Arnold Kling  

New Commanding Heights Watch

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Tyler Cowen says,


An ever-larger share of our personal satisfaction will come from free or near-free sectors of the economy, as I explain in my new book "Create Your Own Economy". But those same sectors won't comprise such a large chunk of gdp, just as agriculture is so efficient that it too is a small part of national income. Inefficient sectors such as health care and education are rising in relative size. This will mean more government, more inefficiency, less accountability, and more dissatisfaction with results. One key question is how much individual liberty can survive in these niche sectors or whether the inefficient sectors will have too large a role in setting the overall cultural tone.

Nick Schulz thinks that our next book should be on the new commanding heights. The old commanding heights were basic industries like steel and oil refining. The new commanding heights are health care, education, and leisure. Cowen thinks that leisure activities will be inexpensive, so that health care and education will be the dominant forms of economic activity. I don't think government necessarily has to control them, but it certainly will want to. (That is, the people who believe in the left's vision certainly will want to, just as Lenin wanted to control the traditional commanding heights.)


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CATEGORIES: Growth: Consequences



COMMENTS (2 to date)
Mark writes:

I don't know if you're including retirement as part of leisure, but if so, then I disagree with Tyler that it will be inexpensive.

As you noted in the past, the "New Commanding Heights" are education, health care, and retirement, all of which are controlled heavily by the government. This bodes poorly for limited government and freedom. Add the recent events in the domestic auto industry, where investors saw their rights to claims on the assets of GM and Chrysler diminished, which consequently makes at least these two wards of the state, and things are not looking good in the limited government arena at all.

Kevin writes:

I believe people will learn that they don't need as much health care or education as they have been told they need. It'll be the demand-side version of Atlas shrugging.

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