The housing market is booming. Median prices are reaching a record high, and economists are suggesting that these trends are not looking to cool off anytime soon. But some government real estate policies are still in need of reform.
Many might guess that real estate commission rates paid to agents might fluctuate with the increase in housing prices, especially in a free-market competition system. However, amidst this housing boom, the rates of commission fees for real estate agents rarely fluctuate below 6 percent. Many may consider this to be not much of an issue. However, a closer look at the government policies instituted to maintain this system goes against the very notion of a competitive free market.
The real issue is that various states throughout the United States have passed what are called “anti-rebate” laws that essentially create a system in which a pre-determined percentage is placed for a commission when services like real estate are offered. Even if a real estate agent or broker wanted to give a buyer or seller a rebate for the brokerage commission, such laws would prohibit them from doing so.
If free-market principles are truly the aim of good policy, anti-rebate laws need to be removed, or at the very least, strongly reformed. The Cato Institute has conducted substantial research on this issue, finding that the practice of government “steering” the real estate market is, in effect, a tax on mobility: “It penalizes a worker who wants to move for a better job or parents who want to relocate to build a better life for their family.” The system stands against those who desire to relocate, purchase a home, find better lives, and, in essence, the American dream.
This problem has also seen legal ramifications as various companies have either filed lawsuits against these laws or supported these legal claims. For example, the Consumer Federation of America and the Oregon State Public Interest Research Group have supported REX’s lawsuit against anti-rebate laws arguing that they stifle competition and ultimately harms consumers that are seeking to sell their homes. In REX’s lawsuit, in particular, an online brokerage firm that had a 2-3 percent commission fee, challenged Oregon’s policy that banned the firm from refunding commissions back to the buyer when they exceeded the desired amount.
While the outcome of cases like these is still to be determined, the seriousness of the issue in protecting the interests of companies and consumers cannot be overestimated. The Department of Justice has spoken to this issue in recent years and highlighted the anti-competitive nature of anti-rebate laws.
Mississippi is not exempt from this issue. According to Mississippi’s real estate regulations, no individual can receive a rebate for the commission costs of buying or selling a home. This stands against everything a free-market system is supposed to accomplish and only aids in the government’s incessant compulsion to control such markets.
Mississippi needs to return to a simpler economic scheme of allowing competition to dictate the rates and prices of the marketplace. The beauty of the free-market system is that problems often fix themselves when given enough time. Unfortunately, Mississippi has not given the free market any opportunity to do so in this area. It would be beneficial to at least give the free market a fighting chance.
The primary purpose of a business is to generate capital through the production of goods and/or services. But big businesses have also become increasingly involved in the political and ideological battles of the day. Some have supported the foundational principles the nation was founded on, while others have chosen the path of "political correctness."
In recent years, there has been a reaction among some that big business itself poses a threat to the values and priorities of the common man. While some big businesses have caused a great deal of harm, big business itself is not the real problem. In fact, a large portion of Americans provide for themselves through employment at these large companies. The problem is when big businesses embrace bad ideologies.
On the fundamental level, the larger a business is, the greater its capacity is for good or for evil. This goes both ways. For instance, American industrial companies were so successful in their production for the World War II war effort that they became known as "the arsenal of democracy.” On the other hand, several big businesses in Germany used government-sanctioned forced labor. They justified it with the Nazi logic of "German superiority.”
While many may gasp at such complicity with evil, these German companies simply did the same thing that many companies do today. They bought into the “politically correct” ideology of their time and context. In the Germany of the 1930s and 1940s, this was the Nazi ideology of racism and world conquest. These companies then used their strength to generate profits in bad faith through forced labor. On the other hand, the American companies used their economic position in the market to rally behind the American ideals of liberty and patriotism while producing honest profits for their companies. The contrast is striking.
