So Whose Property Is It?

More overreach from nanny-staters. This time removing a family's basketball hoop with the popular method of government threats and force.

Planning For Freedom

I'm enjoying Ludwig von Mises' short, FREE book, "Planning For Freedom". I just came across this nugget: "There is only one way that leads to an improvement of the standard of living for the wage-earning masses, viz., the increase in the amount of capital invested. All other methods, however popular they may be, are not only futile, but are actually detrimental to the well-being of those they allegedly want to benefit." He states later in that chapter, "All measures which - like our income and corporation tax system - aim at preventing further capital accumulation or even at capital decumulation are therefore virtually anti-labor and anti-social."

For any good economist, a discussion of wages and capital is incomplete without addressing the issue of sound money and the true definition of inflation: devaluing the currency or printing more money. One result, Mises explains: "Inflation can cure unemployment only by curtailing the wage earner's real wages." Think about that the next time Bernanke announces another "quantitative easing".

Moorhead Monday: Fiddling with Real Estate

Tonight's council meeting included a proposal to spend $25,000 for a housing market analysis. After pointing out that we consume the entire take home pay of a median Moorhead family to do it, I questioned the wisdom of meddling in real estate in the first place.

What would be the potential action we would take on these information in the analysis? If the study confirms what we already know, that MN burdens its citizens with high tax and regulatory costs, particularly in relation to our western neighbors, we are limited to two options (one in the same at the core): transfer wealth or change the rules.

A December 28, 2010 Forum article identified that Moorhead has the highest rental prices. Why aren't developers capitalizing on that? While our state's legislature has, for the past several decades, added greater tax and regulatory burdens, for which they deserve scorn, our own city has added to them. The fact that a business had to fight for 11 years to improve its property is a symptom of the underlying problems. Those city controls not only make it harder to do business in Moorhead, the costs fall disproportionately on the poor.

Part of the reason I opposed this measure is my apprehension about what a majority of this council will do that will ultimately make the situation worse. We'll probably shift some tax burden to another segment of our citizens or dream up new rules for otherwise voluntary transactions amongst buyers, sellers and occupants. After eight more years of interference we'll commission another study to see why there are new problems in the market.

Simply put; freedom is the answer. We should empower consumers to once again drive the housing market. Problems in this market, or any other, aren't caused by too much consumer choice but by too much political and bureaucratic meddling - at all levels of government. We should get politicians out of the real estate market and let the consumers spend their money.

The resolution to commission the study passed 7-1.

TIF = Incremental Problems

Tax Increment Funding is touted as a pain-free way to redevelop certain neighborhoods. But even Mayor (wow!) Rahm "every crisis is an opportunity" Emmanuel recognizes at least some of the unintended consequences of this wealth transfer scheme.

Amazingly, a fellow Moorhead City Council Member once told me in reference to TIF, "Sometimes you have to reach into people's pockets and invest their money for them". Seriously.

Redevelopment Finds Another Foe

It appears California Governor Jerry Brown unwittingly exposes another government central planning failure in the form of "redevelopment" and "enterprise zones". Special thanks to Reason.com for fleshing out the details.

Redevelopment Destroys the Market

Economist Thomas Sowell suggests, "In reality, what redevelopment does is transfer wealth from one place to another place, with no net addition to the wealth of the country as a whole."

Additionally, even if executed perfectly, redevelopment is a net loss to the country since it involves both a middle man (bureaucrats) and aggression (via taxation or eminent domain).

There's No Such Thing as Homemade Ice Cream

Jeffrey Tucker has a keen knack for pointing out the beauty and incredible complexity of capitalism. The idea of a "sustainable lifestyle" would lead to an 18th century standard of living.