Author: Victoria Wilson

Independent theorist interested in questions at the intersection of real estate, value and price.

Is purchasing a medical proceedure the same as buying a car?

I would argue no, for several key reasons.

First, a medical procedure’s success depends heavily on patient participation. The outcome hinges on whether patients follow their physician’s instructions, avoid harmful foods or activities, commit to their rehabilitation, and make necessary sacrifices for optimal recovery. A car, by contrast, operates on a predictable maintenance schedule—oil changes every 7,000 miles, new tires at 50,000 miles—and doesn’t require active participation each time you get behind the wheel to function properly.

Second, evaluating medical outcomes is inherently subjective, shaped by individual expectations and varying standards of success. A tangible good like a car, however, has objective, measurable qualities that remain consistent regardless of who’s assessing it or observing it.

Finally, medical procedures carry inherent risk. Unlike most purchases, where you start at a baseline and gain utility, healthcare interventions don’t guarantee positive outcomes. A procedure can result in complications requiring additional interventions, meaning you could begin at zero and end up worse off. There’s always the possibility of a negative outcome, which fundamentally distinguishes healthcare from consumer goods.

For these reasons, healthcare tends to be heavily influenced by social groups. Peer pressure encourages people to take care of themselves. Role models who demonstrate how to go the extra mile can influence and encourage patients to do the same. The extent of care may be directed in part by group expectations. But, the most significant risk with this over a car or other tangible goods, is that lack of care or poor care can cause the patient to go backwards and incur even more costs both to the body and the pocketbook.

Land claims and the development of administration

But it required more than an annual tour to administer and exert royal power throughout Scotland. The size and geography of the kingdom required the representation of royal authority at both regional and local levels. This was carried out by two tiers of royal officials.

MORMAERS

Mormaers were powerful territorial magnates and their extensive provinces were the primary level of royal administration in eleventh-century Scotland. Mớrmaer means ‘great steward’ and this Gaelic title is first recorded in 918, although its origins are unclear. The absence of mormaers in Ireland indicates that this office was not introduced with the migration of the Dál Riata or from Ireland at a later date. Instead, the predominantly north-eastern distribution of the Scottish provinces recorded as having mormaers suggests that this office had Pictish origins. It may have originated in the provincial kingships that lost their royal status as the kingship of the Picts became increasingly centralised.

However, the disappearance of the earlier Pictish provinces and their names suggests a degree of political and administrative reorganisation after the eclipse of Pictish power in the mid-ninth century. Alternatively, these new provinces may have emerged in response to the requirement for a more effective military organisation to counter Viking raids on Scotland during the ninth and tenth centuries. But the origins of the provinces should probably be sought in internal Picto-Scottish factors rather than external stimuli.

This title popped off the bookshelf at me as I had recently sat in on a Macbeth talk and thoughts had been churning ever since. Intrigued by the play I sought to learn more. And this slim book offered that. And, unexpectedly, the text veered into the social structures of the day. In particular Aitchison describes the layers of relationships between various populations of the time and their ties to Highlands, moors, isles, and meadowlands of Scotland.

Me to Grok: Is it reasonable to attribute the centralizing of power in part to the administration of geographic areas like the mormaers? In other words the repetition of covering the land both in taxation and aid helped to create norms which supported and abstract central power versus a family?

Grok: Yes — absolutely reasonable, and you’ve just named the single most powerful engine that turned Anglo-Saxon (and Scottish) society from “family-first” to “king-first”.

The short answer is:

Every time a king’s officer walked the same geographical circuit to collect tax, raise troops, or hold court, he taught the locals a new reflex: “My duty runs to the shire, not to my cousin.”

Below are the four concrete mechanisms that made repetitive geographic administration the killer app of centralisation. I’ll keep it crisp, with one Anglo-Saxon and one Scottish example for each.

1. The map replaced the family tree

• Mechanism: The same official (reeve / mormaer) visited the same villages every year on a fixed route.

• Anglo-Saxon: The shire-reeve rode the hundred circuit at Michaelmas to collect the farm of one night (food-rent). Villagers saw the same face, carrying the same rod of office.

• Scottish: The mormaer of Moray toured the same thanages every spring to count ploughs for the cain (render in cattle). After three generations the route was more famous than any genealogy.

2. Tax created a shared calendar

• Mechanism: Everyone paid on the same day → everyone felt the same obligation.

• Anglo-Saxon: Domesday Book (1086) records hide assessments that had been frozen for 150 years. A ceorl in Berkshire paid Martinmas geld on 14 November whether his uncle feuded with the next village or not.

• Scottish: The Conveth payments (barley + cheese) were due on Lammas (1 Aug) across the whole mormaerdom of Buchan. The date glued together men who had never met.

3. Military service was territorial, not kin-based

• Mechanism: One man per 5 hides (or one per davoch in Scotland) turned up with spear and 40 days’ food.

• Anglo-Saxon: The trimoda necessitas (bridge, fortress, fyrd) was owed by the land, not the bloodline. If your cousin dodged, the reeve fined the whole vill.

• Scottish: David I’s charters (1124–53) demand Scottish service from every davoch in Moray. A mormaer who tried to raise only his own cousins was laughed at.

4. Courts met in the same place on the same day

• Mechanism: Predictable geography → predictable law → abstract king.

• Anglo-Saxon: Hundred court under the holy oak every four weeks; shire court at the king’s hall twice a year. Suits were “shire vs. shire”, not “clan vs. clan”.

• Scottish: The mormaer’s airidh court at the stone of Forglen sat every Beltane. A theft in Cullen was judged by Buchan law, not by the thief’s great-grandmother’s kin.

Mini-experiment you can run in your head

Imagine two villages 20 miles apart:

• Year 750: Each is run by its own kindred; feuds last decades.

• Year 950: Both send 1 man per 5 hides to the same shire-reeve at Reading; both pay geld on Martinmas; both attend the same hundred court under the oak.
→ By 950 the shire is a louder identity than the kindred.

One-sentence summary

The king’s tax-collector and war-reeve walked the same roads so often that the roads themselves became the new skeleton of loyalty, and the family tree withered to a decorative twig.

Scottish post-script

The mormaers are the perfect bridge case.

• 9th century: they were super-chiefs of giant kindreds.

• 12th century: they are earls who hold regalities by royal charter and collect the king’s cain in coin.
The turning point? The annual ride around the thanages, repeated for five generations.

So yes — geography, drilled into muscle memory by taxation and aid, was the quiet solvent that dissolved tribal solidarity and built the abstract state.

Me again. What’s important about the details written here in the backdrop of Shakespeare’s famous villain, is it demonstrates how many generations or hundreds of years it took to disengage a population from clan ties to administrative loyalties.

Is there not a better explanation for the slow pace of some countries to transition to more sophisticated political economies?

Professor’s presidential challenge

On Fareed Zakaria’s show, GPS, this morning, guest Mai Hassan throws down a Trumpian challenge.

Finally, hundreds of civilians were massacred this week in Sudan’s Darfur region, a brutal escalation of the ongoing war in that country. Mai Hassan, a political science professor at MIT, sat down with Fareed to discuss how it got to this point. 

She suggests that the US president has the power and influence to bring a peaceful solution in Sudan. At the margin, this conflict offers a better chance at that elusive Scandinavian prize.

That was then- This is now

This catalogue arrived in my mailbox today. Are algorithms not enough for the massive online store? Amazon is using print marketing materials and supporting the United State Post Office to reach customers. Oh my!

Or what about the demise of the bookstore, so hardily predicted fifteen or more years ago?

Barnes & Noble opened more new bookstores in a single year than it had in the whole decade from 2009 to 2019. The bookseller expects to open over 60 new bookstores in 2025.

Bigger is better.

 The new Minnetonka Barnes & Noble will cover over 18,000 square feet, including a B&N Café, and carry all the best books, as well as a wide range of toys, games and the usual paper and gifting items found at Barnes & Noble.

A social model of Trick-or-Treat

Everyone laments the commercialization of the holidays. How tacky! How capitalistic! So why do these distasteful traditions continue to weave their way through our culture? Let’s investigate the social upsides to see if there are compensating factors.

First, it is necessary to identify the parties involved. There are the vendors of fun-size treats. These folks are unabashedly money-oriented organizations. There are parents who dutifully open their front doors and dig handfuls of treats out of their stash to parlay them into the bulging pillowcases or plastic pumpkins presented by the costumed youngsters yelping: Trick-or-Treat! These folks are subsidizers. They purchase the candy with no designs on a pecuniary return for their money. And then there are the kids. One might think they have no investment, but that’s not true. Their delight at the mystery of the evening, at the intrigue of mask-wearing, and at the innocent charm they exude is a draw to those around them.

For a proper evaluation, one must anchor the focus of discretion. This tracks which group is being considered in the balancing of accounts. Let’s start with the stores. They are commercial ventures, supplying items their customers demand in return for enough to pay their expenses and a little more. If Halloween went to the wayside, they would simply move on to something else. There seems to be very little to model here in terms of the social sphere.

Now, let’s anchor the view from the adult participants. They lay out the cash– so what do they get? They bring joy to their kids and perhaps a little to themselves. The event might rope in grandma and grandpa, a couple of worthy backstops in the activities of family life. Lastly, the business of activity on the streets brings out a Jane Jacobsian benefit. So, parents and adults can gain in private pleasure, family bonding, and community spirit.

Lastly, consider the kids. It might seem like a windfall for them. However, probably more than one parent keeps the incentives of a successful Halloween as a behavior modifier. So they too pitch in with a bit of work when it comes to supporting the holiday.

For the foreseeable future, the balance in favor of the social gains indicates a continued future for this spooky festivity.

Public says no Payment for rescuing Private parties

Usually actions to shore up safety are drawn from the public purse. But sometimes private actions pull this obligation out of the public sphere.

A Snowstorm Blew Over Mt Washington. More than 20 Hikers were trapped

More than 20 hikers needed to be rescued from the flanks of Mount Washington in New Hampshire after wintry conditions swept across the famed peak on Saturday, October 25.

…..

“Multiple people have arrived at the summit the last few days very unprepared for winter and required assistance. Be ‘wildly Responsible’ and please do some research on current higher summits weather and bring everything needed to hike in winter conditions or just hike another day,” writes the New Hampshire State Park on Facebook.

Personal responsibility in this case means personal repayment.

The New Hampshire fines stem from a piece of legislation called RSA 206:26-bb, which states that “any person determined by the department to have acted negligently in requiring a search and rescue response by the department shall be liable to the department for the reasonable cost of the department’s expenses for such search and rescue response.”

What you don’t know yourself

A home is a complicated purchase. The variables are numerous. The structure is what everyone thinks of first: bedrooms, bathrooms, beautiful kitchens. There are niche items, such as screened-in porches or swimming pools. There are external demands, such as level lawns and striking views. All that along with the nuts and bolts of square footage, the year the home was built, and the number of garage spaces go into the assessed values as calculated for tax purposes.

But there’s more that goes into the process of the home purchase at the time of the transaction. Market conditions, interest rates, and the time of year impact the buying and selling process. The condition of the home can certainly swing a property from very desirable to manageable, only for the most hearty investor. Sometimes the right buyer shows up and eagerly signs for the home in part because the semi loaded with their household belonging is on the way and will need to be unloaded, or parked at a considerable expense.

Real estate is a complicated product. So when a client looks over their showing sheet and wants to talk price, it is important to remind them that is set between buyers and sellers. That as participants in the market they are the best judges of the price based on the path that has led them to the home. As their agent, we can show how the numbers fall within an acceptable range of what the market has recently born out. But ultimately it is up to them to risk missing out by staying low or having buyer’s remorse by going high.

As Pete Boetkke recently wrote in What Hayek Understood About the Unknowable Nature of Markets:

But the dynamics of a market aren’t a given to be applied as one thinks wise when powerful people want to mandate lower rent or produce more computer chips. They must be generated, discovered, utilized, and conveyed—constantly adapting and adjusting to the changing circumstances of economic life. “The continuous flow of goods and services,” Hayek wrote, “is maintained by constant deliberate adjustments, by new dispositions made every day in the light of circumstances not known the day before, by B stepping in at once when A fails to deliver.”

Although these words are generalized, the ideas are there. It is a process of discovery that encourages or dissuades people as they navigate their choices amongst the homes for sale. And when they identify one that offers more of what they really desire with fewer compromises on items that bother, then they move with confidence in securing the transaction. Often, until that point in the process, they don’t know what they want themselves.

Number Nuance

Yesterday’s post showed off a range of house prices across the country. Since housing expenses are the largest portion of most people’s budgets, they greatly influence people’s standards of living and disposable income. To live a lush life in St. Louis might only allow you to squeak by in Salt Lake City.

For that reason, it’s funny when someone brags about their “six-figure salary” — and then you find out they live in Washington State. Sure, congratulations on your $100K, but that’s basically a modest Minnesota income with prettier mountains and pricier coffee. There’s a strange amnesia that kicks in when people talk about money across states, as if groceries, gas, and rent were all federally standardized.

Then there’s the gross-up crowd — those who love to quote the full sticker price of their income, conveniently forgetting everything that comes off the top. Taxes, insurance premiums, pension contributions… not to mention the hidden perks that don’t show up on a pay stub: flexible hours, remote days, or a workplace that doesn’t mind if you pick up your kid at 3 p.m. Some of the most valuable parts of a job can’t be cashed out — they’re lived.

Each region and industry really runs on its own microclimate of opportunity. What looks “low pay” in one city can mean stability, a yard, and free weekends somewhere else. Meanwhile, other jobs look golden until you notice the 70-hour weeks, commutes, and housing markets that never quite forgive you.

And then, of course, there are our Canadian friends. Always happy to tell you about their million-dollar home — in Canadian dollars, around $720K USD. Not quite as flashy a number. But don’t worry, we’ll do the math for you, eh?

MT is up to $495!

California is always high. I remember when Colorado pricing surged ahead of Minnesota’s, but that’s been like that for a while now.

Connecticut seems low for the east coast. And Alabama is a bargain! Especially since their school system is starting to put out some strong scores.

Which state’s average price of housing surprised you?

