Economics Lesson: Libs need to take a class

Hat tip to Jammiewearingfool for this post.

Zogby performed a poll asking the following questions. Take answer the questions and then click the link below them to see what the results are.

I am going to give you a word of advice, read the questions carefully before you answer.

1) Mandatory licensing of professional services increases the prices of those services.

2) Overall, the standard of living is higher today than it was 30 years ago.

3) Rent control leads to housing shortages.

4) A company with the largest market share is a monopoly .

5) Third World workers working for American companies overseas are being exploited.

6) Free trade leads to unemployment.

7) Minimum wage laws raise unemployment.

Article by Daniel Klein http://online.wsj.com/article/SB10001424052748703561604575282190930932412.html

The article is about party affiliation and their understanding of economics. Now, it has always been my contention that liberals just have zero clue about anything, but at least this poll shows that when it comes to economics that statement is pretty true.

To read the study Daniel Klein is writing about click here: Economic Enlightenment in Relation to College-going, Ideology, and Other Variables: A Zogby Survey of Americans by Zeljka Buturovic, Daniel B. Klein


Download the PDF to read the entire study.


My personal take:

When I was in college and taking economics I learned a lot. I always new I agreed with capitalism but didn't know why exactly. I sure experienced the benefits from it since I was growing up in the good ole US of A and that was enough for me.

But what caught my attention was when we started studying rent control.

Being a "Friends" fanatic I saw it as a great thing because young 20 somethings were able to live in a huge apartment on the cheap. I am assuming that that is what most people outside of New York or any other huge city thinks as well.

In the class, though, I learned that rent control is what lead to slums. Slums lead to slum lords. Slum lords lead to good people moving out and dirt bags moving in.

Why?

Because with out incentive of making more money there was no reason to maintain, improve, or even care about the building. Putting in a new fridge was a cost that bared no return. If someone moved out there was always someone willing to move into a cheap place.

Additionally, in most cases the rent control only applied to the current inhabitant. New renters could be charged more. So why improve the living of a person who is never going to pay more rent, even when your costs are increasing.

Capitalism dictates that when there is a demand there will be a supply. But not that when there is a supply that there will be a demand. So allowing free trade markets to regulate themselves affordable housing would be available to everyone.

It may not be in the place you want it to be but it will be available. If you want to live in Manhattan affordable is a relative term. You pay a heavy price. That is why so many commute. If you want to live in nicer digs then move somewhere else.

Freedom is great, if you don't like the way someone is treating you or how you have to live, there is always somewhere else you can go. But remember, you may not like it anymore than were you are. But you have the right to find out!!!