How Trump plans to boost the housing industry has an article discussing how Trump’s policies are impacting the housing industry:

Competition for labor in the housing market has been intense for some time, in part because the flow of immigrants from Latin America has decreased and in part because many people who worked in housing during the boom found other work during the bust. But with the government now openly hostile to the presence of these workers, and starting to deport some of them, it is becoming that much harder. . . .

As the Dallas Morning News notes, between 2012 and 2016, wages for Texas construction workers rose 21.2 percent, compared with 12 percent for all construction jobs in the U.S., and 2.2 percent for all jobs in the state. In Collin County, home to Plano and McKinney, construction workers make $98,000. And that was before the new administration began its immigration crackdown. The Dallas-Plano-Irving metropolitan area is short about 18,000 construction workers—about 20 percent of the total. Which means that many homebuilders literally can’t find people to do the job, and the rest must attempt to pass on higher costs to their customers.

. . .  And on Monday, as Commerce Secretary Wilbur Ross dolefully announced the tariffs of 20 percent on Canadian soft lumber, homebuilders were hit with another price increase. . . . The National Association of Home Builders said that Canadian wood prices could rise 6.4 percent as a result, thus boosting the price of the typical new home by $1,236.

There have been barrels of ink spilled discussing the plight of America’s non-college educated men.  As is so often the case, things are far more complicated than they seem.

Speaking of housing, when I was younger the left would sometimes argue that there was something unethical about living in McMansions—too big a carbon footprint.  The new left says that the real villains are those who choose to live in small houses:

According to an article in the “intersectional” blog The Establishment, people who don’t have to live in tiny houses living in tiny houses is a “troubling” example of “poverty appropriation.”

In an article titled “The Troubling Trendiness of Poverty Appropriation,” July Westhale explains that she grew up in poverty in a small immigrant town in California, where she lived in a small house because she had to — and that she’s finding herself getting a little offended by people who are living in small houses because they want to.

“This background, this essential part of who I am, makes it particularly difficult to stomach the latest trend in ‘simple’ living  –  people moving into tiny homes and trailers,” Westhale writes.

Here’s another no-no:

And it’s not just the Tiny House Movement. No, Westhale also has a problem with certain bars and restaurants “appropriat[ing] . . . low income communities” through trailer-park themes and “trashy” menu items such as tater tots.

I relied heavily on a diet of tater tots while in college and grad school. But then I suppose I was poor back then, so it was OK.

PS.  They’re actually not that bad, if dipped in ketchup.

PPS.  Recall when Trumpistas told us that we had to support Trump because Hillary was a left-wing supporter of big government?  Now you see Trumpistas rooting for Le Pen, who makes Hillary seem like Milton Friedman by comparison.  National socialism is back in style.



26 Responses to “How Trump plans to boost the housing industry”

  1. Gravatar of John Hall John Hall
    25. April 2017 at 18:37

    Someone recently reflected that imitation used to be the sincerest form of flattery…

  2. Gravatar of ssumner ssumner
    25. April 2017 at 19:29

    John, Yeah, I guess you and I are just out of touch with the new generation’s ethics.

  3. Gravatar of Benjamin Cole Benjamin Cole
    26. April 2017 at 02:46

    Scott Sumner:

    Egads, you are barking up the wrong tree.

    How can there be “labor shortages” in housing construction, when the amount of annual production is about one-half of peak levels of 2006? And today less housing is built than through the 1960s?

    As a macroeconomist, do you belief in “shortages,” or a graph where supply and demand cross? At $98,000 a year…I suspect construction worker “shortages” will not persist.

    I guess there is a “shortage” of everything, by some measures.

    And horrors—wages are rising!

    PS. More importantly, I love tater tots too. I have to pan-fry sliced-up potatoes now, and that is okay, but tater-tots are better.

    There is a tater-tot shortage where I live, and that is the Truth!

    PS….if you really want to cut housing costs in America, you don’t have to undercut construction workers, or cut down Canadian forests. That is peanuts.

    You have to ….yes….unzone property.

    What is that never a topic?

    An average house in Newton, MA costs $1 million. That’s because they pay construction workers a ton in Massachusetts?

    Can ee get serious?

  4. Gravatar of Benjamin Cole Benjamin Cole
    26. April 2017 at 03:28

    Add on:

    Here is a funny one: Remember the oil boom in North Dakota and Texas? The press absolutely gushed about the wages to be made in Williston and how wonderful it all was. Americans working hard and making money again! Yahoo!

