I get it. When times are tough, people naturally look for answers. When the cost of living rises faster than wages or when housing prices climb out of reach, families naturally begin searching for solutions. That instinct is part of being human. But too often, we make the mistake of looking in all the wrong places.
Sometimes the problems are modest. Food prices rise a little faster than our paychecks, or rent increases make it hard to save. Other times, the problem is much worse, as in Venezuela, where millions have fled their collapsed economy and those who remain live in poverty with inadequate food and housing. Whether we face discomfort or disaster, one truth remains the same. A drowning man has never been saved by grasping at a straw.
We all wish there were easy answers. It would be wonderful if someone could wave a magic wand and fix inflation or make housing affordable. But no fairies are coming to sprinkle magic dust on our problems. Real solutions require hard work, sound judgment, and respect for the basic principles of economics.
Unfortunately, politicians often promise otherwise. They offer simple fixes that sound compassionate and convenient. They say they can make things "free," that they can control prices, or that government programs will relieve every burden. These promises are designed to win elections, not to solve problems. "Free" is never free.
The result is always the same. Once the politician wins, the magic solutions disappear, and the problems remain or get worse.
Venezuela is a perfect example. In the late 1990s, it was one of the wealthiest countries in South America. Then Hugo Chávez came to power, promising to lift everyone through socialism. He told citizens that the government could provide prosperity for all. At first, when the country still had oil wealth, it seemed to work. But as the money ran out, the promises failed. The government took control of industries, productivity collapsed, and corruption flourished. What began as an appeal to fairness and equality turned into a dictatorship and widespread poverty.
Recommended
We are seeing similar thinking here at home. In New York City, for instance, some candidates promise to make life more affordable through rent controls, government-run grocery stores, and programs that hand out ‘free’ benefits. These ideas sound appealing to families who are struggling, but they are simply new versions of the same old failed approach. People are grasping for something that looks like help, even if it cannot possibly hold up.
The truth is that socialism always fails because it runs against human nature. The system removes the incentives that drive people to innovate, create, and work. Incentives are the engine that powers an economy. Without them, production slows, investment stops, and growth disappears. History has never produced an example where socialism improved life for ordinary citizens in a lasting way.
Argentina provides a striking contrast and a lesson in what works. After decades of socialist policies that left the country’s economy in ruins, voters recently chose a leader, an economist, who understands the power of market-based reform. In his first year, he reduced the size of government, balanced the budget, and cut unnecessary regulations. He even eliminated rent controls. The results were remarkable. Inflation fell dramatically, the housing supply increased, and rents declined as more housing products came to market.
The liberal Swedish economist Assar Lindbeck once observed: "In many cases rent control appears to be the most efficient technique presently known to destroy a city—except for bombing." That statement may sound extreme, but economic history proves its accuracy. Whenever governments impose rent controls, housing shortages follow, buildings deteriorate, and new development stops. The policy feels good at first, but it ends badly every time.
That same principle applies to socialism. It always sounds good, but feels bad once the reality sets in. "Free" bus rides are not free. "Free" childcare is not free. Someone must pay the bill, and that someone is the taxpayer. Eventually, the money runs out. Borrowing can delay the reckoning for a while, but the debts come due in the end. When that happens, the entire system collapses under its own weight.
There is a better way. We know what works because history has shown us. Free markets, fiscal responsibility, limited government, and strong incentives for innovation create prosperity. These ideas may not sound as magical as “free” programs or price controls, but they produce real results that last.
When we feel economic pain, it is natural to want quick relief. But quick relief built on bad economics only makes the problem worse. Real progress comes from applying sound economic principles and trusting the system that rewards hard work, creativity, and personal responsibility.
My message is simple: don’t grasp at straws. Look for real solutions. We know what works, let’s try that for a change.
Les Rubin is the Founder and President of Main Street Economics
Editor’s Note: The Schumer Shutdown is here. Rather than put the American people first, Chuck Schumer and the radical Democrats forced a government shutdown for healthcare for illegals. They own this.
Help us continue to report the truth about the Schumer Shutdown. Use promo code POTUS47 to get 74% off your VIP membership.
Join the conversation as a VIP Member