In one of my blog posts from many weeks ago, I discussed the issue of price gouging prohibitions in areas of disaster. I analyzed and discussed how gouging is actually generally not a detrimental abuse by sellers and firms of their buyers’ situations, but rather is simply the market responding appropriately to a shortage in order to most efficiently allocate resources to those who need them the most. I discussed how allowing prices to react to market forces ensures that the existing goods in a disaster area are allocated most efficiently, helping to ease the burden of the shortage that exists. I also discussed how allowing arbitrage to take place with private sellers bringing goods into the area at a marked up price increases local supply, and thus also helps to reduce the detrimental effects of shortage in the area. If you are interested in this topic and plan to read this post, I highly recommend you revisit my previous blog post, which provides a fairly concise summary of the issue at hand. If you have more time, I recommend you read this scholarly article titled “Planning Disaster” written by Micheal Brewer, which provides an excellent, comprehensive analysis on price gouging and the laws that prevent it, as well as the unique solution that I will discuss in this blog post. This post will be explaining the merits of a system in which the federal government incentivizes state governments to repeal harmful gouging prohibitions in exchange for federal disaster relief aid. Additionally, these federal resources would be allocated to the areas in which the market price for said goods is highest, indicating areas of most need and allowing for the more efficient distribution of resources during disasters.

First let me reiterate, this post will only be best understood if you at a minimum read my previous blog post. Additionally, I cannot explain this solution in this post as well as the original author can; if you are still skeptical, I highly recommend you read through Micheal Brewer’s “Planning Disaster” Article I referenced earlier. That being said, I will get into discussing this solution.

At the core of this proposal is the idea that price gouging bans passed at the state level are overall detrimental during times of disaster and only serve to exacerbate the shortages that are caused by natural disasters. However, this is only well understood among the economic community, as most politicians and their constituents find price gouging bans to be appropriate. Even if state representatives were enlightened as to the harmful nature of these laws, they would be hard pressed to do much about it, as they would likely lose support of many constituents if they voiced support for such reform. Brewer’s plan seeks to remedy this by providing for a multi functioning system of incentives to be introduced by the federal government that would make it much easier and desirable for state governments to repeal such laws. The federal government, in a move resembling a sort of fiscal federalism, would pass legislation that would prioritize relief goods to areas in which the market price for said goods is highest. This would cause state governments to have reason to repeal the shortage worsening price ceilings that were in place, since they would impede their ability to receive federal aid. Importantly this would allow state governments to act with a justification for their actions, so as not to anger their constituents. Overall, this would contribute to a reduction in shortages during times of disaster, primarily due to the ability for resources to be efficiently allocated by the market, as well as for outside sellers to bring more goods into the areas, increasing overall supply and naturally reducing prices without sacrificing efficiency.

The other major advantage of this incentive based approach, is that it will provide a much more efficient mechanism for distributing federal emergency aid to places that need it the most. Often times during such disasters as hurricanes and tropical storms, vast areas, or even several areas, are devastated with destruction and shortage. Figuring out how to best distribute the federal aid that is available is no easy task and requires a great deal of time and effort, slowing the process of actually getting the aid to those who need it. Under this mechanism, goods would be allocated to areas in which the prices for the goods are highest, indicating the areas of greatest shortage. This would in theory be incredibly more fast and efficient than the current process of allocation. Another beneficial consequence of this plan would be that it would naturally drive down prices in disaster areas without creating shortage. Competition from the government resources that will have been added to the market will force local prices down as a response to an increase in supply caused by an additional supplier being added to the local market (the federal government. This would mean that not only would the areas that most need goods get them, but the market price for those goods in that area would be naturally reduced, without worsening shortages in the way that price ceilings do.

Overall this method offers an insightful and logically structured solution to the issue of price gouging laws. Unfortunately I can see very little likelihood that this would ever even be proposed before Congress. This is due largely to the public’s general condemnation of “price gouging” despite the economic community generally voicing contradictory opinions. I believe that because of this, better economic education is essential to the betterment of our nation, so that despite emotional tendencies of the public, economically logical policies may be enacted by our government. An important thing to realize is that theories like this aren’t cold and inhuman, they aren’t just numbers, rather they actually represent what would truly provide the best situation for the greatest number of people, a goal that I find to be worthy of pursuing.

