Originally published on Fraser Institute. 

​South Carolina ranks 21st nationally with an overall score of 6.84 in the Economic Freedom of North America (EFNA) report published by the Fraser Institute. People have more economic freedom when they are allowed to make more of their own economic choices. Based on 2023 data, the ranking places the state comfortably above average but well short of the top tier. That middle position is not puzzling. It reflects a state in which core economic institutions work reasonably well, but a single persistent constraint prevents further progress.

The solid, if not stellar, strength of South Carolina's economic institutions has enabled South Carolinians to prosper. The labor market clearly shows South Carolina’s strengths. SC ranks fifth in labor market regulation, 35th in spending, and 25th in taxing. According to the Bureau of Labor Statistics, the state has experienced solid job growth in recent years. Unemployment rates have generally tracked at or below the national average, indicating healthy labor demand rather than artificial tightness. Firms continue to expand in South Carolina because labor markets remain flexible and adjustment costs are manageable.

The output data helps reinforce that picture. Bureau of Economic Analysis (BEA) state GDP figures show South Carolina's real GDP growing at a competitive pace, with strong gains in export-oriented manufacturing and transportation-related sectors. These outcomes are consistent with economic theory. When labor markets are flexible and regulatory barriers are moderate, investment responds.

Yet EFNA can explain why this growth has not translated into a higher ranking. The constraint is not state-level labor or tax policy. It is local government spending and taxation.

EFNA measures combined state and local burdens, and this distinction matters. While state-level fiscal policy in South Carolina has been comparatively restrained, local government spending has grown faster than population growth in many counties. Property taxes have followed. From an economic perspective, the total burden matters, not which level of government imposes it.

Local taxes are particularly distortionary. Property taxes can raise the cost of housing and commercial investment, reduce capital formation, and disproportionately affect small businesses that lack geographic mobility. EFNA captures this effect by measuring taxes relative to personal income rather than focusing exclusively on statutory rates or isolated policy changes.

The data shows the consequences. BEA figures reveal growing divergence in per-capita GDP growth across regions of South Carolina. Areas with faster local spending growth and higher effective property-tax burdens exhibit slower output growth than lower-tax peers. This is not a coincidence. Capital responds to relative returns, and local fiscal policy directly shapes those returns.

Directionally, South Carolina’s EFNA ranking has been remarkably stable over time. Stability, in this case, is not a feature. It indicates that while the state has avoided major policy mistakes, it has also failed to remove the constraints preventing upward movement. Other states with similar labor-market advantages moved ahead by pairing flexibility with tighter local fiscal discipline.

The timing of the data is important. Because the EFNA report relies on 2023 data, recent local reform discussions or proposals are not yet reflected in it. What the ranking captures is the cumulative effect of local fiscal decisions made over the past decade. EFNA moves slowly because institutions change slowly. That is precisely why it is useful for evaluating structural competitiveness rather than political momentum.

The Fraser Institute’s research shows a consistent relationship between economic freedom and prosperity. States with higher economic freedom experience stronger job creation, higher incomes, greater in-migration, and more resilient growth. South Carolina already benefits from several of these dynamics, but the gains are uneven and increasingly localized.

The economic lesson is straightforward. South Carolina does not need a new growth strategy. It needs spending restraint. State-level policies that support labor flexibility and investment are being undermined by state and local spending excesses that raise costs and reduce returns. Until those incentives are aligned, growth will continue, but it won't be as brisk as it would be if the state permitted its citizens more economic freedom.

Economic freedom compounds when constraints are removed systematically. South Carolina has addressed some of those constraints. The next gains will come not from doing more, but from allowing governments to do less.

Originally published on Substack.

Washington is doing that thing again where it mistakes a slogan for a solution. The latest proof is the White House’s new executive order, “Stopping Wall Street from Competing with Main Street Homebuyers”, paired with a growing bipartisan push to “ban Wall Street” from buying homes.

It sounds pro-family. It feels decisive. It is mostly politics, not economics.

