{"id":5925,"date":"2022-01-26T00:07:16","date_gmt":"2022-01-25T22:07:16","guid":{"rendered":"https:\/\/metacpc.org\/?p=5925"},"modified":"2022-09-27T16:13:46","modified_gmt":"2022-09-27T13:13:46","slug":"hahnel-interview","status":"publish","type":"post","link":"https:\/\/metacpc.org\/en\/hahnel-interview\/","title":{"rendered":"Robin Hahnel Interview on Participatory Economics \u2013 Part 1A \u2013 Housing"},"content":{"rendered":"\n<p><strong>[After The Oligarchy] Hello everybody, this is After The Oligarchy. Today I\u2019m speaking with Professor Robin Hahnel. Robin Hahnel is a professor of economics in the United States, co-founder with Michael Albert of the post-capitalist model known as Participatory Economics, and author of many books.<\/strong><\/p>\n\n\n\n<p><strong>Today\u2019s conversation is in association with&nbsp;<a href=\"http:\/\/metacpc.org\/en\/\" target=\"_blank\" rel=\"noreferrer noopener\">m\u03adta, the Centre for Postcapitalist Civilisation<\/a>. This is the first in a series of interviews with Professor Hahnel about Participatory Economics, and in particular his latest book&nbsp;<a href=\"https:\/\/www.routledge.com\/Democratic-Economic-Planning\/Hahnel\/p\/book\/9781032003320\" target=\"_blank\" rel=\"noreferrer noopener\"><em>Democratic Economic Planning<\/em>&nbsp;<\/a>published in 2021. It\u2019s an advanced discussion of the model proposed in that book, so I recommend you familiarize yourself with Participatory Economics to understand what we\u2019re talking about.<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe loading=\"lazy\" title=\"Participatory Economics (PT 1A) - Housing &amp; Land w\/ Prof. Robin Hahnel\" width=\"580\" height=\"326\" src=\"https:\/\/www.youtube.com\/embed\/5GYC8nRAveg?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n\n\n\n<p><strong>The discussion will also continue on the forum of&nbsp;<a href=\"https:\/\/participatoryeconomy.org\/\" target=\"_blank\" rel=\"noreferrer noopener\">participatoryeconomy.org<\/a>.<\/strong><\/p>\n\n\n\n<p><strong>Robin Hahnel, thank you for joining me.<\/strong><\/p>\n\n\n\n<p>[Robin Hahnel] It\u2019s great to be with you today.<\/p>\n\n\n\n<p><strong>[AO] I finished reading&nbsp;<em>Democratic Economic Planning<\/em>&nbsp;recently \u2013 here it is for viewers \u2013 and it\u2019s an outstanding contribution I think. It\u2019s very technical, which for me is a good thing. I really feel that I needed that book, I felt like I was waiting for that book to be published and it came along at exactly the right time. So I\u2019d say if any viewers are similarly inclined, buy the book&nbsp;<em>Democratic Economic Planning<\/em>,read it. If viewers want a more straightforward and accessible introduction to Participatory Economics, then&nbsp;<em><a href=\"https:\/\/www.goodreads.com\/book\/show\/16052822-of-the-people-by-the-people\" target=\"_blank\" rel=\"noreferrer noopener\">Of the People, By the People<\/a><\/em>&nbsp;is very good; short, clear, and accessible.<\/strong><\/p>\n\n\n\n<p><strong>So without further ado, there are something like 60 questions to discuss in total but we won\u2019t go through all of those today, of course. Today, I just want to begin with some questions about consumption in a participatory economy.<\/strong><\/p>\n\n\n\n<p>[RH] Before you ask me a question, let me congratulate you for actually reading that book. I don\u2019t know how many people have actually managed to do it yet. You are in very select company I can promise you. And it\u2019s because, I mean, it\u2019s long and there are sections that are that are very technical. And I wish there were more people who had managed to take the time and energy to wade through it. I may have to reassess my opinion of economists versus engineers. I understand that you have an engineering background?<\/p>\n\n\n\n<p><strong>[AO] Yes.<\/strong><\/p>\n\n\n\n<p>[RH] What I thought was, well, economists can read this book but I\u2019m worried about my fellow political activists, where it\u2019s kind of difficult. And actually AK Press is going to come out with a book sometime in about three or four months called&nbsp;<em>A Participatory Economy,&nbsp;<\/em>and that book is intended for the for the activist audience, you don\u2019t have to be an economist. But I\u2019m going to revise my strategy to think that, well I can address economists and expect them to actually read things carefully. Maybe I should shift over to the engineers and make you my target audience from now on, because at least you\u2019ve demonstrated a willingness to put in the work.