 

Though this may not be a purely “economic” topic, it relates heavily to current politics in America and I feel that it is worth discussing. Furthermore, this post will relate somewhat to economics in that it will utilize and promote the “quantitative” style of thinking that is standard in economics, and will further touch on Hayek’s “What they imagine they can design” concept. This post will be addressing the recent attention that has been brought to the topic of gun related violence in the wake of the Marjory Stoneman Douglas High School shooting, and more specifically the solutions that have been proposed. The issue of mass shootings in America as a whole is incredibly broad, and would require analysis in many different areas to holistically approach. Even to develop a supposed cure-all, multi faceted solution would be an entirely too complex task for a single blog post. Not to mention the intricacies that applying constitutional interpretation and values to the situation would create. So even though I happen to feel strongly about areas such as constitutionality, and even though I have thoughts on other aspects of this situation, I will only be analyzing a single proposed solution in this post. In a quantitative and analytical manner, I will be discussing the merits of the proposed solution of raising the minimum age to purchase a rifle (long gun) to 21 from 18 via federal legislation.

One of the newest hot button proposals that has been tossed around Washington as of late is the idea of raising the minimum age limit required to buy a long gun from the age of 18 to the age of 21. Even Trump himself, in all of his infinite wisdom, was quoted stating that “It should all be 21” meaning that he supported raising the minimum age as a means to prevent future gun deaths. This proposal may sound quite nice, which may be why even some Republicans like Trump have stepped up to support it. But what impact would this new measure actually have on preventing deaths?

First let’s note the reasoning that is causing this proposal to come to prominence now. The shooter who committed the Parkland shooting used an AR-15 style rifle, which is legally classified as a long gun for purchasing purposes. It also happens to be the case that under federal law, the minimum age to purchase a long gun is 18 years old. The shooter also happened to have been 19 years old, younger than 21 years of age. Consequently a wave of outcry bombarded Washington with phrases such as “Why can I (a person 18 years old) still go to a store and buy a weapon of war?” Debatable labels aside, the message got to politicians, and many supported the idea.

But what do the numbers say? Would adopting this measure actually have a meaningful impact on preventing gun deaths? Let’s start by directly addressing the issue that is of concern, mass shooters access to firearms and particularly to rifles such as the AR-15. The hope of the 21 minimum would be that shooters would have reduced access to these firearms which would in turn prevent them from committing such crimes. A New York Times article titled “How They Got Their Guns” compiled data on 19 recent mass shootings and how the firearms were sourced. Of the 19 shooters, only 3 were under the age of 21, including Nikolas Cruz, the most recent shooter. However, the other two underage shooters had more complex stories. Jaylen Fryberg, who was 15 years old, killed four students in his school cafeteria using his father’s Beretta pistol. This sets off two red flags, one being that he did not purchase this gun at all, and another being that it was a handgun, which would not be affected at all by the proposed law. The other underage shooter was Adam Lanza, age 20, who murdered several elementary school chilren in Newtown Connecticut, using his mothers rifle that he took from her. Here the proposed law would also have had no effect given that Lanza did not purchase the firearm, but rather stole it from a family member. Of the 19 shooters listed in the article, Cruz may have been the only one that would have been affected by this proposal in any way whatsoever. This seems to beg the question, “If stopping mass shootings is the political objective, is this really the most applicable way in which to do so?”

Perhaps the more telling set of data to analyze would be firearms deaths overall, after all, isn’t the goal of this measure to reduce American gun deaths? The AR-15 and other rifles are commonly demonized by political activists, claiming that they are “killing machines” and “weapons of war” but just how deadly have rifles in general been in America by the numbers? According to the FBI Uniform Crime Report, rifles were used in the murder of 248 people in 2014, or when combined with shotguns 510 people. That sounds pretty bad, but for reference, handguns were used in the murder of 5,562 people in the same year. An additional 1,959 murders did not have a listed type of firearm, but even if all of these used long guns (unlikely based on proportion) handgun murders would still more than double those of long guns. So if handguns are really what’s being used to take so many American lives, then why doesn’t the federal government seek to raise the age to buy a handgun to 21? The answer is simple, it is because the age to purchase a handgun is already 21 years of age. Essentially, handgun murders drastically outweigh long gun murders, and the federal government has already set a 21 year minimum for the purchase of handguns. So why then, does it appear to so many that enacting a similar law with respect to long guns is the answer to solving firearms related homicide in the US? This logic is flawed for two fundamental reasons, the drastically more severe problems pertaining to gun homicides in the US are handgun murders, meaning that focusing on long guns (including the AR-15) is misguided statistically. And also that the minimum age for handguns has already been set at 21, and homicides continue to run rampant. Is it really true then, that installing the same policy for long guns really an effective plan?