Historical Fact of the Day- Zoning

Zoning, a means of controlling the land and housing markets by dictating acceptable uses for particular parcels of land, was invented during the 1910s and spread to most American cities by the end of the 1920s. St. Paul and Minneapolis passed their first zoning ordinances
early in the 1920s. The goals of zoning were similar to those of the building permit and inspection programs: to promote public health and safety, and to preserve property values. Zoning is an effective control mechanism, but it is essentially a preventive tactic.

Past Choices/Present Landscapes

Real Estate Books

There aren’t many. There’s the ‘how to get rich in real estate’ type of literature, which is only vaguely helpful to those with no real estate experience and, in equal measure, misleading. There are books developed to help salespersons pass the required testing to obtain a real estate license. There’s material on all sorts of financial instruments used to finance property. But I’m not talking about that type of thing.

I’m talking about the manner in which real estate features in people’s lives.

Judith Martin, a former professor of geography at the University of Minnesota, wrote Past Choices/Present Landscapes: The Impact of Urban Renewal on the Twin Cities. This project spotlights some of the effects I like to talk about. It focuses on the massive slum-clearing and subsequent redevelopment of large sections of inner-city property. In hind site Martin points out:

Much has been written about the ideas and the implementation of the urban renewal program in the United States during the 1950s and 1960s. Most of this literature views urban renewal as a program that: (1) worked to the disadvantage of people most in need of improved housing -a great deal of substandard housing was removed, but a relatively small amount of low-income housing was constructed;(2) was a boondoggle for developers-they were able to acquire land inexpensively from city authorities, and often made large profits on the projects built on this publicly acquired land; and (3) focused on
economic development issues C’let’s fix up downtown”) at the expense of housing and neighborhood concerns (Anderson 1964; Hartman 1964; Gans 1965).

Viewed in retrospect, much of this criticism is valid, but it does not tell the whole story. Critics have portrayed planners who developed and implemented urban renewal programs as heartless beasts who turned a deaf ear to the real needs of “the people.” But it is hard to see most renewal officials as greedy and profiteering, or as consciously
trying to exercise their power over helpless city residents. There are, for example, no notable cases of renewal officials growing rich working on these programs. If anything, the views of those who implemented urban renewal programs in the Twin Cities and elsewhere can be considered somewhat naive. They assumed that renewal could be
accomplished quickly, that private developers would clamor for the opportunity to build in available areas, and that the renewal process could be carried out with relatively few snags. None of these assumptions proved to be true.

Real estate is a tricky wicket. If people want to follow along, they need to, as Judith indicates, read the whole landscape and not cherry-pick a brief situation in the misty flow of time.

Decay

It takes a long time for a house to completely depreciate. Many of its structural elements have lives longer than decades. Exterior features in like roofs, siding, windows, and doors may need little maintenance for years.

Yard work left to run free may give the appearance of a property left to nature. But eradicating the growth is of little cost compared with replacing all new heating and cooling systems, water heaters and appliances. Most of these have an average life of 12-15 years. And then, of course, there are the plumbing and lighting fixtures that are often replaced for both cosmetic and functional reasons.

At each phase of putting off a replacement and trying to patch things up and get by, a debt of maintenance is created. If the property were to trade hands, a new owner might be willing to take on a few additional repairs for a concession on price. At some point (and what would that be?) the average buyer turns away. There’s too much to do. There are too many lurking money pits under the subfloor in the bathroom or behind the paneling in the lower level.

This is when the structure’s value falls to zero. The parcel will only command the price of the land it sits on, with an adjustment for the cost of debris removal. But it takes decades to get to this point. The built world is durable, and there are many opportunities for rejuvenation.

Mobil Homes

There continue to be mobile home parks across the metro offering one of the most affordable form of housing. The structure is considered a vehicle and licensed as such. The home is anchored on a lot in a mobile home park and rent is due every month in a similar fashion to association dues. People like to talk about tiny homes now. Still, manufactured homes can be reasonably constructed in a factory and meet the same quality and amenities as RV’s, another acceptable form of shelter.

:Here are some current listings and recent sales:

Few mobile home parks rise to the level of civic engagement that can be seen in Landfall Terrace, a community on the eastern side of the metro. As with many good things it starts with its history.

James and Mitzi Olson used to own all of the land in Landfall. They moved here in 1953 into a cottage that was hardly better than a log cabin. …The Olsons had lived in a mobile home during World War ll and knew that there was a shortage of affordable housing, so they developed their site into a mobile home park. As it was on the early highway between St. Paul and Hudson, Landfall developed several businesses, including a truck stop, restaurant and nursery, most of which left when Interstate 94 was put through and access became limited.

Often successful things are born out of a basic need of local people. But it is only through nurturing and ongoing maintenance that group projects survive. Especially one a s successful as this.

Landfall is a city in Washington County, Minnesota, United States. The population was 843 at the 2020 census and it is the smallest community in Washington County in terms of area. It lies on the eastern shore of Tanner’s Lake on Interstate 94.

Landfall is an incorporation of a manufactured home community, contributing to its reputation as the most affordable community in the Twin Cities. In 2008 & 2010, the city was named one of the 100 best communities for young people by America’s Promise.

Landfall is one of only two incorporated cities in America that consist primarily of manufactured housing. 

Plat map from 1884

I was digging around the county historical society lately because I thought it would be fun to find where my relatives made a land claim when they arrived in the US. Plat maps, which track ownership, were not updated on a routine basis in the days of primary forests and pioneer wagons. This one was done in 1884, and the next printed update didn’t get published until 1902. Even though the family of five children, all born in Norway, are said to have arrived in 1874, the family name has yet to appear here. It does in 1902.

What you do notice is the number of parcels denoted by St. Paul Minneapolis and Manitoba Ry Co. or St. P. M. & M. Ry Co. These parcels were owned by the railroad built by James J. Hill. The school land is also a major player. There were 168 schools in Leaf Mountain Township. The forty acre plots with no names listed, or US, are the ones open for homesteading. It seems the US government priorities rolled out in that order: transportation, education, and homesteaders to make it all work.

Cabin from nearby site built in 1890

Shop Talk

A convo with ChatGpt: What does ‘shop talk’ mean

ChatGPT said:

“Shop talk” means conversation about work or a particular profession, especially when it happens outside of work or in social settings.

It often implies that people are talking about technical details, jargon, or inside-baseball topics that only others in the same field would fully understand — sometimes to the boredom of outsiders.

Examples:

  • “Let’s not get into shop talk at the party — nobody else here wants to hear about accounting software.”
  • “Whenever those two doctors get together, it’s all shop talk.”

So, it’s basically work-related conversation among colleagues or professionals, often used with a slightly negative or teasing tone (“ugh, enough shop talk!”).

You said:

Name three reasons why an outsider does not follow the insider baseball.

ChatGPT said:

Here are three clear reasons why outsiders often don’t follow inside baseball (or shop talk):

  1. Specialized Knowledge or Jargon – Insiders use technical terms, acronyms, or references that make sense only within that field. Outsiders lack the background to decode the language.
    Example: A software engineer says, “We just migrated from monolith to microservices,” and a non-tech person hears gibberish.
  2. Different Context or Priorities – Insiders share a sense of what’s important in their work — the stakes, the rivalries, the subtleties. Outsiders don’t know why those details matter.
    Example: A debate about which research framework is superior means little to someone outside academia.
  3. No Emotional Investment – Insiders are personally invested — their reputations, routines, and identities are tied to the topic. Outsiders lack that emotional hook, so the conversation feels dry or trivial.
    Example: Two chefs passionately argue about knife brands while everyone else at the table just wants to eat.
You said:

Take these three reasons- are they not the features of an institutional network?

ChatGPT said:

That’s an astute connection — yes, those three reasons are very much features of an institutional network.

Let’s unpack that:

  1. Specialized Knowledge or Jargon → Bounded Communication System
    Institutions build and maintain their own languages — technical terms, shorthand, and shared references that mark belonging. This linguistic specialization not only allows for efficiency among insiders but also creates boundaries that separate members from outsiders. It’s a classic form of social closure: if you don’t speak the language, you’re not fully in.
  2. Different Context or Priorities → Shared Frames of Relevance
    Institutional networks define what counts as important, legitimate, or meaningful. Insiders share a frame of reference shaped by the institution’s history, goals, and internal hierarchies. Outsiders, lacking that frame, can’t easily interpret why certain details matter. This is how institutions reproduce themselves — by shaping what participants see as relevant knowledge.
  3. Emotional Investment → Identity and Belonging
    Institutions aren’t just about rules and roles; they generate emotional commitments. People’s sense of identity becomes tied to their institutional membership — whether it’s a profession, academic discipline, or bureaucratic body. That investment reinforces the network’s cohesion and its internal culture, even as it alienates outsiders.

So in effect, “shop talk” and “inside baseball” are the micro-level expressions of institutional boundaries. They show how networks of practice sustain themselves through shared knowledge, values, and affective ties — precisely the stuff that makes them opaque to outsiders.

Dynamic Private-Order Institutions

From a newly minted Nobel prize winner, Joel Mokyr.

Slowly, and perhaps not always quite perfectly, British formal institutions adapted. But the same was true for private-order institutions: the rather sudden rise of country banks in the second half of the 18th century illustrates the high degree of  adaptiveness of private-order British institutions; they were not coordinated or supervised by some central authority, and no political revolution was necessary to bring them into existence. Yet once the circumstances were suitable and opportunities arose, these banks emerged almost ab nihilo. They replaced the informal activities of local merchants, notaries, and attorneys who had previously intermediated in credit transactions.

This natural and spontaneous progression of credit extension brought real estate ownership to the greater populace.

Read his insights at Ideas Mattered, But So Did Institutions.

Slow Horses- Series Review

This band of MI5 misfits shows real promise. All have backstories, with the leader of the crew showing the deepest scars of past wrongs. His assistant is haunted by tragedy with some sort of entanglement. There’s an assortment of others, including a team builder type and a digital guru extraordinaire. But it’s the two youngsters in the group– dashing and darling– who will engage the viewer the most.

After a bit of a dry spell, this series is one to look forward to for that hour of after dinner viewing!

C’mon people, still?

Check out the number of views of the YouTube shorts where historian and author Sarah CM Paine punches out a history lesson in spurts of ironic and bell clear words- 2.3 million views, 1.6M, 8.5M.

Who is she? It’s hard to know because, despite her online presence, a Google search generates no profiles written about her. Her Wikipedia page has a new photo above a brief description. Only this to stand up for a long time academic who has penned a respectable number of books.

Granted, this new exposure is due to one person- Dwarkesh Patel. He has hosted and promoted Sarah CM Paine’s material. He gets full credit. And there are pleanty of profiles written on him such as in Time or here.

What a grain elevator could say

The grain elevator was the most ubiquitous commercial building in Minnesota’s small and medium towns during the mid to late 1800s.

In most towns in western Minnesota, grain elevators were the dominant feature of the skyline 1837 Treaty | Minnesota DNR. As railroads expanded westward in the 1870s-1880s, grain elevators sprang up along every railroad line to store wheat and other grains before shipping them to Minneapolis and beyond.

This makes perfect sense given Minnesota’s economy at the time. Wheat farming dominated the landscape, and Red Wing held the title as the world’s largest primary wheat market in 1873, exporting 1.8 million bushels valued at more than two million dollars United States v. Sioux Nation of Indians – Wikipedia. Every town with railroad access needed a grain elevator to collect, store, and load farmers’ harvests onto railcars.

Typically, small services would pop up alongside the tall wooden structures. Or an eating and drinking establishment. Sometimes a church was erected down the road a bit. And for decades, the railroad infrastructure supported a node of activity in remote rural areas.

A shift occurred once the interstate system was established in the 1950s. Rail is still most beneficial for long hauls, whereas trucks carry the grain for shorter distances, typically under one hundred miles. With fewer stops, the isolated wooden elevators fell into disrepair. Often they fell for the useful purpose of serving as a training exercise for local firefighters.

The purpose of this short vignette is to show how land uses are tied intimately with public infrastructure. And these types of projects are engaged over long time frames. A slow natural progression of the property from peak usefulness to decline can be led by aging owners, people who can view themselves in a steady state for another decade or more. The insight for the outside observer to understand where in the process a parcel finds itself. And then to implement policy in relation to the receptive impulses of that moment.

Out with the Mall

In with the residential new construction.

“Utilizing existing infrastructure can bring homes to the market quickly, avoiding some of the delays associated with redevelopment or greenfield housing development,” says Hannah Jones, senior economic research analyst at Realtor.com.®. “The shift from retail to residential is a logical solution in a country facing a persistent housing shortage.”

She added that malls in suburban states like New Jersey and Florida—both with well-established commercial corridors and housing pressures—are especially ripe for this type of redevelopment.

This from Realtor.com.

Avidor apartments abutting a public park in what was Ridgedale Mall parking

Pooch with passion

There was this sweet service dog at the airport the other day. A working dog, they call them, helping their owners overcome a sight impairment or a hearing decline. Emotional support animal designations are often used to help college kids bring their feline friends into the dorm. It’s the law that pets can skirt the law. If they meet the standard of a group objective, and an opening of access to those with disabilities meets a group desire level need. The puppy with whisky gold hair and large eyes isn’t a private pet but a public support. The pouch is a new thing even if she looks like the same old thing. And hence in this new nature, is tallied up in a different manner.

MN Railroad Fact

Minnesota’s Land Giveaway

Railroads received 9.9 million acres of Minnesota land from the federal government—more than the 7.3 million acres claimed by homesteaders between 1862-1880. The Homestead Act’s promise of land for ordinary settlers shifted when railroads got the biggest share. Now it’s difficult for any major infrastructure project to command overarching commitments.

Road Talk

It’s no surprise that the homes abutting a freeway are a bit cheaper than similar homes with a buffer from the noise and hubbub. A recent paper, The Traffic Noise Externality: Costs, Incidence and Policy Implications was clever in using the construction of sound barrier walls to calculate the markets preference for a home protected by the wall versus one that was not.

The authors come up with a figure of 6.8%, which in itself is not as crucial as the acknowledgment that a public goods project, such as erecting a barrier wall, uniformly corrects the imposition of a busy road across a blanket geographic area. There is a market for public goods. A consistent, non-exclusionary response to a public goal reflected in the impassionate exchange of cash for homes.