<\/p>\n\n\n\n<p><strong>[AO] Yes well I will add one thing, which is that I\u2019ve got a very intense interest in political economy and I\u2019m kind of pursuing an autodidactic course in economics to prepare myself to become an economist. So I\u2019m in a bit of an odd position. However, I will say that in our post-capitalism discussion group in&nbsp;<a href=\"https:\/\/diem25.org\/en\/\" target=\"_blank\" rel=\"noreferrer noopener\">DiEM25<\/a>&nbsp;\u2013 so I\u2019m a member of the Democracy in Europe Movement 2025 \u2013 there are quite a few engineers, it\u2019s something that tends to crop up. What I will say about engineering and politics is that something I think about is \u2013 it has shaped my view a lot \u2013 I think one benefit is that you have a technical and numerical, mathematical, training but you\u2019re not necessarily indoctrinated into the same presuppositions about economics. So there\u2019s a potential there to engage with political economy that maybe those who were trained in orthodox economics don\u2019t experience.<\/strong><\/p>\n\n\n\n<p>[RH] I can tell that engineers are more inclined to matter-of-fact thinking and therefore less interested in ideology. And I think that\u2019s a huge barrier in thinking about alternatives to capitalism, you know, if you\u2019re so wrapped up in the ideology. Because I think a lot of what we have to do in the aftermath of the failures of attempts to build socialist economies in the past is, I mean we have to engage in really some very concrete thinking about procedures and, you know, what the implications of deciding things this way or that way are. Less political grandstanding and more matter-of-fact thinking would stand us all in good stead. I think the answer is we need to recruit some more engineers.<\/p>\n\n\n\n<p><strong>[AO] Well engineers are not I completely agree with you. That\u2019s the whole premise of this channel, the more concrete the better. And I\u2019m completely on your side in terms of the necessity of vision, in that, it\u2019s kind of common sense: whenever we want to do anything in life we really need to think about what exactly we\u2019re trying to do. And there\u2019s no reason that that would be less true in politics or economics than in any other field of life. But a lot of us on the left have managed to convince ourselves that there\u2019s something wrong with this.<\/strong><\/p>\n\n\n\n<p><strong>The first question is about housing. There are a few questions about this, and I will throw a few of them at you and we\u2019ll move through them and maybe come back. How is housing organized in a participatory economy? Because obviously housing is a very important sector, it has distinct characteristics in terms of houses being assets, they\u2019re durable, they\u2019re large purchases, and so forth. If there\u2019s no private ownership of housing and all housing is socially owned, then what are the rights of use? How does society decide who gets to live where, and for how long? And then, is housing rented? If so, how\u2019s the rent calculated? And so on, but we\u2019ll come to that.<\/strong><\/p>\n\n\n\n<p>[RH] Actually before starting, let me say that when I looked at your questions the first five are the ones that I am least suitable to answering as fully as we\u2019re going to try and do now.<\/p>\n\n\n\n<p><strong>[AO] Yeah that\u2019s all right.<\/strong><\/p>\n\n\n\n<p>[RH] Actually as you just mentioned, housing poses some particular problems. But I think what I\u2019ll explain is not really from the production side, that\u2019s not where it\u2019s peculiar, it\u2019s different. It\u2019s from the using and consumption side, because it is such a major \u2026 I mean a house in terms of an asset or purchase, if you purchased it, dwarfs everything else you buy. And the other problem is that on a regular income you can\u2019t actually pay for the entire thing, and that\u2019s why we have mortgages. So here\u2019s something that we somehow have to figure out: a way for people with sensible incomes to manage to pay sensible amounts as they go.<\/p>\n\n\n\n<p>Now renting is kind of easy, and so my answer could be well \u2018what if we just don\u2019t\u2019? What if all housing units are rentals? Then they would be produced by \u2026 if you take a look on the production side, compared to a lot of really, really, large firms, contractors who build housing, these aren\u2019t multinational firms. They\u2019re large, many of them are large companies, many of them actually aren\u2019t. So the idea that you can have worker councils, with carpenters, and electricians, and all of the kinds of people that actually work to build housing, including the engineers that design them \u2013 well that could be a workers council and that\u2019s the product that they are selling.<\/p>\n\n\n\n<p>That\u2019s sort of straightforward and easy, but it\u2019s the financing and purchasing of it. and when you\u2019re living in it how do you pay for and what are your rights, etc, that that do pose some special difficulties. And I\u2019m just going to say that this is a subject that one of my collaborators \u2026 I accuse him of obsessing over it. This is Anders.