Latest / Underthrow / It Still Doesn’t Work

Transcript

It Still Doesn’t Work · Underthrow

0:00
SPEAKER_00: Picture this.
0:01
SPEAKER_00: You walk into your local grocery store in New York City.
0:04
SPEAKER_00: You load up your cart with fresh produce, milk, and coffee.
0:08
SPEAKER_00: You get to the register, and the total drops by 30%.
0:12
SPEAKER_00: Sounds like a dream, right?
0:14
SPEAKER_00: Well, if the city's democratic socialist contingent has its way, this isn't just a dream.
0:19
SPEAKER_00: It's the new order.
0:21
SPEAKER_00: Their plan?
0:22
SPEAKER_00: Have the city operate grocery stores at a loss, slashing prices across the board by 30%.
0:28
SPEAKER_00: And how do you pay for a government-run grocery chain operating at a permanent loss?
0:33
SPEAKER_00: Just tax the rich, the fat cats.
0:36
SPEAKER_00: At least the ones who haven't already packed their bags from Miami.
0:40
SPEAKER_00: It sounds so easy, but in the real world, it's counterproductive and destructive.
0:52
SPEAKER_00: Let's talk about profit margins.
0:55
SPEAKER_00: I know socialists hate them,
0:57
SPEAKER_00: but all organizations have to bring in more money than they spend,
1:00
SPEAKER_00: or they will run out of money.
1:02
SPEAKER_00: And that means die, even the government.
1:05
SPEAKER_00: Now,
1:05
SPEAKER_00: the average grocery store operates on a Slashing prices by 30% isn't just cutting
1:09
SPEAKER_00: into profit.
1:10
SPEAKER_00: It's running a massive, continuous deficit on every pineapple
1:23
SPEAKER_00: And here's rule number one of municipal finance.
1:26
SPEAKER_00: You can never just tax the rich.
1:27
SPEAKER_00: To cover systemic losses at this scale,
1:29
SPEAKER_00: the tax base expands to everyone in the city, which leads to a glaring irony.
1:46
SPEAKER_00: The working class New Yorkers who are supposed to be rescued
1:49
SPEAKER_00: by 30% off groceries end up funding those exact discounts
1:53
SPEAKER_00: through higher sales taxes, property taxes, and rising living costs elsewhere.
1:59
SPEAKER_00: They aren't saving 30%.
2:00
SPEAKER_00: They're just paying New York City runs on its bodegas, corner markets, and independent grocers.
2:05
SPEAKER_00: These small family
2:16
SPEAKER_00: Now, the socialist planners might say, that's fine, we'll just subsidize the bodegas too.
2:20
SPEAKER_00: But think about that logic for a moment.
2:36
SPEAKER_00: Subsidize state stores so they undercut local bodegas.
2:39
SPEAKER_00: Subsidize local bodegas so they can survive the state stores.
2:43
SPEAKER_00: And raise taxes on the entire city to fund both subsidies simultaneously.
2:48
SPEAKER_00: See why this ain't too bright?
2:52
SPEAKER_00: It's not just megacorporations.
2:54
SPEAKER_00: It's community grocery co-ops like Key Food or Foodtown,
2:59
SPEAKER_00: where workers actually own the operations.
3:01
SPEAKER_00: The very worker-owned models democratic socialists claim to protect
3:09
SPEAKER_00: Now, let's follow the tax trail.
3:11
SPEAKER_00: About 44% of New York City's local tax revenue comes from property taxes,
3:17
SPEAKER_00: with another 13% coming from sales taxes.
3:20
SPEAKER_00: When property tax rates are bumped up to cover expanding municipal subsidies, who actually pays?
3:26
SPEAKER_00: The common assumption is that property owners and landlords will just absorb the costs.
3:32
SPEAKER_00: But property owners aren't all rich, and landlords pass costs to renters.
3:37
SPEAKER_00: Raising taxes, especially property taxes, leads directly
3:43
SPEAKER_00: So the next lever they'll pull is rent freezes.
3:50
SPEAKER_00: But with rent frozen,
3:52
SPEAKER_00: property owners won't collect enough revenue to maintain their buildings
3:56
SPEAKER_00: and cover their property.
3:57
SPEAKER_00: So the quality of housing will drop,
4:00
SPEAKER_00: the buildings will degrade,
4:01
SPEAKER_00: and eventually the city will have to step in to take over tax delinquent properties,
4:07
SPEAKER_00: creating another municipal sector that requires, you guessed it, more tax subsidies.
4:14
SPEAKER_00: New York City already carries one of the highest tax burdens in the nation.
4:19
SPEAKER_00: When you build an entire municipal economy around price controls,
4:23
SPEAKER_00: artificial discounts, and compensatory subsidies, the math won't math.
4:29
SPEAKER_00: They cannot endlessly subsidize basic consumer goods by taxing the very population
4:34
SPEAKER_00: that buys them.
4:35
SPEAKER_00: At a certain point, the state isn't redistributing wealth from the top.
4:39
SPEAKER_00: It's just shuffling money from the citizens' left pocket to their right pocket.
4:44
SPEAKER_00: While skimming half of it on administrative costs.
4:46
SPEAKER_00: You know, unproductive DSA jobs.
4:49
SPEAKER_00: Neither good intentions nor abject stupidity can ever repeal the law of supply and demand.
4:56
SPEAKER_00: If you want truly affordable groceries,
4:59
SPEAKER_00: You don't want government-run grocery stores funded by endless tax hikes.
5:03
SPEAKER_00: You need efficient supply chains,
5:06
SPEAKER_00: lower barriers to entry,
5:07
SPEAKER_00: economies of scale, and tax policies that leave more money in people's pockets.
5:13
SPEAKER_00: So either the DSA needs an econ 101 lesson or they are actively trying
5:18
SPEAKER_00: to destroy New York City's free enterprise system to be replaced with
5:22
SPEAKER_00: a government monopoly.
5:23
SPEAKER_00: And we saw how that worked out for the DMV.
5:27
SPEAKER_00: I'm Max Borders.
5:28
SPEAKER_00: Let's criticize by creating.
5:38
SPEAKER_00: Underthrow is brought to you by Human Respect Labs,
5:41
SPEAKER_00: committed to advancing the philosophy of human respect worldwide.
5:44
SPEAKER_00: Whether you're helping spread the philosophy or building voluntary alternatives
5:49
SPEAKER_00: to political power,
5:50
SPEAKER_00: we support strong startup projects with up to $30,000 in seed funding.
5:54
SPEAKER_00: Got an idea?
5:55
SPEAKER_00: Visit humanrespectlabs.org to see if you qualify.
5:59
SPEAKER_00: That's humanrespectlabs.org.