New York Mayor-elect Zohran Mamdani‘s winning message was affordability: that the necessities of life are increasingly out of reach for most people and that government is the answer. “There is no problem too big for government to solve,” he boldly declared on election night.
He was right about the problem but dead wrong about the solution. As former President Ronald Reagan often warned, “Government is not the solution to our problems; government is the problem.”
Housing affordability is a good place to start. When and where a free market is maintained, home builders have every incentive to meet the housing needs at every income level. The profit margin might be bigger at the top, but the sheer numbers of lower-income families compensate with volume, ensuring ample affordable housing for all incomes.
The government sets basic safety standards but otherwise leaves consumers alone to make their own decisions on everything else. As the tax base grows, new revenues are available to expand water systems, electricity generation, highway capacity, schools, policing, and firefighting — all of the necessities of a community. Landlords have every incentive to provide as many rental units as the population needs, while competition keeps rents low and demand keeps units plentiful.
So what happened? The government decided to “solve” what socialists viewed as problems. To “solve” suburban sprawl, the socialists began imposing severe limits and costly fees on construction permits. Builders could no longer profit from building vast numbers of affordable homes, so they focused their limited permits on pricier models.
To “solve” climate change, socialists mandated outrageously expensive add-ons such as solar panels and hermetically sealed windows. To “solve” their environmental angst, they required pointless studies that were endlessly time-consuming and outrageously costly, adding hundreds of thousands of dollars to the costs passed on to helpless purchasers.
As these “solutions” drove up housing prices, socialists began offering subsidies to lower-income earners who were priced out of the market by socialists’ policies. As taxpayer dollars flooded into the already constricted market, prices and rents continued to rise. As socialists “solved” the rental problem by freezing rents, landlords stopped building new units or maintaining existing ones.
When something is scarce, it’s expensive. When something is plentiful, it’s cheap. Socialists have made housing scarce and therefore expensive. Nowhere can this be seen more clearly than when comparing the socialist dystopia of California with the free state of Texas. Last year, more building permits were granted in the Houston and Dallas metropolitan areas than in all of Gov. Gavin Newsom’s (D-CA) California. The median home price in Texas is $345,000. In California, it’s $900,000. Any questions?
Americans once paid for their own healthcare. They could choose among policies offered by hundreds of competing providers for the one that best met their needs and circumstances. Most opted for inexpensive catastrophic policies for accidents and illnesses that could bankrupt them, while paying for routine care out of pocket. Competition for their business kept prices low and quality high.
But socialists objected to leaving the poor to an extensive network of charity. They “solved” our healthcare inequalities with highly subsidized and mandated coverage that leaves consumers powerless to choose their best options while severing the connection between the patient and the payer. When somebody else is paying the bill, the patient doesn’t care about the price, and the payer doesn’t care about the quality. The result? Costs spiral out of control, while patient satisfaction continues to decline.
At the center of socialism is the mistaken belief that profit is waste, and if it can be removed from the equation, everything will be cheaper. That is the fundamental misconception behind Mamdani’s government grocery stores. But profit is not waste. Profit is the essential ingredient that spurs competition, drives innovation, demands efficiency, and craves customer satisfaction. Take profit out of the picture, and you will learn the difference between FedEx and the United States Postal Service.
NEW YORK BRACES FOR MAYOR ZOHRAN MAMDANI
Consumer electronics have steadily declined in cost while quality has steadily improved precisely because the socialists have not yet decided to “solve” this market. When they do, you can expect the same high prices and declining quality they have already delivered in every field they have “solved,” from housing to healthcare.
It comes down to four simple words: Freedom works. Socialism fails.
Tom McClintock represents California’s 5th Congressional District in the House.