The impact of the wall’s benefit, or the detriment of a noisy road, is reflected in the nearby neighborhood. There are other impacts resulting from the existence of the road and its location. It allows people to get to jobs. It might be an emergency route to a hospital where people object to the use of sirens. Buses might run off the road and so on. For that reason the net effect of the road is best taken as a package with the ability to divvy out and assess the pro’s and cons as refelcted in the surrounding land values.

To make a jump and try to use changes in house prices to make a meaningful observation of the traffic composition is a stretch. To extrapolate the value of home price change and reflect that back onto individual cars driving down that road, as the authors of The Traffic Noise Externality simply don’t follow me. It seems it would be a categorization problem.

the land let him down

Imagine you write a whole textbook only to find out you were on the wrong track. Five hundred pages establishing rigorous scientific method for geography—two years of intellectual labor demonstrating that spatial patterns could be analyzed with the same logical precision as physics. And then you look up from your equations and see Baltimore burning, students protesting, urban poverty that your elegant models somehow failed to predict or explain.

David Harvey himself had acknowledged in the book’s preface that he “wrote this book mainly to educate myself,” seeking to understand why his quantitative work kept producing “unpublishable papers.” 1 THE RIGHT TO THE CITY David Harvey He thought the problem was methodological sloppiness. He thought tighter logic and better statistics would solve it.

But standing in the ruins of American cities in the late 1960s, Harvey confronted a different possibility: perhaps the methods weren’t wrong exactly, but they were asking the wrong questions. You can’t model urban crisis without modeling capital. You can’t explain spatial patterns without explaining property. You can’t understand cities without understanding who owns the land and how they acquired it.

The textbook wasn’t false—it was beside the point. All that careful work distinguishing inductive from deductive inference, all those chapters on probability theory and classification systems, and somehow he’d managed to write 500 pages about space while avoiding the one thing that actually organizes space: value.

By 1973, Harvey had become a Marxist. The shift wasn’t a rejection of rigor—it was a recognition that methodological precision without political economy is like having perfect instruments for measuring shadows while ignoring what casts them.

“Explanation in Geography” remains a landmark. But it’s a landmark of a particular kind: a monument to what you can accomplish while carefully, meticulously, rigorously avoiding the most important question.

Does the land still have something to say?

Discovering New Voices

One of the great rewards of reading broadly is encountering thinkers who challenge our assumptions in unexpected ways. John Cassidy’s new book Capitalism and Its Critics serves as an excellent gateway to such voices—including Silvia Federici, whose work I encountered for the first time through his analysis.

Federici builds upon Marx’s foundation while charting her own critical path. Like Marx, she argues that capitalism fundamentally depends on one group exploiting another’s labor—but she expands this critique beyond the traditional worker-owner dynamic. Her distinctive contribution lies in highlighting how capitalism systematically devalues and invisibilizes reproductive labor, particularly the unpaid work of mothers and caregivers.

Her proposed solution—direct payment for domestic and care work—has sparked both organizing efforts among women’s networks and genuine debate about the nature of care itself. There’s an inherent tension here: while some forms of labor may be best performed voluntarily rather than as market transactions, this doesn’t negate their immense economic and social value.

This raises a crucial point that transcends ideological boundaries: regardless of whether we embrace Federici’s specific remedies, her core insight about the systematic undervaluing of reproductive labor demands serious consideration. The work of raising children, maintaining households, and caring for family members provides enormous value to society—value that our current economic frameworks struggle to recognize or measure adequately.

In exploring these ideas, Federici reminds us that the most interesting economic critics aren’t just those who diagnose capitalism’s failures, but those who help us see the invisible foundations upon which the entire system rests.

What is Private, What is Public Eastern block home edition

Those of you who follow this site know that we view the boundary between public and private as fundamentally a matter of choice. Bridges can be privately owned and charge tolls, but they more commonly become part of public transportation infrastructure. These decisions about what remains public versus private are often driven by considerations of efficiency and practical management. It was fascinating, then, to recently discover that following the collapse of communism in 1989, one of the most immediate and sweeping divestitures involved housing itself. Here’s that remarkable story.

The Great Housing Transfer: Eastern Europe’s Post-1989 Privatization Revolution
The collapse of state socialism in Eastern Europe triggered one of history’s largest transfers of public wealth to private hands through housing privatization. Between 1990 and the early 2000s, millions of state-owned apartments were sold to sitting tenants at deeply discounted prices, fundamentally reshaping the region’s housing landscape and creating lasting economic and social consequences.
From State Monopoly to Private Ownership
Under communist rule, Eastern European countries maintained near-total state control over housing. In most countries, 80-90% of urban housing stock was publicly owned, with the state serving as both landlord and developer. This represented one of the most comprehensive public housing systems in modern history, housing the majority of urban populations across the Soviet sphere.
The transition was dramatic and swift. Following the privatisation of state-owned housing in the transition to a market economy in the early 1990s, CEE countries now record some of the highest homeownership rates in the OECD, with over 70% of households owning their home outright. Countries like Hungary, Slovakia, and the Czech Republic saw homeownership rates soar from under 20% to over 80% within a single decade.
The Titling Process: Converting Tenants to Owners
The privatization process varied by country but followed similar patterns. Most governments opted for “sitting tenant” sales, offering apartments directly to current occupants rather than through open markets. The privatization policy of the 1990s aimed to make the sitting tenants owners of their rented flats, by offering 70–90 per cent discounts on the price of the houses and flats.
The legal titling process was often complex, requiring new property registries and cadastral systems. Many countries had to create entirely new frameworks for private property ownership, having operated under state control for decades. Voucher systems were also employed, where citizens were given or could inexpensively buy a book of vouchers that represent potential shares in any state-owned company, though these were more commonly used for enterprise privatization than housing.
The Value Transfer: A Massive Subsidy
The financial scale of these transfers was enormous. With discounts typically ranging from 70-90% below estimated market value, the programs represented massive implicit subsidies to sitting tenants. In Hungary alone, the value transfer has been estimated at several billion dollars in current terms. The Czech Republic’s privatization program transferred approximately 1.2 million units, representing roughly one-third of the entire national housing stock.
These discounts were justified as compensation for years of poor maintenance and recognition of tenants’ de facto investment in their homes through decades of occupancy. However, the beneficiaries were not necessarily the neediest—middle-class professionals and party officials often lived in the most desirable state housing and captured the largest windfall gains.
Lingering Effects: Winners, Losers, and Market Distortions
The privatization legacy continues to shape Eastern European housing markets today. The dramatic shift to homeownership created several persistent challenges:
Market Thinness: The formal rental market is generally thin and underdeveloped — only in the Czech Republic is the rental market home to more than 15% of households (19%). This limits labor mobility and creates barriers for young people entering housing markets.
Quality Degradation: Multi-apartment buildings dominate the housing stock, many built during the communist period. As a result, the stock is ageing and of poor quality. Most households cannot afford to maintain or upgrade their dwellings according to environmental requirements. The mass transfer of maintenance responsibilities to individual owners without corresponding financial capacity has led to widespread deterioration.
Social Housing Shortage: The social housing supply in most CEE countries is well below the OECD average, with the exception of Poland and Slovenia. The elimination of public housing left a gap in affordable housing provision that has never been adequately filled.
Inequality Effects: The privatization created a new form of wealth inequality, where accident of residential location in 1989 determined lifetime wealth accumulation. Urban professionals gained valuable assets, while rural residents and those in less desirable locations received minimal benefits.
The Eastern European housing privatization represents both a remarkable success in creating a property-owning democracy and a cautionary tale about the unintended consequences of rapid large-scale privatization. Three decades later, the region continues to grapple with the market distortions and social challenges created by this unprecedented transfer of public wealth to private hands.

Deep Cover- Movie Review

I’m usually critical of comedies, but I can recommend this one. Deep Cover follows three characters who meet in an improv class and gradually get pulled deeper into the street drug network, all under the guidance of an undercover cop. Orlando Bloom plays a manic actor-artist, Bryce Dallas Howard embodies the sharp-tongued former head girl turned mom-coach, and Nick Mohammed takes the brunt of the square punchlines.

But the story isn’t just about comedy—it’s about self-discovery. Each character is searching for a way forward in life, and the chance to step into another world allows them to see themselves from a fresh perspective. It’s the classic tension: the difficulty of truly facing oneself. Through improv, they begin to uncover truths about their own lives and the people around them.

Of course, the act of going “undercover” soon feels too real, and while they’re tempted to bail out, each turn forces them to go deeper. That push-and-pull creates both the comedy and the revelatory moments. By the end, they find their way back to the safety of their old world—bruised, a little wiser, and leaving the audience thoroughly amused.

Follow up on European homeownership rates

Taken from today’s Bloomberg letter.

There’s a noticeable trend where countries with higher state capacity—broadly understood as the ability of a government to effectively implement policies, provide public services, and maintain robust institutions—tend to have lower homeownership rates. This pattern, while not absolute, holds across several key countries when examining the most recent data (2023–2024, primarily from Statista and Eurostat).

Want a Ride?

One thing to note if you are planning a trip to Denmark is that you can rely on public transportation with confidence. In Denmark, this covers trains, commuter rail, metro, buses, and the availability of bike lanes (of which there are shockingly many). Just because it is said that a bus will be at a certain place at a certain time, it does not always mean that it will be there. And if you are in a foreign place, you don’t have the background to think, Don’t worry, the E11 always runs a little late.

Cutting back on concerns is essential when you are on a trip. They are time-consuming. They make you rethink your plans. They drain the fun out of the adventure. And maybe they are the best way to judge the efficacy of a provided service.

In Denmark, all metro, commuter trains, and inter-city trains are accessible via an app. It’s straightforward and easy to use. You can book as you stand on the track. The bus schedules are also available electronically and at each stop. On board, the screens display the time, stops, and the time of arrival at each stop, among other information. A subdued Scandinavian kerfluffle of concern arose on one trip as the wagon had to stop at the central station and not continue as planned to the airport. There was an instant sharing of information among riders to ensure everyone was in the know.

Rail infrastructure is present across the country, whose land mass is only a fifth the size of Minnesota, but whose citizenry is very similar. With the main corridors of population running between the higher-density areas, it is not surprising (in a way) that rail can be the dominant form of transportation. In an area like the northern tip of Jutland, where the rail network is limited, buses take over. As far as I could tell, most of the towns enjoyed regular daily service.

If you are making travel plans from afar, it’s significant to know that not only are the towns, cities, and hamlets accessible, but they are reliably and frequently visited. You might have a UNESCO-rated Viking archaeological site on your list of must-sees, and you know you don’t have to rent a car to reach it. Nor do you have to fudge in extra time if your timing is off in such a way as to miss the one bus that goes through the area. A traveler doesn’t worry about contingency plans or estimate the risk of not having transportation.

Renting a car is possible, but it’s expensive, costing $60-$90 per day. And then you have to pay for gas and parking. A one-hour bus ride up to Lokken, a beach town on the North Sea, costs DK94, or just under $15 —seriously.

Lastly, you will find that the vehicles themselves are well-kept and clean. School children, teens, and adults of all ages trundle on and off them with noticeable familiarity. No need to fear being laughed at or judged for not following any particular protocol. Everyone is simply going about their day. Using the extremely reliable, well-networked, optimally supplied sources of transportation that their governing body chooses to provide with a substantial subsidy.

Great architecture in Denmark

Aarhus City Hall, a classic of Danish Scandinavian Modernism, was designed by Arne Jacobsen and Erik Møller and completed in 1941, replacing an older, medieval city hall. A competition was held in 1937 to replace the increasingly insufficient town hall from the mid-19th century, leading to Jacobsen and Møller’s winning, intentionally unmonumental design. However, after public and political requests, a towering clock tower was added, and construction continued despite the German occupation of Denmark during World War II, making the finished building a symbol of democratic governance during that time.

When asked about Polanyi’s Double Movement- Claude said:

Polanyi’s Double Movement and the Evolution of Economic Thought

The Household Foundation • Original containment: In household economies, the tension between acquisition (growth, accumulation) and protection (equitable distribution, waste prevention) operates within manageable, face-to-face relationships • Natural limits: Family/clan structures provide built-in mechanisms for both encouraging productive activity and preventing destructive excess • Embedded economics: Economic activity remains subordinated to social relationships and moral obligations

The Great Transformation: Market Economy Emergence • Dis-embedding: Economic activity becomes separated from social relationships and moral constraints • Fictitious commodities: Land, labor, and money become treated as market commodities despite not being produced for sale • Double movement emergence: Society’s protective response to market fundamentalism becomes institutionalized

Evolutionary Responses in Economic Thought

Adam Smith (1776) • Market optimism: Invisible hand suggests self-interest can serve social good • Early recognition: Acknowledged moral sentiments and social bonds as necessary counterweights • Household parallel: Like family moral economy, broader society needs ethical framework alongside market mechanisms

Karl Marx (1867) • Protective critique: Exposed capitalism’s tendency toward crisis and worker exploitation • Systemic analysis: Showed how market expansion undermines its own foundations through overproduction and underconsumption • Double movement insight: Predicted capitalism would generate its own contradictions requiring protective responses

Émile Durkheim (1893) • Social solidarity: Distinguished mechanical (traditional) from organic (modern) solidarity • Integration challenge: Modern division of labor requires new forms of social cohesion • Protective institutions: Professional associations and moral regulation needed to prevent anomie

Rosa Luxemburg (1913) • Accumulation limits: Capitalism requires constant expansion into non-capitalist areas • Imperial protection: Advanced economies use state power to secure markets and resources • Global household: Imperial expansion recreates household-like extraction relationships on world scale

John Maynard Keynes (1936) • Market failure recognition: Markets alone cannot ensure full employment or stability • State intervention: Government must provide protective functions through fiscal and monetary policy • Embedded liberalism: Markets need social and political frameworks to function sustainably

Friedrich Hayek (1944) • Spontaneous order: Complex economies require market coordination beyond human planning capacity • Anti-protection warning: Government intervention threatens individual freedom and economic efficiency • Market fundamentalism: Pure market logic as protection against totalitarian planning

Contemporary Double Movement Tensions

Neoliberal Expansion (1980s-2008) • Market fundamentalism: Hayek’s vision implemented globally through deregulation and privatization • Household disruption: Traditional protective mechanisms (unions, welfare states, community institutions) weakened • Global reach: Market logic penetrates previously protected spheres (education, healthcare, environment)

Protective Responses (2008-present) • Financial crisis: Market failure triggers protective interventions (bailouts, regulation) • Populist movements: Political responses to economic dislocation and inequality • Environmental limits: Climate change forces recognition of growth’s destructive potential • Digital economy: New forms of commodification (data, attention) generate protective responses

Synthesis: The Persistent Tension

The household analogy reveals how economic thought has grappled with scaling up the balance between acquisition and protection:

• Smith to Marx: Recognition that market expansion requires moral/social counterweights • Durkheim to Keynes: Development of institutional mechanisms for social protection • Hayek’s challenge: Market efficiency versus social protection trade-offs • Contemporary crisis: Global markets outpacing protective institutions’ capacity

The enduring question: How can societies maintain the household economy’s natural balance between productive growth and protective distribution as economic relationships become increasingly complex and geographically dispersed?

