The Independent Institute


The “Bern” Unit

According to the American Burn Association, approximately 486,000 burn injuries are treated every year.

Chances are you’ve experienced a burn or two in your life. From touching a pan that was too hot, to forgetting to make sure the electricity was shut off before some DIY house work, to being particularly inept with a curling iron (voice of experience there), anyone who has ever had a burn can tell you they aren’t fun. First degree burns, the least severe type of burn, are incredibly painful and can take days to heal. Second degree burns cause blisters, take several weeks to heal, and may scar. Third degree burns destroy every layer of skin.

Few people would willingly burn themselves. Why on Earth would you knowingly subject yourself to excruciating pain, long healing times, scars, and possibly even death?

Such an idea seems absurd, but it appears that many people are more than willing to jump headfirst into a sort of inferno. While this fire I speak of may not cause physical burns, it would undoubtedly leave quite the mark.

I’m talking about the cast of thousands who’ve thrown their support behind Bernie Sanders’ economic plan.

Sanders has proposed a variety of initiatives to combat what he views as major problems. A quick look at his campaign website reveals he plans to combat the supposed evils of income inequality by taxing the rich and stopping them from shifting jobs overseas. He states that as president he will raise the minimum wage to $15 an hour, spend $1 trillion on infrastructure, reverse trade agreements, and create 1 million jobs for young Americans. He’s also apt to sign the Paycheck Fairness Act into law, mandating that men and women’s wages be equal. (He cites the “women make 77 cents for every dollar a man makes.” I’ve discussed the problems with that statistic here.) Sanders also promises to make public colleges tuition free throughout the country, wants to expand Society Security, guarantee healthcare as a “right of citizenship,” and require all employers to provide “12 weeks of paid family and medical leave; two weeks of paid vacation; and 7 days of paid sick days.” We also can’t forget things like universal childcare, free kindergarten, and making changes to the banking system.

Any political figure writes checks they’ll never cash on the campaign trail, but this list is something to behold. When reading through this “plan,” a part of me feels like I have to be making it up. It’s an economic night terror and any second now I’ll wake up. How is it possible for so many patently backward policies to be rolled up into one package?!

Certainly, I’m not the only economist to look askance at Sanders’ economic plan. Austan Goolsbee, former chairman of Obama’s Council of Economic Advisers to the New York Times that Sanders’ “numbers don’t remotely add up.” He goes on to refer to Sanders’ economic agenda as “magic flying puppies with winning Lotto tickets tied to their collars.” Other economists have referred to Sanders’ plans as “wishful thinking,” and a “fairy tale.”

What’s particularly alarming is how many individuals seem keen to endorse and accept Sanders’ economic ideas without giving these policies any critical thought. “Free” education? Great! “Free” healthcare? Awesome! “Free” childcare? Sure! Make the “rich people” pay for it? Absolutely! When it’s all laid out like this it sounds silly—because it is silly.

In my principles courses, one of the first lessons I teach my students is the economic definition of cost. In order to truly assess the cost of an activity, we cannot just consider the required monetary outlay, but must also take into account what we give up. In order to do one thing, we necessarily give up the chance to do something else. This means that every activity has a cost—“free” does not exist when you understand economics. Promises of “free” healthcare, “free” childcare, “free” kindergarten, and “free” anything else take us to the aforementioned realm of magical flying puppies.

One of the first lessons my principles students learn when discussing how to analyze policy is that intentions don’t always equal outcomes. There are lots of things we’d like to do, but economic analysis and economic reasoning tell us what we can do. In fact, there are lots of examples where policies have the opposite effect of what’s desired! Look at things like unemployment rates for low-skilled workers and minimum wage increases. Look at the employment rate of women in countries with generous mandated maternity benefits. Look at the War on Drugs! Though we might like a world where everyone is paid $100 an hour, new parents can take an entire year to spend with their newborns, and no one uses dangerous drugs, such things may not be feasible.

While the plans proposed by Sanders and others might sound good, they make about as much sense as trying to serve soup with a slotted spoon. It all comes back to econ 101. Just like we can’t turn off the laws of physics when gravity doesn’t suit us, we can’t turn off the laws of economics because we don’t like them.

I’ve discussed minimum wageincome inequalitycollege education, and paid leave (several times) on this blog and elsewhere. I’ll let those arguments speak for themselves. While we may not like some elements of the current system, these proposed policy “cures” may be worse than the diseases they’re intended to treat.

So for everyone who likes to #FeeltheBern when it comes to economics, I’ll ask you to reconsider. There isn’t a “bern unit” big enough in the single-payer hospital to fit everyone.

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