<\/p>\n\n\n\n<p><strong>[AO] Ah yes.<\/strong><\/p>\n\n\n\n<p>[RH] Anders who is a member of the collective in \u2026 he\u2019s Swedish and he lives in Stockholm.<\/p>\n\n\n\n<p><strong>[AO] That\u2019s Anders Sandstr\u00f6m, is it?<\/strong><\/p>\n\n\n\n<p>[RH] Yes, it\u2019s Anders Sandstr\u00f6m. And he\u2019s published a book called&nbsp;<em><a href=\"https:\/\/www.routledge.com\/Anarchist-Accounting-Accounting-Principles-for-a-Democratic-Economy\/Sandstrom\/p\/book\/9780367477035\" target=\"_blank\" rel=\"noreferrer noopener\">Anarchist Accounting<\/a><\/em>, which I think has the most brilliant title of any book I\u2019ve ever heard. Because who would be the least likely people to have anything to do with each other? It would be anarchists and accountants. And here it is. So I\u2019ve declared him to be the most famous anarchist accountant in the history of the world.<\/p>\n\n\n\n<p>And he also obsesses on matters do come into play particularly heavily in trying to deal with a situation like this. I mean it\u2019s amortization and how do you cost all that out. So I\u2019m just going to say that I\u2019m going to give you my answer, but he took up that challenge in his book&nbsp;<em>Anarchist Accounting<\/em>&nbsp;in more detail and more seriously than I have in anything I\u2019ve published.<\/p>\n\n\n\n<p>Here would be the short side of it. I think if we just had housing always rented, there\u2019d be a fairly straightforward explanation. And the rent would be, people will be charged the social cost of providing the housing. Whether or not they are paying that to the construction workers council that built it, or whether there\u2019s actually an intermediate workers council which is \u2026 I mean usually the builders aren\u2019t the ones that are then managing the property, or the sale of the property, or if it\u2019s rental taking care of the rental. Then there\u2019s another workers council that basically is managing that.<\/p>\n\n\n\n<p>But I think that that people sometimes have a legitimate interest in not just being a renter, where, you know, they might be thrown out at any point. And there I think the idea that comes to mind is well there\u2019s a difference between a lease and being a renter. It\u2019s sort of a halfway ground between \u2018I\u2019m the owner of the property\u2019 and \u2018I\u2019m merely a renter\u2019, and maybe I sign a one-year contract but basically I\u2019m paying rent month-to-month and the rate can be varied as we\u2019re going along. So as far as I\u2019m concerned, I don\u2019t see any reason that we couldn\u2019t be leasing for people who wanted the lease, and that gives you a long-term contract.<\/p>\n\n\n\n<p>And now you\u2019re thinking \u2018okay, we have people who still probably are working on family farms\u2019. And so here\u2019s a family farm and the parents die, and should there be some sort of arrangement? Or just if you grew up in a house, and your parents have been there all that time, you\u2019d grown up, and now you want to stay there. I don\u2019t know why we couldn\u2019t write in something like a first right of \u2026<\/p>\n\n\n\n<p><strong>[AO] Exactly.<\/strong><\/p>\n\n\n\n<p>So if the person who has the long-term lease \u2013 the parents \u2013 die, then instead of just putting it up for anybody who wants to now bid on living there, that the children or the descendants who wanted to continue to live there, why wouldn\u2019t we just give them a first right to say, well, at the going rate, at the regular lease, they can take over the lease, essentially? And we wouldn\u2019t basically put them in a situation where somebody else could get the lease out from under them.<\/p>\n\n\n\n<p>My own instinct is all those things are not that difficult to arrange, and don\u2019t look that different from a lot of things that are, sort of, out there. I mean my impression is in Europe there\u2019s a lot more sensible handling of housing, particularly in Germany. But in the United States, we have outfits that are proposing, sort of, communally-owned properties in urban areas. And what they\u2019re trying to deal with is that they don\u2019t want to put people in the situation where there\u2019s an asset that\u2019s the most important asset in your life, and you have to worry about what\u2019s happening to the value of that asset.<\/p>\n\n\n\n<p>So our goal here is to take that out of the equation. We don\u2019t want to make this somehow wealth that you have to carefully manage, the way you have to carefully manage the wealth in your house if you happen to own a house in a capitalist economy. We want to take that out of the equation. And it is a little complicated to do. I don\u2019t think it\u2019s rocket science, I think there are sort of a number of ways that it can be handled. But it is a particularly unique and difficult sort of economic problem that needs to be solved sensibly.