In the beginning

The term “economics” comes from the ancient Greek word oikonomia, which translates to “management of the household” (oikos meaning “house” and nomos meaning “law” or “management”). In ancient Greece, thinkers like Xenophon and Aristotle discussed economics in the context of managing household resources, including property, agriculture, and labor, to ensure the well-being of the family unit. This was a practical concept focused on efficiency and resource allocation within the home or estate, rather than the broader market-based systems we associate with economics today.

The word economics evolved from its original Greek meaning of “household management” (oikonomia) to a broader concept over centuries, with key shifts occurring as societies and intellectual thought developed. Here’s a concise overview of when and how this transformation happened:

• Ancient Greece (4th–5th Century BCE): As you noted, oikonomia referred to managing household resources, as discussed by thinkers like Xenophon and Aristotle. It focused on practical matters like agriculture, trade within the estate, and family welfare, with some extension to city-state (polis) administration.

• Medieval and Early Modern Periods (5th–17th Century): The concept remained tied to household or estate management in feudal Europe, but as commerce and trade grew, thinkers began applying similar principles to larger entities like manors or small states. The term wasn’t yet used for broader societal systems, but mercantilist ideas (1500s–1700s) started focusing on national wealth and trade, laying groundwork for a wider scope.

• 18th Century – Enlightenment and Classical Economics: The shift to a broader meaning took shape during the Enlightenment. In 1776, Adam Smith’s The Wealth of Nations marked a pivotal moment, redefining economics as the study of wealth creation, distribution, and consumption across societies. Smith and contemporaries like David Ricardo moved the focus from households to markets, trade, and national economies, emphasizing concepts like division of labor and free markets.

• 19th Century – Formalization of Economics: By the 1800s, economics solidified as a discipline studying societal resource allocation. Thinkers like John Stuart Mill and Karl Marx expanded its scope to include production, labor, and capital on a national and global scale. The term political economy was often used, reflecting its focus on state and societal systems.

• Late 19th–Early 20th Century – Modern Economics: The marginalist revolution (1870s) and the work of economists like Alfred Marshall further abstracted economics into a science of human behavior, choices, and resource scarcity. Marshall’s 1890 book Principles of Economics popularized the term “economics” over “political economy,” cementing its modern, broad meaning as the study of how societies allocate scarce resources.

But let’s not forget about the distinction of political economy—

The term political economy played a crucial role in the evolution of the word economics from its original Greek meaning of “household management” (oikonomia) to its modern, broader sense. Here’s how political economy fits into the sequence, building on the earlier discussion:

• Ancient Roots (4th–5th Century BCE): As mentioned, oikonomia in ancient Greece referred to household or estate management, with some application to city-state governance (e.g., Aristotle’s discussions of resource allocation in the polis). This laid the groundwork for thinking about resource management beyond the household, but the term political economy didn’t exist yet.

• Medieval and Early Modern Periods (5th–17th Century): During this time, economic thought was still largely tied to household or feudal estate management, but as trade and mercantilism grew, scholars began applying resource management principles to larger entities like states. The term political economy emerged in the early 17th century, particularly with works like Antoine de Montchrestien’s 1615 Traicté de l’oeconomie politique, which explicitly used the term to describe the management of state resources and wealth. Here, “political” referred to the polis or state, extending oikonomia to national governance, trade, and wealth accumulation (e.g., mercantilist policies focused on state power and gold reserves).

• 18th Century – Enlightenment and Rise of Political Economy: The term political economy became prominent during the Enlightenment as thinkers like Adam Smith, David Hume, and the French Physiocrats (e.g., François Quesnay) analyzed wealth, trade, and production at a societal level. In 1776, Smith’s The Wealth of Nations used political economy to describe the study of how nations generate and distribute wealth, focusing on markets, labor, and trade policies. This marked a clear shift from household management to the broader study of economic systems influenced by government policies, laws, and institutions. Political economy was the dominant term for what we now call economics during this period.

• 19th Century – Peak and Transition of Political Economy: In the early 1800s, political economy was the standard term for the discipline, as seen in the works of David Ricardo, John Stuart Mill, and Karl Marx. It encompassed the study of production, distribution, and consumption, often with a focus on how political structures (e.g., class systems, government policies) shaped economic outcomes. For example, Marx’s critique of capitalism in Das Kapital (1867) was framed as a work of political economy, analyzing economic systems through the lens of power and class dynamics. However, by the mid-to-late 19th century, the term began to be seen as too narrow, as it emphasized political and social factors over emerging scientific approaches to resource allocation.

• Late 19th–Early 20th Century – Shift to “Economics”: The marginalist revolution (1870s), led by economists like William Stanley Jevons, Carl Menger, and Léon Walras, shifted the focus to individual choices, marginal utility, and mathematical models of resource scarcity. Alfred Marshall’s Principles of Economics (1890) popularized the term economics as a more neutral, scientific label, dropping the “political” to emphasize the study of universal principles of resource allocation across societies. Political economy began to be seen as a subfield, focusing on the interplay of politics and economics (e.g., trade policies, labor laws), while economics became the broader discipline.

In summary, political economy emerged in the 17th century as an extension of oikonomia to state-level resource management, became the dominant term for economic thought in the 18th and early 19th centuries, and bridged the gap between household-focused economics and the modern, abstract science of economics. By the late 19th century, economics overtook political economy as the broader term, with political economy now often referring to a specific lens within economics that examines the role of political institutions and power in economic systems.

Is it politics? Is it the economy? Or is it some mix of the two?

Veblen’s pecuniary obsession

Thorstein Veblen, the Norwegian-American economist raised in rural Minnesota, left an indelible mark on social theory with his 1899 classic, The Theory of the Leisure Class. In that book alone, he wielded the term “pecuniary” over 200 times, hammering home his critique of money-driven motives in society. Makes you wonder: was Veblen subtly arguing that transactions fueled chiefly by monetary incentives carry a distinct, perhaps colder essence—diverging sharply from exchanges rooted in social bonds, reciprocity, or community welfare?

The economics of Kronborg Castle

Sure— you knew that Kronborg Castle, on the NE tip of Zealand in Denmark, was the setting inspiration for Shakespeare, in Hamlet.

Moat, entrance,stables and Kronborg Castle

But did you realize its raison d’etre is an economic story?

See that short distance from the edge of the ramparts to the coast afar? That’s a narrow strait— perfect for tax collection.

Kronborg Castle was constructed by Denmark to enforce the collection of “Sound Dues,” a tariff levied on all ships passing through the Øresund strait between Denmark and Sweden.

The castle’s cannons ensured that vessels complied, generating significant revenue for the Danish Crown for over 400 years. 

Kronborg and the Sound Dues

  • Strategic location: In the 1420s, King Eric VII of Denmark built a fortress named Krogen on the site of present-day Kronborg. The castle was strategically positioned on the narrowest point of the Øresund, which at just 4 kilometers (2.5 miles) wide, served as a crucial entryway to and from the Baltic Sea.
  • Enforcement of tariffs: The castle and its formidable cannons guaranteed that all commercial ships entering or leaving the Baltic paid the Sound Dues.
  • Revenue generation: For centuries, the Sound Dues were a main source of income for the Danish royals, funding not only the maintenance of the castle but also covering a significant portion of Denmark’s state income.
  • Preventing fraud: To prevent ships’ captains from undervaluing their cargo to lower the tariff, the Danish king could exercise the right to buy the entire cargo for the value stated.
  • Upgraded fortress: In the mid-1500s, King Frederick II radically expanded and rebuilt the fortress into the lavish Renaissance castle known today as Kronborg. The project was almost entirely funded by the Sound Dues. 

Market Failure was used as the signal– but what now?

In days of yore, there was the market and the state. Two separate spheres of activity coexisted. And when private industry did not come through for the people, in the way they thought it should, market failure was the name given to assign blame. When the market failed, it was up to the state to address the lack of supply in areas such as medical care, poverty alleviation, housing, and the like.

One of economist Tyler Cowen’s first books addresses this trigger for state action in a compilation of thoughts on The Theory of Market Failure: A Critical Examination. But he isn’t convinced. He seems to say that when you look so closely at a tiny segment of a large system, you don’t see anything at all.

Consider externalities, a key signal that the market is merely pushing a problem onto some unsuspecting observer. He claims that (nearly) every single transaction has a positive or negative external effect. And, if you think about it, it’s true. We are social creatures. Although many consumptions are deeply personal, in the end, we always touch the lives of others.

The scope of the externalities/nonexcludability issue is vast. Nearly every concern of economic policy, from environmental considerations to research and development, involves externality problems. No one would claim that every instance of an externality warrants state intervention. There is no doubt, however, that the existence of externalities is one of the most powerful arguments for public sector involvement in the provision of public goods.

This isn’t the proper trigger for government intervention.

What about when the price seems too high, as in housing, or too low, as in wages? Whether a good is mediated through the private or public sector, prices still carry the most valuable form of comparative value information.

As noted earlier, the theory of public goods and externalities implies that if a good is characterized by nonrivalrous consumption, allowing additional individuals to consume it entails zero marginal cost. Demsetz’s arguments (1964; 1970) imply that this is only true in the presence of perfect information. Otherwise, allowing additional individuals to consume a good free of charge results in the abandonment of the price system in that sphere of activity. Since the publication of Hayek 1945, the role of prices in communicating information has been well known. In the provision of public goods as well as private goods, sacrificing such information may entail significant costs.

Prices are the most critical form of encapsulation of what groups of exchangers say about an exchange. We may not always conduct a thorough analysis of prices. That might be where the problem lies.

For instance, the exchange might be telling something vital about a group of people that others are simply not attuned to. People join various clubs throughout their lives. And these associations create structures of value.

The next two selections in section 2 of this volume discuss the nature of local public goods. Because such goods, by definition, can be provided to only a segment of a nation or community, determining which individuals will receive them becomes part of the economic problem. Once club or community membership becomes endogenous, many of Samuelson’s conclusions do not hold.

When people leave or join a club, when they exit or stay loyal, they impact how much of a surcharge the group of people in the club can charge.

The Tiebout model avoids the preference revelation problem; an individual’s preferences are revealed by his choice of location. It also avoids the free-rider problem; those who choose to belong to a given community are subject to the taxes or user fées that finance the provision of goods. Nor is pricing inefficiency a problem. If an individual is inefficiently excluded from the use of a public good or service, he can simply move to a community where that exclusion is not practiced.

The introduction written by Tyler Cowen is comprehensive. To the engaged observer, he dispels the dichotomy between industry and the state. There’s something pluristic out there. It’s big, messy, and complicated. It dovetails into many of the things people talk about under the titular of institutions. But it has structure– once you stand back and take a look.

That’s the project of the moment: a unified theory of price.

Market Design: For the Group or for the Individual?

We often think of markets as the ultimate expression of individual freedom—buy what you want, sell what you have, let prices sort everything out. But look closer at some of the most important markets in our economy, and you’ll notice something curious: they don’t work that way at all.

Take spectrum auctions. When the government sells radio frequencies, they don’t just post a “For Sale” sign and take the highest bidder. Instead, they craft elaborate auction mechanisms with complex bidding rules, eligibility requirements, and payment structures. Why? Because the goal isn’t just to make a sale—it’s to maximize revenue for taxpayers and ensure efficient allocation of a scarce public resource.

Or consider medical residency matching. Before the current system, medical students and hospitals engaged in an increasingly frantic and early scramble for positions that left everyone worse off. Now, students submit ranked preference lists, hospitals do the same, and an algorithm produces matches that no student-hospital pair would want to trade away from. Individual students might not get their first choice, but the system as a whole works better for everyone.

These aren’t broken markets that need fixing—they’re markets deliberately designed to serve collective goals while still respecting individual preferences. And they represent a fascinating middle ground.

The Pattern Emerges

Look across the landscape of market design and you’ll see the same pattern everywhere:

Electricity markets must ensure grid reliability and efficient dispatch while still letting generators and consumers pursue profit and savings. Emissions trading systems must hit environmental targets while allowing companies to minimize their compliance costs. Kidney exchange networks must save as many lives as possible while respecting individual donor and recipient preferences.

In each case, there’s a collective goal that matters—revenue maximization, system stability, environmental protection, saving lives—but also individual participants who won’t play unless they can pursue their own interests.

The Design Challenge

This creates a fascinating design challenge. How do you interpret a market that serves group goals while still harnessing individual incentives? The answer lies in the mechanisms that align private interests with public purposes.

Traditional markets work through the “invisible hand”—individual optimization magically leads to collective benefit. But in these designed markets, there’s a very visible hand carefully crafting the rules to ensure that what’s good for individuals adds up to what’s good for the group. The group is the primary competitive player.

A New Taxonomy

Perhaps we need to think about markets along a spectrum. On one end are pure private optimization markets—commodity exchanges, stock markets, your local farmer’s market. Here, individual pursuit of profit and value drives everything, and collective benefit emerges as a byproduct.

On the other end are what we might call “group-goal-constrained markets”—auctions, matching systems, environmental markets. Here, collective objectives take priority in the design, but individual incentives are carefully preserved and channeled toward those broader goals.

This isn’t about eliminating private goals or replacing markets with central planning. It’s about designing institutions that make private and public interests align. The medical student still wants a good residency. The electricity generator still wants profit. The polluting company still wants to minimize costs. But the market structure ensures these individual pursuits nod up to group purposes.

The Future of Markets

As our economy becomes more complex and interconnected, we increasingly need markets that can serve collective purposes while still harnessing individual incentives. Climate change, healthcare allocation, urban planning, financial stability—these challenges require coordination at a scale.

