If there is one difference between conservatives and leftists, it’s that conservatives are much stronger on basic economics than leftists. That’s why conservative states like Tennessee and Florida and Oklahoma are much more fiscally healthy than leftist states, like California, New York and Illinois. Conservative voters understand the problems with nationalization and price controls.
First, let’s see the news from Daily Signal, where they explain what policies New York assemblyman Zohran Mamdani holds :
A far-left socialist who has supported defunding the police and replacing them with social workers, abolishing prisons, abolishing private health insurance, banning guns, decriminalizing pretty much every drug, and creating government-run grocery stores won the Democratic Party mayoral primary in New York City on Tuesday.
Like many leftists, Mamdani comes from a very wealthy background:
Mamdani came from a well-to-do background. His mother is a famous Bollywood producer. His father is a Columbia University professor who specializes in “postcolonialism.”
And what’s interesting is where the support for his Marxist economic policies come from.
Daily Wire explains:
According to election results published by the New York Times, Mamdani won counties with a median income of more than $117,000 by an average of 13 points, while Cuomo won counties with a median income below $62,000 by 13 points.
[…]Mamdani’s margin of victory in wealthier counties is likely to increase after several rounds of ranked-choice tabulation conclude throughout the week.
The Daily Wire article also says that Mamdani has expressed support for higher taxes, and $65 million for “gender-affirming” drug treatments and surgeries for adults and children. And that’s not his parents’ money, that’s taxpayer money. According to the Daily Caller, he wants to raise minimum wage to $30 an hour.
So, what do economists say about policies like this? What happens when governments take over private industry, like grocery stores? What happens when governments raise the minimum wage? What happens when the government imposes price controls on rent?
Well, we know about all of these things – we know by studying what results these policies have had when they have been tried in other times and places. And the results are always the same.
Nationalizing grocery stores
Let’s start with nationalizing grocery stores. It’s been done in Venezuela and Cuba. In Venezuela, the Chavez government took over private supermarkets like Éxito in 2010, rebranding them as state-run Bicentenario stores.
By 2015, most basic goods were unavailable in stores due to price controls and mismanagement. Shoppers faced long lines. Food production plummeted, because food suppliers could not sell at a loss. Malnutrition surged, including for children. Investors got a clear signal – do not put your money into producing food, you will not get a return on your investment.
Raising minimum wage
Seattle, Washington, a bastion of atheism and socialism, raised their minimum wage to $15 and hour in 2017 for large employers.
The results? It hurt the poorest most. Low-wage workers had their hours cut. Small businesses laid off staff to stay open. Prices for consumer goods increased. Businesses closed down. When you raise the price of labor for no gain in productivity, businesses cannot survive. They have to cut worker hours, or eliminate low-skill jobs entirely. For example, McDonald’s installs self-serve kiosks to replace low-skill cashiers.
Imposing rent controls
San Francisco imposed rent control on pre-1994 buildings, including 45% of rentals.
Landlords responded by selling rental units, or converting them into owner-occupied residences. There was a drop in rental supply, leading to shortages of rentable properties. This affected the poorest people the most, because it’s the poor who rent small residences when they are just starting out.
Basic economics
When you read a book on basic economics, such as “Basic Economics” by Thomas Sowell, or “Common Sense Economics” or “Economics for Dummies”, all of the above cases are considered basic cases that virtually no economist disagrees on. So then, if almost every economist agrees on the bad results from such policies, how do they get made into law?
It’s simple. Many of the wealthiest people champion these policies because they want to get elected by seeming “generous”. They want voters to believe that their words, which sound so kind and compassionate, will automatically achieve good results. And many voters – and I mean especially the economically-illiterate leftist voters – believe this. Sadly for them, ignorance of economics does not give you immunity from the results of your voting.
