Tuesday 16 April 2013

Is it the role of the state to subsidize badly paid jobs and reward unscrupulous landlords?


Is it the role of the state to subsidize badly paid jobs and reward unscrupulous landlords?

In Britain, as it happens in the USA, state money aka taxpayers’ money is used to subsidize badly paid jobs. Tax monies are paid to support those whose employers are not paying them enough. The matter is that people will keep those jobs, bad employers will pocket the revenues produced by subsidized workers and live happily ever after while the rest of society picks up the bill.

The same happens with housing subsidies. Landlords have been extorting public money and pushing up renting costs. The natural consequence is that those at work that get paid decent wages by their employers can no longer afford to rent decent accommodation. Who is the winner in this affair? Unscrupulous landlords that in many cases are not even registered as landlords.

It would make sense to stop providing housing subsidies, to start using tax monies to reshape the housing market by making better use of space, to implement mandatory registration for all those acting as landlords and to stop subsidizing bad employers.

Converting family homes into flats has nothing to do with solving the housing crisis. The Soviet style fragmentation of old housing stock is a human tragedy. Old properties have been partitioned with chalk walls and then sold as if they were brand new properties.
We need less subsidies and higher incomes in a market in which prices are not inflated by state subsidies.

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