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Housing Debate Shows Why Capitalism Needs No Defense



Yesterday I pointed out that for the left, ideology trumps facts when it comes to the relationship between housing prices and housing supply. The left refuses to acknowledge the benefits to consumers from competition in a market with few constraints. As I’ve posted before, the left is predisposed to see price as a social construct, something set and determined by individuals rather than fluctuating as part of negotiations between buyers and sellers. This stubborn contention is a roadblock, but it also illustrates why there are few market oriented advocates for real increases in housing supply.

I hosted a three part training session for small housing providers from around the country. The topic was how changing the narrative about housing would help shift policy. My contention has been and remains that there are two factors driving daft housing policy in the country. The first is the stubborn resistance on the ascendant left about where price comes from and the second is the perception that rental housing is all about passive income; the only work attendant to owning and operating rental property is depositing the rent checks every month.

But a third element that keeps the country locked in a self-imposed housing “crisis” is a complete lack of interest by conservatives in the housing issue and willingness by developers to bribe their way beyond bureaucratic gate keepers to get their permits. I explore this in more detail in a post titled, “Esta es La Mordida.” I touched a bit on the “conservative” problem in a long and meandering post about conservative identity.

Why is there so little intellectual foment in favor of the market? Why do “conservatives” simply ape what they think are conservative views with knee jerk opposition to taxation and opposition to “big government?” Why do left-leaning academics and flashy efforts to promote a non-existent “eviction crisis” proliferate while so called conservatives sink millions of dollars in to issues like abortion and gun rights?

My hypothesis is that what we call capitalism and what I prefer to call value exchange needs no defense. What I have found is that developers and housing providers when confronted with regulatory roadblocks find ways around them. At first there is outrage: “How dare they ban eviction!” and “No credit checks! That’s insane!” Then, somehow, they all manage to figure out how to operate their businesses anyway.

A perfect example is mandates for inclusion of rent restricted housing in new development, the Mandatory Inclusionary Zoning (MIZ) scheme. At first, developers slap their foreheads about a per square foot fee on their product. They oppose it. Some even claim, “This will push us out of this market!”

Then developers start bargaining on the fee that will wind up laundered by the government and in the pockets of non-profit developers. Once the fee seems reasonable, they capitulate, and the fee regime takes effect. From the perspective of everyone watching, life goes on, housing gets built anyway. This validates the position of politicians: the opposition was just hype and worry about lost profits.

What really happens is that developers reset their expectations for land costs, debt coverage, and assumptions on rent. Ironically, what makes this possible is that demand continues unabated, rents stay high and thus rationalizes the fees. Individual developers could care less about rising inflation across the market; in fact it is the basis upon which they are able to keep building. Higher prices for consumers mean there is enough money sloshing around to keep projects profitable and absorb fees.

Purists like me ask, “Where’s the outrage?”

Then in walks Claude Rains as Captain Louis Renault from Casablanca. Captain Renault is not an intellect or a man of principle. Renault is a rational actor unlike the more romantic figure of Victor Laszlo. We didn’t need Ayn Rand to point out that human beings act like Louis Renault while wanting to be Victor Laszlo. In fact, in many ways, society is structured to allow us to be Renault while feeling like Laszlo. The excellent book by John Murray Cuddihy, “The Ordeal of Civility,” points out how Jewish intellectuals like Marx and Freud pointed this out precisely; the Christian-Capitalist vision of society is to not only allow the contradiction, but to hallow it.

The notion that price is a construct is poppycock. It simply isn’t true. That’s why the left has written book after book arguing points like “housing is a human right” as justifications to impose inflationary fees. While producers of housing might burst onto the scene now and then claiming to be “shocked, shocked to see gambling going on here” they soon enough find an accommodation with the regime and fade away, counting their money as they go.

I find this both frustrating and edifying. If I really subscribe to the notion of the Fable of the Bees, the “invisible hand,” and spontaneous order, how could I be anything but satisfied that value exchange continues no matter what the left tries to impose to create “equity.” Yet, the Richard Blaine in me wants to do the “right thing;” so instead of getting the girl I always seem to end up walking away with Louis. Oh well. We’ll always have Paris.

