Bernie Sanders' "College For All" Act VS Henry Hazlitt's "Economics in One Lesson"

5/24/2017

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We all want to care about others. The 'Free College for All' narrative is rooted in the idea that we take care of others. But are we taking care of others by stealing from the masses to pay for College? What happens to the price of college if our subsidies for it increase? The price of college has increased DUE TO the persistent governmental interference in the market.

Politicians like Bernie Sanders can't wait to get in front of microphones and discuss how 'moral' it is for us to provide these services. Imagine that. It's moral to steal from your neighbor to provide college for free to others. But the moral argument should be made for those that are getting stolen from and for the future generations that have to pay the price of our generation's policies.

The image below is the cliffnotes version of Bernie Sanders' "College For All" Act, basically just marketing. The full version of Bernie's plan (51 pages) takes some time to figure out how his policy proposal works.

My friend loves the idea, I responded to him that if we understand economics, then we know what we can expect to follow:

Throw 'free' money at colleges and then be amazed at why college costs increase and then throw more money at college and then be amazed so we throw more money at colleges and then costs increase so we have to throw more money...

Each time we find that it is the government that is increasing the costs of college making it MORE necessary for government to get MORE involved and making it HARDER for families to afford it... Dangerous cycle. Government begets more government and creates more problems when it tries to solve problems.

I offered to read the entirety of Sanders' bill if he would read Economics in one lesson, a quick read.

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His response?

I am quite familiar with the Mises Institute and Hazlitt's One Lesson. However, I'm cautious of lessons from the 1940s! You and I just don't agree on what's important or of value.

"What's important or valuable" isn't free college and free health care. It's the kind of world and indebted nation you're leaving to your children. They own this debt that we're ignoring because we aren't mature enough to live within our means. But we can't do that because politicians use 'emotions' to keep themselves in power, at our expense.

Our politicians are like children who keep passing the buck off on others because they won't be in office when it fails and promising 'free' stuff gets votes.

Economics is Timeless

If we were in the stone age, Economics in One Lesson would still apply. Hazlitt doesn't talk about the results of what happened in the 1940s, he talks about the things we are doing today.

Chapter 1: The Lesson: The art of economics consists in looking not merely at the immediate hut
at the longer effects of any act or policy; it consists in tracing the consequences of that
policy not merely for one group but for all groups.

Chapter 2: The Broken Window fallacy (economy runs on consumption), basically the reason The Fed is drowning us in free money and zero% interest rates.

Chapter 3:The Blessings of Destruction fallacy explains why economies boom during wartime and why the US is at perpetual war because peace isn't profitable. (Let me know if this seems relevant today)

Chapter 4 Public Works mean Taxes- talks about the ills of an economy when taxation is used for public works compared to the free markets ability to do the same without taxation. Not applicable? 40% of the US GDP today is money spent by the US Government.

Chapter 5: Taxes Discourage Production - Read this chapter with the understanding that EVERYTHING today is taxed. And before it's taxed, the money you've gotten through labor (income) is taxed. The stuff you made is taxed from many ingredients that were taxed and the people who bought it from you were taxed when buying it. Rewritten today, this chapter is it's own book.

Chapter 6: Credit Diverts Production-

"Actually, you know what," I tell my friend, "feel free not to read it because it's written in the 40's. But that's a cop-out".

He's got children, it's his and my job to make the world better for them. If we can't read one book and challenge me to read something that might challenge my worldview and then follow on with an adult conversation, then we both can't continue this virtue-signaling where we think we're being moral and 'looking out for folks'.

Government growth and deficit-spending hurts those that can't voice an opinion against it - Our Children

His response will likely be that I don't value Free Education or Free Healthcare or Free unlimited safety nets for everyone. He'd think I was immoral for not supporting it. Quite the opposite. The moral argument is to remove government obstacles to the free market and charity to support these causes.

Prices are high where government interferes and over-regulates the most. Why do our health care costs rise while Breast Implants and Lasik eye procedure costs plummet (while the quality increases)? One is highly regulated by the government, the other is not. The Free Market is competing for people's dollars so costs go down and quality goes up.

Additional Reading

How Government Regulations Made Healthcare So Expensive

Economic interventionism

Third-Payer Problem, AKA "If I go to a restaurant and my tab is picked up by someone else (Insurance Company), then I'm ordering the steak".

PRICE CEILINGS AND PRICE FLOORS, a CENGAGE lesson in microeconomics.

Rent-seeking - Wikipedia

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