<\/p>\n\n\n\n<p><strong>[AO] It is indeed. I haven\u2019t read it yet, I\u2019m going to read&nbsp;<em>Anarchist Accounting<\/em>&nbsp;and interview Anders Sandstr\u00f6m if I can. It looks like a really interesting book. That issue of the first right of rent or leasing was actually a further question, and I think that makes a lot of sense.<\/strong><\/p>\n\n\n\n<p><strong>I suppose just to ask a couple things more about this. If we break this into a few different components, what we want is to pay worker councils responsible for producing a new building the necessary social costs of doing that. Okay, that much is clear. I suppose the question then is \u2013 I\u2019m just trying to make this concrete \u2013 it would be perhaps a lease or a rent to the local government? Something like that?<\/strong><\/p>\n\n\n\n<p>[RH] You know, it could be the local government but it could also be another workers council. That\u2019s where I was saying I don\u2019t see why we couldn\u2019t have two \u2026 we basically have the people living in the housing, and there could be two workers councils involved in how it\u2019s provided or supplied. One is a construction outfit that just builds. And then, sometimes builders sell their houses \u2013 but we\u2019re not really selling \u2013 but often builders don\u2019t sell their houses to the people who live in in them. The builder sells it to another company that then markets those, and\/or manages those if they decide to make a rental property. So I think we can do that and that would allow some workers councils to just simply be \u2018well, we have our social costs of building, and now what are the social benefits that we are weighing off against that?\u2019. Well, basically, they are they are providing that to this other workers council.<\/p>\n\n\n\n<p>It\u2019s basically like, there are a lot of worker councils who are providing their goods to other worker councils. We usually think of them as intermediate goods. So a steel company doesn\u2019t sell steel to households, it sells it sells steel to automobile companies. So we could essentially set it up that way, where it\u2019s the construction outfit \u2026 And so there wouldn\u2019t be a problem with figuring out what are their social benefits that we compare to their social costs. It\u2019s basically an intermediate sale to another workers council and that other workers council, then they have these costs of acquisition. And then they also have the benefits, that their benefits are essentially the rents or the mortgage payments that they are collecting over time.<\/p>\n\n\n\n<p><strong>[AO] I want to think about it as almost the land aspect \u2026 I mean I think we can think of housing in terms of \u2026 like today, if you buy a house or if you rent you\u2019re paying for the land and you\u2019re paying for the building at the same time.<\/strong><\/p>\n\n\n\n<p>[RH] Right.<\/p>\n\n\n\n<p><strong>[AO]<\/strong>&nbsp;<strong>And so, if I understand you correctly, it\u2019s almost like you\u2019re talking about \u2026 well, actually not exactly. But this would be a workers council for, say, a particular region, and they would be responsible for \u2013 after the construction worker council had been allocated its resources through the annual planning process, so that\u2019s been accounted for, that\u2019s relatively simple \u2013 that this workers council would then take responsibility for that housing unit and that land. A different one not the construction one. And that this worker council would, I suppose \u2026 how would they collect rents and things like that? I thought that\u2019s not really the role of worker councils. That would be more the role of a consumer council. Sorry, that was very unclear. But do you see what I\u2019m getting at?<\/strong><\/p>\n\n\n\n<p>[RH] In that regard I\u2019m imagining there actually is a worker council whose production activity is the activity of actually supplying and managing the housing.&nbsp;<\/p>\n\n\n\n<p><strong>[AO] Ah, yes.<\/strong><\/p>\n\n\n\n<p>[RH] Now, I mean, the land poses another reason that housing is an extra-complicated situation. Now let\u2019s talk about the land. So, on the one hand, as far as we\u2019re concerned, all land is communal property. On the other hand, if we use land for one purpose it can\u2019t be used for another purpose, and that means using land has an opportunity cost. and we want to include that as the cost to society of making something available.<\/p>\n\n\n\n<p>So part of what you want people paying for, when they are paying for the housing they\u2019re living in, is well first of all it took a lot of work to make this house. And it was all done in like a one- or two-year time period, but it\u2019s a big, big, item so there\u2019s a cost that was the cost of the work and the cost of the materials, etc. We\u2019re going to need to amortize that over a long period of time, one way or another in terms of the payment system.