Though I could talk at length about the topic of firearms and gun control, this post simply aims to analyze a particular proposed policy, and determine if it actually could realistically contribute solving the problem that it is claimed to. Though mass shootings are emotional experiences, it is important to remember to use logic when creating policies and to see how the data supports your claims. The bottom line is, America needs policies that will actually help to reduce the loss of life that occurs each year, rather than supporting policies for their political and rhetorical attractiveness, politicians ought to look at the numbers and craft more realistic solutions to the problems at hand. That is not to say that supporters of this proposal don’t mean well, it is simply a reflection of my favorite F. A. Hayek quote, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”

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One of the things that I like most about economics is that it truly is the driving force behind all of humanity. When you think about economics you may not think of it in this way. You might imagine that it is strictly the study of currency or financial markets, but in reality the true fundamentals of economics are quite different. Economics is in fact largely a social science, and its focus lies at describing the cause for all actions that have ever been taken by humans. At the core of this social science is the study of incentives. Understanding the economic incentive requires awareness of only a few fundamental assumptions. First of all, every person has unlimited wants and needs, and is inherently self interested. Second of all, all resources are scarce, meaning that the limited amounts that exist are not sufficient to fulfill the unlimited wants of each person. And because of this, every action and choice has a cost, meaning that by choosing to do one thing, you give up something else that you could have done instead. An example of this is that by choosing to pay to go to college, you are giving up all of the other potential things you could have done with the time and money you have expended by choosing to go to school. And finally all people are generally rational, meaning that when making decisions, they would always seek to maximize personal gain while minimizing personal losses. And from this structure comes the incentive. An incentive simply refers to an adjustment of either the costs or benefits of a choice with the intent of encouraging a desired action, this can be done through either positive or negative means. If implemented correctly, an incentive will cause the benefit of a desired action to outweigh the costs, or the costs of an undesired action to outweigh the benefits. It is very important to understand that in every single aspect of society, whether it was intentional or not, incentives based on cost benefit analysis are responsible for every action of ever person. People often say that a corporation “should” be doing something or some other sort of normative phrase. In reality it is very clear why people and firms act in the way that they do, it all comes down to a cost benefit analysis and the incentives that surround each situation. It may certainly be true that incentives control each persons actions, but that in no way applies that it is a straightforward task to predict just how an incentive will influence decision making. It is important that we acknowledged how incentives that we create will not always yield the intuitive results that we may expect.

 

An instance in which incentives have backfired can be seen in British Colonial India. At the time the city of Delhi was seemingly infested with venomous cobras. The British governor saw this to be a problem, and sought to end the cobra scourge. In an attempt to incentivize the extermination of cobras, a cash reward was offered to anyone who turned in a dead cobra. The idea was of course that the incentive would increase the benefits of hunting and killing cobras, which would in turn reduce the cobra population and solve the problem. The incentive seemed logical, but backfired in the most counter productive way possible. While the benefits of hunting cobras were increased, the benefits of farming cobras increased on an even higher scale. Citizens began to farm the snakes, and turn in their bodies in exchange for the cash bounty. By the time the British government had caught on, there were excessively higher numbers of cobras within the city than there had been to start with, especially after the farmers released most of their remaining snakes after the bounty was dropped. This idea of an incentive with unintended consequences has since come to be known as “The Cobra Effect“.

The main takeaway of the aforementioned story is not that incentives don’t work. In fact, incentives were the very reason that the Indians farmed the cobras at all. Rather, it is to show that incentives are a powerful, but complex tool, and that there is often more than meets the eye in any given situation. A story such as the Cobra Effect is not an antiquated tale of misfortune, this same concept applies very directly to many areas of modern life and politics. Every year politicians promote policies that they promise will change something for the better. It is important to remember that a great deal of these policies deal heavily with incentives, and are therefore subject to very similar risks as the cobra bounty in colonial India. Though politicians may think they know exactly how they can influence a situation, it is quite likely that they are missing a key detail somewhere. One of my favorite F. A. Hayek quotes summarizes this entire concept beautifully, ” The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design”.