    No one sniveled, “You know there are labor shortages in North Dakota. We need to import more workers, maybe a few hundred thousand SE Asians who now work in the Mideast. Or cool off the oil industry so there is not so much drilling.”

    But when construction workers make more?

    “You know, we have a problem here….”

  5. Gravatar of Major.Freedom Major.Freedom
    26. April 2017 at 04:09

    “Recall when Trumpistas told us that we had to support Trump because Hillary was a left-wing supporter of big government? Now you see Trumpistas rooting for Le Pen, who makes Hillary seem like Milton Friedman by comparison.  National socialism is back in style.”

    Lol, so what you’re saying is that anyone to the right of Leon Trotsky is a “far right” national *socialist*?

    Le Pen just makes Clinton seem like Rosa Luxemburg, and that to you makes Le Pen seem like Eva Braun, all because deep down you are a left wing socialist.

    You are a nationalist left wing socialist. Le Pen is a nationalist right wing socialist. But that doesn’t put her further to the right than Clinton is to the left.

    As a libertarian, I can teach you that the fundamental principle of libertarianism is non-aggression. You are not a libertarian because you advocate for aggression in many respects. Politicians like Clinton and the left wing candidate in France want to increase domestic civilian on civilian aggression, because their goal is power over the world. By aligning themselves with globalist interests, they believe they can achieve more power and wealth as compared to only having control over a single country. This is not a conspiracy theory, you just need to follow the money.

    Are you so naive that you believe the obvious financing of groups that are breaking down countries is from people who have your interests at heart Sumner? There are in the world people you defer to, who would call you a useful idiot.

  6. Gravatar of Major.Freedom Major.Freedom
    26. April 2017 at 04:21

    Sumner you need to watch the recent daily Press Briefing with Wilbur Ross as guest speaker.

    Your assessment of the reasons for the duties show you don’t understand. You are getting your information from fake news. Go to the source.

    Ross said in response to a journalist talking about the costs that lumber costs are a relatively small fraction of the total housing costs. Meaning he doesn’t expect much effect on the housing industry as a whole.

    The reason they are imposing a tariff is because Canadian lumber is subsidized by the Canadian provinces, and lumber sellers then sell lumber in the US at a discount, which undercuts domestic lumber sellers who do not have such subsidies.

    They are doing this to send a signal to the world that the days of the US producers having to compete with state subsidized foreign producers selling goods in the US are over. Of course it is not a free market. Ideally all states should eliminate subsidies, which of course you don’t write about

  7. Gravatar of ssumner ssumner
    26. April 2017 at 05:08

    Ben, I’ve answered this comment many times. Do you have a reply to my answer? Do you remember it? Did you read it.

  8. Gravatar of B Cole B Cole
    26. April 2017 at 06:38

    Scott Sumner: Your answer I do not remember. I do remember Tater Tots. I have been thinking sbout them for hours. Why did you have to mention Tater Tots?

  9. Gravatar of Rob Rob
    26. April 2017 at 06:56

    The second part of this post seems kind of like those articles where someone just pulls out a few offensive tweets and pretends it’s a huge problem we need to talk about. Of course there’s some nutter out there writing nutty stuff. Pretty sure most libs like small houses still (at least in theory…)

  10. Gravatar of Patrick R. Sullivan Patrick R. Sullivan
    26. April 2017 at 10:50

    The most obvious place where national socialism is fashionable is a college campus. Middlebury or Berkeley for examples.

  11. Gravatar of Patrick R. Sullivan Patrick R. Sullivan
    26. April 2017 at 11:28

    CATO is onboard with Trump’s tax plan;

    ‘All in all, the Trump proposals push tax reform in a good direction. Trump, his advisors, and House leaders seem to understand the urgency of passing major tax reforms. But we need Republican senators to step up to the plate and think boldly as well. Republicans have an opportunity this year to pass reforms that would generate large and lasting benefits in terms income and opportunity for every American family.’

  12. Gravatar of Greg DeLassus Greg DeLassus
    26. April 2017 at 12:53

    “They are doing this to send a signal to the world that the days of the US producers having to compete with state subsidized foreign producers selling goods in the US are over.”

    I am sure that you are right about this, but that merely forces us to ask the question “why?”.

