Nevertheless, in spite of improvements in education, housing, and health care, the work-time costs of these goods and services — unlike the costs of food, furniture, and most other products — have indeed risen. And it’s possible — although I think highly unlikely — that this rise in the costs of these three categories of products has resulted in overall economic stagnation for ordinary Americans.
If so — if the rising costs of education, housing, and health care are causing ordinary Americans to tread water economically despite the falling work-time costs of most other goods and services — why would anyone suppose that the “solution” to this problem is more government intervention? No three sectors of the American economy are as heavily and as consistently distorted by taxes, subsidies, and regulations as are these three sectors. The conclusion that I draw is that reducing the role of the state — rather than increasing it — is a necessary step to take to ensure that the prosperity of ordinary Americans continues to grow.