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The part of economics that I like the most isn’t what you’d first think of when someone mentions the field. While typical concepts such as GDP growth and unemployment rates are certainly essential to the study of economics, it is less conventional niches of econ that I find most fascinating. Stephen Dubner is a University of Chicago economist who co authored the Freakonomics series with Steven Levitt, another economist. Their work, which I very highly recommend, seeks to “explore the hidden side of everything” through the lens of economics. The books analyze a wide array of topics, from incentive structures that promote teachers cheating on standardized tests, to the dynamic through which levels of society tend to adopt popular baby names. All of the areas assessed prove to be incredibly interesting, but in this post I will be highlighting an area that has a very significant economic and social effect on society as a whole. Crime is, of course, a constant occurrence that we as a society are constantly trying to suppress. In Freakonomics, Dubner points out the seemingly “out of control” crime rates of the mid 80s and early 90s that had many people concerned. Many scholars and policy makers had championed various, and often conflicting theories of crime reduction. Dubner points out that those who had promoted all sorts of different policies have always asserted that aggressive and deliberate application of their policy would result in a decrease in crime. When crime finally did come down in the 90s, many suggested that this was the result of these same policies. However, Dubner shows that such claims are inconsistent and unsupported by data. He rather suggests that another factor entirely was at play below the surface, one that seemed unrelated, but logically and statistically added up upon deeper inspection.

One of the major claims that Dubner asserts in the book is that “conventional wisdom” is almost always assumed to be true, but is often formed from incomplete or incorrect logic. Conventional wisdom generally consists of the set of assumptions that we as a society have come to consider intuitive. For instance that the logical way to combat crime would be to enact “anti crime” policies such as gun control or increased police presence. While this may seem logical, Dubner argues that a much more definite, yet much less expected variable was the result of the decrease in crime seen in the 90s, and a general means by which crime can be lowered. As counter intuitive as it may sound, Dubner argues that that Roe v Wade supreme court decision in 1973 is what deserves credit for the crime reduction roughly two decades later. It may sound crazy, but the evidence presented actually presents a very strong argument in favor of the theory.

In 1973 the US Supreme Court ruled in in favor of Norma McCorvey, meaning that abortion was effectively legalized throughout the entirety of the United States. This decision on the surface would at first seem to have next to nothing to do with crime, let alone a drop in the crime rate nearly twenty years later. But when you take a closer look, the connection becomes surprisingly intuitive. Demographically, abortions are sought most commonly by low income women. Prior to the decision, abortions were particularly difficult to obtain in many parts of the US, meaning that many of these low income women were unable to have a procedure done. Then suddenly in 1973, abortion becomes widely accessible, meaning that hundreds of thousands of low income women began to have abortions each year following the decision. Its not so much about what began happening at this point, but rather what ceased, that being the birth of hundreds of thousands of low income individuals to mothers who likely couldn’t have afforded to raise them. It also happens to be the case that these low income individuals who are not being born, would also typically be part of the demographic that is most predisposed to committing crime (low income). The decrease in crime experienced in the 90s coincides almost perfectly with when all of the individuals that were not born due to abortion, would have been reaching their peak crime committing years. Thus, as concluded in a much more thorough study co-authored with John Donohue, Dubner reaches the hypothesis that the drop in crime experienced was the result of the Roe v Wade decision. This is further extended into the theory that abortion in general plays a key role in lowering crime rates, and other comparative examples are referenced further supporting the hypothesis. If you are interested in reviewing a more thorough explanation of Dubner’s claims, I would recommend reading Freakonomics or referencing the complete study via the link above. Also check out a list of responses Dubner compiled which address various counter arguments brought against his theory.  

This is of course not in any way meant to be an argument for or against abortion based on moral principles or protection of rights (to life or choice). Rather the goal of this post was to highlight the idea that the conventional wisdom often does not provide adequate answers to many occurrences, and that in order to understand the full picture, it is often necessary to dig a bit deeper than you normally might. As Dubner often asserts, many people will try to explain observed patterns in an over simplified, self interested manner, the true cause is often a variable that may have never occurred to you. It is all summarized quite well in a quote by legendary economist F. A. Hayek, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”

Today’s post will of course still be featuring a controversy relating to economics; however, the nature of this issue will require a bit more “normative” analysis than purely quantitative, positive analysis. This is the case because though the issue is heavily economically based, the core arguments are largely based on principle rather than practicality. Nonetheless, it is a very legitimate issue and I feel that it deserves to be understood in its entirety. After all, the study of economics occasionally evaluates somewhat normative concepts such as economic freedom. This post will focus on the controversy of whether or not churches and religious institutions should be exempt from taxation. Currently, religious institutions are not required to pay taxes to the government, a policy that is derived from several principles. However, this policy has been met with opposition as opponents also cite many reasons that the practice is undesirable. It is important that rarely talked about issues like this be fully understood and considered so that as a society we may develop informed opinions and work towards viable solutions to such debates.