Even some Republicans are following the herd. Senators Hawley and Merkley’s bipartisan bill would prohibit large institutional investors from purchasing single-family homes, townhouses, and condos.

Senate Democrats just rolled out the American Homeownership Act, which targets “Wall Street landlords” by stripping key tax benefits and reinvesting the savings elsewhere.

Here’s the hard truth: if your diagnosis is wrong, your treatment will fail.

Institutional investors are not the cause of unaffordable housing. The core cause is a housing shortage created and protected by government.

The housing crisis is a supply crisis

America did not build enough homes for decades. A widely cited estimate from the National Bureau of Economic Research finds that if housing growth from 2000–2020 had matched the pace from 1980–2000, the U.S. would have roughly 15 million more housing units. That is the real missing ingredient: supply.

And the biggest barriers to new supply are not on Wall Street. They’re at City Hall.

Local governments control zoning, density, parking minimums, minimum lot sizes, height limits, and endless neighborhood veto points. Those rules make it illegal or financially impossible to build the kind of housing families need, where they need it.

You cannot fix government-created scarcity with more government restrictions. That is doubling down on failure.

Investors are not “taking over” housing

The narrative says families are being “outbid” by institutional investors everywhere. The evidence says something very different.

The American Enterprise Institute finds institutional investors’ market share is less than 1% nationally, with only 22 counties reaching 5–10%.

The Mercatus Center reports large institutional owners have never exceeded 2.5% of home purchases in any quarter.
Most investor-owned inventory is held by small mom-and-pop landlords. And more importantly, much of the institutional activity is shifting away from buying existing homes and toward building new rental communities.

This matters because the policy proposals are aimed at a tiny slice of the market, while ignoring the actual constraint: not enough homes.

Single-family rentals help families, not “Wall Street”

Here’s what gets lost in the political shouting.

Single-family rentals are a pressure valve for families who are not ready to buy, cannot save a large down payment, or are priced out by interest rates. When supply is tight, rentals in good neighborhoods can be a lifeline.

That is not theory. Research by Tom Mayock finds that increased single-family rental supply can help economically disadvantaged children access higher-performing schools.

And the broader research on neighborhoods is clear: Raj Chetty’s work shows that moving to lower-poverty, higher-opportunity neighborhoods improves long-run outcomes for children, especially when they move young.

So when lawmakers talk about “helping families” by shrinking the single-family rental industry, they are playing with real lives. Less rental supply means higher rents, fewer options near good schools, and less mobility for working families.

If Congress meddles anyway, the least-bad guardrails matter

I don’t like carveouts. But if Congress insists on intervening, then write the bill to avoid detonating the single-family rental market.

Two provisions are now being debated that matter a lot:

1) Preemption over the states.

If a federal bill moves, preemption can prevent a patchwork of state bans, including a unilateral ban from California. A 50-state mess of restrictions is how you guarantee uncertainty, reduced investment, and fewer homes built.

2) An investor-to-investor sales exemption.

This is the other key fix under discussion: allowing institutional investors to sell homes to one another. That does not compete with families and it helps preserve single-family rentals. It also avoids forced liquidations that can trigger fire sales, displace renters, and depress neighborhood values.

I still prefer Congress not meddle at all. But if it does, these guardrails help reduce much of the collateral damage.

The Rotterdam warning: bans raise rents

If lawmakers want a real-world test case, look at the Netherlands. A study of the Dutch “buy-to-let” restrictions finds the ban increased rental prices, consistent with reduced rental supply.

That is what happens when government tries to outlaw a category of buyer instead of fixing supply. Scarcity wins.

What policymakers should do instead

If you actually want affordability, do the boring work that matters:

• Legalize more housing types locally: duplexes, ADUs, lot splits, and modest density
• Streamline permitting and end open-ended delays
• Cut fees and mandates that raise construction costs
• Stop treating property taxes as a harmless funding source. They punish ownership and investment, year after year
• Encourage building, including build-to-rent, to expand options for families

The best evidence for this approach is painfully simple: when supply rises, housing prices and rents fall.