<\/p>\n\n\n\n<p>The second part of the problem is that, well, there\u2019s another cost to that house and that is that there\u2019s an opportunity cost of using that land. And unfortunately that cost is actually going to change over time, over the 30-year time period. So we have a house, let\u2019s say it lasts for 50 years. Well, we know how much it costs to build it, and we can amortize that over 50 years.<\/p>\n\n\n\n<p>But what about the cost of using the land? I mean, what an economist will tell you is as population grows and as situations change the opportunity cost of using that land is going to vary over time. Well, on the one hand we like the people living in housing to know what their mortgage is. I mean part of the reason you want to own something is you like to have a mortgage where you know what your payment is every month, whereas if you\u2019re a renter they can always raise or lower the rent.<\/p>\n\n\n\n<p>And this is sort of a complicated thing. This is one of the reasons that I\u2019m happy that Anders is stretching his mind around it. Because, on the one hand, we have the goal that we would like the people living in houses, we\u2019d like to offer them a situation saying you can count on the fact that with your just income this is what it will cost you to live in the house that you\u2019re in, or the apartment that you\u2019re in, you can you can own a condominium too; this is what it\u2019ll cost you, and we don\u2019t want you to have to worry about \u2018is it going to vary over time?\u2019, \u2018am I going to get charged more as time goes on?\u2019, etc.<\/p>\n\n\n\n<p>On the other hand, we do want to signal that there are changes in how much it costs society for you to be living in that same place you\u2019ve been living in. My guess is there\u2019s no magic wand we can wave over this and say there\u2019s a perfect solution. We have to find a happy, comfortable, way to resolve that part of the problem. But that\u2019s the only part of the problem that I think is actually sort of a serious problem. I mean, the rest of it we can have workers councils that build things, we can have workers councils that manage and collect the money on a monthly basis. As you said that could be a that could be a role for government. Certainly we\u2019re going to need government doing zoning, that part we know.<\/p>\n\n\n\n<p><strong>[AO] Just to recap, and maybe just a little bit more on land and we can move on to the next question. From my understanding, some things are clear: that there can be a workers council responsible for constructing the buildings. And there is no matter of buying or selling there, it\u2019s really that that worker council will need certain intermediate goods, capital, resources, and labour, to do that which will be allocated through the planning procedure.<\/strong><\/p>\n\n\n\n<p>[RH] Right. So that\u2019s the cost side. Their proposal says \u2018these are our costs, these are what we\u2019re asking for, and we\u2019re going to build so many units or so many houses in this time period that we are going to deliver\u2019.<\/p>\n\n\n\n<p><strong>[AO] Yes, so that\u2019s taken care of. And then there\u2019s another side, which is essentially the role in the capitalist economy of an estate agent and also a property manager. And then you\u2019re saying, about that, possibly collection as well; so being an intermediary between people who want to live in houses \u2026<\/strong><\/p>\n\n\n\n<p>[RH] And those who actually built them and then want to wash their hands of it from that point on<\/p>\n\n\n\n<p><strong>[AO] Yes and also possibly managing the property if it\u2019s apartments, you know, the water, the security, and whatever else. Okay, so that\u2019s fine.<\/strong><\/p>\n\n\n\n<p><strong>So then there\u2019s the issue of land and I just want to ask you this and then we can move on. I suppose there are many different ways to approach calculating that opportunity cost. Of course, it\u2019s not going to be perfect. The obvious way to approach it, being used to living in this society, is that there\u2019s a market, okay?<\/strong><\/p>\n\n\n\n<p>[RH] Right.<\/p>\n\n\n\n<p><strong>[AO] And so I\u2019m just going to throw that out there and see what your response is. So people could bid either for rents or for leases, and whoever proposes the highest bid wins and gets the rights to use that property. And that is one way of approaching calculating the opportunity cost.<\/strong><\/p>\n\n\n\n<p>[RH] So how would we do it in a participatory economy?<\/p>\n\n\n\n<p><strong>[AO] Yes.