This article caught my eye. The author, Greg Ferenstein, concludes “it might be wiser to redirect anger towards those who get in the way of new housing, rather than rely on taxes to solve our problems.” Yes, and no.
Back up. What’s the general idea? Well, Matthew Rognlie found that “recent trends in both capital wealth and income are driven almost entirely by housing.” This is not entirely in contrast to the findings of Piketty, rather derived from Piketty’s data: “Also using Piketty and Zucman (2013)’s data, I find that a single component of the capital stock—housing—accounts for nearly 100% of the long-term increase in the capital/income ratio, and more than 100% of the long-term increase in the net capital share of income.”
This shouldn’t be a surprise. Individuals who are forced to spend almost all of their income on housing can’t save any money. We’re talking about people forced…
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