A General Campaign at the Local Level for Laissez-Faire Capitalism (Part 9 of 10)

by | May 24, 2023 | POLITICS

What would be required to restore New York to its former prosperity and greatness would be the combination of the elimination of public welfare, the abolition of rent controls, and the privatization of the city's transportation system.

This article is excerpted from chapter 20 “Toward The Establishment of Laissez-Faire Capitalism” from George Reisman’s Capitalism: A Treatise On Economics (1996). See the Amazon.com author’s page for additional titles by Dr. Reisman.

The seven preceding sections have described various major aspects of the campaign for capitalism. Here it is appropriate to bring some of those aspects together in the form of a specific program that, over the course of less than a decade, would bring about the economic and cultural revival of America’s leading city, New York. I choose to focus on New York not only because it is the country’s leading city, but also because, of any major American city, it best represents the destructive economic and social consequences of contemporary American “liberalism,” of which it is the intellectual home.

What would be required to restore New York to its former prosperity and greatness would be the combination of the elimination of public welfare, the abolition of rent controls, and the privatization of the city’s transportation system.

The abolition of welfare, of course, would have to be preceded by the elimination of minimum-wage and prounion legislation and of restrictions on child labor over the age of fourteen. In the absence of the outright repeal of minimum-wage and prounion legislation at the national level, it would be necessary for the city to obtain a special congressional exemption from that legislation. These preliminary measures would be necessary so that, as I have said before, the present welfare recipients would have a realistic opportunity of finding employment. As I have also said before, the elimination of welfare would need to take place gradually, say, over a ten-year period. The elimination of public welfare and restrictions on employment would make possible a radical improvement in the lives of the poorest portion of the city’s population, whose members would then live by working and recognize their responsibility for their own well-being, and who thus could advance to far higher economic levels than could ever be possible for them while on the welfare rolls. At the same time, and for much the same reasons, it would make an enormous contribution to the reduction in crime and thus to the improvement of the lives of the rest of the city’s population, if large numbers of those who otherwise would have been out committing crimes–namely, unemployed, impoverished juveniles and the hardened criminals they grow up to become–were instead busy earning money by working.

The abolition of rent control, of course, would radically and progressively improve the city’s housing stock. It would also bring about the return of the middle class to the city. Another important consequence of the repeal of rent control would be a great increase in the revenues of the city government that were derived from property taxes. Property tax collections would soar by virtue of bringing the value of all the housing and land in the city that is presently under rent controls, up to the free-market level. The great increase in property-tax revenues, combined with the elimination of expenditures for welfare, would make possible the elimination of much or even all of the city’s income and sales taxes, which would further improve the quality of life in the city and promote the return of industry and commerce. As a result of the vast increase in the property-tax base, even the property-tax rate could probably eventually be reduced.

The privatization not only of the city’s subway system but also of its bus lines, accompanied by the phasing out of restrictive taxicab licensing requirements, would achieve major improvement in the city’s transportation system. This too would represent an important improvement in the daily life of the average New Yorker and serve to encourage the return of industry and commerce to the city.

No doubt, repeal of victimless crimes legislation and the consequent ability of the city’s police department and judicial system to concentrate all of their resources on apprehending and punishing those guilty of crimes against the persons or property of others would be a further measure vital in restoring the life of the city.

Needless to say, success in enacting the above program in New York City would operate powerfully to promote the cause of capitalism in the entire country.

Articles in this Series

Copyright 1996 George Reisman. All rights reserved. The encyclopedic Capitalism: A Treatise on Economics is a required reference for every Capitalist’s library. Reisman’s treatise is now available in two volumes: Volume I (focuses on microeconomic issues) and Volume II (focuses on macroeconomic issues).

George Reisman, Ph.D., is Pepperdine University Professor Emeritus of Economics and the author of Capitalism: A Treatise on Economics. See his Amazon.com author's page for additional titles by him. Visit his website capitalism.net and his blog atGeorgeReismansBlog.blogspot.com. Watch his YouTube videos and follow @GGReisman on Twitter.

The views expressed above represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine. Capitalism Magazine sometimes publishes articles we disagree with because we think the article provides information, or a contrasting point of view, that may be of value to our readers.

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