<\/strong><\/p>\n\n\n\n<p>[RH] Okay, you\u2019re absolutely right. So, first of all who are the people who are basically saying \u2018I want to use land\u2019? Well, that would be the construction company that wants to use land in an urban area to build housing. So when they put in their proposal, that\u2019s effectively where demand to use that land comes from. And it\u2019s similar in agriculture. Suppose you have either an individual farmer, a farmer family, or you have a group of people who are farming as a worker council. Well, they have to basically ask permission to use the land. They have to say \u2018we need to renew our application to have these fields that we\u2019re going to be planting these crops in\u2019. So that\u2019s where, in the planning procedure, that\u2019s where the demand to use land comes from.<\/p>\n\n\n\n<p>Now in a capitalist economy who are the sellers of the land? The people who own it. Ah, but it\u2019s owned by everybody. But that doesn\u2019t mean that there\u2019s not a fixed supply of urban land and there\u2019s a fixed supply of agricultural land. So the charge for that, in a sense they\u2019re paying society. They\u2019re not paying an owner. But we can do the calculation in the same way. We have a scarce supply of, in this case, the natural resource land. It\u2019s owned by everybody. People are asking for permission to use it during the year, and they\u2019re essentially bidding on permission to use it. And we\u2019ll end up with an indicative price, an estimate of the social cost of using that land, and we will have charged people for that. And we want to do that because we want to make sure that that whoever the user of the land is they can make the most socially valuable use of the land. That\u2019s why you want to charge them. But the payment doesn\u2019t have to go to anybody and that\u2019s the difference. I mean, in a socialist economy where the land is not privately owned, the payment essentially goes to any and all people. It doesn\u2019t go to any particular person.<\/p>\n\n\n\n<p><strong>[AO] Yes so you\u2019ve highlighted there something that I didn\u2019t actually think about at the time, that there is that opportunity cost of land which enters into the planning process itself on the production side as well as on the consumption side. There will be those wanting to construct it on land or agricultural workers council who wants to use land, and that the opportunity cost of land will have to enter into their social cost calculations during the planning procedure. But that also on the consumption side those who, say, want to rent an apartment will have to do that.<\/strong><\/p>\n\n\n\n<p>[RH] They\u2019re demonstrating a desire to live in a particular kind of house but also in a particular location. That location has other uses and so there is a social cost associated. The part that\u2019s easy to wrap your mind around is, well, we can calculate the cost of the construction materials, the labour time to build it, etc. But isn\u2019t there a cost of the fact that you now are living on a particular piece of land and that land was scarce and had an opportunity cost? It could have been used for something else and we want to be sure that it gets used for the most valuable thing.<\/p>\n\n\n\n<p>Now, what zoning basically does is say we don\u2019t let everybody bid on a particular piece of land. If you zone land for residential housing only, then the only people who can bid on using that land are people who are going to put up residential houses there. A business that wants to have a gas station there can\u2019t bid on that. And I think zoning can be very sensible, and I think you\u2019re going to want zoning in a participatory economy. And the zoning is basically part of land planning, land use management. We want our cities to be built in a certain a sensible way, so we\u2019re going to use zoning for that purpose. But what zoning does is it just says not everybody is allowed to enter into the process of asking to use that land during participatory planning. Only people who wanted to use that land to put houses there would be allowed to be making proposals to use that land to build houses there, if the land has been zoned for housing only. And sometimes you might want to zone land only for industrial uses.<\/p>\n\n\n\n<p><strong>[AO] Yes that\u2019s a very good point and a good way to put that. And I\u2019m sure as well there will be social housing as part of allowances for people, say, who can\u2019t work and so forth or \u2026?<\/strong><\/p>\n\n\n\n<p>[RH] We\u2019re not going to have these huge differences in income in a participatory economy. But still presumably there are significant differences between how much I would like to spend out of my income.