Mike Munger’s life was saved by the division of labor… as also was, not incidentally, the life of my son.
Housing regulation is another fine example. When housing regulation was light, housing prices stayed close to the physical cost of production. The obvious benefit for the poor was that they didn’t have to spend a huge share of their budget on rent or mortgage payments. But there was also a less-obvious benefit: Poor families used to have a near-foolproof way to raise their standard of living – move to higher-wage parts of the country. Over the last fifty years, however, housing regulation has become very strict, especially in the country’s high-wage areas. As a result, average U.S. housing prices are now roughly double the physical cost of production.
To ask, “How can we help the poor get affordable housing?,” creates the impression that the rest of us are neglecting the poor. In other words, that we’re guilty of leaving desperate folks to fend for themselves in a hostile world. The reality, rather, is that our society artificially strangles the supply of a naturally abundant necessity. In the long-run, this hurts almost everyone – probably including most homeowners. But the poor clearly suffer extra because (a) they spend a higher share of their income on housing, and (b) are much more likely to rent.
My very first publication was co-authored with my great teacher Bill Field and it appeared in the August 1979 issue of Reason; it was an argument against conscription. Today at Reason Ira Stoll wisely argues against the use of conscription by Ukraine’s government.
o ease the suffering caused by Vladimir Putin’s invasion and strengthen our position against him, the United States should open its doors both to Ukrainian refugees fleeing the conflict and to Russians seeking to escape Mr. Putin’s tyranny.
There are several things we can do quickly: President Biden has taken a valuable first step by making Ukrainians in the United States eligible for temporary protected status, which will shield them from deportation and allow them to seek employment. But this measure applies only to those who arrived in the United States by March 1 and lasts only for 18 months (though that could be extended). He can also protect Ukrainian students in the United States by granting special student relief, which would make it easier for them to remain here. Further, he should grant parole status to newly arriving Ukrainian refugees, allowing them to remain in the United States.
The major message in this Essay is that market-driven corporate social responsibility, reflecting the preferences of consumers, employees and investors, is the preferred approach for achieving many of the goals in a CSR world. Non-market, namely, governmental or CEO induced approaches, contain serious problems that either (1) ironically, undermine the intended goals or (2) leave the job of addressing social problems in the hands of company management and their boards, who have dubious incentives and capability to execute this task efficiently and effectively. The public-policy question comes down to what institutional arrangement can best address various social problems. The scientific assessment of most economists, and what seems practical and sensical, is that governments should assume primary responsibility for dealing with social problems.
Populists of all stripes who want to tell you that globalized trade is a cosmopolitan conspiracy against the middle of the country are peddling nonsense. Countless high-quality American jobs depend on globalization, and many of them are located in so-called flyover country. Those of us who live on the coasts would do well to remember the people in Memphis, Louisville, Columbus, New Orleans, and elsewhere who make it possible for Americans to buy and sell products across the globe.
Omar Al-Ubaydli wisely warns that “economic decoupling is a threat to world peace.” Here’s his conclusion:
Thankfully, neither side is looking to decouple from the other economically. However, many countries – including the US – are actively trying to decouple from China. If successful, this will make it easier for people in those countries to hate Chinese people and vice versa and make the cost of war considerably lower for all sides. We should not be surprised, therefore, if the result is war.
Humans are intrinsically nomadic, and so we are easily seduced by the idea of managing our conflicts with others by permanently cutting ties and wandering off to a different hunting ground. This general impulse doesn’t work at the international level because we live in the same small space. Economic relations help us override our intrinsic desire to butt heads, and the great powers must remember this when they seek the short-term catharsis offered by economic decoupling.