Real-estate analysts are warning that there’s no end in sight to rent increases. The Secretary of Housing and Urban Development (HUD) is calling it “the worst rental affordability crisis this country has even known.”
This is big. What’s happening?
To begin with, there’s a huge surplus of cash sloshing around the globe. It is controlled, not by the people who need it, but by the people who “own” it — the capitalist oligarchs.
Apple, for instance, the manufacturer of the iPhone, the iPad, and the Mac, has more than $200 billion it has not been able to invest.
In the past, that cash might have become productive capital, invested in mines, mills, and factories that employed millions of people to produce the things we need.
Today production is more and more computerized and robotic. Amazon staffed its four new warehouses with robots — and Amazon is undercutting Walmart and other big-box retailers, who are closing stores and laying off real people.
This is an economic revolution. With the traditional economy on the verge of collapse, the cash-heavy oligarchs — the capitalist 1 percent — are looking for investments in anything that will enable them to extract value from the working-class 99 percent.
In the past, they left renting houses and apartments to small investors, the mom-and-pop landlords who spent long nights keeping the books with pencil and paper and who collected the rent and did the repairs themselves.
Now global management companies like Brookfield have computerized the whole process and are marketing it to cash-heavy investors looking for an easy return. And they are doing it long-distance, without ever looking their tenants in the eye.
Funny thing, their money consists, not of gold, but of electrons on computers, the same being true of the property deeds they hold. If the 99 percent stood up, united, and said, “Enough, we built this, we use it, it’s ours,” the 1 percent would slink away into the shadows.
