There was more to the slums than abject poverty. For a large number of immigrants life in the tenements was an improvement over their old lives

See ‘A Slumless America’ Review: Helping the Other Half Live by Howard Husock of AEI. He reviewed the book In “A Slumless America: Mary K. Simkhovitch and the Dream of Affordable Housing” by Betty Boyd Caroli. Excerpts:

"Like other reformers, including Catherine Bauer and Edith Elmer Wood, Simkhovitch saw slums through the narrow prism of their deplorable physical conditions, such as overcrowding. She overlooked what Tom Buk-Swienty, a biographer of Jacob Riis, a 19th-century reformer, has observed: “There was more to the slums than abject poverty. For a large number of immigrants life in the tenements was an improvement over their old lives. They worked, paid rent, fed their children and had hopes and dreams.”

By 1930, Wald noted the large number of “empties” on the Lower East Side; immigrants had moved up and out to Brooklyn. Simkhovitch and her fellow housing activists viewed slums through what can be called a reformer’s gaze, certain they would not want to live in one—but they overlooked the slums’ dynamism, thanks to shops, churches, synagogues and mutual-aid associations, none of which would be found in the public housing soon known as the projects.

It would have been a lot to ask that Simkhovitch, idealistic and self-sacrificing, predict that immigrant poverty and its housing conditions would be ameliorated with time. Or that the public housing she championed would itself deteriorate so badly that, by 1990, the federal government would label much of it as “severely distressed”—and demolish it for having become a latter-day slum."

"But it would seem a serious oversight for Ms. Caroli not to mention that Simkhovitch’s housing triumph was not an unalloyed improvement. By 1957, even Bauer, arguably more influential in promoting public housing, had changed her mind, labeling it “dreary” and unpopular." 

Section 122 Can’t Carry Trump’s Tariffs

It requires a balance-of-payments deficit—a problem that has become obsolete

By Phillip W. Magness. Excerpts:

"The U.S. has run trade deficits for most years since the mid-1970s. But Mr. Trump’s reading of Section 122 is erroneous. The relevant statute allows only tariffs that “deal with large and serious United States balance-of-payments deficits,” “prevent an imminent and significant deprecation of the dollar,” or facilitate an international agreement to correct a “balance-of-payments disequilibrium.”"

"While the U.S. current account is in deficit, the capital account runs a large surplus, effectively balancing it out. Under this full accounting, the current U.S. balance-of-payments deficit is close to zero."

"the problem Congress had in mind when it crafted Section 122 in the early 1970s vanished shortly thereafter." 

"A balance-of-payments crisis could happen when sustained demand for a particular currency depleted the U.S. government’s official reserve holdings, thereby threatening the stability of the peg."

"Records from 1973 show that Congress had this exact scenario in mind when it drafted Section 122. The committee report for the bill noted that a “large decline in the U.S. net international monetary reserve position would be evidence of a serious balance-of-payments deficit.”"

"America eventually settled on the floating exchange system we have today. And so we left behind any possibility of a problem that would trigger Section 122. As Milton Friedman explained in 1967, “a system of floating exchange rates completely eliminates the balance-of-payments problem.”"

"Solicitor General John D. Sauer [said] . . . that Section 122 tariffs aren’t a viable substitute for IEEPA, because “trade deficits . . . are conceptually distinct from balance-of-payments deficits.”" 

A Global Minimum Tax Means Price Fixing

We punish anticompetitive behavior in the private sector but permit it in the public sector

Letter to The WSJ.

"Kevin Brady’s “An End to Double Taxation” (op-ed, Feb. 12) is right to applaud the U.S. exiting the global minimum tax on companies. The U.S. should go even further, fostering agreements that institute antitrust enforcement for governments, not only companies.

The U.S. Sherman Act of 1890 made it illegal for competing companies to engage in horizontal price fixing, potentially punishable by prison time. Private antitrust enforcement occurs even though customers can voluntarily not buy at the higher prices upon which they’ve colluded.

Yet price fixing among governments, like that of Pillar 2 (the Organization for Economic Cooperation and Development’s global minimum tax proposal), is legal and common. In contrast to the private sector, government collusion is legal even though customers are mandated to pay the colluded-upon prices. Citizens can’t opt out of the national taxes charged. It’s a striking contrast: In the private sector, the price-fixers may face jail time; in the public sector, the customers not paying the publicly fixed prices do.

Bureaucrats including Janet Yellen, Joe Biden’s Treasury secretary, advocate for Pillar 2. They justify government collusion to avoid a “race to the bottom” in taxation. I’m sure private companies would also prefer to avoid competition in pricing their goods and services, but for consumers, that race is desirable. Should companies colluding on price-fixing be allowed to use the Yellen defense?

Only self-serving bureaucrats view rising after-tax incomes as a negative. It’s not a race to the bottom; it’s healthy price competition. Such tax competition among U.S. states protects local taxpayers from California’s and New York’s levels of taxation and cuts individual and corporate income taxes. Ireland’s lower tax serves the same competitive role in Europe. ​

One may argue that other foreign governments charging higher taxes benefits the U.S. if we can opt out unilaterally. That’s short-sighted. If other countries have high taxes, wealthy customers abroad will have less money to spend on buying American goods and services.

The U.S. should take the lead in pushing for more price competition, not only in the private sector but also in the public one.

Tomas J. Philipson

The University of Chicago" 

America’s Trade Deficit Is a Sign of Strength

A country runs trade deficits whenever it attracts more global capital than it repels

Letter to The WSJ.