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Top US admiral bristles at criticism of ‘woke’ military: ‘We are not weak’



Adm. Michael Gilday, chief of Naval Operations, rebuffed pointed interrogations by GOP lawmakers who grilled him over his decision to recommend sailors read a book deemed by some conservatives as anti-American.

The U.S. Navy’s top admiral also defended moves to address and root out racism and extremism in the forces as well as its efforts to bolster inclusion and diversity, which have prompted criticism from some conservatives and Republican lawmakers.

“Do you personally consider advocating for the destruction of American capitalism to be extremist?” Rep. Jim Banks, R-Ind., asked Gilday during a House Armed Services Committee hearing Tuesday, referring to a passage from Ibram X. Kendi’s book “How to Be an Antiracist,” which argues capitalism and racism are interlinked.

Banks continued to interrogate the admiral over specific quotes from Kendi’s book, which was a No. 1 New York Times best seller in 2020, and statements he had made elsewhere in the past.

Visibly distraught, Gilday fired back:

“I am not going to sit here and defend cherry-picked quotes from somebody’s book,” he said. “This is a bigger issue than Kendi’s book. What this is really about is trying to paint the United States military, and the United States Navy, as weak, as woke.”

He added that sailors had spent 341 days at sea last year with minimal port visits — the longest deployments the Navy has done, he said.

“We are not weak. We are strong,” Gilday said.

Rep. Doug Lamborn, R-Colo., also challenged the admiral by citing specific quotes from the book and asked him how those ideas laid out by Kendi would further advance or improve the Navy’s power.

Gilday responded by arguing the importance of transparency and open dialogue about racism.

“There is racism in the Navy just as there is racism in our country, and the way we are going to get out of it is by being honest and not to sweep it under the rug,” he expounded, adding that he does not agree with everything the author says in the book.

The key point however, he said, is for sailors “to be able to think critically.”

The exchange was the latest in vociferous complaints from some conservative leaders and lawmakers who suggest the armed forces are becoming a pawn for the country’s culture wars and “wokeness” ideology, as the military takes steps to address issues of racial inclusion, extremism, racism and white supremacy.

And only last week, Sen. Tom Cotton, R-Ark., accosted Secretary of Defense Lloyd Austin about Kendi’s book, which Cotton said promoted “critical race theories” at a different Senate Armed Services Committee hearing where Austin was testifying.

Days earlier, Cotton and Rep. Dan Crenshaw, R-Texas — two combat veterans — launched a “whistleblowers” online platform to report examples of “woke ideology” in the military.

“Enough is enough. We won’t let our military fall to woke ideology,” Crenshaw, a former Navy SEAL, said in a tweet.

Also in February, Austin instructed a one-day stand-down across the Defense Department pausing regular activities to address extremism and white nationalism in the ranks — an issue Austin declared as a priority after a number of rioters at the U.S. Capitol in January were found to have military backgrounds.

The stand down completed in April was an effort to better understand the scope of the problem of extremism in the ranks, Pentagon press secretary John F. Kirby said in a briefing then.

Earlier, Austin had revoked a ban on diversity training for the military.

More recently, in May, a U.S. Army animated ad focused on soldier diversity — featuring the real story of a soldier who enlisted after being raised by two mothers in California — drew criticism and political backlash from some conservative lawmakers.

“Holy crap,” Sen. Ted Cruz, R-Texas, said in a tweet. “Perhaps a woke, emasculated military is not the best idea. . . .”

Cruz was referring to a TikTok video that compared the U.S. Army ad with a Russia campaign that showed buff soldiers doing push-ups and leaping out of airplanes, adding that the contrast made the American soldiers “into pansies.”

The confrontation Tuesday is also the latest in reproaches by Rep. Banks, who is a Naval Reserve officer, and other GOP members over Gilday’s recommendation to include Kendi’s book in the Chief of Naval Operations Professional Reading Program.

In February, Banks sent a letter to Gilday arguing that the views promoted in the book are “explicitly anti-American” and demanded Gilday explain the Navy’s decision to include it on the reading list or remove it.

Gilday responded to Banks in a letter obtained by Fox News saying that the book was included on the list because “it evokes the author’s own personal journey in understanding barriers to true inclusion, the deep nuances of racism and racial inequalities.”