America is no longer at war with an evil foreign power set on taking over the world. Yet, the threat of certain ideologies in corporate America is more real than ever. History teaches us the immense danger of large corporations simply going along with whatever ideology of the day happens to be in fashion. But these lessons have not been learned by all.
While the politically correct corporations of today are not embracing the ideology of Nazism, many of them have embraced other evils that are popular in our day. Companies have supported the breakdown of society through critical race theory. Some have used their dominant market share to censor certain views that go against the orthodoxy of the Left. While others have leveraged their political and cultural clout to campaign against the rights of unborn children, contribute to the breakdown of the family, and support the election of political leaders that will expand government and oppose freedom.
Many of tomorrow's business executives are indoctrinated in schools and colleges with the tenants of the Left’s orthodoxy. So we should not be surprised when the companies they lead become more concerned about being “woke” than producing quality products. When a large company contributes to the breakdown of the nation, the fault does not lie in the size of the business. The fault lies with the decision of the company to mix “political correctness” with its profits.
Bad ideologies are damaging no matter where they are found, not just in big business. These ideologies have infiltrated into America’s government, media, corporate world, public opinion, and universities. To protect the nation from the dangerous consequences of such ideologies, America needs hearts and minds that are grounded in the principles it was founded on. This is the true key to victory against the assault on the nation’s founding ideals.
The technology sector carries some of the highest-paying salaries in the market. Technology workers bring immense potential to state economies with their high-value skills and abilities to drastically increase productivity. Mississippi is in a position to attract tech sector workers and jobs.
Software developers, network engineers, data scientists, web developers, and other tech workers bring unique skills that are becoming more and more critical to the modern economy. According to the Bureau of Labor Statistics, tech workers produce approximately 18 percent of the United States GDP.
Areas with these high-income tech workers stand to benefit from their incomes. More money in the economy leads to more spending, saving, and investment in a state. Many might think such technology jobs have the highest salary potential almost exclusively in big technology hubs such as Silicon Valley and New York City.
However, the data suggests otherwise. According to Visual Capitalist, Mississippi ranks among the top ten states in the country regarding the income difference between tech workers and workers in other sectors. This places tech workers as some of the most in-demand earners in the state.
While some areas may offer numerically higher tech salaries than Mississippi, their higher cost of living makes it less attractive to live in these areas. To put this in perspective, the average tech salary in Mississippi is $71,720. While California’s tech workers have an average salary of $116,820, the raw numbers themselves don’t tell the whole story. The average tech salaries in Mississippi are indeed numerically lower than in states like California that have more urban centers. But many factors may actually put Mississippi tech workers in a better financial position than their counterparts in California or New York.
Much of the salary differences are due to the higher cost of living in many states compared to Mississippi. For instance, a dollar in Mississippi has 33 percent more purchasing power than a dollar in California, based on data from the Tax Foundation. In fact, a dollar in Mississippi has more purchasing power than anywhere else in the country. This gives the state a competitive advantage as a place of residence for tech workers seeking a lower cost of living.
Furthermore, in the wake of expanded opportunities for remote work, many tech workers now have the option to earn high-paying salaries from companies based in tech hubs like Silicon Valley while avoiding the high cost of living. Workers are doing this by having their actual residence in lower-cost states.
When such workers come to Mississippi, they bring their knowledge and abilities to Mississippi. While some may continue to work remotely for out-of-state companies, evidence suggest that many also use their skills to start their own startups and create more tech jobs in the state.
Tech job listings in tech hubs like New York and San Fransico have not seen drastic increases. On the other hand, many cities with traditionally smaller tech ecosystems have increased their tech job listings as new startups come about from the Silicon Valley exodus. In the second quarter of 2021, several such cities saw tech job listing increases. This would include Richmond (68 percent increase), Salt Lake City (33 percent), San Antonio (32 percent), Cincinnati (29 percent), and others. Exceptional tech startup growth has happened in the cities of other states. So why can’t we see the same thing happen in Mississippi?
