Wall Street Journal columnist Barton Swaim decries Americans’ loss of an ethos of risk-taking. Two slices:
Evidence abounds that most college-educated Americans have lost the ability to assess risk. An exaggeration, maybe, but that thought has haunted me since the pandemic years of 2020-21, when otherwise sane people embraced draconian interventions of minimal benefit while showing no interest in costs. The very few advocates of shutdowns and school closings willing to acknowledge those policies as misjudgments mostly excuse themselves by noting how little we knew of the virus in its early days.
Well, sure—although some of us knew folly when we saw it. Anyway, the maniacal demand for a clinically neat solution to the pandemic, and the concomitant failure to acknowledge cost-benefit trade-offs, suggests a cultural pathology predating Covid-era safetyism. In fact, its roots go back nearly a century, as Manhattan Institute economist Allison Schrager makes clear in “Worth the Risk,” to be published next week by Yale.
America’s global economic dominance, achieved in the 1950s and enduring still, is largely thanks to the young country’s risk-welcoming ethos. The few provisions that shielded economic actors from ruin in the 19th century—bankruptcy protections, limited-liability laws—didn’t deter risk-taking but encouraged it.
Then came the New Deal’s dramatic expansion of the welfare state. Social Security, unemployment insurance and an assortment of jobs programs aimed to make economic life less risky and more predictable. Three decades later, beginning with the Great Society and its attendant War on Poverty—Medicare, Medicaid, expanded food stamps, school lunch programs, housing vouchers—the federal government tried to abolish risk for the working class: the class, that is, from which the country’s boldest entrepreneurial risk-takers had always sprung. The trend continued when consumer-protection and product-liability laws made America a more litigious society and forced companies and public institutions to think constantly about safety and risk-avoidance.
After the 2008-09 financial crisis and the shutdowns of 2020-21, wealthy democracies all over the world, including the U.S., expanded their role as citizens’ primary insurer. “Regulatory policy changed to restrain banks from lending and taking on risk, and industrial policy, tariffs, and reshoring efforts were billed as ‘de-risking the economy,’ ” Ms. Schrager writes. Rather than insuring against a specific risk that went badly in the past, “the government started heading off opportunities for risk altogether, explicitly forfeiting growth in exchange for safety.”
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Ms. Schrager debunks several myths that she says keep Americans of all ages and stations from taking healthy chances. Among those myths: the belief on the progressive left and populist right that U.S. workers face more economic risk than they did two or three generations ago. The odds of being laid off, for example, haven’t changed appreciably since the 1950s. Or this: “Conventional wisdom says that Millennials don’t have the cash to buy a home because, unlike their parents’ generation, they have too much student loan debt. But there is actually a positive correlation with student debt and homeownership, since people with more student debt tend to earn more.”
And bear in mind, Ms. Schrager says, the reason millennials carry that debt in the first place: because politicians starting in the ’80s presented college as a risk-free road to financial security. Federal and state governments made loans easy, borrowers felt less price sensitivity and colleges responded rationally by bumping up tuition. “When college is touted as a ticket to a certain lifestyle,” she writes, “it seems smart to agree to almost any price tag and any amount of debt.”
John Stossel writes wisely about AI.
GMU Econ alum Dave Hebert ponders Canadian membership in the EU.
From a new poll by the Cato Institute:
74% Say President Trump’s Tariffs Have Raised Prices; 53% Say Tariffs Have Weakened the Economy, 70% Say the President Needs Congressional Approval to Impose Tariffs.
“US-Canada trade war further taxes small businesses as costs rise during the Iran war.” (HT Scott Lincicome)
National Review‘s John Puri applauds the tightening of U.S. monetary policy and hopes that it remains tight long enough to actually whip inflation. Here’s his conclusion:
Americans should be worried that, for a second time, the Fed will declare victory at the first sign of easing inflation and quit before the task is done. As Warsh said last month, no self-executing law of the universe requires inflation to revert to 2 percent. Inflation is a function of monetary policy, and policy must be sufficiently restrained over time to keep the money supply in check.
“Inflation is a choice,” Warsh reiterated today. The Fed has finally begun to do its job of restoring some semblance of price stability. It needs to make sure that it finishes the job this time.
“The damage to the higher education system and to the economy of the United States is likely to be catastrophic,” U.S. District Judge F. Dennis Saylor IV, a former President George W. Bush appointee, writes in response to a lawsuit filed by organizations representing universities, educators, and journalists. “Notwithstanding the scale of the likely harm, the government’s proffered rationales for the rule are exceptionally weak, and the connection between the rule and the problems it purports to address is exceptionally attenuated.”
Although the DHS estimated that complying with the rule would cost about $250 million in the first year, “the real expected costs go far beyond” that figure, Saylor notes. Under prior regulations, foreign students could remain in the United States until they completed their educational programs, including “authorized practical training following completion of studies.” For people earning one or more advanced degrees, that process often takes longer than four years. By ignoring that reality, the DHS rule would undermine the huge scientific and economic benefits generated by international students.
The accumulation of all powers, legislative, executive, and judiciary, in the same hands, whether of one, a few, or many, and whether hereditary, selfappointed, or elective, may justly be pronounced the very definition of tyranny.
For it is not necessary to choose between social control administered by the aggrandized state and a self-assertive individualism subject to no social control. That supposedly exclusive choice, which causes such furious party antagonism in our society, overlooks entirely one of the oldest, best established, and most successful methods of social control in human experience. It is social control, not by authority fro9m above commanding this man to to this and that man to do that, but social control by a common law which defines the reciprocal rights and duties of persons and invites them to enforce the law by proving their case in a court of law.
Consumers benefit most from dynamic pricing in ride-sharing services. Economist 
