New Refrigerators, Washing Machines, Furniture and Tires Will All Have to Last Longer, Europe Mandates
New Refrigerators, Washing Machines, Furniture and Tires Will All Have to Last Longer, Europe Mandates
That feels like a move on the slippery slope from a market economy to a planning economy.
The objective is honorable, but better value should come from customer choices, not from regulations.
Instead of making those rules and establishing institutions that enforce them, the EU should create infrastructure that allows consumers to compare products objectively. Add the opportunity to finance more expensive but also more durable products easily and there is no need to suffocate everything in regulations.
I should add that this recreates the limited housing markets for consumer goods. This is going to make life more expensive despite each rule being very reasonable. The promise of the EU were free markets, but the opposite is happening.
but better value should come from customer choices, not from regulations.
You mean lower value should come from misleading advertisement, incomplete information, irrational behaviour of actors, and other forms of market failure. Because that is how it works out in the real world.
Also, quoth the constitution (or well what passes as one for the EU), Article 3(3) TEU:
The Union shall establish an internal market. It shall work for the sustainable development of Europe based on balanced economic growth and price stability, a highly competitive social market economy, aiming at full employment and social progress, and a high level of protection and improvement of the quality of the environment. It shall promote scientific and technological advance.
Get out of here with Ayn Rand's fever dreams.
the EU should create infrastructure that allows consumers to compare products objectively
forms of market failure. Because that is how it works out in the real world
I think that it is better to improve the markets and minimize the market failures instead of trying to regulate everything.
Everything has to be checked by institutions if consumers are kept ignorant whereas competent consumers do that work for free.
Improving markets means regulation. Rating systems as you propose them are easily influenced and gamed by companies and subject to the same information and irrationality problems that individual consumer behaviour are.
Lastly, don't think that such EU regulations aren't initiated by and pushed for by consumer advocate groups. The commission is not in the habit of going around, saying "where is a market segment that isn't regulated and what pointless shit can we accost them with". If things work fine they just plainly let things be.
Thing is: There's always going to be chuds saying "REEEE I want a more powerful vacuum" and go with the one with the higher wattage number on the box, no matter what comparison portals say about actual performance. Those portals are nothing new, they have existed for a long time. Yet companies did get into a wattage war, and to write a bigger number on the box so that people would buy it you need to use a bigger motor and use more energy. Problem being: Noone is helped by vacuums which stick to the floor, so you also have to leak, and be loud. All that extra power, good for nothing.
There's exactly one way out of such a market failure: Regulation. "vacuums may not use more than X watt per Y of sucking power".
That's a good argument but doesn't fit the situation. The bad buying decisions can be corrected with market mechanisms. Allow people to finance the products over the entire expected lifetime. Then high quality goods are cheaper and people will choose them.
Some people speculated that Britain left the EU because they believe in markets whereas many EU countries don't. This could be one of many decisions that put the EU onto a different trajectory. We will see in 20 years if the EU can stay on top of its regulations.
Allow people to finance the products over the entire expected lifetime.
So you want to capture regulation in the name of the banks and whatever presumably private (because markets!!!11) agency does the life expectancy rating while simultaneously letting the manufacturers off the hook warranty-wise. Got you.
Some people speculated that Britain left the EU because they believe in markets whereas many EU countries don’t.
Those people are stupid. At least in so far as "they" refers to Britons at large. If with "they" you mean certain nobs and posh folks and with "market" you mean "offshore tax havens" then you have a point.
Brexit was pushed for by Atlas network members, notably against opposition from Atlas members from anywhere else in the world, right before the EU started tightening regulations on tax havens. Coincidence? You tell me. The rest of those neoliberal fucks rather pay taxes than burn the cake they're eating.
We will see in 20 years if the EU can stay on top of its regulations.
The EU Commission, back then in the form of the ECSC High Authority, has been doing this stuff since 1952. All European post-war prosperity is based on this kind of approach. Details differ but by and large the European economical policy is ordoliberal.
Manufacturers are not off the hook. If they are not reliable then the expected runtime is low and their monthly payments go up.
the European economical policy is ordoliberal
Without Britain, it could become more ordo than liberal.
We don't have to prevent this regulation. However we should prepare ourselves to prevent the appliance market to become like the housing market. Citizens are unable to make a change there. That shouldn't be ignored when other markets are regulated more.
Manufacturers are not off the hook. If they are not reliable then the expected runtime is low and their monthly payments go up.
If you're a manufacturer and you're not sure whether your product can last 10 years then you're free to contact an insurer and hash something out with them. Still, the buck stops with the manufacturer everything else is pointless bureaucracy. Shit broke? Manufacturer is on the hook, replace it. Simple as that. Not "customer now has to deal with a bank and the manufacturer and a rating agency".
However we should prepare ourselves to prevent the appliance market to become like the housing market.
I don't see much speculative capital flowing into home appliance rentals and turning regular home appliance rentals into short-term high-profit rentals.
There's not even an oversupply of luxury appliances at the expense of reasonably-priced ones.
Quite literally nothing about the housing market issue has anything to do with what's going on on the home appliance one, or with overregulation. Sure, in places there's regulations to re-think or even straight abolish, e.g. parking minimums, but generally building codes don't make stuff more expensive. Least of all on a macroeconomic level. The issue, for a long time, were ROI expectations of investors. It's a general problem in the economy: Too many rich fucks with too much money, not knowing what to do with it, where to invest it, but still wanting their 8% because... why. They're already filthily rich. I totally get a starving artist rent-seeking, "then I can let go of my day job and focus on my art", but a billionaire? Get the fuck out of here.