Lamborn and Rep. Vicky Hartzler, D-Mo., also wrote a letter to the admiral to convey their concern about the inclusion of Kendi’s book as well as Michelle Alexander’s “The New Jim Crow” and Jason Pierceson’s “Sexual Minorities and Politics.”

The GOP lawmakers argued the books “reinforce a view that America is a confederation of identity categories of the oppressed and their oppressors rather than a common homeland of individual citizens who are united by common purposes,“ Lamborn and Hartzler wrote, according to Fox News.

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Looking back on the 1991 reforms in 2021



Our understanding of events refines with time. New developments reframe the issues, and prompt reassessment of the solutions applied, their design and outcomes. What does looking back on the 1991 reforms in 2021 tell us?

For three decades, India celebrated and criticised the 1991 reforms. The reformers of 1991 say that the idea wasn’t only to tide over a Balance of Payments (BOP) crisis; the changes they brought in went beyond the International Monetary Fund’s (IMF) conditionalities for the bailout. The reforms, they insist, were ‘home-grown’. In the years leading up to 1991, technocrats in government had been thinking and writing about how India’s economic policies had been blocking the country’s rise to potential and the structural changes needed. If the broad range of reforms—including tearing down the industrial license permit raj, an exchange rate correction, and liberalising foreign direct investment and trade policies—could be launched within a matter of days of a new government joining office, they argue, it is because the blueprints were ready, waiting for the go-ahead from the political leadership.

The reformers of 1991 say that the idea wasn’t only to tide over a Balance of Payments (BOP) crisis; the changes they brought in went beyond the International Monetary Fund’s (IMF) conditionalities for the bailout.

At least two well-regarded technocrats that were important in the 1991 reforms disagree—publicly and in off-the-record conversations. In a media interview last month, one of them, the economic adviser in the reforms team, Dr Ashok Desai, suggested that if there were any reformers in government before the IMF “forced” India to liberalise in 1991, “they hid themselves very well”. According to him, after the BOP crisis was resolved, finance minister Dr Manmohan Singh turned “dead against reforms”.

The multiple versions of the reforms story make it difficult to separate fact from romance. It cannot be disputed, though, that the 1991 BOP crisis was a turning point for the economy. India had tided over BOP crises earlier with loans from the IMF, repaid them prematurely, and avoided going through with the bailout’s conditionalities. 1991 was singularly different because India was on the brink of default, which is likely to have forced politicians to set politics aside and listen to technocrats. Any default on external obligations would have meant hurting India’s credibility grievously and an inescapable sense of national shame. The government probably took the view that there was no choice other than to take corrective steps. Prime Minister PV Narasimha Rao named Dr Manmohan Singh, who had been a technocrat in government and was well regarded in global policy circles, as his finance minister. Dr Singh clearly had the Prime Minister’s, his party’s and the IMF’s trust. Records irrefutably show that the Congress party’s acceptance of the reversals in the interventionist economic policies of the first four post-Independence decades was not secured by the Prime Minister. He had delegated the task of tackling doubts and resistance within the party to his ministers, in particular, the finance minister and the commerce minister, and an aide in his office. The finance minister defended the reforms on the floor of the house in Parliament.

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Taxpayer-funded NPR mocks ‘CaPitAliSm,’ prompting calls to ‘defund’ media outlet



National Public Radio (NPR) ignited a social media firestorm Thursday night over a tweet that appears to mock capitalism, despite taxpayer dollars accounting for much of the organization’s annual budget.

The outlet posted a story titled “And Now, Crocs With Stiletto Heels” that explores a curious new collaboration between luxury fashion brand Balenciaga and Crocs, the rubber slipper company responsible for fashion faux pas among the millions of comfort-clinging owners nationwide.

The caption accompanying the article, which was written in both uppercase and lowercase letters, appears to mock the collaboration: “CaPitAliSm bReEds InNovAtiOn,” it reads. 

The tweet’s language sparked outrage on social media, with figures like conservative Tim Young calling out the irony in NPR’s three-word post.

“You wouldn’t exist without capitalism, clown who is tweeting on behalf of NPR,” he wrote.

“Job at public news station wouldn’t exist wo capitalism,” another user echoed. “Are you guys ok?”

“Our tax money shouldn’t pay for this,” one person expressed.

“It’s still a hell of a lot better than communism at breeding innovation, even if some of the products are silly,” one woman fired back.

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