Newspapers and the Unseen

Frederic Bastiat, the 19th Century French economist, made a wonderful distinction between the "seen" and the "unseen" in everyday life. His most famous analogy on the subject related to a vandal breaking a window of a homeowner. Bastiat argued that some people would look at that event as a net positive for the community because the guy who fixed the window would be employed to do the repairs and he would be better off and his wages would then go to all of the merchants that he dealt with (the seen). But Bastiat cautioned that the event had unseen consequences also. The homeowner, because he had to repair the window, would have to delay his purchase of new shoes, so the cobbler was less well off (the unseen).

There are numerous examples of the seen and unseen. For example, when hurricane Katrina happened a large percentage of the stories after the storm dealt with the assumed benefits to the region that federal emergency money would have. There was no coverage of the unseen effects of federal money - of the cost to the rest of us taxpayers who subsidize people who live in hurricane regions (not forgetting those who subsidize those of us who live in earthquake regions for those who think I would pick on only the Gulf Coast). There was also precious little coverage of the notion that the people of the Gulf Coast might actually have been better off without the hurricanes.

On the front page of the Bee this morning there is a story - "Tenants fear end to rent control." It goes on to describe the effects of Proposition 98 (which is on the June Ballot) which is one response to the Kelo decision on eminent domain. Among other things, opponents of the measure argue that Proposition 98, because of its requirement to pay owners when the government takes something of value, would ban rent control. The seen of rent control measures is the dandy rates that some lucky devils get in their dwellings. The unseen, which is a major issue, is the decline in the number of rental units available because property owners are less willing to risk their capital in a controlled market. There is absolutely no debate in the economics community about those effects. I am not sure how I will vote on Proposition 98, but the Bee's story, if it is accurate, is a good reason to consider it seriously. I am pretty sure that was not the intent of the front page story.