We Need 2X Income-to-House Prices
A real metric for tracking national success
Corporatist politicians around the world are crowing that inflation is back down to their target 2%.
One:
They’re lying.
We all know the price of everything is going up more than 2% a year.
Governments have never calculated inflation honestly because it’s against their short-term best interests to do so — many countries including the US, UK, and Canada don’t even include the price of houses in the calculation.
Two:
2% inflation is still 2% theft.
2% inflation is still 2% currency debasement.
2% inflation is still 2% purchasing power devaluation.
If you get paid $50,000 per year, 2% inflation is like taking a $1,000 pay cut every single year.
If you’ve saved up a $50k down payment for a house, that’s like someone stealing $1,000 every single year.
And remember, that 2% is compounding.
2% inflation will wipe out 74% of your money’s purchasing power in your lifetime.
But, after causing us more than +30% permanently higher prices over the past four years, corporatist governments are content to go back to pushing prices up by “just” fake-2% per year, even though they should be driving prices back down 32% this year.
(There are ways to do this without causing a depression — in fact, there’s a way to chop the price of everything in half while actually growing the real economy.)
But never mind inflation.
Let’s talk about housing inflation.
Nations around the world need a new target number.
Not 2% annual currency debasement.
Not 2% yearly wage theft.
Nations should be targeting a maximum median house price of 2X the median worker’s after-tax/take-home pay.
Here in the UK, the current median worker’s after-tax take-home pay is a punishing £27,600.
The median house price is a brutal £267,100.
That’s 9.67X.
Meaning human shelter is 5X more expensive than it could or should be.
It’s completely unjust, unreasonable, unsustainable, and unnecessary.
It’s bank slavery, pure and simple.
We need to do two things:
Drive incomes up.
Drive house prices down.
There are plenty of ways to drive net incomes up:
Equalize taxation on multinationals so locals can compete
Stop importing millions of cheap laborers
Stop exporting jobs overseas
Break up monopolies and encourage competition
Support unions and collective bargaining
Support cooperatives
Raise the minimum wage
Create a living wage job guarantee
Make banking a not-for-profit utility so bankers get paid less and everyone else gets paid more
Add a universal basic living income
Stop taxing income and spending and tax parasitism instead
Link wages to productivity gains to ensure that workers benefit from increased efficiency. This alone would’ve 2.5Xed pay in the past 50 years:
We should try all of these at the same time.
So, we get incomes soaring…
…which will just send housing costs through the roof unless we do the two in tandem.
There are plenty of terrible ways to drive house prices down:
Raise interest rates
Crash the real estate market
Let crime rates soar
Neglect infrastructure
Let neighborhoods fall into disrepair
But there are also plenty of good ways to drive house prices down:
Get rid of income taxes and introduce Georgist land value taxes instead
Tax unearned capital gains from real estate at/near 100%
Make landlords maintain rentals to a high health standard
Tax unearned rental profits at/near 100%
Charge hoarding fees on second/third/fourth/fifth/etc homes
Make banks not-for-profit utilities that lend interest-free to first-time owner-occupiers while refusing to lend a dime to second-homers, land-lorders, corporate sharks, etc
Cut the red tape and automatically approve the building of gorgeous, long-lasting, gentle-density six-story Paris-style flats in cities
Create sovereign money, buy forests, open quarries, start AI giga-factories, blitz-build millions of hyper-affordable homes in new towns, and sell them at cost to people for zero down on installments
We should try all of these at the same time.
If we did the two in tandem, we’d see median net incomes more than double and median house prices more than halve.
Suddenly nations like the UK are hovering near their new target.
2X.
Any President or Prime Minister who fails to keep median house prices at 2X median net income is automatically sentenced to ten years banishment in, say, Antarctica or Blackpool.
The benefits would be exquisite:
Housing hardship would virtually disappear, as would the financial stress associated with trying to stay sheltered.
Fewer people would get divorced because of money issues, leading to fewer broken families, which leads to less crime, and less public cost.
Even working single parents could easily afford to stay sheltered.
It would drive down the cost of sheltering non-working people, too, which would lower taxes for everyone.
It would skyrocket the incentives to work — because people would actually be retaining their hard-earned wealth instead of handing it over to banksters and land-lorders as interest and rents — which would drastically decrease the unsustainable welfare crisis, which would lower taxes for everyone and further push up wages.
No one would have to spend 10 years saving for a down payment and 25-40 years paying back banksters. After 3-5 years, most people would be debt-free homeowners instead of bank slaves, leading to more consumer spending, more jobs, higher wages, and more well-being.
What say you?
Let’s wipe out 2% inflation.
Let’s go for 2X income-to-house-prices instead.
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