Call to action

If you want to help families, stop chasing applause lines and start focusing on increasing housing supply.

Tell your city council and county commissioners: reform zoning, speed up permits, and allow builders to build. Tell Congress: don’t scapegoat a tiny share of the market, and don’t double down on government failure with more government.

And if you want a deeper dive, see my writings and the full breakdown on this issue at vanceginn.com.

Government failures broke housing. Markets kept it functioning. The solution is less government and more building, mostly at the local level.
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Get more insights here:

​What happens when public policy is built on narratives instead of numbers?

​We get bloated budgets, broken housing markets, and education systems that spend more but deliver less. In a world flooded with information, the real scarcity is truth. This episode features guest Jim Agresti, founder and president of Just Facts, to discuss public policy, misinformation, data analysis, housing affordability, AI’s impact on research, education spending, and why transparency matters more than ever. If you care about economic policy grounded in evidence instead of emotion, this episode is for you.

​🎧 Listen to the full episode of the Let People Prosper Show on Apple Podcasts, Spotify, or YouTube. Find out more about my work at Ginn Economic Consulting here: vanceginn.com. Get show notes at vanceginn.substack.com.

Originally published at Kansas Policy Institute.

Kansas families feel the squeeze. Prescription drugs are expensive. Credit card balances are heavy. Rents and groceries are up. When people are hurting, it’s understandable that lawmakers reach for a simple-sounding fix: cap the price. 

But that’s where good intentions collide with bad economics. Milton Friedman’s warning applies perfectly here: don’t judge policy by its stated goal, judge it by its results. And Frédéric Bastiat’s “seen and unseen” is the cheat code every legislator should keep on their desk: the “seen” is the lower posted price; the “unseen” is the shortage, the quality drop, the access loss, and the costs pushed into other corners of the economy. 

ECON 101: A cap doesn’t remove scarcity; it hides it.

Prices are signals. They tell producers what to make more of and tell consumers what’s scarce. When the government sets a price ceiling below what supply and demand would produce, sellers respond rationally: they supply less, invest less, or change the product to cut costs. The result is predictable: shortages, waiting, rationing, fewer choices, and lower quality. That’s not ideology. That’s how incentives work. 

The political appeal is obvious: a cap looks like instant relief. But the “unseen” shows up later, and it hits real people.

“Upper payment limits” for drugs are price controls

In Kansas, one proposal (introduced in 2025 as SB 212) would create a prescription drug pricing board and allow the state to set “upper payment limits” for certain medications. That is a textbook price ceiling, just written in bureaucratic language.

Supporters likely mean well. But if you cap what can be paid, you change the incentives for manufacturers, wholesalers, pharmacies, and insurers. The “seen” is a headline claiming lower prices. The “unseen” is what follows: tighter formularies, fewer covered options, delayed availability, and supply pulled toward higher-paying areas. 

Scarcity doesn’t vanish; it’s managed—usually through paperwork and gatekeeping.

Federal example: the 10% credit card rate cap idea

A federal proposal to cap credit card interest rates at 10% is being sold as consumer-friendly. But interest is the price of unsecured credit. Cap that price below the risk-based level, and lenders will protect themselves in the only ways they can: tighter approvals, lower credit limits, fewer rewards, more fees, and less access for people with thinner credit files. The “seen” is a lower APR for some borrowers who still qualify. The “unseen” is credit drying up for those who need it most.

This is the same pattern as any other price control: if you force the price down, you get less of the thing. In this case, that “thing” is credit availability.

Local example: Rent control is a cautionary tale

Rent control is one of the clearest “seen/unseen” examples in economics. The “seen” is a tenant paying below-market rent today. The “unseen” is fewer rentals over time, less maintenance, less new construction, and higher prices for everyone who isn’t lucky enough to get one of the controlled units. Kansas law wisely prohibits local governments from enacting rent controls or controlling real estate purchase prices.