"I hope that President Trump will read Joseph Sternberg’s column describing the economic doldrums inflicted on Europe by the European Union’s economic interventions (“Hurrah! Europe Is Fighting Over Economic Policy,” Political Economics, Feb. 13). Should he do so, the president might rethink his assertion that the EU has been “screwing us on trade”—a faulty conclusion that Mr. Trump grounds on the fact that the EU has consistently run annual trade surpluses with the U.S.

To describe real per capita gross domestic product growth in the EU as strong since 2009 would be generous and far from accurate; it has hardly grown. In the U.S., by contrast, real per capita GDP rose over these same years by about 32%. And yet in each of these years the U.S. ran a trade deficit with the EU, as well as with the rest of the world, while the EU, with the exception of 2022, ran a trade surplus with the rest of the world.

These data point to a reality that Mr. Trump refuses to acknowledge—namely, a country or region runs trade deficits whenever it attracts more global capital than it repels, and it runs trade surpluses whenever it repels more capital than it attracts. The EU consistently runs trade surpluses and the U.S. trade deficits not because the EU is cheating or besting America at trade but rather because the EU’s growth-stifling policies repel global investors while America’s more market-oriented policies are attractive to investors.

Mr. Trump’s obsession with putting an end to U.S. trade deficits will make America repel global investors.

Donald J. Boudreaux

George Mason University" 

Newsom’s Climate Policy Backfires

As refineries close, California is importing more foreign oil

WSJ editorial. Excerpts: 

"California has lost roughly a quarter of its refinery capacity since Mr. Newsom became Governor in 2019."

"the state’s burdensome regulations—e.g., its cap-and-trade program, low-carbon fuel standard and threatened tax on “excessive” gross margins—make it uneconomic to operate older facilities."

"California’s refined fuel imports have increased by more than 30% compared to late 2019"

"the state’s anti-fossil fuel regulations is higher CO2 emissions from all that transport to get the oil to California."

"Californians are paying $1.67 a gallon more for gasoline than the national average." 

The Economics of Illegal Drugs

As a teenager I saw the war on drugs up close. Then I studied it as an economist and saw it differently

By Roland Fryer. Excerpts:

"When demand for a drug is inelastic—meaning users don’t reduce consumption much even as prices rise—supply-side enforcement doesn’t starve traffickers. It enriches them."

"When enforcement raises costs, the street price goes up. If demand is elastic, consumers cut back, total spending falls, and less money flows to traffickers. But if demand is inelastic, as decades of evidence suggest it is for hard drugs, consumers cut back only modestly, total spending increases, and more money flows into the drug trade."

"legalize and tax. When demand is sufficiently inelastic, an excise tax on a legalized drug . . . reduces consumption more than any “war” on the drug. With legalization, producers prefer paying the tax to going underground, and enforcement costs collapse."

"in the 1980s and ’90s. With the rise of crack, homicide rates doubled among black males 14 to 17 while fetal deaths among blacks sharply increased. Yet even as crack use persisted at 60% to 75% of its peak level through 2000, the violence almost disappeared. The initial violence was driven not by drug use but by the struggle to establish property rights in illegal markets. Once those rights were established and crack prices fell, the violence subsided."

"Portugal and Switzerland represent partial steps: decriminalizing use while keeping supply illegal, or medicalizing supply for the most dependent users."

"Portugal decriminalized all drugs in 2001 and redirected resources to treatment. Annual drug-related deaths fell from 76 to 16 by 2012; HIV infections among users fell more than 90%; drug use didn’t spike."

"Switzerland began prescribing pharmaceutical-grade heroin to its hardest cases in the 1990s. Muggings by participants dropped 70%; opioid-related criminal cases nationally declined from 20,000 a year to 5,000."

"cocaine retails at 262 times its farm gate price—a markup attributable to the risk premium of illegality."

"addicts respond far more to permanent price changes than to temporary ones."

"In November 2025, the Congressional Budget Office’s director testified that he had no evidence the interdiction campaign has affected drug use or prices in the U.S. A classic RAND Corp. study found decades ago that treatment is 23 times as cost-effective as source-country control and 10 times as cost-effective as interdiction."  

Claims that government-funded centre-based daycare and pre-kindergarten programs promote positive early-childhood development unsubstantiated; research remains inconclusive

By Ben Eisen of The Fraser Institute.

The Impact of Daycare Participation on Children's Development: A Review of Recent Evidence

• In recent years, Canadian governments have made large financial commitments to expand access to and participation in formal daycare centres. One of the stated rationales for these expenditures is that they will have a positive impact on child development.
• This study examines that premise by reviewing recent empirical research on the effects of participation in centre-based daycare and pre-kindergarten programs on child development.
• The review is illustrative rather than comprehensive. We selected studies based on their prominence, methodological credibility (randomized, quasi-experimental, or meta-analytic designs), and policy relevance.
• The results from the studies examined here are mixed. One study from Boston shows significant positive effects from childcare participation on academic attainment. But other studies from New Haven and Ontario as well as a meta-analysis from across OECD countries show null or mixed effects on child development outcomes. Studies from Quebec and Tennessee show negative results.
• Taken together, the recent evidence remains inconclusive about whether participation in formal childcare has an effect on children’s well-being and by how much. On balance, the studies reviewed here support the long-standing reality that evidence about the developmental effects from participation in centre-based childcare are mixed, often modest, and contingent upon a wide variety of factors.
• Policymakers should therefore be modest about any claims they make about the developmental effects from government expenditures designed to expand participation in centre-based daycare.