, August 20, 2006 - 08:25 pm: |
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but until the expiration, they're allowed to potentially cause cancer. Not good in my book.
That happens under every system. And we can't stop a modern economy every time something "maybe, perhaps, might, just possibly could do something bad." You seem to think that businesses have no beneficial effects. Let's see the employees afford health care after their employer goes under and they lose their jobs.
The Wal-Mart example is supremely applicable, because it shows that the only thing a company cares about is its bottm-line.
Fortunately, tradable permits work with a company's concern for its bottom line.
All tradable permits do is encourage people who pollute little to buy more permits than they need and sell them for a profit.
Why would a company who pollutes LITTLE buy permits when it could SELL them? They already have extra permits. There's no comparative incentive for them to speculate in the permits market compared to any other company.
Those people have a vested interest, and will at all costs sell to someone else at the highest price - a price which is market-driven.
That's the point. That also mean the other party has to PAY in order to pollute. You're not really saying anything more than "if there's a seller, there has to be a buyer to have a sale." Would you rather the other party pay less to pollute?
No pollution is really decreased, the "polluting" company just pays a little more for the permit they didn't get for the government. They're still not hurt in the pocketbooks.
That makes no sense. The pollution level is capped. Do you understand that?
Let's do it this way. I want you to give me
***ANY*** pollution level and ***ANY*** industry in which the pollution is spewed into the environment generally (as opposed to some very narrow geographic segment; we have to have more than one player to trade). Then I want you to show that caps achieve the SAME POLLUTION LEVEL for as much or LESS money than tradable permits.
You can't do it. You won't do it. All you're doing is proposing that we spend MORE MONEY to get the EXACT SAME POLLUTION OUTCOME.
Tradable permits are almost universally accepted by economists as a more efficient way to reduce pollution than so-called "command and control" measures like simple hard caps.
As one Nobel laureate in economics puts it: "Here's the thing. If you say all the firms in the Los Angeles basin have to cut their [current] sulfur dioxide emissions by 10%, the problem is that some firms can do it easily; in fact they can do much more than 10%. Other firms--to cut by 10%--it'll bankrupt them. There is a huge differential cost impact. You have everything from dry-cleaning plants to power plants and refineries. Instead imagine that we take each of those companies and give them tonnage permits to pollute based equal to whatever they were putting out in a baseline year. Now tell them, next year we have to reduce overall pollution by 10%. Some of you will continue to pollute, and you can buy permits in the market to be allowed to do that. Some firms at those prices are going to sell their permits and start cleaning up. They can make money by selling their permits to the market and use the money to clean. Now firms, of course, will probably want to schedule the cleanup. What that does is achieve the clean-air standard but at the minimum cost to firms. The following year, you can reduce the overall level of permits by 10%. What this does is it creates incentives to find better ways to clean up, by making their pollution costs real out-of-pocket costs. http://www.forbes.com/2002/11/06/cx_da_1106nobel2.html |
tricky
Member
Username: tricky
Post Number: 190
Registered: 05-2005
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Votes: 0 (Vote!) | | Posted on Sunday, August 20, 2006 - 09:09 pm: |
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Yes, I understand the pollution level is capped. I get that. It's still the same level of pollution. And since there are tradable permits, meaning people buy them and then sell them when they don't need them, there is incentive for the cleaner companies to pressure the government not to lower standards. If they lower standards, "clean" company might not be able to sell any of their allotted permits, because they'll no longer be clean enough. I fail to believe that there is enough incentive in a system that says "This is how much pollution we can have. Everybody gets a percent. If you need more, your SOL unless somebody else will sell it to you." It might be great economics. But the overall decrease in pollutants in the air will be smaller than the decrease in a capped, taxed and fined system.
It's the way the world works. The more hands in the pot, the greater the possibility for trickery and thievery. |
teleburst
Senior Member
Username: teleburst
Post Number: 1134
Registered: 06-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, August 21, 2006 - 07:57 am: |
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"And we can't stop a modern economy every time something "maybe, perhaps, might, just possibly could do something bad." You seem to think that businesses have no beneficial effects. Let's see the employees afford health care after their employer goes under and they lose their jobs".
Let's just make a couple of changes:
" And we can't stop a modern payment scheme every time something "maybe, perhaps, might, just possibly could do something bad." You seem to think that tipping have no beneficial effects. Let's see the employees afford health care after their employer goes under and they lose their jobs when people stop tipping". |
eeyore_conspiracy
Member
Username: eeyore_conspiracy
Post Number: 180
Registered: 06-2006
Rating: N/A
Votes: 0 (Vote!) | | Posted on Tuesday, August 22, 2006 - 02:15 am: |
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there is incentive for the cleaner companies to pressure the government not to lower standards.
So what? They can pressure all they want.
the overall decrease in pollutants in the air will be smaller than the decrease in a capped, taxed and fined system.
Prove it. Why should I believe you over a Nobel laureate in economics?
You seem to think that tipping have no beneficial effects.
Wrong. There are all sorts of beneficial effects for the people who receive them. My position is that tipping is a net social loss despite the gains for some. Tradable emissions permits, on the other hand, are a net social gain. |
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