March 31, 2011

Looters and moochers

I recently finished reading "Atlas Shrugged" by Ayn Rand. I'm not going to review the book here. I mention it because whether you liked the book or hate it, it makes some salient points and many of them remain relevant today.

One recurring theme is that "looters and moochers" are immoral and they seek only to live off of others work and effort. They expect to share in the rewards for that they are not (by Rand's reckoning) entitled to.

Looters are typically government entities that seek to use connections and cronyism to take from the productive and unconnected and give to those that are untalented, unskilled and lazy but connected who feel they are entitled to things.

Irrespective of whether her moral calculus is correct I believe she is correct that government is ceaselessly meddling in business in order to take from some to give to others who are deemed "unfortunate". The problem remains; who determines who can afford to give? Who determines how much is enough? Who determines who the unfortunate ones are?

One example from the book; Hank Reardon is a wildly successful and innovative businessman who invents a new type of metal that is stronger than steel, lighter and cheaper. Toward the end of the book the central government committee plans to allow all the mills to run at full production (something they previously prevented) and the total tonnage will be sold at a fixed price. The profits from that sale will then be given back to the producers but it will be allocated according to the number of furnaces they have at each plant.

Reardon points out that while he has only 20% (or so) of the furnaces, he is producing over 40% of the metal making it to market. Whereas another character who is politically connected has 60% of the mills but produces less than 10% of the metal on the market. Reardon would then be operating at a loss every month.

The book is thick with examples of this reasoning. In Rand's world it's a sure sign that everything is collapsing and the productive men of the world will check out and leave.

I thought the example extreme. No way would there be a regulation or law. It would never pass Constitutional muster. Right?

Wrong.

Marinís Community Development Agency recommended amending zoning regulations to ease the construction of new apartments, passing new laws requiring new developments to offer housing at below-market rates, and stepping up programs to combat discrimination by landlords and realtors.

So let's review:

1. Large numbers of white people are, by definition, racist. Even among the Eloi of California.

2. Minorities are poor

3. Women apparently count as minorities sometimes but not others.

4. California legislators think that forcing people to change their business to lose money on units sold is legal

5. They further think this is not going to adversely affect the number of new housing developments in California.

So that's what California has come to. They are so far down the path that they refuse to accept that it is their policies that are creating the very problems they seek to solve. If they can only just tweak the regulations properly, they'll somehow be able to achieve equal outcomes for all.

Posted by Duffy at March 31, 2011 12:54 PM | TrackBack

Comments  (We reserve the right to edit and/or delete any comments. If your comment is blocked or won't post, e-mail us and we'll post it for you.)

"passing new laws requiring new developments to offer housing at below-market rates"

Just because housing is below market rates does not mean the landlords would be operating at a loss. They might be or they might not. If they're lowering regulations and therefore reducing construction costs on the front end, it may be perfectly reasonable to require some sort of rent reduction on the back end.

Of course they're trying to solve a largely non-problem that the market will fix itself. Poor people can't buy expensive housing. Duh. They'll either move or local businesses will soon have to pay more for labor. Ultimately the issue is the government things marin county should have it's cake and eat it too.

Posted by: Jeff the Baptist at March 31, 2011 02:09 PM

Actually that's a good point. I was conflating price with cost erroneously. Sort of the same way Democrats refer to reduced increases in spending as "cuts".

Posted by: Duffy at March 31, 2011 04:15 PM