 

I will start by addressing the normative, but legitimate arguments posed by those who support tax exemption of religious institutions. It is of course implied by the American constitution, and generally accepted as fundamental American doctrine, that religion be left separate from government. This often referred to as “the separation of church and state” and is generally a straightforward concept. The idea is that the government should not sponsor, punish or otherwise be affiliated with any particular religious organization in order to fully support the ideal of religious freedom in America. This issue forms an interesting contradiction between “sponsoring” and “punishing” religious institutions, in economics these terms often materialize as “subsidies” and “taxes”. Supporters of religious exemptions argue that taxing churches would equate to not only affiliation with religion, but also punishing religious organizations economically. In 1970, during the ruling of the US Supreme Court on the case of Walz v. Tax Commission of the City of New York, Chief Justice Warren E. Burger stated that, “The exemption creates only a minimal and remote involvement between church and state, and far less than taxation of churches. It restricts the fiscal relationship between church and state, and tends to complement and reinforce the desired separation insulating each from the other.”. Essentially, those agreeing with Burger argue that taxing churches infringes on the value of the separation of church and state, and should be avoided for the sake of promoting religious freedom.

On the contrary, those who feel that religious institutions should be taxed cited similar normative principles to reinforce their beliefs. Advocates from this side of the debate interestingly also cite upholding the separation of church and state, using similar logic to those who denounce taxation. The opponents of exemption focus on the “sponsor” side of separation, arguing intuitively that tax breaks for churches are a blatant example of the government economically rewarding religious institutions, also infringing on said values. Following the same aforementioned Supreme Court case, Associate Justice of the US Supreme court, William O. Douglas drafted a dissent statement against the previous stance, stating that, “If believers are entitled to public financial support, so are nonbelievers. A believer and nonbeliever under the present law are treated differently because of the articles of their faith… I conclude that this tax exemption is unconstitutional.” This argument also holds significant credibility. In my perception both arguments have considerable merit and it likely comes down to personal opinion as to whether you support one or the other.

In order to gain a more holistic view of this issue, it is necessary to also consider whatever positive data we can find regarding the economic costs and benefits of deciding one way or another. First let us consider the data in support of maintaining the current policy of tax exemption. As cited by CNSNEWS a Georgetown University Study concluded that the religious sector contributes 1.2 trillion dollars worth of services to the US economy, taking into account both the actions of religious institutions themselves and Americans acting on the behalf of religion. The low estimate from the study was estimated to be 378 billion and the high number estimated to be 4.8 trillion. The variation was caused by different methods of calculation; however, the 1.2 billion estimate was concluded to have been the most reasonable. Advocates use these findings to argue that taxation of religious organizations would severely cut into this valuable sector. They argue that these organizations are much better at allocating the funds to produce these services than the government would be if it were to take these funds via taxation. Though it would be difficult to calculate the effects that taxation would have on these numbers, it can be reasonably assumed that taxation would reduce the aggregate benefit that these organizations contribute to society.

On the contrary, opponents of church tax exemption note that every year the US government loses a significant amount of tax revenue by allowing religious establishments to remain un-taxed. The Washington Post cites that the US government loses, or in their words “awards a religious subsidy”, of about 83.5 billion dollars in revenue each year. The implications of this are obvious considering that that amount in revenue could otherwise be being used to fund various government programs. For reference, the 2017 federal budget included expenditures of 4.2 trillion, with a 503 billion deficit.

The overall issue is very two sided, particularly in the normative sense, but also when considering positive data. Both sides have strong claims when it comes down to pure principle, and in that case it generally becomes a matter of personal belief of preference. The quantitative evidence is telling, but requires vital additional information in order to become conclusive in deciding this debate. In order to decide the debate, the benefits yielded by the revenue gained from taxing religious organizations would need to be shown to outweigh the costs incurred from the lost services provided by the religious sector, or vice-versa. Until this situation is specifically, and thoroughly analyzed, it is very difficult to say confidently which side holds the better “economic” claim, and comes down essentially to estimation. Until then, it is important for us as responsible citizens to take into account all available information when considering issues such as these and work to develop viable solutions so that we may optimize our society and live as prosperously as possible.

