Gongol.com Archives: December 2021

Brian Gongol


December 3, 2021

The United States of America Move along now

If you were to build a house in the Northern Hemisphere with a wide expanse of windows on the south face, you might well expect that the rooms on the south end of the home would turn out to be warm and comfortable in the winter, but hard to keep cool in the summer. You might also expect that the rooms on the north side of the home would offer relief from the summer heat, but be left relatively chilly in the wintertime. ■ You could enhance the circulation of air between the rooms simply by leaving the interior doors open. By closing them off, you would only serve to compound the effects of different rooms being too warm or too cold. ■ Beyond the mostly passive act of leaving doors open or closed, you could take an active step by installing a circulating fan, moving the air from warmer rooms to colder rooms in the winter and vice-versa in the summer. The fan wouldn't actually create more heat, but would merely move the existing heat around to spread it more evenly. Better distribution of that passively collected solar heat would enhance the comfort over a broader footprint of the home for a larger portion of the year than without. ■ What seems like an obvious "best practice" for energy efficiency offers lessons for the marketplace, too. In principle, the principles of classical liberalism we inherited from the Enlightenment era would tend to endorse the freest possible movement of people, money, goods, and ideas. But it's a practical approach, too: The United States functions as a giant free-trade zone, much to the cumulative benefit of the country as a whole (not to mention its constituent states). The freedom of interstate commerce has a big part to play in explaining why West Virginia is richer than Shanghai. ■ But economic growth and development is not evenly spread across the country, which is why it's wise to consider when steps beyond leaving people free to move around (the equivalent of leaving the doors open) could benefit from gentle interventions to enhance circulation (the equivalent of adding a circulating fan). People don't always migrate to places where opportunities are abundant, and it's the job of policy-makers to examine why. ■ Some experiments have been conducted to offer active interventions -- like vouchers to help families "move to opportunity". Such experiments have offered intriguing experimental results. But there are other interventions that matter, too: For instance, the structure of our tax policy affects how families accrue wealth. How we tax property (and how we treat deductions for things like mortgage interest) have a big effect on whether people treat their primary homes as a primary source of household wealth -- and that effect is magnified among lower-income households. If people are hesitant to move because doing so could erase their biggest stock of wealth, then that's a problem worthy of attention. ■ Wherever we find obstacles to that free circulation of people, it would be prudent to look at ways to remove them. And to the extent that people are reluctant to migrate from one state to another, it would be sensible to dive into the underlying causes: Americans still move a lot, but also move a lot less than we used to. If there are light-touch interventions that would help people "circulate" to places where their economic and social outcomes might be improved -- or if there are artificial barriers that could be removed by fixing bad policies -- that could be a laudable and efficient way to make Americans better off, on average and on the whole.


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