The Renter Society

Guest Post by The Zman

Anyone who has rented a car, or an apartment knows it is a different relationship from owning a car or especially a house. Drive through a working class neighborhood and you can easily spot the owners from the renters. The houses with overgrown lawns will usually be the renters. Of course, everyone knows the jokes about rental cars. Even the most conscientious renter tends to be more reckless with a rental car. You just do not have the same connection with it as you own car.

Another thing goes along with this. People with old beat up used cars tend not to be as careful as people with new cars. This has been tested. Take that old clunker and fix it up or replace it with something nice and the driver gets more conscientious about his driving and how he treats the car. The same thing probably happens with houses or even neighborhoods. What is the point of having a great lawn if every lawn in your neighborhood is a trash strewn, overgrown mess?

The point here is that the relationship one has to the property at his disposal is controlled to some degree by the ownership and condition. For this reason, it has been an article of faith with conventional conservatives that the way to lift people out of poverty is to get them into a house they own. The theory is these people will invest in their community, because they own a house in it. They have skin in the game, while the renter can just pick up and leave if things get bad.

This is not something that gets much attention now. While homeownership rates are about where they have always been, few people really own their house. They have a mortgage that they may never pay off. Each generation of American is poorer and carries greater debt. The policy to inflate home prices means younger people will carry a mortgage much longer and carry a much larger debt load in general. America is a land of debtors falling deeper in debt with each generation.

Then there is the general erosion of property rights. You may own your home and your car, but some company is tracking your use of them. That information, which is your property, is bought and sold without your consent. If you have a smart TV, it is spying on you, maybe even listening to your conversations. Just as the landlord can come into your apartment at any time, corporate America can poke around in your life whenever it feels the need to harvest information about you.

It is not just in our private lives where we see the transactional arrangement supplanting the ownership society. Businesses are increasingly moving to technology platforms that are pure services. Instead of owning the accounting system and running it on your server, you sign up for a web-based option. You pay monthly and agree to their terms of service, like all the other services that now dominate our lives. Increasingly, a business is just a temporary set of rental agreements.

This is something that cannot be overstated. if you look at the firms behind the apps that pop up in our lives, there is nothing to them. They have assembled a collection of licensed products that they have given a clever name. They work out of temporary offices and rent server space from Amazon. The employees are contract labor from somewhere over the horizon. The traveling circuses of old had deeper roots than the typical tech startup. They at least owned the tents.

There is something else that relates to this change in our society. Drive around and the infrastructure is looking shabby. Streets are full of potholes. Utility lines are a cluttered mess, often looking like something from the third world. Schools are old and shabby, even in nice middle-class areas. People think about the tyranny part of anarcho-tyranny, but it is the anarchy part that has the greatest impact. There is a general shabbiness to our lives that erodes our civic pride and commitment to community.

Taken together, the engine for creating social capital has slowly fallen into disrepair, to the point where we have adopted the renter’s mentality. The only time politicians speak of community is when they are discussion artificial or imaginary communities like the “trans community” or the “Asian community.” Even more bizarre is that most people think about their on-line groups when they think of community. The typical millennial has a stronger relationship to other gamers than his neighbors.

The other thing about the renter’s mentality is the owner of the rental property does not invest more than necessary. The landlord does not install granite counter tops in a rental unit and the car rental place is not waxing the cars between rentals. The software as a service vendor is cutting costs on development, because that is his only way to increase his profit margins. Eventually, these savings have to be balanced out with a capital infusion, but often after the property is sold.

This cannot work in a society. There is no way to replace the social capital that is not being created due to the lack of community. We see this with the attempts by Washington to inject money into the economy. What is not stolen by the pirates that prey on the economy has no impact on the people. The $1,400 check is never going to be the same as a job at a local business, run by one of your neighbors. Once the money is spent, there will be a new cry for more checks.

America is a rentier economy populated by people with a renter’s mentality. Every relationship is transactional. Once the transaction is over, the parties go on their way until the next transaction. One result of this is the country now looks like a neighborhood full of rental properties. No one, not even the government, sees a reason to invest in anything other than their immediate needs. The last functioning institution is the military, and it is succumbing to the same mentality.

It is tempting to call this feudalism, but feudalism had a strong ownership component and a well-defined set of reciprocal responsibilities. Modern America is becoming something different. A tiny group of people own everything, either directly or through the financial system, with no relationship to anyone other than through the rental agreement, the terms of service or the short term contract. The vast majority are just passing through society like renters.

Whether or not this is sustainable is an open question. The only societies we have ever created without social capital are penal colonies. Even in those, the inmates build bonds with one another. A prison cellblock has more social capital than a gaming community or social media network. We are into uncharted territory. Can a society sustain itself in a crisis, even a society post scarcity, when none of the members feels any connection to the other members? It seems unlikely.

On the other hand, maybe one part of the post scarcity society is there is no longer a threat of a genuine crisis. The great crises of the last few decades have been imaginary or exaggerated. There is a strong sense that things like the Covid panic are due to the political class not having anything to do with their time. These fake crises give them a reason to demand our attention. Maybe the renter society is a natural response to the elimination of real threats to society.

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