“Fixing” Problems by Making Things Worse?

A month ago, I wrote a post titled “It’s a Crisis!” in which I poked fun at the special pleaders routinely parading up to the microphone at City Council meetings asking for official government sanction to address various so-called crises.

I declared if you can’t beat ‘em, join ‘em, then offered my own market-based perspective on how to deal with the housing affordability ‘crisis’ in our fair city, which included:

  • Liberalize the over-restrictive 3-unrelated ordinance. When adopted 10+ years ago the city government completely disrupted and shrank the rental supply basically overnight. They can fix that crisis.
  • Commit not to adopt any new ordinances, resolutions or fees without first analyzing the impact on housing supply and costs. City government talks about the high housing costs, then takes action after action to contribute to them. They can fix that crisis.
  • Commit to cut time in development review for housing projects in half. Baby elephants can be conceived, gestated, and born before some housing projects in Fort Collins get built. They can fix that crisis.

Ah, but the pro-government camp is not to be out done! Their thinking seems to be ‘Why go to all the hard work of correcting flawed government policies when we can just create some more?!’ So, on cue, a member of the City Council proposed passing a local minimum wage of $16 to $18 an hour to address affordable housing.

Are you following this? Local government policies are largely responsible for making housing expensive by restricting supply and the ‘answer’ would be for government to now mandate the relationship between employers and employees to ‘fix’ the first set of problems.

To see how that’s working in New York City, read this story about what’s happening to small businesses there due to the new $15 minimum wage.

For the people losing their jobs because of this government mandated wage, their minimum wage is now $0 per hour.