Supply-Side Progressives
Supply-Side Progressives
Top Stories of the Year: #5
It is time for me to count down the top stories of this year, particularly as covered in The Tracinski Letter.
At #5 is the growth of the so-called “supply-side progressives,” people on the left who are struggling to come to grips with the startling new truth that you can’t consume what you haven’t produced.
But first a note about a story I didn’t talk about much because it stopped really being a story: This was the year the covid pandemic finally petered out.
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Now back to the top stories of 2023.
The fading of the pandemic should probably be counted as one of the top stories of this year—except for the fact that we all started ignoring the pandemic a year too early, at the beginning of 2022. As I noted last year, at that time the pandemic was most definitely not over yet, and people were still dying in large numbers.
But if you look at the numbers for this year, you see the pandemic fading away. People are still dying from covid, but at levels more comparable to ordinary health threats. As I observed early this year, covid is finally what the skeptics were wrongly claiming all along: It is becoming the flu.
This is not quite as comforting a description as some people assume, because the disease that became our normal seasonal flu started out a hundred years ago as the devastating Spanish Flu that killed many millions of people across the world…. [T]he other reason this is less than reassuring is that the seasonal flu, the old leftover of the Spanish Flu, usually kills tens of thousands of people in the US every year. If covid settles into the same pattern, it will add another seasonal flu on top of that, killing an additional tens of thousands of people. But those number are still far lower than covid at its peak, and this returns us into the realm of “normal life”—well after most people have already returned to normal, anyway.
Now take a look at the numbers as we reach the end of the year, helpfully provided by the New York Times. I would particularly direct your attention to two graphs. One shows “weekly deaths,” which rose to massive spikes every few months of the pandemic, up through the Winter of 2022. (To put these spikes in context, note another graph that shows covid deaths as a share of all deaths. At the height of the Winter 2022 spike, almost one in four of all deaths was due to covid.) The disease still had significant upward bumps in the Summer of 2022 and in December and January one year ago. But after that, the numbers have been bouncing around at much lower levels.
The other interesting graph, which largely explains these results, is the one you will on the lower right if you scroll all the way down. It compares death rates among the unvaccinated, the vaccinated, and the vaccinated and boosted. The vaccinated and boosted are significantly less likely to be infected and about four times less likely to die. The vaccines work, and most of us have had them—69% of the general public, 94% of the elderly—so the pandemic is now over, and at far less cost than without the vaccines.
And look, I don’t mean to boast, but occasionally it’s necessary to blow my own horn. So I will point out that this has all followed the general timeline predicted by Amesh Adalja in the interview I published when the pandemic first hit in the US. If you followed covid news in this newsletter, you were relatively well informed and prepared.
Now back to my #5 top story for this year. The concept of the “supply-side progressive” was first coined by Ezra Klein in September of 2022, but this is this year in which it became a trend.
I wanted to mock it a bit. As I wrote, “as a child of the 1980s, I just broke down into uncontrollable laughter at that phrase.” But there is a real and important point to it. Here is Klein from his original piece.
Many of progressivism’s great dreams linger on the demand side of the ledger. Universal health care promises insurance that people can use to buy health care. Food stamps give people money for food. Housing vouchers give them money for rent. Pell Grants give them money for college. Social Security gives them money for retirement. The child tax credit gives them money to care for their children. The minimum wage and the earned-income tax credit give workers more money. A universal basic income would give everyone more money….
But progressives are often uninterested in the creation of the goods and services they want everyone to have. This creates a problem and misses an opportunity. The problem is that if you subsidize the cost of something that there isn’t enough of, you’ll raise prices or force rationing. You can see the poisoned fruit of those mistakes in higher education and housing. [Editor’s Note: Ahem.] But it also misses the opportunity to pull the technologies of the future progressives want into the present they inhabit. That requires a movement that takes innovation as seriously as it takes affordability.
It’s the holiday season, so I’ll quote everyone’s favorite Christmas movie. Welcome to the party, pal. Klein is, of course, just catching up with about 100 years of free-market critiques of the welfare and regulatory state. But at the same time, he is maddeningly dismissive of those very same free marketers. That’s the problem I pointed out.
Klein…seems to want to challenge the progressive orthodoxy on this one issue alone—while still ticking all the boxes to show he’s still in step with the conventional wisdom on global warming, inequality, and every other left-of-center article of faith….
We can’t solve the problem without facing up to basic questions about the role of government, and the questions beneath those questions. In particular, I mentioned this one: “The fundamental question is whether we want to live our lives independently or to be permanent wards of the state.” If you want more production, you have to think about the kind of independent thought and action that causes production, the kind of people who engage in such action—and the envy and resentment and petty mania for control that puts barriers in their way.
But I did project, “If some of these people really start looking at the problem of production, and at what is holding back production, they just might come up with some valid and useful ideas.”
Klein’s big follow-up was “Everything Bagel Liberalism.” Here is Klein’s explanation and my commentary.