As the state continues to look for avenues to attract talent, the tech sector's future in Mississippi carries the dynamic potential for new startups and high-paying jobs to grow the economy. The state could see a real increase in tech-driven growth by enacting policies that lower taxes, promote safer streets, lower regulation, and promote prosperity. In the friendly competition among states to attract tech talent, Mississippi should rise to challenge and take these steps to make the state a more attractive place for the free market. Tech sector growth will be sure to follow.
Mississippi is ripe with economic opportunity. With abundant natural resources, two deepwater ports, a low cost of living, and a central location to much of the nation, there is ample potential for growth.
Before the 2000s, Mississippi ranked 14th in economic growth at 2.1 percent. However, this growth has slowed. How can Mississippi get back on track?
Private sector growth carries the greatest potential for state economies, with private-sector job growth being one of the key measurements for economic growth. But in Mississippi, state and federal government have taken the helm as the top sectors in the state. Altogether a poor job has been done in cultivating an environment that promotes economic growth.
The Clarion Ledger reports that in Mississippi, federal, state, and local government spending amounts to 55 percent of the economy. This is the fifth-highest percentage in the nation. This is not an environment that breeds growth. To get Mississippi back on the map economically, limited government and free-market capitalist principles should take the forefront by reducing the government’s size and spending.
According to a study conducted by the Legatum Institute, Mississippi has failed to achieve satisfactory standards of prosperity, especially when compared to other states throughout the United States.
Mississippi has consistently ranked in the ten lowest states over the last ten years in terms of economic quality. This is considering factors such as financial stability, productivity and competitiveness, dynamism, and labor force engagement.
Mississippi’s economic situation has caught national attention as the US News and World Report has similarly ranked it and neighboring states at the lowest in the United States. Many local economies have experienced no growth as employment opportunities, and major industries have dwindled in size. In addition, limited educational resources have made the possibility of innovation stagnant.
The Daily Journal estimates that 19.6 percent (nearly one out of every five residents) of the Mississippi population live below the poverty line. This is the highest poverty rate in the country.
But there is an exciting tomorrow for Mississippi if the right steps are taken. The near future of the state is promising as it leaves the world of Covid. The state’s gross domestic product is expected to rise by 2.8% this year. Such growth has not been seen since before the Great Recession; however, it is expected to plateau within the next few years.
This does not need to be the case. If policy makers want to change the trajectory of their state, it might be time to harness this economic momentum and give the opportunity for economic growth back to the citizens of the state.
Economic growth can only occur if government refrains from drowning it. If the state wants more available capital, encouraging the private sector to grow through tax cuts and regulatory reform, could effectively lower poverty levels -this just might be a better strategy than expanding the government sector.
At the Mississippi Justice Institute, one of our foundational causes is litigating to free workers from excessive licensing laws that make it exceedingly difficult for ordinary people to use their talents and earn an honest living.
We’re focused on this issue because we believe that there is inherent dignity in work; that opportunity is vital to a vibrant society; and that pursuing one’s calling is at the very heart of the American Dream.
Occupational licenses were originally intended for professions in which a mistake could pose serious health and safety risks to the public, like EMTs or school bus drivers. But they have also crept into many professions that pose no risk to the public, like florists and interior decorators.
In the 1950s, only one out of twenty people required a government permission slip to do their job. Today, that number has skyrocketed to nearly one in three. And most of those licenses are for working class jobs.
What has led to this explosion in occupational licensing? Counterintuitively, practitioners of various occupations lobby the government to impose regulations on them. In exchange, they gain a sense of legitimacy, monopoly use of a title, and expensive and time-consuming barriers to entry into their professions which keep many would-be competitors at bay.
The posterchild for licensing creep is the beauty industry. Because of the need for sanitation in any profession which involves touching customers, and because the work sometimes entails the use of sharp implements, chemicals, or heated appliances, practitioners of the profession claim that their work is dangerous and needs to be licensed and regulated. But the potential dangers are often wildly exaggerated by industry insiders and used to justify licensing burdens that are vastly disproportionate to the actual risks involved.
