A modest proposal

It used to be a melancholy object for me that some places suffer from far higher unemployment than others, but no longer, thanks to the learned Doctor Tim Leunig.

He explains so clearly and beautifully that we should not worry about the regeneration of deprived areas since it is impossible anyway. Instead “everyone should have the opportunity to leave failing towns and cities and move to more prosperous, thriving areas”.

It is truly inspiring to see someone brave enough to take on this government’s recklessly ambitious approach to regeneration. They are apparently poring billions upon billions into schemes to regenerate poorer areas and this must stop.

Inspiring too to read someone calling for an end to restriction of movement in the United Kingdom. After all, how can we truly call ourselves free if we are not even allowed to move town? Dr Leunig is brave enough to argue against those people who would legally restrict where we can move. Thanks to his leadership no one will force us to live in the towns of our birth.

Now, far be it from me to raise a note of criticism about the good Doctor’s work but I was confused to read advice from a similarly learned writer in America. Matthew Yglesias’ very well researched book is daring and brave enough to tell us all to stop complaining about high rents in places like London and New York. After all, if we want low rents we can just move to Detroit.

Wise advice. But it seems that the unemployed should be moving to London or New York to find work but to Detroit or Burrows to buy their house. You can, perhaps, understand my confusion.

That is why I have come up with this modest proposal. A happy medium between these two fantastically practical and erudite positions. We should have slum
housing in London. Before you shout me down you should know that no less a respected magazine as The Economist recently called for exactly that, writing that “Cities need poor housing”.

There are many advantages to my proposal including creating a huge pool of cheap labour to work long and hard to enrich a small number of wealthy business owners. Not only can you work for next to nothing under this system, but you will also still be able to afford rent.

I should note, just at the end, that I myself will not be able to live in slum housing as I already have a place in Camden but I hope that this will not distract the reader from what I believe to be a very fair and workable idea.

3 thoughts on “A modest proposal

  1. We need to build more housing in and around London so that decent housing is cheaper there. Then if people want to move, they can. At the moment they are priced out of moving.

  2. I’ve been thinking about this post for a while.

    I agree with you that the invisible hand of the market does not always do a great job of allocating jobs and houses where they are needed. And that, to correct this misallocation, some kind of policy intervention would be helpful. But given that funding for such efforts will always be finite, and often provided by central government, is there not sometimes a tension in how those funds should be allocated? Should the priority be on making more houses where the jobs are, or more jobs where the houses are?

    Or should we just allocate funding on the assumption (even though it is not actually the case) that people are completely static in their residence, and do not move around the country or even the world over the course of their lifetimes?

  3. Thanks for the comment. A few observations;

    I am not sure that I do think that the invisible hand does a bad job of allocating jobs where they are needed. In fact, I think the areas with the highest unemployment are often in cities with lots of jobs like London or Manchester. I am certainly not sure that you can sustainably re-locate jobs through central command in post-industrial economies. Prof Porter’s approach of identifying ‘clusters’ of businesses and using policy to support these clusters seems a better approach than traditional job creation schemes.

    I am also not sure that funding for non-market housing will always come from central government. In fact, historically in the UK council housing has been exactly that, housing built by Local Authorities. They use some grant but mostly they borrow money and pay off the debt through rents. The reason this stopped is because central government stopped local authorities from borrowing. In general these schemes pay for themselves over 30 years.

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