Market design offers a path forward: not the heavy hand of government control. We’re learning to interpret markets that work for everyone precisely because they’re designed to balance what individuals want with what society needs.

The invisible hand was never really invisible—it was just poorly understood. Now we’re learning to make it work more deliberately, and that might be exactly what our complex world requires.

Tolstoy, and the X side of warfare

A topic under examination that runs through War and Peace is the analysis of warfare. What were the keys to Napoleon’s success? The size of the army, or the genius of the man? Or something else.

In Part 15, chapter II Tolstoys starts us we thinking in terms of individual agents.

ONE OF THE MOSt conspicuous and advantageous departures from the so-called rules of warfare is the independent action of men acting separately against men huddled together in a mass. Such independent activity is always seen in a war that assumes a national character.

The author then tells us the accepted view is that it is about counting soldiers, guns, and supplies.

Military science assumes that the relative strength of forces is identical with their numerical proportions. Military science maintains that the greater the number of soldiers, the greater their strength.

But…

Military science, seeing in history an immense number of examples in which the mass of an army does not correspond with its force.

And thus Tolstoy suggests there is something else. He wants to be scientific about this thing. He calls it X.

One has but to renounce the false view that glorifies the effect of the activity of the heroes of history in warfare in order to discover this unknown quantity, x.

X is the spirit of the army, the greater or less desire to fight and to face dangers on the part of all the men composing the army, which is quite apart from the question whether they are fighting under leaders of genius or not, with cudgel or with guns that fire thirty times a minute.

It seems that what is important here is that soldiering with X is something different than soldiering in general. To fulfill a duty with X is not the same as a run-of-the-mill fulfillment of the same task. It does not quantify in the same way or lead to the same results. Labor with a purpose or a shared ambition deserves a subscript of x.

Unit One— Series Review

This Scandi noir cop series from 2000 features a strong cast and solid plotlines. But that’s not what makes it interesting. The special investigation team works out of a mobile trailer, which travels to the location of the crime. Any travel enthusiast will appreciate the insights into towns, villages, and the larger cities all over Denmark. A viewer might even take to referring to Google Maps at the start of each episode as the investigation becomes apparent.

The changing roles of women and household composition also thread through the background of each episode. It’s hard to remember that it was a big deal for a woman to be made head of the homicide unit just twenty-five years ago. Whether in conjunction with women’s advancements or not, the flagrant mate swapping verges on humorous. There are absolutely no traditional family structures. Flirtations and infidelities and reunifications are the going thing.

Control price, Property will degrade to reflect change

Territory-Watersheds for Insurance

In the context of car insurance pricing, a territory is a geographic area defined by insurers to group locations with similar risk profiles for setting premiums. Territories are typically defined using the following methods and delineators:

1. ZIP Codes: The most common delineator, as ZIP codes provide a standardized way to segment areas based on localized risk factors like accident rates, crime statistics, and claim frequency. Insurers may use individual ZIP codes or aggregate them into larger territories. [2] [16] [19]

2. Custom Territories: Insurers may create their own territories by combining ZIP codes, counties, cities, or townships into broader zones. These are designed to reflect similar loss experiences, traffic patterns, or demographic characteristics. For example, multiple adjacent ZIP codes with comparable risk may be grouped into one territory. [11] [13] [14]

3. Census Block Groups: For more granular analysis, some insurers use census block groups (small areas with 600-2,000 people) to define territories. These allow for precise risk assessment in densely populated or diverse areas. [16] [19]

4. State-Regulated Territories: Some states impose rules on how territories are defined. For instance, Connecticut uses 18 predefined territories, while California requires territories to be at least 20 square miles and prohibits single-ZIP code territories to ensure fairness and avoid overly specific pricing. [13] [14]

5. Geocoding: Insurers use geocoding tools to map a vehicle’s primary garaging address (where it’s parked most often) to precise coordinates, ensuring accurate assignment to a territory. This helps account for variations within larger geographic units. [18]

Territories are defined based on data like accident frequency, vehicle theft rates, vandalism, weather risks, traffic density, and claims history, which help insurers assess the likelihood and cost of claims in a given area. The boundaries are set to balance statistical homogeneity with practical considerations like regulatory compliance and administrative simplicity.

State Fair Season

With nearly 500 food items, 30 carnival rides, and more than 900 free performances, there’s plenty to keep you busy throughout the Minnesota State Fair‘s 12-day run. 

It’s a thing here in Minnesota. All walks of life mingle through the entrance gates in Falcon Heights. Check out the one day attendance record.

The Brief

    • The Minnesota State Fair saw its first record-breaking attendance day so far this year.
    • On Monday, 145,022 people were recorded attending the fair.
    • This breaks the previous record of 144,504 people set in 2017.

The cost of uncertainty

I showed a house this week in a modest but well-situated neighborhood. It had some problems, but mostly superficial– carpet, paint, appliances, and the like. Yet, even at a price below the comparable sales, it remains on the market. What? Uncertainty.

The property has been through a foreclosure, and as the tax records show, the bank holding the paper, Midfirst Bank, repurchased it. But this is a murky ownership situation.

At a sheriff’s sale, the buyer is not immediately given a full and clear ownership title the way they would in a normal real estate closing. Instead, the buyer typically receives one of two legal instruments depending on the state:

  1. Sheriff’s Certificate of Sale (common in states like Minnesota)
    • This document shows that the buyer purchased the property at the sheriff’s sale.
    • It is not a deed and does not yet transfer full title.
    • The original owner still has a redemption period (often 6–12 months, depending on the type of property and state law) to pay off the debt and reclaim the property.
  2. Sheriff’s Deed
    • If the redemption period expires without the former owner redeeming the property, the sheriff’s certificate is converted into a sheriff’s deed (sometimes automatically, sometimes requiring a filing).
    • The sheriff’s deed conveys whatever interest the debtor had in the property to the buyer, but it usually comes without warranties of clear title. That means the buyer takes the property subject to existing liens, unpaid taxes, or other encumbrances, unless state law says otherwise.

The property is being marketed by the owner who went through foreclosure, even though their right to the property is only through redemption. They would have to find a buyer to settle the full amount owed to Midfirst. This middle-ground ownership area makes the market uneasy. What if the bank wants more than the sheriff’s sale for fees and expenses? What if the property’s condition deteriorates between the offer and closing? Who will handle the repair? Will the title transfer be handled properly in the end?

Minnesota’s foreclosure rate is very low at one-half of one percent of the housing stock. So these sales are rare, and an investor will undoubtedly find it worthwhile to take on as a project. But in areas with insecure property rights and poor banking relations, the surcharge for uncertainty carries a hefty surcharge.

New Construction Update

Twice a year, builders in the Twin Cities Metro (and beyond) open up their model homes in an organized event to bring potential buyers out to browse.

More than 300 new homes in the Twin Cities and Rochester will be on display as part of the 2025 Fall Parade of Homes, according to Housing First Minnesota.

The event — which runs Fridays through Sundays from Sept. 5 through Sept. 28 — features homes built by 76 builders in 76 cities. Home prices range from $299,900 to more than $3 million.

Also planned is the Remodelers Showcase, which will be open on the final weekend of the tour. The showcase will feature 32 “home transformations,” including one remodeled “Dream Home” in Excelsior, according to Housing First Minnesota. (Finance and Commerce)

A lot of folks are window shopping. Builders pay designers to select the best paint colors and tile selections. It’s interesting to see if builders are betting on a new floor plan. Some years, the appliance styles make a dramatic switch, like going from stainless to white. People are curious. People are making plans for their own home improvements.

And some people really will build that brand new home they’ve always wanted.

The Public and The Private- electric edition

From Your Home to the Grid: Who Owns and Operates the Power System

When you pay your monthly electric bill, you’re acting as a private consumer in the electricity market. To you, the relationship looks simple: you use electricity in your home, and you pay your local provider for it. But behind the walls of your house is a layered system of ownership and responsibility—households, retail providers, wholesale markets, and the grid itself—all working together to keep the lights on.

Households: Private Buyers
At the household level, the role is clear: you buy electricity as a private party. You don’t own the power lines in your yard, the substation down the road, or the generating plant hundreds of miles away. Your responsibility begins and ends at the point where electricity enters your home. Your choice in the matter is limited—most households don’t pick their provider directly, unless they live in a state with retail competition. Still, you form judgments about reliability and cost, and those perceptions influence how you view your community’s services overall.

Retail Providers: Local Operators
Your local utility—the company whose name is on your bill—owns and maintains the distribution network that connects households to the grid. These companies come in different forms:

  • Investor-owned utilities (IOUs): Private corporations accountable to shareholders but regulated by state commissions.
  • Municipal utilities: City-owned providers accountable to residents through local government.
  • Rural cooperatives: Member-owned organizations governed democratically by the people they serve.

Each owns the poles, wires, transformers, and meters in their service area. Their job is to ensure safe, reliable delivery of power to your home, while also balancing infrastructure costs with customer affordability.

Generators and the Wholesale Market
The electricity itself originates with power plant owners—companies that run gas plants, wind farms, solar arrays, hydro dams, or nuclear stations. They sell their output into regional wholesale markets. Ownership here is diverse: it may be a private energy company, a public authority, or an independent producer. Retail utilities buy from these generators, sometimes through long-term contracts, other times through daily market transactions.

The Grid: Shared Infrastructure
The “grid” refers to the transmission network that carries bulk electricity over long distances. Ownership here is shared, too. High-voltage lines and substations are owned by transmission companies, often subsidiaries of investor-owned utilities. Oversight and coordination, however, rest with regional transmission organizations (RTOs) or independent system operators (ISOs). These bodies don’t own the lines; they operate them, ensuring the system is balanced and fair access is maintained.

Above them, the Federal Energy Regulatory Commission (FERC) provides national oversight, while state commissions regulate local distribution and retail rates. In this sense, the grid is a patchwork of physical assets owned by many companies, but coordinated as a single machine for reliability.

A Household’s Place in the System
So, while your home participates as a private buyer, every other level—local utilities, generators, transmission owners, and grid operators—has its own structure of ownership and accountability. The result is a complex but interdependent chain: private households at the end, backed by local, corporate, cooperative, and government players. Each layer has different incentives, but all share the responsibility of ensuring that when you flip a switch, the power is there.

Zap

Utility flagging for underground cables

If you’ve ever had to dig in your yard, you know the first step is to call the power company. Before a shovel hits the dirt, utility crews mark the lawn with a rainbow of little flags, showing where buried lines and cables run. Those markers are a reminder that beneath every property lies a web of infrastructure you don’t own but rely on every single day. This network is owned and maintained by your local electric company—the same one that sends you a monthly bill. Whether electricity enters your home through an overhead mast or a buried cable, the reliability of service rests with these local players.

Behind the Flags: How Power Reaches Homes
The electricity that hums through a house begins far away, at generating stations powered by natural gas, wind, solar, hydro, or nuclear energy. High-voltage lines move that power long distances until substations step the energy down to safer levels. From there, your local utility takes over, operating the distribution system that delivers electricity to neighborhoods and households.

For homeowners, the poles you see on the street—or the lines you don’t see underground—are not just background scenery. They are the lifelines of everyday living. Flicking on a light switch, charging a laptop, or running an air conditioner all depend on the quiet, constant work of utilities keeping those lines in good order.

Reliability and Perception
While utilities don’t often feature at the top of a buyer’s checklist the way school districts or commute times do, reliability still shapes homeowner perception. Most people only notice electricity when it fails, but repeated outages or slow restoration times can quickly create frustration. Just like trash pickup or snow plowing, electricity is a municipal-style service that residents take for granted—until it stops.

In this sense, dependability forms a kind of background preference. A household may not choose a neighborhood primarily for its utility provider, but they still form judgments, even if peripheral, about whether the service is reliable, responsive, and trustworthy. When those expectations aren’t met, the dismay can be just as real as when other civic services break down.

The Household–Utility Relationship
Every month, the bill you pay reflects both the energy you used and the infrastructure behind it. Rates cover not only the electricity itself but also the upkeep of poles, wires, substations, and the crews ready to respond when trouble strikes. For families on tight budgets, these costs can feel heavy, which is why many utilities offer assistance programs or rebates to help households manage expenses.

More Than Wires
Ultimately, the connection between utilities and homes is about more than cables and meters. It’s about ensuring every household can reliably plug into modern life. From the flags in your lawn to the wires above your street, utilities provide the unseen backbone of comfort, safety, and opportunity—making sure that when you flip the switch, the lights always come on.

Night Sky

It’s dark out! So I gave my iPhone a try at constellation photography. Not outrageous, but still satisfactory.

Big Dipper on the bottom edge of the frame

According to NPR, here’s the reason for the bright lights.

There are “blood,” “super” and “blue” moons, and then there’s the “black” moon.

The “black moon,” a rare phenomenon that occurs during a new moon phase of the lunar cycle, will occur this weekend. But don’t get your hopes up too much, scientists say, because it will be technically invisible.

Big Dipper with telescope feature

It’s unclear when it was coined, but “black moon” is an unofficial astronomical term. A new moon is considered by some to be a black moon one of two ways. It can happen when a new moon appears twice in one month (new moons usually happen once per month) or when there are four new moons in one season. When there are four new moons in one season, the third new moon is called a “black moon.”

Tariffs on Timber

Many home builders, contractors and retailers wagered that higher U.S. tariffs on imports would boost the cost of lumber, while lower interest rates would lift demand for the building material.

But those bets have failed to pay off — and lumber prices have tallied a steep decline from a record high reached only three weeks ago. MarketWatch

Of course, there’s more than just tariffs in play in the market. Housing demand is down. Many new owners tackle renovations in the first months of home ownership. Fewer sales mean fewer renovations.

The market had rallied on classic “buy the rumor, sell the fact” action, he told MarketWatch. Prices for lumber had been higher just a few weeks ago based on the idea that tariffs were going to be attached to lumber and people were going to have to pay substantially higher costs — yet the underlying demand isn’t there, Kuta said.

People also overestimated where interest rates would be and their impact on lumber demand, which continues to slide lower, he added, with the “swing and a miss” he referred to based on housing statistics and earnings for publicly traded companies that supply lumber.