The excessive and costly training that results from this scaremongering can make it virtually impossible for workers of modest means and young people to break into the beauty industry. A new report by the Institute for Justice shows that the average beauty school program costs $16,000 and takes about a year to complete.
Beauty school students borrow an average of $7,100 in federal student loans, which is $600 higher than the average student. After all of that, beauty school graduates can expect to earn just $26,000 a year on average, less than restaurant cooks, janitors or concierges – none of whom are required by law to attend costly schools before working.
This type of excessive licensing has implications far beyond the beauty industry. Recent research indicates that excessive licensing laws cost our country an estimated 2.85 million jobs per year and over $200 billion annually in increased consumer costs.
Perhaps that is why reforming occupational licensing laws has become one of the few remaining bipartisan issues. In 2015, the Obama administration issued a report encouraging states to roll back unnecessary occupational licenses. In late 2020, former President Trump followed suit, issuing an executive order that similarly encouraged states to enact licensing reforms and outlined several principles for reform. And on July 9, 2021, President Biden joined the club, issuing a new executive order encouraging the Federal Trade Commission to ban unnecessary licensing restrictions.
When President Obama, President Trump, and President Biden all agree that licensing creep is strangling the American Dream, it’s a pretty safe bet that they’re right. Mississippi is making progress in this area, but we need to continue working to eliminate anticompetitive licensing laws and let Mississippians shape their own destinies.
As the nation gradually exits COVID and heads back into regular operations, the climate is ripe with opportunity to consider questions regarding the merits of regulatory freedom. Throughout the country, states have taken different stances on how to best approach the pandemic.
Some, such as New York and California, instituted a strong lockdown policy that vastly expanded government control over social and economic activities, while others, such as Florida and South Dakota, took a more hands-off approach, ensuring that the principle of individual autonomy drove good social and economic policy. These differing approaches offer a unique opportunity to evaluate whether the government is necessary to solve all of society's problems. History, free-market principles, and experience would certainly say that it is not.
For example, Brad Polumbo of the Foundation for Economic Education asserts the data is overwhelmingly in favor of free states over those states that locked down completely. For one, studies by The Lancet in July of 2020 and the Frontiers for Health in November of 2020 demonstrated that the stringency of COVID regulations showed no correlation with the numbers of COVID deaths within those states that promoted lockdowns.
Instead, studies indicated that the stringency of COVID regulations led to great economic cost as businesses took significant financial hits. Social consequences have included an increase in suicides, domestic violence, and drug overdoses.
Meanwhile, when comparing lockdown states to those that took a more relaxed approach, the result is quite telling. In terms of unemployment, those states that have prioritized lockdowns have taken longer to return to normal than those that took a more relaxed position. On top of that, most states that took the hands-off approach are much better positioned with unemployment (about 3 percent) than those that took a strict lockdown approach.
On a practical level, the pandemic offered the opportunity to really put various philosophical and economic principles to the test. As the pandemic comes to a close, it is evident that mistakes were made. Not adhering to principles of economic and social freedom may have been one of those mistakes. When making this kind of evaluation, hindsight is, of course, always going to be 20/20. However, the data demonstrates that moving forward, the best policy is that which adheres to limited government and prioritizes individual autonomy.
The Covid experience has only further demonstrated that there is no reason, pandemic or otherwise, that justifies government shutting down people’s lives and taking away their freedoms. As Mississippi and the nation at large return back to normal, it is critical that the protection of individual freedom and establishment of limited government ought to be the priority.
We live in a day when the logistics supply chain touches almost every aspect of life. From raw materials such as lumber and steel to complex electronics, practically every element of the market is somehow related to the workings of the logistics supply chain.
There have been multiple recent events highlighting the critical significance of a supply chain that can scale and adjust quickly to new scenarios. In the international trade sector, the accidental blocking of the Suez Canal slowed world shipping and completely halted all traffic through a waterway that facilitates 12 percent of all world trade.
