Their ignorance is shining through.
With ambitious Democrat senators like California’s Kamala Harris, Massachusetts’ Elizabeth Warren and New Jersey’s Cory Booker already trying to outflank each other to get to the left of the leftiest liberal competition, the American electorate is going to be in for some loony ideas long before the 2020 presidential campaign gets into high gear.
But with a Twitter post Sunday on helping Americans deal with housing costs, Harris got a big step on her competition.
Unfortunately for Harris – and the American people – her idea makes approximately zero sense.
In the post, Harris tried to explain the Rent Relief Act that she introduced into the United States Senate earlier in July.
“Under the Rent Relief Act, anyone who spends more than 30% of their income on rent would be eligible for a federal tax credit,” Harris wrote. “What would you do with that extra money in your pocket?”
Under the Rent Relief Act, anyone who spends more than 30% of their income on rent would be eligible for a federal tax credit. What would you do with that extra money in your pocket?
— Kamala Harris (@KamalaHarris) July 28, 2018
That might sound like a brilliant economic plan to a socialist political party, but as The Daily Wire’s Ben Shapiro wrote in a short, scathing commentary on Monday, it’s not quite the great idea Harris thinks it is.
“So, this is stupid,” Shapiro wrote with characteristic clarity.
“Here’s why. Imagine that you spend $3,000 on rent and make $10,000 in gross income per month. Now the government gives you and everybody like you a percentage back on your taxes. This creates additional demand in the housing market, as everyone who is competing to take your apartment offers the landlord that extra cash. So the cost escalates for your apartment. Here’s what you’ll be using that extra money for: rent.
“This is precisely what happens with every subsidy: you generate more of that which you are subsidizing. If you subsidize rent, you create higher rental prices. Undoubtedly, Harris would then answer that we need rent control – which would lead to less development of real estate, leading to housing shortages. And those housing shortages are supposedly what Harris is attempting to prevent in the first place.”
Anyone with even a vague understanding of human nature could guess what would happen in a world where the government effectively subsidized rental costs – rental costs would just go up to absorb the extra money floating around.
But it’s not like the United States doesn’t have experience with this kind of thing already.
Just one example, and possibly the easiest, is the increase in the price of higher education.
As Business Insider has reported, the cost of college tuition grew by about 260 percent between 1980 and 2015.
The general cost of living in those year, meanwhile, rose by less than 130 percent.
What’s the difference? The federal government, through a variety of programs – loans and grants – subsidizes college tuition, which makes it easier for colleges and universities to raise their prices without being subjected to the normal disciplines of the market.
Anyone who thinks college education got better in those 35 years hasn’t gotten a first-hand look at how abysmally ignorant American college students and graduates are when it comes to matters of economics, or history, or politics.
So, one of the rising stars of the Democrat Party wants to do for American housing costs what the government has done for “higher education” in recent decades?
Someone close to Kamala Harris might want to pull her aside for a second and whisper, “Kamala, your ignorance is showing.”
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