The Other McCain

"One should either write ruthlessly what one believes to be the truth, or else shut up." — Arthur Koestler

Well-Informed Customers Are Well-Armed Customers

Posted on | November 10, 2011 | 6 Comments

by Smitty

Freakonomics discusses an NYU mashup that maps out subsidized housing:

As the article makes clear, this database performs a variety of worthwhile functions — allowing renters or buyers to locate affordable housing; letting affordable-housing advocates keep track of when subsidized buildings are scheduled to potentially lose their subsidized status; etc.
There’s one potential function the article didn’t mention, however. Am I a cynic (or a jerk, or maybe just a realist) for thinking that this database will also be used by renters and homebuyers eager to avoid neighborhoods that have a lot of subsidized housing?

It would be unsurprising, after a time, that if the application gains traction it drives the property values toward an inverted bell-curve. You’d think you’d go for a normal distribution, but subsidies do nothing if not queer a market.

When things get bad enough, you can bail out the subsidized market, because two bad policies form a double negative and make things all keen again, don’t they?

Oh, and speaking of great economists like Sowell, via @GinTheGin, we have an example in Herman Cain where the legal system has been sadly distorted:

The real scandal is that the law allows people to impose heavy costs on others at little or no cost to themselves. That is a perfect setting for legalized extortion.

The good news is that the people smelled rat, or at least John Edwards’ hair spray, and knew there was more to the story. Increasingly, where there is smoke, there is smoke machine.

Update: linked by Daily Pundit.

Category: Economics

Comments

6 Responses to “Well-Informed Customers Are Well-Armed Customers”

  1. Cruising Along the Reward Curve, From Left to Right | Daily Pundit
    November 10th, 2011 @ 11:29 am

    […] Well-Informed Customers Are Well-Armed Customers : The Other McCain […]

  2. JeffS
    November 10th, 2011 @ 12:28 pm

    Am I a cynic (or a jerk, or maybe just a realist) for thinking that
    this database will also be used by renters and homebuyers eager to avoid
    neighborhoods that have a lot of subsidized housing?

    I vote realist.

  3. Anonymous
    November 10th, 2011 @ 3:14 pm

    A cynic is someone with a strangle hold on reality.

  4. Adjoran
    November 10th, 2011 @ 3:33 pm

    People will certainly use it, but realtors will need to be very careful and not have any paper trail of recommending or using it themselves, and caution their clients not to speak of it.  People have been sued by various federal agencies and/or subsidized entities for merely criticizing the existence or proposed expansion of subsidized housing in their area.

    1st Amendment?  That’s so cute!  So far, no one has been able to stop the abuse.  Several people have won cases or settled for nothing, but others have suffered judgements and most have suffered legal costs.  The word “unconstitutional” has yet to cross a federal judge’s lips in this regard – and if Obama is reelected and appoints a couple hundred more federal judges to life tenure, it may never happen.  Your government at work.

    Which reminds me that there is another Department that Rick Perry could have mentioned for elimination with only benefits to the economy and society:  HUD.

  5. DaveO
    November 10th, 2011 @ 4:53 pm

    Most real estate agents already know the no-go places in their territory. And taking time to thoroughly scout out (with eyes and online) a neighborhood should be a no-brainer.

  6. Anonymous
    November 10th, 2011 @ 5:44 pm

    You’d be amazed where “subsidized housing” sneaks in. I recently worked on a project in Chapel Hill there were five buildings roughly 40/40 condos and office with about 20% retail when I enquired why some of the condos, about 5%, were so tiny compared to the others it was explained that the $100,000 dollar units were subsidised.