On the infrastructure level, devasting cyberattacks targeted critical supply chain infrastructures and led to unforeseen shortages of essential resources. From a productivity standpoint, the logistics sector has had to confront the challenges of the backlog that came from a global pandemic with its labor shortages, lockdowns, and unprecedented demands for certain products.
In the wake of such shortages, it is more important than ever that our supply chain is strengthened and made to work better and faster. For these reasons, it is critical to recognize the role technology contributes to our supply chain’s ability to scale quickly in the event of future challenges.
The technologies that carry promise for supply chain advancements are numerous. Although these technologies cover multiple sectors and accomplish numerous tasks, there is a combined effect that can reduce shortages, increase speed, and facilitate efficiency.
A key technology with the potential to expand supply chain efficiency is the further implementation of automated data analysis. Using a combination of sensors, automated reporting, and location tracking, logistics companies have the ability to capture data trends and increase efficiency.
Furthermore, artificial intelligence (AI) development has created a new frontier as companies can now utilize data through AI. Using AI, logistics companies can predict patterns and respond to supply chain variables as quickly as possible. AI does not just increase efficiency for large logistics companies. AI also opens up new doors for smaller logistics companies that may not have the expertise and workforce for large-scale data analysis.
Building on the power of data collection and analysis, there has also been an uptick in warehouse technologies that use data-driven decision-making to sort inventory, standardize inventory management, and ultimately send off orders for shipping. These technologies also increase the level of production, decrease the incidents of injury, lower labor costs, and improve product traceability.
All of these technologies have a real significance as America continues to face challenges to the supply chain. As many in the nation come to grips with just how far-reaching the inefficiencies in our system are, the solutions that emerging technologies bring to the table are practical tools that could help to meet new challenges.
The free market developed the technologies to push the supply chain into the future, and the free market has the tools to make the supply chain more efficient. Instead of expanding government control of the supply chain and putting more regulations on transportation and logistics, government leaders should pursue policies that will encourage technology innovation and support the free market. As a result, our supply chain just might emerge better than ever before -and even more ready to meet the challenges of tomorrow.
In recent years, the political and economic landscape in the United States has brought about a subtle but significant policy proposal. This proposal involves special jurisdictions in a quest to help struggling businesses that have been affected by the COVID-19 pandemic or by poor economic infrastructure in their respective communities.
As part of President Trump’s economic plan, states throughout the United States (in addition to the federal level) have instituted a plan to give tax breaks to businesses to try to revitalize the economy. Mississippi is no exception as it has adopted various special economic zones with the express intent of prioritizing the investment and development of state infrastructure. In cities such as Vicksburg, this reform has reportedly saved jobs and helped stabilize the hurting economy.
These Opportunity Zones are designated to “encourage long-term investments in low-income and rural communities through Qualified Opportunity Funds.” Currently, there are about 100 Opportunity Zones in Mississippi. This will last as a program until 2027 per the Tax Cuts and Jobs Act of 2017.
They operate on the basis that investors can earn tax relief through investments designated by the Opportunity Zone. Such benefits increase as the time the investment is held increases. These zones have been placed in strategic areas throughout Mississippi and particularly target low-income and rural communities.
As a matter of policy, this appears to generally makes sense on paper. It goes without saying that to get more money into struggling areas, it is important to have opportunities for capital investment. This has been done in the past by incentivizing businesses with generous tax breaks rather than just having federal or state grants to keep those areas from downing. In doing so, the principle of choice by the consumer remains intact, by allowing the private sector to direct capital to where it is most needed.
In addition, such a policy has been propounded as a way to help fix economic decisions in the reality of business rather than the theory of bureaucracy. Opportunity zones can help promote economic growth in those hurting communities.