<\/p>\n\n\n\n<p>You know, I have a reasonable income, I have a friend who has a reasonable income. I know this friend would use a much higher percentage. I mean, we talk about oh well as soon as your rent or your mortgage gets to be more than 40 percent of your income, then you\u2019re housing stressed. If you have reasonable incomes and reasonable housing costs, there are still going to be significant variations between how much do I want to spend on my housing and how much do you want to spend on your housing. So we want to allow for that. That\u2019s what\u2019s going to generate \u2026 some housing has more rooms in it, some housing has fancier appliances in it, some housing is located in places where people on average think that\u2019s a nicer place to live, I\u2019ve got a view or I don\u2019t have a view. So we want to create a situation where people can essentially spend different amounts on housing \u2013 &nbsp;what kind how much do they want to spend and where do they want to live, what does it look like \u2013 and in general we want to charge people for what the cost of society is. And that cost includes the work that went into it, and the materials that went into it, and the opportunity cost of the land that it happens to be sitting on.<\/p>\n\n\n\n<p><strong>[AO] Just before we move on, a critical thing being: in a participatory economy, not having the opportunity to capture the economic rent arising from the land. And that is something that would sharply distinguish participatory economy \u2013 or hopefully any socialist society \u2013 from the one that we live in at the moment. Housing policy in Europe versus the United States, on continental Europe perhaps, particularly in Germany, but definitely not in Ireland. Ireland is very much like the U.S, and Britain in that regard. It is to a large extent a housing bubble with people living in it.<\/strong><\/p>\n\n\n\n<p>[RH] It\u2019s totally financialized and it\u2019s the largest part of an ordinary person\u2019s nightmare of \u2018how do I manage my wealth situation?\u2019. I mean, I can just promise you that a large part of the thinking that went into coming up with our answer to this was we want to take all of that out of the equation. We don\u2019t want that to be what\u2019s governing how this or this whole situation is being handled in a participatory economy.<\/p>\n\n\n\n<p><strong>[AO] Absolutely, yeah. I mean, private ownership of land is the foundation of feudalism and all of those kind of dynamics.<\/strong><\/p>\n\n\n\n<p>[RH] There was a famous economist named&nbsp;<a href=\"https:\/\/en.wikipedia.org\/wiki\/Henry_George\" target=\"_blank\" rel=\"noreferrer noopener\">Henry George<\/a>&nbsp;and he was famous for something called the single tax. And he probably was wrong, I mean socialists would not agree with him that you don\u2019t need any other tax if you have a good land tax. But his idea of the land tax was actually brilliant, very socialist. And it was: well nobody actually made the land, the land is just there, so we shouldn\u2019t allow people who are the owners of land to somehow reap an advantage and a reward from the fact that they are the owners of the land. So he basically said what we should basically do is just tax the value of land, because they don\u2019t deserve that. And then if we collect enough taxes that way we don\u2019t have to collect any other, that\u2019s where he went off in a direction that most of us were not willing to follow. But in a sense when we say that land is communally owned, that nature just like oil deposits and land is communally owned, what we\u2019re basically saying is the equivalent of what he said, which is nobody has a right to earn income because they happen to own the title to that.<\/p>\n\n\n\n<p>We don\u2019t entitle nature but that doesn\u2019t mean it doesn\u2019t have an opportunity cost when anybody uses it. And we want people to take that into account, and it\u2019s fair to take that into account when we\u2019re figuring out how much people are going to pay for different things, including their housing. As we went over already, the dilemma that generates is that that opportunity cost will vary over time, and therefore one of the bad things about being a renter is you\u2019re never sure they\u2019re not going to change your rent. That\u2019s one of the nice things people like about a mortgage. We can\u2019t totally guarantee people that.<\/p>\n\n\n\n<p>Or we could just guarantee people that and say we know it changed over time, but when you settled in there on your income, and your desires for how much you\u2019re paying for your housing, you wanted to be assured that it would stay the same for as long as you were there. We could just suck it up and say \u2018fine, and now you\u2019re being a little undercharged, because actually the opportunity cost of using the land that you\u2019re living on is a little higher than you were charged back when you began\u2019. There would little harm done there? I mean I suspect that actually taking that approach would also not be any great harm. As an economist I could say \u2018oh you\u2019re paying a little price and efficiency just to give people peace of mind\u2019 and that\u2019s a that\u2019s a reasonable thing for people to do.