    If some foreign government wants to spend *its* citizens’ tax dollars to provide *U.S. consumers* with cheaper goods and services, why should *we* try to stop them. I can understand why the citizens of those foreign countries might rise up and demand that their governments quit subsidizing the lifestyles of the world’s richest country, but why should *our government* try to stop those subsidies?

    One is reminded of Bastiat’s wise observation that we do not add boulders into our own harbors just because other nations naturally have obstacles in their harbors.

  13. Gravatar of ssumner ssumner
    26. April 2017 at 12:54

    Rob, Um, I thought it was obvious that I was joking.

    Patrick, And how is he going to pay for this massive giveaway?

  14. Gravatar of ssumner ssumner
    26. April 2017 at 12:55

    Greg, And doesn’t the US also provide massive subsidies to our producers? So why shouldn’t we put up barriers to our exports, if we are also an evil nation?

  15. Gravatar of Christian List Christian List
    26. April 2017 at 14:03

    The article at is a bit misleading. Take the title as an example. The construction workers (who I assume voted Trump a lot) will be happy about his changes because of higher wages and less competition. The construction industry itself might react pretty neutral, also because of less competition. The real victims here are the customers of course who have to pay for all this. Maybe those negative effects could at least partly be offset by deregulation. Deregulation that never comes, like always.

  16. Gravatar of Major-Freedom Major-Freedom
    26. April 2017 at 15:15

    The “fascist” dictator Trump just had his Treasury Secretary and Director of Economic Council announce plans for one of the largest tax cuts in US history:

    Guaranteed the “libertarian” Sumner will deep down feel uncomfortable with this because he wants MUH GUBMENT PROGRAMS to prevent poor people from revolting and having more of HIS wealth taken away

  17. Gravatar of Major-Freedom Major-Freedom
    26. April 2017 at 15:46

    The Obama administration imposed a socialist law that consisted of applying a 100 year old law called “the Antiquities Act” to literally steal and put under federal control millions of acres of land and water all over the country

    The “fascist” Trump just signed an EO to repeal that law

  18. Gravatar of Major-Freedom Major-Freedom
    26. April 2017 at 15:53

    The “fascist” Trump just signed an EO that orders a repeal of federal control of education:

    This is THE most important EO that has been signed

    Socialist Sumner on suicide watch, because MUH GUBMENT EDUCATION

  19. Gravatar of Benjamin Cole Benjamin Cole
    26. April 2017 at 19:50

    Scott Sumner and others on the Trump tax cuts:

    I would prefer payroll tax cuts, but okay, Trump proposed corporate income tax cuts.

    Most analysts say the Trump tax cuts will boost federal deficits and the national debt.

    Here is the question: Does federal debt matter?

    The Bank of Japan is buying back the Japanese national debt, and has no inflation. Soon the BoJ will own the Japanese national debt. The Japanese government will owe the money to itself (or taxers to themselves). I call it Mobius-strip economics.

    The Fed bought $3 trillion or so in Treasuries in its QE program, and has been below inflation targets ever since.

    Okay, so Trump adds $5 trillion to the national debt. And in next recession, the Fed buys it back.

    I am not describing a theory. I am describing what has happened in the U.S. and is happening in Japan.

    I realize, “That may be true in fact, but more importantly, is it true in theory?” is the orthodox macroeconomic framework.

    But seriously, do national government debts matter anymore?

  20. Gravatar of Major-Freedom Major-Freedom
    26. April 2017 at 20:04

    Benjamin Cole:

    “Personal” taxes are also being cut

    The plan would collapse the income tax system from seven to three brackets: 10 percent, 25 percent and 35 percent. The current top rate is 39.6 percent.

    The current standard deduction would also rise from $6,300 to $12,600 for individuals under the proposal. For married couples filing jointly, it would rise from $12,600 to roughly $24,000.

    It’s not just “business” tax cuts

  21. Gravatar of Major-Freedom Major-Freedom
    26. April 2017 at 20:07

    Debt has gone down over $100 billion since Jan 20

    He is also trying to cut spending, so it is not necessarily the case that debt will go up with the tax rate cut, spending need not be the same

    And the Laffer curve idea, with tax rate cuts, could very well end up with a higher total amount of taxes collected due to the increased investment spending in the US as opposed to abroad

  22. Gravatar of Patrick R. Sullivan Patrick R. Sullivan
    27. April 2017 at 05:00

    ‘Patrick, And how is he going to pay for this massive giveaway?’