Tom Bell of the Foundation for Economic Education describes this principle perfectly and rightly suggests that, “it also bears noting that [these special jurisdictions] escape the charge that they can thrive only thanks to top-down subsidies. These days, special jurisdictions happen only if and when private investors fund them. That sort of objective oversight helps to ensure that special jurisdictions, far from floating on clouds of theory, have a solid grounding in the real world.”
In recognition of this fact that these geographic zones are entirely dependent on private investment, it is important that they do not offer only fiscal incentives. Otherwise, some have rightly pointed out that Opportunity Zones could potentially lead to crony capitalism. It is important that Opportunity Zones be coupled with tangible evaluations for success by local community members in order to avoid this.
As Lotta Moberg points out, the focus of the zones must encompass whole regions and offer not just tax breaks but thorough deregulation as well that will assist in directing those investments. This was done in Hong Kong, and it not only liberalized the economy, but incentivized state officials to provide further reform. Ultimately, it confirmed one of Friedman’s primary predictions: “Privately created and managed special jurisdictions tend to outperform public ones.”
As a general principle, the people of Mississippi and businesses ought to welcome the concept of free-market zones as opportunities to fix their own communities that are struggling economically. However, rather than simply placing a tax break incentive to fix the problem, the mindset behind Opportunity Zones needs to have a broader application as state governments seek direct investments from the private sector.
Ultimately, government incentives are not the answer to expanding investment. Rather than focus on specific regions, policies should lower taxes and regulation across the board. Free market investments that are not restrained by government action are much better solutions to building communities. Opportunity Zones may carry potential in some contexts, but ultimately it is broader freedoms for the free market that have the best chance at growing communities.
In a day when high-tech farming and agriculture are growing in importance, high-speed internet technology is becoming an important tool for farmers across the country. Emerging mobile internet could play a key part in getting farms connected and expanding their capacity.
In order for agricultural implements to be connected to the internet, mobile connectivity is a critical component. Wired broadband infrastructure (such as fiber) is not always available in rural areas. But mobile internet connectivity is essential for elements such as tractors, drones, and other tools that may be outside the reach of a wired connection.
A relatively high amount of bandwidth is required for mobile internet connections to achieve their highest potential for agricultural use. While the widely available 4G mobile internet technology common in cell phones allows for some applications, 4G was originally designed for private consumer use in cell phones. Thus, it is not as ideal for commercial applications, such as agriculture.
With speeds that are usually slower than a wired internet connection but relatively responsive, 4G is ideal for personal use such as checking social media, watching a quick video, or sending an email. But the technology doesn’t always carry the bandwidth that is needed in a commercial context.
But the exponential growth of 5G is expanding mobile connectivity capabilities, which carries some exciting possibilities for agricultural technology. What is 5G? 5G stands for “5th Generation” since it is the fifth generation of mobile internet technology. Unlike 4G technology, 5G technology provides the opportunity for mobile connectivity that meets or exceeds most wired internet speeds.
For agricultural use, 5G has numerous applications that are continually expanding. For instance, 5G can power automated sensors that determine soil and crop status. The correct application of fertilizer can then be applied to specific areas of the fields.
Tractors, powered by 5G, can utilize artificial intelligence to assess crop health and detect weeds to apply precision herbicide. Drones, powered by 5G, can assess pests and specifically target areas that need pesticides. For livestock, 5G-powered tracking devices can track herd movements. The speed of 5G can be used to upload photos of dairy stock to analyze their health by artificial intelligence systems. When it comes to agriculture and 5G, quite literally, the sky is the limit.
As farmers utilize the enterprise-level speeds of 5G, they will be able to monitor the ever-changing variables of agriculture more effectively. These emerging capabilities could have a tangible impact on greater efficiency, higher yields, and increasing profit margins for agriculture.
America’s 5G internet infrastructure is building up at a rapid rate. Farmers, investors, and policy makers would do well to be prepared so that the industry can hit the ground running as 5G technology becomes increasingly available.