<\/p>\n\n\n\n<p><strong>[AO] Yeah certainly and it\u2019d be the exact opposite of society today, where I mean in Dublin people are just paying through the teeth for absolute \u2026 you wouldn\u2019t believe. I mean, I\u2019m sure you\u2019ve seen similar things where you are. But it\u2019s ridiculous. You know, people paying for apartments \u2013 \u201capartments\u201d \u2013 &nbsp;bedsits without doors, and they\u2019re paying half their income for this. So once you take those dynamics out of the way you\u2019re really just getting into questions of preference.<\/strong><\/p>\n\n\n\n<p>[RH] In the west coast of the United States this is huge. I mean this is probably the single most talked about economics issue in the west coast of the United States. We have the San Francisco housing market where, you know, absolute ruins are selling for millions of dollars. Now they\u2019re going to be torn down and something be put up that they\u2019re going to sell. So we have the San Francisco housing market. The Portland, Oregon, housing market is probably a third of what the San Francisco market is. Seattle is some place in the middle. L.A. is in the stratosphere.<\/p>\n\n\n\n<p>So you have whole situations where people can\u2019t afford to live in certain cities, but if they can sell a house, if they already happen to be lucky enough to own a house in San Francisco, they can sell it in San Francisco and then they can come up to Portland and they are happy to pay way more than any of us would pay and they bid our prices up. We want to eliminate that. That is just complete and total nonsense. And when you think about the amount of mental aggravation that people are going through because of that economic issue and problem that they\u2019re confronting, and this isn\u2019t even talking about the homeless population. But there are perfectly straightforward ways that we don\u2019t even need a participatory economy to eliminate. I think in Germany they\u2019ve done a fairly decent job of eliminating that kind of real estate insanity.<\/p>\n\n\n\n<p><strong>[AO] that\u2019s the end of Part A of my first interview with Professor Robin Hahnel about Participatory Economics and his latest book&nbsp;<em>Democratic Economic Planning<\/em>. Stay tuned for Part B where we will discuss consumption. And as always I want to hear your thoughts in the comment section below. That\u2019s all for now. The only viable future for humanity is one After The Oligarchy.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>[After The Oligarchy] Hello everybody, this is After [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":6098,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"template-parts\/content-blog.php","format":"standard","meta":{"_acf_changed":false,"_eb_attr":"","_EventAllDay":false,"_EventTimezone":"","_EventStartDate":"","_EventEndDate":"","_EventStartDateUTC":"","_EventEndDateUTC":"","_EventShowMap":false,"_EventShowMapLink":false,"_EventURL":"","_EventCost":"","_EventCostDescription":"","_EventCurrencySymbol":"","_EventCurrencyCode":"","_EventCurrencyPosition":"","_EventDateTimeSeparator":"","_EventTimeRangeSeparator":"","_EventOrganizerID":[],"_EventVenueID":[],"_OrganizerEmail":"","_OrganizerPhone":"","_OrganizerWebsite":"","_VenueAddress":"","_VenueCity":"","_VenueCountry":"","_VenueProvince":"","_VenueState":"","_VenueZip":"","_VenuePhone":"","_VenueURL":"","_VenueStateProvince":"","_VenueLat":"","_VenueLng":"","_VenueShowMap":false,"_VenueShowMapLink":false,"_tribe_events_control_status":"","_tribe_events_control_status_canceled_reason":"","_tribe_events_control_status_postponed_reason":"","_tribe_events_control_online":"","_tribe_events_control_online_url":"","footnotes":""},"categories":[61],"tags":[],"class_list":["post-5925","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-what-we-like-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/posts\/5925","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/comments?post=5925"}],"version-history":[{"count":5,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/posts\/5925\/revisions"}],"predecessor-version":[{"id":6099,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/posts\/5925\/revisions\/6099"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/media\/6098"}],"wp:attachment":[{"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/media?parent=5925"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/categories?post=5925"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/metacpc.org\/en\/wp-json\/wp\/v2\/tags?post=5925"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}