Micah Kennedy’s Reviews > Basic Economics: A Citizen's Guide to the Economy > Status Update

Dry empirical questions are seldom as exciting as political crusades or ringing moral pronouncements.

But empirical questions are questions that must be asked if we are truly interested in the wellbeing of others, rather than in excitement or a sense of moral superiority for ourselves.

“None of this is rocket science, but it does require stopping to think.”

“Much confusion comes from judging economic policies by the goals they proclaim rather than the incentives they create.”

“In a world of positive-sum transactions, it is understandable why rent control laws lead to housing shortages, and minimum wage laws increase unemployment.”

And yet to this day politicians get voted in by promising to do exactly this!

Privileges which harm others must be distinguished from achievements which benefit others and advance society as a whole.

Exploitation may be an intellectually convenient, emotionally satisfying, and politically expedient explanation of income differences between nations or between groups within a given nation, but it does not have the additional feature of fitting the facts about where profit-seeking enterprises invest most of their money.

After the stock market crash in October of 1929, the unemployment rate peaked at 9% two months after the crash, then gradually decreased to 6.3% in June 1930.

Then, after a series of major unprecedented government interventions, the unemployment rate soared over 20% for 35 consecutive months.

Interventions started with Hoover, continued by FDR.

Interesting thought: sometimes best to let economy recover itself.

When honest landlords stand to lose money under rent control, while dishonest landlords can still make a profit, it is virtually inevitable that the property will pass from the former to the latter.

Shrewd and unscrupulous landlords have made virtually a science out of milking a rent controlled building by neglecting maintenance and repairs, defaulting on mortgage payments, falling behind in the payment of taxes, and then finally letting the building become the property of the city by default. Then they move on to complete the same destructive process with other rent controlled buildings.

In New York City, landlord arsons became so common that the city responded with special welfare allowances. For a while, burned out tenants were moved to the top of the list for coveted public housing. That gave tenants an incentive to burn down their buildings—they did, often moving television sets and furniture out onto the sidewalk before starting the fire.

#rentcontrol

Those who create incentives toward widespread dishonesty by promoting laws which make honest behavior financially impossible are often among the most indignant at the dishonesty, and the least likely to regard themselves as in any way responsible for it.

One example -> rent control laws