    Apparently, the same way Canada and the UK did;

    Does legislated base broadening explain the increase in U.K. tax revenues? Not for the most recent round of rate cuts. In 2010-11, the government collected £36.2 billion from a 28 percent corporate tax. The government expected its corporate tax package—including a rate cut to 20 percent—to lose £7.9 billion a year by 2015-16 on a static basis. That large expected loss indicated that the package had little legislated base broadening. Study author Daniel Mahoney sent me a table confirming that the package included only modest base-broadening measures that were mainly offset by base-narrowing measures.

    The government’s dynamic analysis of the corporate tax package projected a revenue loss of about half of the static amount over the long run. But that analysis was apparently too pessimistic: actual revenues in 2015-16 had risen to £43.9 billion. So in five years, the statutory tax rate fell 29 percent (28 percent to 20 percent) but revenues increased 21 percent (£36.2 billion to £43.9 billion). That is dynamic!

    Looking at the longer term, the CPS study says, “In 1982-83 when the rate was 52%, corporation tax receipts yielded revenues equivalent to 2% of GDP. Corporation tax now raises over 2.3% of GDP when the headline rate is at just 20%.” The Brits have scheduled a further rate cut to 17 percent.

    Canada’s experience also shows that when you slash the corporate tax rate, substantially more profits appear on corporate returns over time. Canada cut its federal corporate tax rate from 28 percent and higher in the 1980s to just 15 percent today, but it collects about the same amount of corporate tax revenues as a share of GDP now as then.

    The British and Canadian experiences show that large corporate tax rate cuts lose governments little if any money. There is no need for risky changes to the corporate tax base, as House Republicans are proposing with border adjustments. That approach would disrupt the economy and invite retaliation from our trading partners for no economic gain.

    The CPS study suggests that British industry has responded strongly to tax rate cuts, with rising investment and higher wages for workers. That’s what we want here. So Republicans should put aside their complex base-broadening plan, and just slash the corporate tax rate to the British-Canadian range of 15 to 20 percent.

  23. Gravatar of Christian List Christian List
    27. April 2017 at 13:17

    I agree with Scott here. Cutting taxes without adjusting the budget sounds like a bad idea. The same might be true for procyclically cutting taxes. Trump seems to do both, so prepare for disaster.

  24. Gravatar of Major-Freedom Major-Freedom
    27. April 2017 at 16:17

    RATES, Christian, he is cutting tax RATES

    Rate cuts are not synonymous with tax revenue declines

    Imagine a thief has always taken 99% of Bill Gates’ annual earnings since his days in the garage

    Then imagine a different world where that thief has taken “only” 15%

    In which world would the thief take more?

    With the highest or second highest corporate tax rate in the world, it is unlikely we are on the wrong side of the Laffer Curve

  25. Gravatar of ssumner ssumner
    30. April 2017 at 05:29

    Patrick, If you cut the rate from 35% to 15% then corporate profits need to more than double as a share of GDP. Not likely.

  26. Gravatar of Anand Anand
    1. May 2017 at 07:51

    Aren’t you a teensy bit uncharitable when you take the representation of a leftish blog from National Review at face value? I’ll bet that you have not even read the original post ( For instance, it says pretty clearly, near the start of the article:

    “Tiny homes, which are typically sized at less than 500 square feet and cost an average of “only” $20,000 to $40,000, no doubt serve some people who truly need to spend less money on housing in a difficult economic environment. It’s also commendable that the movement helps trim down on excess and reduce the environmental footprint.

    And yet, I can’t help but feel complicatedly about the waxing-ons of pastoral nostalgia; about the bright, glossy photos of tiny houses that promise a “simpler life.”

    The article acknowledges your point about carbon footprint (and the NRO writer’s point that it’s not necessarily appropriation but financial planning) and says the matter is complicated; and then goes on to make its own points. You are free to think that their points are misguided, irrelevant, wrong, whatever, but at least read the stuff before commenting on it.

    The “trashy” is in scare quotes in the original piece, here’s the context:

    “The bar has an actual trailer inside, and serves cans in paper bags, so that bar flies can have a paid-for experience of being what the owners of this bar think of when they think of trailer trash.”

    It’s also not clear why you quote this blog as some sort of common “left” position which hates poor people and their lifestyle. It is just a blog started up by a few journalists; as far as I can see, it has no institutional backing or other influence.

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