Liquid Assets

The Freeman has published a piece in which I contrast the disorderly allocation of water with the orderly allocation of gasoline. A slice:

Now what about water in drought-stricken states? Water prices are set by “authorities” at arbitrary prices that don’t change to reflect water availability. The authorities allocate water to various uses.

But how can the Water Resources Control Board know which purposes are most important? And most important to whom? Are a few more strawberries more important than keeping the lawn and garden green? Doesn’t that depend on whether the strawberries are more important to those who eat them than the beauty of the lawn and garden are important to the homeowner? How can the water board make that judgment? And might a car buff not care so ardently about keeping his car spotless that using the water to wash his car is actually more important—to him—than either the strawberries or the freshness of the lawn and garden?

How can a government agency know the importance of all possible uses of water to all possible users?

It can’t.

So is there any way for society to make sure water does go to the uses its people consider most important?

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Unregulated By Government Doesn’t Mean Unregulated

Many people believe that markets must be either regulated by government or unregulated. They believe that if we don’t want markets out of control, lacking in regularity, predictability, and quality control, we have to let governments regulate them. But that’s false, because markets forces regulate markets. The actions of every market participant constrain and influence theContinue Reading

No Public Service Here

Here is a letter to the Baltimore Sun: To the editor: By its decision to regulate Uber as a “common carrier” (“Uber is ‘common carrier,’ commission rules,” Thursday, August 7), the Maryland Public Service Commission (PSC) stands athwart the tide of technology and history. Allowed to stand, the ruling would harm Marylanders. Why restrict Uber’s freedomContinue Reading

How Free Market Forces Would Regulate Banks

One of my numerous smart and interested students at Towson University (yes, I’m fortunate), a non-economics major named Kristin, has sent me the following question in response to my recent post, “One Reason Governments Should Not Regulate Banks“: How would you rely on free market forces to better regulate banks? Here is my reply: Kristin,Continue Reading

One Reason Governments Should Not Regulate Banks

A big reason why governments should not regulate banks is painfully illustrated this week in “Banks Battle Weight Issues” in the Wall Street Journal  (July 22). The article focuses on New York Community Bancorp, which is “projected to reach the $50 billion mark by the end of the year if it continues to expand at its current rate.”Continue Reading

Who Has the Wealth of the Wealthy Rentiers?

Prompted by Thomas Piketty’s book Capital in the Twenty-First Century, I ask the question in this post’s title in a recent Freeman article. A slice: Let’s begin with the source of the income of the idle rich in a free economy. (We need this proviso, “in a free economy,” because in an unfree, crony capitalist economy, the idleContinue Reading

St. Louis Government Regulators v. Uber and St. Louisians

Here is a letter to the St. Louis Business Journal: To the Editor: I have been following the contest in St. Louis between Uber and St. Louisian riders, on the one hand, and the forces of darkness, repression, and crony capitalism on the other. I object to the title and first paragraph of your reportContinue Reading

Let Markets Forces Regulate – Taxicabs

In this Freeman article I argue that “the sensible response” to any unfairness to taxicabs from competition from Uber, which has so far avoided government restrictions, “is not to burden Uber the way taxis are burdened, but to unburden the taxis and leave all ride services free to compete.” Two commenters on Facebook were notContinue Reading

Who’s Anti-competitive?

Here’s a letter to the Baltimore Sun: To the editor, The Annapolis mayor’s and taxicab companies’ justifications for regulating Uber conflict with the facts (“Annapolis gives Uber a warning,” July 15, 2014). The mayor “insists that [Uber be] regulated…like…taxicabs…to keep our citizens and visitors safe.” But Uber already checks its drivers’ backgrounds and requires they beContinue Reading

Let’s Free City Ride Services

The Freeman online has published a piece I wrote suggesting that instead of subjecting Uber, Lyft and other ride-sharing services to burdensome taxi regulations, local governments should instead stop burdening taxis with regulations. A slice: If we had free markets for city ride services, that would be the whole story so far. The preferred rideContinue Reading

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