You might assume that when faced with a problem of overriding public importance, government would use its awesome might to sweep away the obstacles that stand in its way. But too often, it does the opposite. It adds goals—many of them laudable—and in doing so, adds obstacles, expenses, and delays. If it can get it all done, then it has done much more. But sometimes it tries to accomplish so much within a single project or policy that it ends up failing to accomplish anything at all.
I’ve come to think of this as the problem of everything-bagel liberalism. Everything bagels are, of course, the best bagels. But that is because they add just enough to the bagel and no more. Add too much—as memorably imagined in the Oscar-winning “Everything Everywhere All at Once”—and it becomes a black hole from which nothing, least of all government’s ability to solve hard problems, can escape. And one problem liberals are facing at every level where they govern is that they often add too much. They do so with good intentions and then lament their poor results.
His examples are California’s attempt to subsidize “affordable housing,” which is undercut by requirements that government-funded housing has to use small, minority-owned contractors, which adds expenses and delays; and the Biden administration’s attempt to subsidize microchip manufacturing in the US, onto which they have piled mandates for worker child care and other demands.
That is the problem. To have building and growth and innovation, you have to want these things. And for all of Klein’s talk about the “good intentions” of politicians and regulators, it is precisely their intentions and moral priorities that Klein fails to take seriously or subject to examination.
The question I posed at this point is whether supply-side progressivism “is a contradiction in terms—whether ‘progressivism’ and its obsession with government control and planning contradicts the desire to increase growth and innovation.”
I took that up in a Discourse column, where I criticized the need to cling to the “progressive” label, especially given that movement’s checkered history.
The progressive movement did not begin as a call for increased wealth and construction. It began as a backlash against an economy that was already producing rapid growth, abundant innovation, new construction, and economic progress. The first great progressive president, Woodrow Wilson, described the movement that brought him to the presidency as a “sober second thought” to the “heedless” pursuit of “material greatness.”…
So, to some extent, an anti-supply-side, “degrowth” attitude was part of the basic impetus of progressivism from the very start. And that problem is still smack-dab in the middle of supply-side progressivism. Klein’s proposals, for example, are mostly about how to make it easier to do a small subset of politically privileged projects. To be worth lightening the burden of regulations, your project has to have a “green” angle or benefit the homeless. We couldn’t possibly scrape anything off the everything bagel when it comes to the kind of normal economic activity that is the actual bread and butter of economic progress….
We would clear the way for projects that involve properly progressive goals of redistribution, but we would not clear the way for projects that are desirable just because the average person wants to be happy and prosper.
I end up calling for these apostates from progressivism to shake off the need to cling to the label.
[T]he cost for the would-be supply-side progressives is that they are limited by a set of thoughts they can’t mention. They need to be freer, less defensive, less apologetic. Few of us want to be against progress, of course—but there is no need to be restricted to one particular dogma that claims a highly implausible monopoly on progress.
As I conclude, “This is yet another reason to break down the existing categories of ‘left’ versus ‘right’ and ‘progressive’ versus ‘conservative’ and reclaim ‘liberalism’ in its proper sense.”
But I observed that Klein “has a talent for devising interesting formulations and turns of phrase,” and “everything bagel liberalism” is a phrase I have actually heard people using out in the wild, so to speak. “Supply-side progressivism” has changed the political debate about economics a little, so far. It is not sweeping all before it, but it is becoming something of a movement. Klein helped give people on the center-left permission to start talking about these ideas.
So far, the main concrete result has been a rise in the YIMBY movement: people who oppose the NIMBYs and say “yes, in my back yard,” primarily to new housing. This has had success in a few areas of the country and is starting to produce results.
For example, one of the chief complaints about the post-pandemic economy is inflation. Fortunately, in the past year, price increases have cooled down for most goods, but rents and house prices have remained high. Yet this looks like the next bit of inflation to break, and YIMBYs are largely to thank for it.
The rental market has lost momentum over the last year and a half in large part because there are more apartments on the market—the result of a building boom in recent years. This jump in supply has left many landlords struggling to fill vacancies, motivating them to drop asking rents in some cases.
“Renters are finally catching a break. Better deals are easier to come by because landlords are doling out concessions and rents have started falling in a meaningful way. Rising supply also means renters have more good options to choose from,” said Redfin Chief Economist Daryl Fairweather. “With homeownership so expensive, renting has started to lose its stigma. Still, we may see more renters jump into the homebuying market next year as home-sale prices and mortgage rates tick down.”
Some landlords are offering one-time discounts like a free month’s rent or reduced parking costs to attract renters. This means the prices renters are paying in total are likely coming down faster than they appear to be in the data.
This may help put an end to the “vibecession”—the emotional sense of gloom and doom even in the midst of low unemployment and rising wages (which I will be writing about soon). But it also serves as proof of concept for YIMBYism by showing that the way to make people better off is make it easier to produce more housing.
This is not exactly a novel truth, I know—but for precisely that reason, it’s good to see some people dropping their defenses against accepting it.
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