For now, the addition of tariffs has not resulted in the anticipated price increase. So what’s the takeaway? Hire contractors and get that house addition done! Lumber prices, a main component in construction, are down because demand is down, which on turn means contractors are looking for jobs– it is time to build.

Best Bird App

I love the Merlin ID app by Cornell Lab.

Everyone can make out a mallard or spot a majestic eagle, but this chirp identifier lets you identify all the smaller or lesser know creatures perched in your backyard foliage.

Just tap on the green arrow, and a recording starts. Every time a song is picked up, the bird ID flashes below.

Then you can replay the recordings to become familiar with all the different calls.

Another free educational service brought to you through new technology and the drive for data.

The Cascade Effect: Unlocking Housing Affordability

Housing markets often seem mysterious, but at their core they operate as a cascading system shaped by wealth, supply, and lending rules. A recent model by Abramson and Landvoigt highlights how rising wealth inequality and slow housing supply interact to push prices upward. Their framework divides housing into quality tiers, from luxury to starter units, and shows how households with different levels of wealth compete across these tiers.

A central insight is that prices at the very top do not stay isolated. Luxury buyers are a small share of the market, and in some sense they simply bid against one another for exclusivity. One might argue that they are “fools” for paying such large premiums, while the rest of the market should remain relatively affordable. But in practice the tiers are linked. When supply of luxury units is restricted, affluent households who cannot find space at the top tier shift down into the next-best homes. That displacement triggers a chain reaction: middle-income households face stiffer competition, prices at their tier rise, and the pressure filters all the way down to lower-income renters. Economists call this the filtering or musical chairs effect, and it means that adding supply at the high end can improve affordability across the board.

This cascading dynamic is exactly what makes the market work. New supply at any tier frees up units that can be occupied by someone else, allowing households to sort themselves according to means and preferences. The danger arises when either end of the ladder is blocked. If new high-end supply is not built, the wealthy bid down-market and crowd out others. If older or more affordable stock is neglected, the bottom rungs collapse and low-income households are left without viable options.

At the same time, credit standards shape who can actually buy. A household that cannot afford the payments will not receive a loan, which protects individuals from becoming dangerously over-leveraged. But this underwriting filter does not stop prices from rising overall; it only determines who gets excluded. The clearing price is still set by those wealthier households who can obtain financing. Those priced out of ownership often remain in the rental sector, where demand pressures drive rents upward as well.

Taken together, the picture is less about a simple split between the rich and poor and more about a tightly connected cascade. Housing affordability depends not only on overall supply but also on how well each rung of the ladder is maintained and allowed to expand.

The associational role- Tolstoy Edition

Pierre explains to the Freemasons.

“The whole plan of our order should be founded on the training of men of character and virtue, bound together by unity of conviction and aim,— the aim of suppressing vice and folly everywhere by every means, and protecting talent and virtue, raising deserving persons out of the dust and enrolling them in our brotherhood….”

The Reality of Minnesota’s Housing Market: Data Over Drama

Is affordability really an issue?

The narrative of a housing affordability crisis in Minnesota deserves scrutiny when examined against the actual data. The numbers tell a remarkably different story than the one often presented in policy discussions and media coverage.

The fundamental reality is this: 99.82% of Minnesotans are housed. With approximately 5.7 million residents and only 10,522 experiencing homelessness according to the most recent Minnesota Homeless Study, the state has achieved what many would consider a housing success story. This isn’t a marginal victory—it represents one of the most successful housing outcomes in the nation.

Supply Meeting Demand

Perhaps even more telling is the relationship between housing supply and population growth. Over the past five years, Minnesota’s housing stock increased by 3.87% while the adult population grew by 3.90%. This near-perfect alignment suggests that new construction is effectively matching new resident demand—a fundamental indicator that the housing market is functioning properly.

This supply-demand balance contradicts claims of a systemic housing shortage. When housing supply keeps pace with population growth, market forces should theoretically maintain relative affordability absent other significant economic disruptions.

The Missing Financial Stress Evidence

Claims of widespread housing-related financial distress should be accompanied by clear indicators of economic strain. Yet when we examine Minnesota’s financial stress metrics, the evidence doesn’t support a crisis narrative:

Credit Card Debt: While Minnesota residents carry an average of $6,800 in credit card debt, this represents a manageable burden for most households. Only 6.65% of Minnesotans are behind on credit card payments—a figure that, while not negligible, hardly suggests widespread financial collapse.

Payday Loans Eliminated: Rather than seeing increased desperation borrowing, Minnesota has essentially eliminated its payday loan industry through regulatory action. The state capped interest rates at 36% APR in 2024, driving out predatory lenders who previously charged an average of 202% annually. Payday America, which handled two-thirds of the state’s payday loan volume, simply stopped operating in Minnesota. If financial stress were truly endemic, we would expect to see increased demand for these services, not their market elimination.

Bankruptcy Filings: While March 2024 saw 731 bankruptcy filings—the highest since March 2020—this represents a return to pre-pandemic levels rather than an unprecedented crisis. The temporary reduction during the pandemic was likely due to federal assistance programs and eviction moratoriums, making the current numbers a return to historical norms rather than evidence of new distress.

The 30% Rule: An Arbitrary Standard

The frequently cited “30% rule”—that housing should consume no more than 30% of household income—deserves particular scrutiny. This threshold traces back to the United States National Housing Act of 1937, developed for public housing eligibility criteria nearly 90 years ago.

As household finance expert Andrés Shahidinejad notes: “There’s no scientific basis or magic reason for (30%) being a cutoff.” Fortune magazine has called the rule “arbitrary and not very helpful for policy makers.” The standard was created in an era of dramatically different household economics, employment patterns, and lifestyle choices.

Modern households make different tradeoffs than their 1937 counterparts. Some prioritize location and are willing to spend 40% or 50% of their income on housing in exchange for shorter commutes, better schools, or urban amenities. Others prefer larger homes in less expensive areas. These are choices, not evidence of crisis.

Reframing the Conversation

The data suggests Minnesota has achieved something remarkable: a housing market that houses virtually everyone while maintaining supply growth that matches population growth. Rather than focusing on arbitrary percentage thresholds from the 1930s, we should celebrate this success while remaining vigilant about maintaining it.

This doesn’t mean housing policy should be ignored. Maintaining the supply-demand balance that currently exists requires continued attention to zoning, construction costs, and regulatory barriers. But it does suggest that crisis rhetoric may be misplacing our focus and potentially leading to policy solutions for problems that may not exist at the scale suggested.

The evidence points not to a housing affordability crisis, but to a housing success story that deserves recognition and careful preservation. Minnesota’s achievement of housing 99.82% of its population while maintaining supply growth represents a model worth studying and replicating, not a crisis requiring dramatic intervention.

This is one type of missing housing

For 125 years, this building has been a form of low-income housing. It was a hotel for most of the time, but it is now being explicitly managed in aid of Veterans. But slowly, these types of housing are squeezed out of areas, as are trailer homes.

Rentals in single-family homes are also less common than in years gone by. Many core cities, which would benefit most from additional forms of rentals, require a variety of regulations which discourage owners from renting out part of their house. They are also held to standards that, in the past, favored an owner whereas now puts them as a disadvantage.

Yes, more homes need to be built. But many other forms of casual living situations have been squeezed out of existence by rules and regulations.

Is it better?

Sometimes I run a piece through Claude to see how it appears as an AI revision. It’s always much better. The one below is a rewrite of yesterday’s post. But I sometimes miss my unusual word choice and structure.

When Everyone Had the Power to Act, No One Did

Victoria Wilson
August 11, 2025

US Attorney General Joe Thompson’s recent assessment of Minnesota’s fraud crisis cuts to the heart of a systemic failure. As he told the Star Tribune: “This fraud crisis didn’t come out of nowhere. It’s the result of widespread failure across nearly every level of leadership in Minnesota: Politicians who turned a blind eye. Agencies that failed to act. Prosecutors and law enforcement who didn’t push hard enough. Reporters who ignored the story. Community leaders who stayed silent. And a public that wanted to believe it couldn’t happen here.”

Thompson is describing something profound: the collapse of state capacity through a thousand small abdications of responsibility.

The Architecture of Inaction

At every decision point—what scholars call the “locus of discretion”—someone could have acted. The architecture of prevention was already in place; what failed was the will to use it.

Politicians possessed both influence and institutional knowledge. Any number could have quietly removed a questionable contractor from consideration or flagged suspicious applications. Career bureaucrats, masters of administrative friction, could have deployed their expertise differently—slowing suspicious applications rather than legitimate ones, demanding additional documentation, or simply doing their jobs by visiting the nonprofit distribution sites that journalists later discovered were empty storefronts.

But the machinery of oversight had been recalibrated around different priorities.

The Pendulum’s Swing

Law enforcement and prosecutors had internalized a new philosophy. Years of concern about overcharging and mass incarceration had created an institutional bias toward restraint. The progressive approach—emphasizing rehabilitation over punishment, empathy over enforcement—had become orthodoxy. This wasn’t necessarily wrong in principle, but it created blind spots in practice.

When the prevailing wisdom holds that harsh enforcement causes more harm than good, the institutional reflexes that might catch sophisticated fraud schemes atrophy. The very skills and instincts that prosecutors once relied upon were now viewed with suspicion, even by the prosecutors themselves.

The Fourth Estate’s Absence

Perhaps most puzzling was the media’s delayed response. Major fraud schemes leave trails—suspicious contracts, questionable nonprofits, patterns of payments that don’t match claimed activities. These stories don’t require deep investigative resources so much as basic skepticism and persistence.

Yet for years, the story went untold. What accounts for this collective editorial blind spot? The same social and ideological currents that affected other institutions likely influenced newsrooms as well. When the dominant narrative emphasizes compassion over skepticism, reporters may unconsciously avoid stories that complicate that narrative.

Social Proof and Professional Risk

The community leaders Thompson mentions—board members, nonprofit executives, civic figures—faced their own constraints. In professional networks where certain viewpoints signal virtue and sophistication, dissent carries social costs. The cocktail party circuit that shapes elite opinion had settled on particular truths about criminal justice, social services, and community empowerment.

Raising uncomfortable questions about fraud prevention or accountability could mark someone as unsympathetic, backward, or worse. When career advancement and social standing depend on maintaining good relationships within ideologically coherent networks, the incentives point toward conformity rather than vigilance.

The Paradox of Distributed Responsibility

This case illustrates a peculiar modern phenomenon: system-wide failure despite individual competence. None of these actors were incompetent or malicious. Politicians understood governance, bureaucrats knew their procedures, prosecutors understood the law, reporters could investigate, and community leaders cared about their communities.

The failure occurred because everyone was optimizing for their immediate institutional and social environment rather than the system’s overall integrity. Each actor made rational decisions given their constraints, yet the collective result was irrational—a massive fraud that continued for years despite numerous opportunities for intervention.

The Cost of Consensus

Thompson’s critique suggests something uncomfortable: that the very social and ideological consensus meant to create a more just society may have created new vulnerabilities. When preventing harm becomes conflated with avoiding enforcement, when empathy becomes synonymous with credulity, the institutions meant to protect public resources become unable to protect them.

This doesn’t argue for a return to punitive excess, but rather for institutional cultures capable of holding multiple values in tension—compassion and accountability, reform and vigilance, trust and verification.

The Minnesota fraud case reveals what happens when that balance is lost, when the locus of discretion at every level points in the same direction: away from the uncomfortable work of saying no.

The Locus of Discretion

What is being described in the following passage?

“This fraud crisis didn’t come out of nowhere. It’s the result of widespread failure across nearly every level of leadership in Minnesota: Politicians who turned a blind eye. Agencies that failed to act. Prosecutors and law enforcement who didn’t push hard enough. Reporters who ignored the story. Community leaders who stayed silent,” he told the Star Tribune recently. “And a public that wanted to believe it couldn’t happen here.”

That’s from US Attorney General Joe Thompson as reported in the Minnesota Reformer.

Isn’t he talking about state capacity? At every level, at each locus of discretion, action could have been taken to deter the fraudsters. Politicians are powerful and familiar with the levers of influence. Many could have bumped a potential n’er-do-well from the contract they pursued. Bureaucrats are very familiar with slow walking. Anyone in the chain of processing payments could ask for more information, lose pieces of the application, or demand more verifications. Heck, they could have even done they’re job and gone looking for the non-profits’ distribution sites, which, as the reporters later discovered, were vacant shells.

Prosecutors and law enforcement were busy working the other side of the justice spectrum. Anxious about overcharging instead of undercharging, they were busy releasing those who in past years would have received sentences. It’s been avant-garde to look the other way and anticipate a return to the law-abiding citizenry due to this empathetic understanding. (If you haven’t been au courant, this has not been successful.)

The reporters have finally come through five or six years into this monumental fleecing of the public purse. But where or where were they a few years ago? Four years ago? Six years ago? Who’s been persuading them to look away when such a tale was left untold? And the community leader, how about you? At the same parties, I’m sure. Drinking the same cocktails. Talking the same talk of empathy for the wayward results in reduced recidivism. Even though there is no track record. But the fashion of the day prevails. And social circles are heavily influenced by the fear of being left off the invite list for the next big event.

So there you have it. A big state capacity flop. At every level, the few who might have shoved the right disclosing email on the right desk, or talked a bit too much at a party to get the right word in the right ear, all muted. All cloaked down by the desire, no, the need, to be in with the crowd du jour.

Namibia and Saskatchewan?

Rural folks in Namibia share a similar need to those living in the open plains of southern Saskatchewan. There is a need for ambulances and none are forthcoming.

We have lost more than five innocent lives due to poor roads and a lack of clinical facilities,” Gcugcuma village headman Kapeta Sikukutu told regional leaders during the engagement….

“People have died on their way to the hospital from remote areas because of transport problems,” the headman said.

“We use the traditional mode of transport, which is oxen, and it contributes to the loss of lives. It takes hours for one to reach the clinic, which is 30km away from where we live,” Sikukutu said. Namibian.

Meanwhile across the globe.

High call volumes and a shortage of paramedics are making for difficult situations when it comes to fast ambulance services in Saskatchewan.

Through a mutual aid agreement in Regina, fire crews are responding to ambulance calls when an ambulance can’t immediately respond.

Global News CA

In both cases local residents come together to figure out how to cover these infrequent, untimely, but highly necessary transport needs.

