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Something there is that doesn’t love a wall September 22, 2006

Posted by federalist in Economic Policy, Government Regulation, Taxation.
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Apparently Republicans have not yet learned the futility of building walls to separate supply from demand.  Whether we’re talking about Mexican labor, Columbian cocaine, or Afghan opium, when there’s a huge imbalance between supply and demand outlawed goods and services will find a black market if the white one is closed.  Pouring resources into trying to restrain these market pressures is almost always counterproductive because the black market they fuel protects itself by subverting the systems that guard the white market.

It’s like trying to construct a wall to hold back the ocean (see: New Orleans): you can try to do it in small areas at great expense, but when your walls inevitably fail the damage is even greater.  We’re better off letting water seek its level, and when we do build walls it should just be to create a harbor or some other buffer against storm surges.  We can channel water to a great degree, and even focus its energy to productive uses.  Likewise, we can tax “undesirable” markets, and if we structure them right maybe even use them for constructive purposes.

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