The main bottleneck for the housing market is land in areas where people want to live. People have to pay whatever they can to live close to their work. If demand is so big, of course only housing with the highest margins is developed, which is the luxery market.
The speculative capital is flowing because the high demand keeps prices stable. If there would be a surplus to the point that the speculative capital doesn't find a buyer when selling, prices would be much lower. The backing for the high prices are the real tenants though who want to live where they work.
Appliances don't need the speculative capital to become expensive. It is enough if there is less competition. Then customers can't 'move' to other products and have to pay whatever is demanded.
If the requirements stay limited to an extended warranty then things can remain competitive but I doubt that the regulations will end there. This should take cheap Chinese brands off the market that don't have a support network in Europe. That's good for nature, but it removes the cheap options off the market which will allow the market to rise the prices for the cheapest durable goods.
If demand is so big, of course only housing with the highest margins is developed, which is the luxery market.
BS. There's no market for overpriced accommodation which developers finally understood so they're dialling it down. Took them long enough.
If there would be a surplus to the point that the speculative capital doesn’t find a buyer when selling, prices would be much lower.
It's not about not finding a buyer. It's about finding a buyer that meets their ROI demands, otherwise they're happy to just let properties sit idle. That's the "speculation" part.
Again, the solution is regulation in the form of taxing vacant property. Can't find a tenant, you say? City will be happy to provide you with one, straight off the top of the waiting list for social housing. Not the price range you want to rent for? Well, then you can pay taxes until you think otherwise.
In the end, money is power. If you don't want all the power to end up with whoever happens to have money you gotta stomp people with money at some point or the other. When they whine, tell them they should become better business people, not invest in such stupid schemes as trying to turn a working class neighbourhood into accommodation for billionaires.
This should take cheap Chinese brands off the market that don’t have a support network in Europe.
Turkish, more like, China isn't really in the market here and Beko rules the low end. Still, two years warranty instead of the one year that's the legal minimum.
And honestly, 120 Euro fridges turning into 150 Euros fridges would be a good thing. Building things in a solid way is a different thing than blinging it out: Don't push designers to get rid of the fourth bolt for the attachment plate, don't save fifty cents by buying cheap lubricant, penny pinching is a disease. May increase GDP in the broken window way but who the hell wants that.
That’s the “speculation” part.
A surplus in supply would threaten them with an infinite time to wait for their target ROI.
the solution is regulation in the form of taxing vacant property
fully agree
If you don’t want all the power to end up with whoever happens to have money you gotta stomp people with money at some point or the other
Fiat currency. Public banks can hand out credits to whomever wants to build with a solid calculation.
If you don’t want all the power to end up with whoever happens to have money you gotta stomp people with money at some point or the other
You tax them. Of course only possible if the masses are not manipulated. Drones and AI, stomping would only be possible for something like 5 more years. Afterwards there is not much more power left.
120 Euro fridges turning into 150 Euros fridges
More like 120 Euro fridges leave the market and 150 Euro fridges cost 200 Euros.
Building things in a solid way is a different thing than blinging it out: Don’t push designers to get rid of the fourth bolt for the attachment plate, don’t save fifty cents by buying cheap lubricant
I want to live in a society where people choose the solid products on their own. Everything else calls for trouble down the line.
May increase GDP in the broken window way but who the hell wants that.
I don't undderstand that.
Britain (where I live) left the EU because lots of people where unhappy and Leave ran a much better campaign that Remain (and lied a couple of times). Racism probably also had something to do with it but that's hard to prove.
It wasn't really about markets because most voters don't know enough about them to decide based on them.
Most voters rely on the campaign communications which was not equally good. Is it too far fetched to think that Remain was intentionally bad?
Ah, the dream of a libertarian paradise.
The promise of the EU were free markets
Free as in fewer hurdles between nations, not as in "the market will take care of everything".
but the opposite is happening.
Yeah, no. The EU has always strived for a balance there. You bringing up the spectre of "planning economy" is just fearmongering.
You wouldn't happen to work at the Internet Research Agency?
Well you either have a plan to help people or the plan automatically devolves to “extract as much rent as possible from the people”.
Yes, and that's why competition is needed so that the 'as much rent as possible' is minimized. I am not arguing against a helpful society. We don't exchange goods for compassion but for money so we need competition.
We don't exchange goods for compassion
We actually do that all the time. Altruism takes many forms. Or if you wanna be a nerd you can call it Mutual Aid.
Edit: sorry I’ll stop pecking at you, it also took me a long time to deprogram from “Keynesian/Chicago economics is 100% right about human behavior.”
I wouldn't mind switching to a society that is built on altruism. My point is that the EU is not an inherent benevolent government. These regulations will be abused and I believe that there would be less abuse if we spent the resources on infrastructure that allows the consumers to make better decisions.
Why can't you have both? Create the best value for customers, but you have to adhere to these regulations.
Seems like a perfectly reasonable position to me.
Regulatory capture. It already exists in the housing market, medical equipment, medical drugs, etc. There, things are more expensive than necessary.
https://en.m.wikipedia.org/wiki/Regulatory_capture
The shift in responsibility to the EU is not free. Of course, it costs some taxes to run the institutions that enforce the regulations. But who is supervising those institutions? That would be up to the citizens, instead of comparing products directly.
Are citizens going to do that? Have citizens checked the sourcing of the covid vaccines?