It seems like there’d be a model for this.

Claims about public goods— data edition

Data collection by government is good. It is necessary. It’s as reliable as the bureaucracy that Shepards its output.

I love how this article in Bloomberg, The BLS Can’t Be Replaced by the Private Sector, by Claudia Sahm slices and dices the public nature of data collection. But I wonder about her denial of its private creation. Let’s consider her claims.

To be clear, this is the way it should be: Private companies are not in the business of creating public goods, which is what economic statistics from the government are. They are free to users, transparent in their methods, protective of the privacy of individuals and businesses, and dependable. Most private companies that create statistics charge users for access. (Some share their results publicly as a form of marketing.) Many private companies share only limited information about their methodology to deter competition.

Private companies are in the business of making a profit, and to do that they need to attract customers. Some customers are more profitable than others. As a result, a company’s data will tend to reflect the needs of its clients — it won’t capture the economy as whole.

And yet— many privately created data sets are used openly in a transparent fashion.

Here’s a list summarized by Grok of data provided by private enterprises for public consumption:

Private organizations often provide data that can function as a public good—non-excludable and non-rivalrous, benefiting society broadly. Here are some examples:

  1. Open-Source Software Data: Companies like GitHub or Red Hat share code repositories and software documentation, enabling developers worldwide to build and innovate without restriction.
  2. Environmental Data: Private firms, like those operating weather stations (e.g., IBM’s Weather Company), provide real-time weather and climate data, which supports disaster preparedness and agricultural planning.
  3. Health Data Aggregates: Pharmaceutical companies or research institutions sometimes release anonymized clinical trial data or disease prevalence statistics, aiding public health research and policy.
  4. Geographic and Mapping Data: Organizations like OpenStreetMap or Google (via public APIs) offer mapping data that supports urban planning, navigation, and disaster response.
  5. Educational Resources: Platforms like Khan Academy or Coursera provide free or low-cost educational content, democratizing access to knowledge.
  6. Economic and Market Data: Financial institutions like Bloomberg or trading platforms sometimes release anonymized market trends or economic indicators, informing policy and research.
  7. Scientific Research Data: Private research labs, such as those in biotech, occasionally share datasets (e.g., genomic data) that advance collective scientific knowledge.

These datasets, while often generated for profit, can be shared in ways that make them accessible and beneficial to the public, resembling public goods.

Furthermore, there are frequent examples of bureaucratic efforts being led astray by private subgroups. The temptation for biased numbers can occur in both sectors.

Can we think of any recent Federal agencies being dismantled?

Once modest, Now grand

The Potato Row houses were built for factory workers outside the fortifications of Copenhagen in the late 19th Century, a time when each one housed 2-3 families. Today, they are coveted single-family townhouses for the upper class, selling for $2-3 million, with a tiny backyard and street parking if you can find it.

With thanks to @copenhagenbycosedis for his hospitality, and for providing the mobile number of a good helicopter pilot.

Land use and appreciation is always in transition. Sometimes slowly, sometimes fast.

Discovery then and now

Before AI, you had to get up close and to see how things happened.

Now you just ask: Rubber cultivation from rubber trees involves planting the trees, allowing them to grow for several years, and then collecting latex from the bark. This latex is then processed into natural rubber. The process can be resource-intensive, and there are ongoing efforts to improve the sustainability of rubber production, including using degraded land for plantations and exploring more efficient extraction methods. 

The Feast of the Goat

This carefully crafted book intertwines three tales occurring around the 1961 assassination of Rafael Trujillo, the brutal dictator of the Dominican Republic. The author’s language is beautiful and descriptive. He astutely matches the voices of each of his characters to the vernacular. There are enough historical facts to learn something without the narrative becoming pedantic. All these features make it brilliant.

But I believe the author is trying for more. It’s as if he wants to answer the question: How does a brutal dictator maintain such cruel control of a country for three decades? He is laying out how it works. First, he tells us of the agents. He gives us Urania. She returns to her homeland with the sole objective of presenting her father with a tally of her expenses for a decision he made so long ago. Then there are the insurgents, working together in a high-risk pursuit. And there is the dictator who is conflated with the state, as he has all those powers and economic means at his disposal.

The author is clear that there are more units of shared interest. Each of these agents has ties to the family. And each of these has varying fortunes depending on its ranking within the social structure.

To keep his model tight, the author does not pursue the family as agents who take action. He keeps to three stories, three positions of departure around one historical event. The first is the view of the lead character, Urania Cabal. Her story is one of private loss. One might want to point out that her upbringing in the upper echelon of society is what led to her success at Harvard and in the legal profession. Though her return after thirty-five years in the US is only to punish her father. To make it clear that his betrayal was beyond redemption.

The insurgents’ story is interesting as they tell individuals tales while collaborating in the assassination of the all-powerful leader. Their losses under the dictator’s reign are aired. There’s an ongoing tally of the wrongs against them, the losses they’ve incurred, and the potential penalties their actions could bring to them and their families, all while dangling the glory of being the crew that extinguishes the dictatorship. They work as a team. Their action influences the direction of the country.

Truiljo’s firm grip on the small Caribbean country occurred through control of the secret police, the army, and industry. His private gains were considerable. Truiljo’s ability to manipulate the interests of subordinates is significant. But the author gives us more insight. He shows, by running these stories simultaneously, how Truiljo understood the impact of corruption on other close affiliations. He led people to a point of no return, destroying collations one by one. One wonders if his fear of the church is somehow related to a fear of the levers of redemption.

I believe that Mario Vargas Llosa uses this book to break out individual agents, groups as agents, and show how they interact, how they are motivated, and where all the gains and losses occur. It shows up in his language.

On page 267, Trujillo’s girltrader and dealmaker tells Urania’s father, “He (Trujillo) will call you. He’ll return what’s been taken from you. Uranita’s future will be secure. Think of her, Agustín, and shake off your antiquated prejudices. Don’t be an egotist.” He offers a perverse message of fulfilling his family obligation, of helping out his daughter, by offering her up as a sexual morsel to the dictator.

On page 322 the author emphasizes the active reformulation of groups as agents, “As if in a dream, in the hours that followed he saw this assemblage of Trujillo’s family, relatives, and top leaders form cliques, dissolve them, and form them again as events began to connect like pieces filling in the gaps of a puzzle until a solid figure took shape.” Once the new assemblage forms, it becomes one. A solid shape.

On page 355, the brilliant Vargas Llosa reminds his readers to depend on human nature: “Doña María’s response had been predictable: her greed was stronger than any other passion.” The first lady could be depended on to prioritize personal interests over group ideals.

In this book, the audience is presented with a model of group agency, with actions for the self or for the group, with an accounting in a before-and-after setting of people’s fortunes and deficits. Vargas Llosa answers the question of how it works.

Fully modeled with examples.

Mario Vargas Llosa talks about Adam Smith

I enjoy books where one famous intellectual gives their interpretation of another’s insights. Vargas Llosa starts his history of thought with Adam Smith and his book The Theory of Moral Sentiments.

Human beings get to know each other through imagination, and a natural sense of sympathy toward one’s neighbor is what draws one individual to another, something that would never occur if human actions were exclusively governed by reason. This feeling of sympathy, and imagination, brings strangers together and establishes between them a link that breaks down mistrust and creates reciprocal bonds. The vision of man and society that permeates this book is positive and optimistic, for Adam Smith believes that, despite all the horrors that are committed, goodness-—that is, moral sentiments— prevail over evil.

MN fact of the day

The state’s acting U.S. Attorney Joseph H. Thompson provided this statement about the decision to terminate the HHS program:

“We welcome today’s news. Fraud has been eating away at Minnesota’s public programs for years, costing taxpayers billions. Ending the Housing Stabilization Services program cuts off a major source of abuse, but this is just the beginning. The fight against fraud continues, and a broader reckoning is long overdue.”

KSTP

So there’s still more to come. The 1Billion figure is looking real.

Perhaps 7% of homes turnover in a year

Is Rural Housing Really Unaffordable? The Numbers Tell a Different Story

A recent Council of Economic Advisers (CEA) report claims rural housing affordability has plummeted, with charts showing a 75.5% rise in house prices ($145,000 to $254,000) from 2000 to 2023, while incomes grew only 12.3% ($65,000 to $73,000). This suggests a price-to-income ratio jumping from 2.2 to 3.5, implying homes are much harder to afford. But the charts mislead by lumping everyone together, hiding who’s really affected.

The CEA’s charts (Figures 5 and 6) plot real income and house prices for all rural homeowners, suggesting everyone faces a $254,000 price tag. Here’s the catch: only about 7% of rural homes (~1.6 million households) are sold each year. Most homeowners have fixed costs from years ago, like a $145,000 mortgage from 2000, and aren’t hit by today’s prices. Even worse, only a third of those sales—about 2% of all homes—are to first-time buyers, who truly face the 3.5 ratio. The other two-thirds are existing homeowners using equity from their old home to buy a new one, cushioning the cost. So, the chart overstates the burden, as only ~2% of rural households (first-time buyers) face the full market price.

Worse, the income figure ($73,000) includes older homeowners, who make up ~20% of rural residents (65+). Many own their homes outright, with low costs (e.g., $2,540/year in taxes on a $254,000 home) and low incomes (e.g., $30,000 from pensions). This drags down the median income, inflating the 3.5 ratio. Young buyers (25–45), earning ~$85,000, face a better ratio (~3.0), showing the problem isn’t as dire for them.

Picture a bar chart: in 2000, the price-to-income ratio was 2.2 for all. In 2023, it’s 3.5 for everyone (per the CEA), but only 3.0 for young buyers. A pie chart would show 20% older homeowners (low-income, high-equity), 73% other existing owners (fixed costs), and just 7% new buyers (2% first-time, 5% equity-backed). By mixing everyone into one pool, the details are drowned out.

Prices have gone up. They are set by the purchasing abilities of those entering the market. But the few homes that turn over every year should not be used to consider the housing expense of the 93% of owners who did not buy or sell. That obligation was set years prior in a different market.

Single Issue Groups vs Pluralistic Partnerships

Two recent articles by prominent housing policy voices reveal a shared concern about the structural limitations of the YIMBY movement’s traditional approach. Both Chris Elmendorf’s “YIMBYism started as a single-issue movement. It’s time to think bigger” and Matthew Yglesias’s “The power of a single-issue group” examine how YIMBY organizations have operated as focused advocates for increased housing density, but each author suggests that this narrow framework may need evolution to achieve lasting success.

The Competitive Model of Single-Issue Advocacy

Both authors describe YIMBY groups through a similar structural lens: as collections of people united around the singular goal of increasing housing density through land use reform and community lobbying. This approach has positioned YIMBY organizations as competitors in the arena of local politics, where they must vie against other community interests—from neighborhood character preservation to parking concerns—to secure favorable outcomes.

This competitive dynamic has been YIMBY’s strength. As Elmendorf notes, “The signal advantage of one-issue groups is that they can work with almost any legislator. By not taking stances on peripheral issues, they avoid making enemies.” Similarly, Yglesias emphasizes that “the strength of YIMBYism over the past 10-15 years has largely derived from its single-issue orientation during a time of relentless political polarization.” The movement has achieved bipartisan success across diverse political landscapes precisely because it hasn’t alienated potential allies by taking controversial positions on unrelated issues.

However, both authors identify a fundamental limitation in this competitive approach. When YIMBY groups operate as single-issue advocates, they inherently position themselves in opposition to other legitimate community concerns rather than as partners in comprehensive neighborhood improvement.

The Case for Pluralistic Collaboration

The articles converge on a crucial insight: sustainable support for housing density may require YIMBY groups to embrace a more pluralistic approach that considers multiple public goods simultaneously. Rather than competing against other neighborhood priorities, they could collaborate to address the full spectrum of urban challenges.

Elmendorf argues that this shift is not just strategically wise but empirically necessary. His research reveals that “people who feel good about big cities want existing cities to become more canonically city-like.” This finding suggests that support for density depends heavily on broader urban quality of life—including schools, transportation, public safety, and cultural amenities.

Yglesias acknowledges the value of this broader approach while defending the continued importance of single-issue organizing. He recognizes that multi-issue coalitions can offer something valuable to skeptical neighbors: addressing their concerns about construction impacts by simultaneously improving schools, transit, and safety.

Beyond Zero-Sum Thinking

The structural shift both authors envision moves beyond zero-sum competition toward collaborative problem-solving. Instead of viewing neighborhood concerns as obstacles to overcome, a more pluralistic YIMBY approach would treat them as legitimate issues requiring integrated solutions.

This doesn’t mean abandoning the core mission of increasing housing supply, but rather embedding that mission within a broader framework of neighborhood improvement. As Elmendorf suggests, such an approach could offer community members a compelling trade-off: “You may not like all the buildings, but you’ll love the great schools, safe streets, fast transit, and thriving business that we’ll deliver.”

The Challenge of Multiple Public Goods

Both authors acknowledge the complexity of this transition. Weighing multiple public goods requires sophisticated political judgment and potentially controversial prioritization decisions. A group focused solely on housing can avoid taking positions on education funding or transit investment; a multi-issue coalition cannot.

Yet this complexity may be precisely what sustainable urban policy requires. Rather than treating housing, transportation, education, and public safety as separate domains competing for attention and resources, effective urban governance demands understanding their interconnections and potential synergies.

Conclusion

While Elmendorf and Yglesias differ on whether YIMBY organizations should fully embrace multi-issue coalition building or maintain some single-issue focus, they share a recognition that the movement’s competitive, narrow approach has structural limitations. The path forward likely involves both preserving the strategic advantages of focused advocacy while developing new organizational forms capable of the pluralistic collaboration that sustainable urban development requires.

The evolution from single-issue competition to multi-issue partnership represents more than a tactical shift—it reflects a deeper understanding that creating livable, dense communities requires addressing the full spectrum of residents’ concerns rather than simply winning narrow victories on housing policy alone.

Old Friends

I can’t thank fortune enough for that sweet twist of fate,


Our worlds collided, bound, some forty years to date.


Yet here we sit, on lawn chairs side by side,


On a grassy knoll where lake and sky abide.

The birds weave songs through whispers of the breeze,


Their calls a chorus, soft beneath the trees.


We share our stories, threads of joy and pain,


Each word a ripple on the lake’s serene domain.

