Category Archives: Government failure

The Welfare Cliff, a.k.a. the Low-Wage Trap

Pretend you are a poor, single parent of two in Chicago, earning $12 an hour, working full time, and determined to do what is best for your family. And suppose your employer, impressed with your work, offers you training for and promotion to a new job paying $15. Should you take the offer? It soundsContinue Reading

The Need to Regulate Destructive Regulation

Here is a letter to the Wall Street Journal today: To the Editor: The legal hassling you describe of ride-sharing services such as Sidecar, Uber, and Lyft (“Ride-Sharing Services Face Legal Threat From San Francisco, Los Angeles,” Sep. 25, 2014) is farcical. What should be shut down is not the ride services, but the regulations and taxicabContinue Reading

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 howContinue 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

Is College Worth It?

Towson University’s commencement, a lovely event on a perfect May afternoon, aroused mixed emotions in me this year, thanks to Bryan Caplan. I had recently listened, twice, to his excellent talk at a Cato Institute event whose topic is the title of this blog post. So while I was proud of my university and happyContinue Reading

What’s Wrong With ObamaCare, in Seven Words

From the standpoint of its economic consequences—not the intentions of those creatures in Washington who wrote and passed it, but its consequences—the “Affordable” Care Act now going into effect is a destructive, retrograde, pernicious piece of legislation. American healthcare and health insurance have been badly in need of reform for decades, but the Affordable CareContinue Reading

Let Market Forces Regulate – Mortgage Standards

Part II of Free Our Markets argues that regulation by market forces outperforms government regulation. One of several reasons why governments make bad regulators is that two or more of the government restrictions, prohibitions, or mandates that bear on a particular kind of business may conflict with one another. That conflict can make it difficult,Continue Reading

Let Market Forces Regulate – Baby Swaddling

Guest post from my former student John K. Ross: A common complaint against government regulation is that regulators cannot possibly appreciate each individual’s differing preference for risk. For instance, in the last few years several states have prohibited day care centers from swaddling infants in blankets, an ancient practice that helps babies sleep. State regulatorsContinue Reading

Let Market Forces Regulate – Health Insurance Standards

In a healthy economy, who should determine health insurance standards, and how? Reporting this morning on Washington’s scramble to make it legally permissible for Americans to keep individual health insurance policies now being cancelled due to the Affordable Care Act, the Wall Street Journal refers to “health insurance policies that don’t meet the new law’sContinue Reading

Misallocation of Resources: Ghost Cities in China and Quantitative Easing in the US

Guest post from my former student Jim Vinoski: Free Our Markets explains how investment can quickly turn to waste when it’s shielded from market incentives and market feedback.  With government spending in particular, this non-market “investment” often results in continued allocation of capital that could be used for much better purposes toward less valuable ends. Continue Reading

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