Can You Tell The Difference Between Economics And Politics? (@EconTalker, @EconLib, #economics, #politics)

Can You Tell The Difference Between Economics And Politics? (@EconTalker, @EconLib, #economics, #politics)

These days, it is trendy to practice political punditry under the guise of a thoughtful economist handing out enlightened “economic policy” suggestions.

A recent case in point is the interview with Harvard’s Ed Glaeser with EconTalk’s Russ Roberts, wherein Glaeser shared the following ideas about reforming city governance with respect to “historic preservation districts”:

In the case of the city historic preservation districts I would probably replace the ever-increasing swatch of territories–15% of the land area in Manhattan south, in the bottom half of Manhattan excluding Central Park as an historic preservation district right now–and areas go into historic preservation districts but they rarely come out of them. So, it seems like it’s going to be an ever-increasing swath of the city. I don’t much like the idea of cities being museum pieces. There are a few which are appropriate, like Bruges, but I think it’s good that cities change and that they develop new space, combination of new activities and people. So, I would in terms of preservation–my father was an architectural historian so I do really believe in the value of preserving some old, beautiful buildings–but I would have a fixed number of the total number of buildings that they are able to set aside as being preserved rather than allow them to just keep on getting new areas for preservation districts.

Here is what an economist would say:

Land and property use should be conditioned on “most highly valued use”, as evidenced by voluntary exchanges agreed to by participants in the property market. For some, purchasing historic properties for the purposes of preserving them, perhaps for commercial exploitation as a tourist attraction or simply to be kept out of the hands of the public or those who might privately redevelop them, might be the “most highly valued use” for which a person would exchange their wealth to control these properties. For others, tearing the historic buildings down or otherwise modifying them from their original, historic state, may be the “most highly valued use”, perhaps for the purpose of providing new housing or areas of commerce and industry.

There is no moral reason why future generations should be beholden to the land-use decisions of ancient generations, and even if there was, it is not an economist’s place to discuss such topics.

Notice– Glaeser said none of this, and in fact violated the statement at the end while complementing it all with a bit of arbitrary personal psychological projection, the idea that because his father was an architectural historian he has some kind of special need or special knowledge into the value of preserving historic properties that necessitate the violence of the State to protect such value impositions.

In fact, the closest Glaeser came to say anything “economic” about the subject was his attempt to calculate a “fixed number of total buildings” which would be available for historic preservation. But even here, his theorizing falls flat on its face, for Glaeser does not explain how his arbitrary calculus would be superior to the outcomes of voluntary exchanges between market participants.

How many is a “fixed number”? What constitutes a “building” for purposes of this policy? Which “buildings” shall be a part of this “fixed number” and which shall remain outside it, and how are such decisions evaluated in an objective way?

Such policies are an invitation for gross, arbitrary and wild government intervention and special interest group politicking that Glaeser claims earlier in the interview he is strongly against. Yet, he opens the intellectual door to them in moments like these when he places his economist costume over his political self and attempts to perpetrate a theoretical deception.

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