Socialism is the fast--track to an affordability crisis

When you study economic models, it doesn't take long to figure out that socialism quickly leads to an affordability crisis. Though John Phelan's op-ed doesn't directly tie to socialism, it definitely highlights the difference between treating symptoms and fixing problems. In his op-ed, Phelan wrote "What can state and local governments do to alleviate this squeeze? One set of proposals is taxpayer-financed subsidies or tax credits for low-income households, but this is a misdiagnosis that doesn’t understand or tackle the problem. It regards the prices as the problem to be treated not as what they are: signals alerting us to underlying issues with supply of and demand for a good or service. These underlying issues must be treated to ease the squeeze on affordability."

Socialism isn't a growth-oriented economic model. It's a redistributionist-oriented economic model. That means socialist models are based on scarcity of goods and services. Demand stays high but supply stays paltry.

Democrats and socialists cringe when they hear the term supply-side economics because of its linkage with the Reagan administration. It must've almost killed Ezra Klein to write this:

As left-leaning writers Ezra Klein and Derek Thompson note in their recent book “Abundance,' '[I]f you subsidize demand for something that is scarce,' as with housing vouchers or childcare tax credits, for example, 'you’ll raise prices or force rationing.” They note that '[t]oo much money chasing too few homes [or childcare places] means windfall profits for homeowners [or childcare providers] and an affordability crisis for buyers [or parents].'

If people don't fix the profit margin problem, the problem will persist. Once profits increase, then stabilize, the problem will be fixed. A tax credit will get a few people into homes but it isn't a fix. Depending on the structure of the subsidies, that's just a watered-down version of a tax credit. This woman is part of the problem, not part of the solution:

The American Dream only works in a capitalist system. We need capital formation. Socialism pits one against another. That's foolish.