No grand design, no fate’s unyielding hand,


Just us, this moment, on this gentle land.


Grateful am I, for this sweet chance to know,


The peace of hearts aligned where wild things grow.

When the public and the private look each other in the eye

This is a super Conversation with Tyler. Helen Castor is an historian specializing in the Middle Ages.

When asked what drew her to her scholarship, she answers.

CASTOR: What an interesting question. I think I’m preoccupied by the human dimension, and that’s why the focus of my interest goes in two directions. One is psychological, that I am always trying to work out what makes my protagonists tick from moment to moment, even though I’m trying to work across five or six hundred years. That’s what I love, trying to get inside their minds and see through their eyes.

The other thing I’m preoccupied with is the functioning of power. I think that’s why I love the Middle Ages, because I’ve always felt, in looking at modern history, that I get bamboozled by structures, by the institutions through which power is expressed and mediated.

What I find fascinating about the Middle Ages in England is that you’re looking at a very sophisticated structure of power, but it’s present in bare bones because we don’t have the great apparatus of state. Therefore, individual choices and individual psychology become extremely exposed, so it’s that point where skeletal structures of power are being inhabited by particular individuals, and how that plays out. I think that’s where my interest lies, and therefore that’s where I’m hoping to contribute.

The Middle Ages, the family, the state and the people are so tightly held they look each other in the eye.

A way to think about transaction costs

Me: Could you say the friction occurs at the intersection of markets for goods and markets for institutional services? It’s a settling of accounts between two spheres

Grok: Yes, that’s a sharp way to frame it. Transaction costs can indeed be seen as frictions arising at the intersection of markets for goods (where the primary exchange of products or services occurs) and markets for institutional services (the mechanisms, like legal systems, information platforms, or intermediaries, that facilitate those exchanges). These costs reflect the “settling of accounts” between the two spheres, as you put it, because they emerge from the interaction of the core transaction (buying/selling a good) and the supporting infrastructure needed to make it happen.

For example:

  • In the goods market, supply and demand determine the price of, say, a car.
  • In the institutional services market, the costs of searching for the car (e.g., via a platform), negotiating the contract (e.g., legal fees), or ensuring delivery (e.g., escrow services) create frictions that add to the total cost of the transaction.
  • These frictions are where the two spheres “settle accounts,” as the efficiency of institutional services (or lack thereof) directly impacts the ease and cost of completing the transaction in the goods market.

This interplay can be sticky—high institutional costs (e.g., slow courts, opaque information) don’t always adjust smoothly to market dynamics, creating persistent frictions. Conversely, competitive institutional markets (e.g., streamlined online platforms) can reduce these costs, aligning the spheres more seamlessly. Your metaphor captures how transaction costs are a bridge—or sometimes a barrier—between the idealized exchange of goods and the real-world systems that enable it.

Damages- Series Review

This 2007 made for TV series started slow. But the actors involved were some of my favorites like Glenn Close who plays the villain well, and Ted Danson and Zeljko Ivanek who is always a ringer for the man behind the power player.

By the third episode the interplay in the plot becomes entangled and interesting. Slowly the story is revealed with further complications for all the players. Back and forth the favor seem to switch from one party to the other.

The writers seem particularly tuned in to playing off the balancing act between privates lived and work commitments. The whole ‘how wealthy people live in expensive cities’ add a dimension to this. The videography of Manhattan is fun.

This legal drama series is worth your time!

Externalizing and Internalizing

What does it mean? When a party externalizes or internalizes? Let’s consider how Edward Glaeser uses the terms in his article, “Reforming Land Use Regulations,” published by Brookings.

Theoretically, it is at least conceivable that America’s web of locally-constructed zoning codes have worked out to be a finely tuned system that functions like a perfect Pigouvian tax internalizing all the offsetting externalities of all new construction.

The article explores how zoning, particularly single-family zoning, restricts the market from generating more livable units, such as multifamily buildings. This restriction causes an internalization of benefits to the group of homeowners who wish to limit growth near them. And this is indeed how it works. A developer wants to build a high-rise, and the neighbors show up at the planning commission meeting to complain that the new structure will cast shadows over their properties.

The reference to offsetting externalities refers to the implication that new construction will generate some negative outcomes in the form of increased vehicles and hence air pollution, for example. Glaeser suggests that the motion of externalizing and internalizing, which is a dynamic effect of value transfer between individuals and groups and greater groups, can arrive at a balance: a perfect Pigouvian tax.

Here’s another observation about externalities.

Our attempt to assess the total externalities generated by building in Manhattan found that they were tiny relative to the implicit tax on building created by land use controls (Glaeser, Gyourko and Saks, 2005).

This comment also suggests that an equalizing measure can be achieved by balancing the flow of social costs and benefits between groups. Here, the researchers were unable to add up enough costs to validate the internalized benefits to property owners of land-use restrictions. However, perhaps this is a framing issue. Maybe people only see the costs and benefits in their very reduced sphere because they haven’t been presented with the resonating effects up and down a nested system of groups.

Internalizing and externalizing are dynamic terms for the balancing of social costs and benefits.

Delays are not all due to Land Use Regs

There’s some good stuff in this 2017 article, Reforming Land Use Regulations, written by Edward Glaeser for Brookings.

First, there is the concept of Minimum Profitable Construction Cost.

But the regulatory approach on housing should compare housing prices to the Minimum Profitable Construction Cost, or MPPC. An unfettered construction market won’t magically reduce the price of purchasing lumber or plumbing. The best price outcome possible, without subsidies, is that prices hew more closely to the physical cost of building.

Many people outside the real estate industry discuss ‘building new housing’ as if it were something that can be grown if you simply plant the right seeds. Whereas the reality is that a construction project won’t get off the ground without incentives. The MPCC validates this model and provides a benchmark for measuring the starting point at which a project can be launched.

The following noteworthy observation is that old properties are valued less than new. Thus it follows that rents for older properties are less than new construction.

We then compare these construction costs with the distribution of self-assessed housing values in the American Housing Survey. The distribution of price to MPPC ratios shows a nation of extremes.  Fully, 40 percent of the American Housing Survey homes are valued at 75 percent or less of their Minimum Profitable Production Cost. 

What this means for the public is that it is 25% cheaper (or more) to subsidize a renter in an older property than in brand new construction. Now that a Harvard man has written it down, can everyone stop with the ‘let’s build affordable housing’ rhetoric? New is never the least expensive option.

In reference to the 2008-2011 downturn, Glaeser remarks.

Our painful housing bust eliminated some of the affordability problem in our most expensive areas, but that problem has returned.

So, housing prices go up and down. Yet it seems that the topic of housing is always making the intellectual rounds when prices are on the rise —why? There is as much to learn about the dynamics of real estate when the market deflates as when the market inflates.

Here is a most underinvestigated observation.

 Getting the right national policy requires comparing the social costs of building in one location versus the costs of building elsewhere. 

The two social costs mentioned are environmental damage and the downsides of local growth. But think about who shows up at council meetings and what they complain about. Insufficient parking, increased traffic, noise and disruption, putting a strain on the schools, criticism of luxury buildings, and on it goes. The social aspect of this is extensive and profound. And each person in the chain of events that end in new construction has the ability ot use social norms to enhance or detract from the project.

Land use rules are a factor in shaping the development and redevelopment of an area. But there is so much more.

Composers in the time of *War and Peace*

Leo Tolstoy’s epic, War and Peace, is set during a period of significant change on the European continent. During this time, the musical patronage system was also transitioning. “While the Napoleonic Wars (c. 1792–1815) and the broader European revolutions disrupted or dismantled many traditional aristocratic institutions, a handful of European courts managed to maintain strong systems of musical patronage well into the 19th century. These courts often had a mix of economic resources, political insulation, and cultural identity-building motives that allowed them to keep composers and ensembles under their employ.

Here are the royal courts that held onto the aristocratic support model longest — and why: the full link (from chat).

The stories of Napoleons voracious conquests are felt in Beethoven’s rhythms.

Here is the full playlist of music heard in the Vienna court in 1810.

Put and Take Lakes

Fishing is an integral part of Minnesota’s culture. People fish off their boats. Clusters of folks fish off piers at public parks. High school students have developed fishing as a competitive sport. And there’s purse money involved. Partly, it’s evolved due to the abundance of lakes. Almost all lakes have public access, and the waters are open to those who wander.

The Scandinavian countries have counted on the waters for fish for centuries. Rod Hsu, a fisherman blogger, recounts a trip to Denmark where he learned about put-and-take lakes, Urban Fishing in Danish Lakes.

Denmark is made of several large islands that were formed during the glacial melt. Unlike British Columbia, it lacks mountains and streams. However, it is surrounded by productive ocean waters and there are many small lakes that can be excellent for sportfishing. Fishing is a year round activity, and wintertime can be extremely productive. For the adventure seekers, testing your strength with huge Atlantic cod up to 20kg or flyfishing for sea trout along the beach are definitely the way to go. However, if you can not brave the windchill, lake fishing can be just as exciting. Target species in lakes include rainbow trout, brown trout, northern pike, walleye and several species of carp, perch, roach and bream.

While a fishing license is required, there are also private waters where anglers need to pay user fee to fish in them. One such type of waters is known as the “put & take lakes”. These natural lakes are privately owned and stocked with rainbow trout by the owner. The lakes are generally quite small, most BC anglers would call these ponds. The concept is simple, the owner put fish in the lakes regularly while the anglers pay a certain fee based on the length of their fishing time and are allowed to take their catches home.

Fishing licences are required in Minnesota as well. And they are enforced. A ranger will stop boats on the lake and ask to see their documentation. They will also check the boat to ensure fishermen are not taking more than their limit. This is all organized through public means.

It’s interesting how, in different countries, different goods are considered better managed by private parties versus keeping them open to the public.

These privately managed put & take lakes are great ideas for a country such as Denmark that does not have enough natural resources such as streams and large lakes like the ones we have in British Columbia. These lakes are extremely popular, especially during the summer months. By providing good fishing lakes such as these to meet the angling demand, it takes away the fishing pressure on the protected wild stocks. I think the user fee is reasonable, since anglers are fishing in a well managed lake that has all the needed facilities such as washroom, fish cleaning area and kiosk. I justify it by comparing to going to an amusement park, movie theatre or golf course where you also have to pay to enjoy the facilities. 

Heat Maps

In some parts of the country, particularly the south, people are noticing a slowdown in real estate home sales. That’s not the case up north. The image below is of the seven-county area that comprises the Greater Twin Cities metro, which is predominantly painted in red, a representation of only a few days on the market.

But the more interesting insight is that there are patches of yellow throughout the area, indicating a nook where market times approach forty days. Averaging loses nuance. Nuance is precisely where the interesting observations are to be had.

For that reason, heat maps are wonderful visuals.

Two Parent Privilege and more?

Perhaps you’ve heard the term ‘two-parent privilege’ used lately. It seems to be in the air. The “two-parent privilege” refers to the socioeconomic and developmental advantages often associated with children raised in stable, two-parent households compared to those raised in single-parent or other family structures. It’s a concept rooted in statistical trends and sociological research, though it’s debated due to its implications and the complexity of family dynamics.

Please note that there are two key aspects to the potential benefits. First, there is the straightforward sharing of resources that two working adults can bring to a shared household, versus one. Think of paying for everything on your own in a home, or being able to split all the utilities and household purchases. Consumables like food even benefit as it is easier to cook for a crowd than for a single person.

Many people may quickly lean in on the second component of the privilege, which anticipates benefits to the child in terms of emotional support as well. This is an essential factor, yet it too depends on the time a parent has to devote to the child’s needs and ambitions. If there are two adults in the home, then the number of hours available for the youth tends to increase.

The point is that the money and resources and time are resources transfered in households from adults to children. We don’t really have a separate name for these things. Or we don’t subscript them to give a sense of benchmarks for what a typical child consumes to thrive. And if we don’t tag the resources to outcomes in the household, we certainly don’t do it in clusters of households or groupings by, say, school districts. And why not? It seems like a valuable form of analysis.

Grok gives a complete response to the prompt: What does the two-parent privilege entail? Give details on the mechanics?

Floorplans, Voila

Getting the floor plan of the bank is always a prelude to a great heist movie plot. A secondary actor would have some contact who knew the architect and could somehow finagle the plans. The thieves would then strategize on how to rob the bank.

Now, plans are ordered on demand based on a simple walkthrough video of the property.

On the one hand, it seems like people would be concerned with divulging this information about their house. On the other hand, home buyers find it very useful.

Beyond the Numbers: The Hidden Social Triggers Behind Arizona’s SB 1070

I was at a family gathering this week in Montana, and somehow the conversation landed on the 2010 immigration controversy in Phoenix. Following a period of lax immigration enforcement, the people of the Grand Canyon State rose up and said, “No more.” They passed the most restrictive immigration legislation, SB 1070. While several factors are credited for triggering the political backlash, the perception of increased crime is among the leading ones cited. Opponents of enforcement are quick to point out that, on paper, crime was steady. But does that tell the whole story?

While official statistics showed no dramatic rise in crime prior to the passage of Arizona’s SB 1070, it’s a mistake to assume that public concern over disorder was baseless. The real story lies in the rise of unreported, low-level disruptions and the erosion of civic reciprocity—factors that rarely appear in data but deeply affect social life.

In neighborhoods experiencing rapid demographic change, residents noticed shifts in everyday norms: unfamiliar languages, informal labor markets, overcrowded housing, or changes in how public space was used. These behaviors weren’t necessarily illegal, but they violated shared expectations around cleanliness, quiet, parenting, or neighborliness. What was being felt wasn’t crime in the strict sense—it was a breakdown in social trust.

At the same time, public institutions like schools and emergency rooms were absorbing new burdens, often without visible new funding. To some longtime residents, this looked like one-way civic obligation: they paid in, others drew out. Whether or not that was accurate, it felt unfair, especially in the wake of the 2008 recession. That resentment built a political appetite for laws like SB 1070—not just to target undocumented immigrants, but to restore boundaries between insiders and outsiders, contributors and perceived free riders.

Support for SB 1070 was less about a spike in violent crime and more about a sense of dissolving norms and a loss of control. The law functioned as a signal: that the state would step in to defend social order where federal and informal mechanisms had, in many people’s eyes, failed.