Comment by Gormo
16 days ago
Internet access isn't particularly expensive in the US.
Healthcare, education, and housing are expensive in the US for the same primary reason: political interventions that simultaneously subsidize demand and restrict supply.
it is for what you get. the US LEC and CLEC system sucks, and I had wayyyy more options in the EU, and in fairly upfront and straightforward ways.
e.g. https://documentscontractuels.orange.fr/les-offres-orange-mo...
The EU doesn’t have the challenging scope and geography of the US, no?
The problem in the US is less of a geography problem and more of a regulatory one. Many towns and cities in the US gave the cable companies local monopolies back in the 50s and 60s. There are technical reasons why this worked ok (not well but perhaps better than the alternatives) for television, but now that the same rules have stretched to apply to delivery of internet access they no longer have any technical basis. So at this point they’re just a barrier to competition and exist only to raise prices.
The good news is that modern fiber systems blow cable internet out of the water. It is far cheaper to supply symmetric gigabit internet to every customer over fiber than over cable. Fiber just has more bandwidth to go around. And because it’s a different technology it is not subject to the same local monopolies that cable is encumbered with. This means that the free market is correcting the problem and has been for a decade. In many parts of the country it is now possible to get internet that is faster and cheaper than what is available in the even the best built parts of Europe. The main obstacle to that build–out is probably local permitting. Many large cities require new permits, with public comment periods for each and every one of them, for every single block that an ISP lays fiber for. Cities like San Francisco have imposed a glacial pace on their ISPs.
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// subsidize demand and restrict supply
I have never seen anyone articulate this so crisply.
The government has created a situation with the student loans thing where basically anyone can borrow 500k to get an obviously useless degree.
Are the colleges going to ensure they collect that money? Obviously yes.
> The government has created a situation with the student loans thing where basically anyone can borrow 500k to get an obviously useless degree.
The point applies even to the useful degrees, and more broadly to the universities irrespective of any particular degree program. Student loans and scholarships make demand almost completely inelastic -- totally insensitive to price increases. Universities compete to attract the best students, and a major mechanism for doing that is to invest in non-academic amenities, such that tuition prices are funding much more than literal tuition. Combine these two factors together, and you have a feedback loop of continuous price inflation.
Similar factors are at work in the healthcare and housing sectors, with the most important element being that external subsidies eliminate price elasticity on the demand side of the equation, and completely obliterate the dynamics that ensure downward price pressure in normal markets.