Social welfare programs have been a topic of considerable controversy in the United States, and continues to be the subject of extensive in American politics. While this issue as a whole is certainly one with many economic implications, it is entirely too broad to do justice for in its entirety in a single post. Instead I will be focusing on a more specific tenant of the national welfare controversy, and one that is often under examined or contemplated. The idea of administering mandatory drug tests to welfare recipients is one that has often been thrown around or suggested, but less often analyzed more thoroughly. This post will assess what mandated drug tests would look like and what some of the results and consequences of such a policy would entail. The goal is to look a bit beyond the surface, putting impulsive, emotional reactions aside and looking more at the objective economic implications of this issue.

When considering this issue, people often react in one of two primary ways. The first general opinion is to think “That sounds cruel and hypocritical”. People who feel this way tend to believe that such a policy is too harsh and is designed to hurt those who are already struggling with poverty. They often cite that politicians who support this have no compassion for the poor and are just trying to further contribute to their struggle. On the other hand, others who consider such a policy often think “that sounds totally fair, if you’re going to receive our hard earned tax money, you should at least be able to pass a drug test”. People of these beliefs tend to suggest that it is already unfair that people on welfare use the money they receive for unnecessary or detrimental purposes. They claim that welfare recipients may even use the money to purchase drugs or other illegal goods. Both of these sentiments are very legitimate when it comes to morals and values; however, neither of these alone addresses the actual practicality or the direct costs and benefits of such policies.

According to the National Conference of State Legislatures, at least 15 states have passed legislation that requires recipients of public assistance to pass a drug test. Similar regulations were passed in many other states, but were never passed into law. When it comes to designing new legislation, it is important not only to consider the normative values that the law will seek to uphold, but also the actual positive effects that will occur as its result. The issue of prerequisite drug testing seems to be an instance where perhaps the quantitative results are not reflective of the values behind the legislation. When analyzing any decision, it is first necessary to analyze the costs, and then compare them to the benefits in order to determine the logical course of action. The intended benefits of these proposals are of course to prevent welfare recipients from using government money to purchase drugs, and to save taxpayers money by reducing the number of people on welfare programs. For this to be effective in an economic sense, the welfare payments being received by active drug users would have to be greater than the cost of testing all of the recipients. The data generally seems to indicate that these drug testing programs are actually quite expensive, and that, in practice, they actually seem to indicate that far fewer welfare recipients are active drug users than was previously imagined. Think Progress found that states requiring drug testing for welfare applicants spent a combined total of nearly $1 million in order to conduct testing. It was also found that, though the national drug use rate was 9.4 percent, positive tests occurred at a rate ranging from 0.002 percent to 8.3 percent, and it should be noted that all states but one (Oklahoma) found rates below one percent. These high costs coupled with low success rates indicate that these programs are almost certainly more expensive to carry out than they are beneficial in terms of saving taxpayers money.

To be fair to those who support mandatory testing, their position is often accompanied by more than this stance alone. Those supporting testing often feel that funding to welfare programs in general should be cut, which would indeed save considerable amounts of taxpayer money if implemented. However, that is a complex debate of its own with too many intricacies to elaborate on in this post. Supporters also have argued that even though it is a pricey endeavor, it is still worth it. They feel as though it is very important to prevent the spread of drug use and find it fundamentally unacceptable for the possibility to exist that taxpayer money could be used for the purchase of illicit drugs. Though this is a fair viewpoint that holds merits in its own sense, it does not align with economic rationality. Applying certain morals to the situation may allow for such points to be recognized as legitimate, but from a purely economic standpoint the regulations simply do not prove efficient.

It is always important to consider every aspect of an issue before passing judgement, especially when you are a representative of the people contemplating spending taxpayers’ hard earned dollars. Considering the economic costs and benefits is a crucial step in thoughtful consideration, although it is all too often overlooked or under researched. This past May, the “Drug Testing for Welfare Recipients Act” was introduced to the US House of Representatives. I only hope that our representatives thoroughly consider the costs and benefits of this proposed legislation, and make decisions that will reduce the cost to the American people rather than increase it.

 

 

 

Update: If you read the previous post on the minimum wage, I recommend you take a moment to reflect on the comments of California Governor Jerry Brown as he signs a statewide raise in the minimum wage.