Housing is the same story: prices fall when supply rises. Kansas should encourage local reforms like accessory dwelling units, smaller minimum lot sizes, and fewer parking mandates because fewer zoning restrictions actually reduces housing prices rather than subsidies or caps.

That same logic should guide the state and federal levels, too. If rent control is bad economics in Wichita or Kansas City, it doesn’t magically become good economics when moved to Topeka or Washington.

The consistent rule for lawmakers: avoid price caps everywhere

Whether the policy comes from a city council, the statehouse, or Congress, the economic mechanics are the same:

• Price caps reduce supply (less production, less investment, less entry).
• They shift costs into hidden fees, lower quality, rationing, or delays.
• They invite gaming and lobbying as industries fight over exemptions and loopholes.
• They punish innovation by lowering the payoff to creating something better.

That’s why Friedman’s point matters: you can have noble motives and still cause harm. Bastiat’s point matters because the harm is often delayed and invisible until families are stuck with fewer options.

What Kansas should do: free up supply and competition

If the goal is affordability, focus on reforms that expand supply and competition rather than trying to command prices:

• Remove barriers that limit entry and supply (especially in housing and healthcare delivery).
• Increase transparency that consumers can actually use to shop and switch.
• Reduce rules that entrench incumbents and block lower-cost competitors.

​Price controls feel compassionate. But real compassion means choosing policies that work in the real world, not just in press releases. Kansas should keep its policy compass steady: don’t cap prices—free markets so supply, competition, and innovation can push prices down the right way.

Originally published on The Daily Economy.

Free-market capitalism still delivers the goods. But its political coalition is fracturing — and that should worry anyone who cares about prosperity and freedom.

Recent Gallup polling on Americans’ views of capitalism and socialism shows that just 54 percent now view capitalism favorably, the lowest Gallup has recorded. Views of socialism remain much lower at 39 percent, but the direction matters. Support for capitalism has fallen notably over time, especially among independents and younger Americans.

The partisan breakdown is even more revealing. Republicans remain strongly pro-capitalist, though support has softened slightly. Independents now only narrowly favor capitalism. And among Democrats, fewer than half view capitalism positively, while nearly two-thirds view socialism favorably. As earlier Gallup polling on capitalism and socialism shows, this pattern has been developing for years.

Here’s the hard truth: those of us who defend free-market capitalism are unlikely to persuade most Democrats anytime soon. The data confirm it. Democrats often like the outcomes of capitalism — jobs, innovation, higher living standards — but reject the label, associating it with inequality or corporate power.

That alone wouldn’t be alarming. Political disagreement is normal. What is alarming is where capitalism is losing ground next.

A System of Liberty, Not Privilege

True capitalism is grounded in private property, competitive markets, voluntary exchange, and the rule of law. It treats individuals as decision-makers in their own lives — not subjects of top-down control. It decentralizes power, rewards value creation, and invites experimentation, allowing people to say “yes” to opportunity without asking permission from bureaucrats or politicians.

This idea is old — and proven. Adam Smith’s explanation of voluntary exchange captured it 250 years ago in The Wealth of Nations: “it is not from the benevolence of the butcher, brewer, or baker that we get our dinner, but from their regard to their own interest.” In a system of voluntary exchange, people seeking to serve themselves must first serve others. Prices convey information, profits signal value creation, and losses expose waste — the core of the price mechanism in a free-market economy.

The process isn’t perfect, but it’s far superior to the alternatives. As Milton Friedman argued in his critique of big government, markets work because they respect people’s ability to decide, adapt, and improve through cooperation — not central command.

The Real Warning in the Gallup Data

The most troubling signal in the Gallup polling isn’t Democratic skepticism. It’s the erosion among independents and younger Americans — groups that historically decide elections and shape long-term political trends.

Independents still lean pro-capitalist, but their support has fallen. Younger Americans overwhelmingly support small business and free enterprise, yet are increasingly ambivalent toward “capitalism” as a system. That suggests confusion, not rejection.

Even more concerning is what’s happening on the right.

A growing faction of Republicans — often labeled “national conservatives” or “populists” — is openly abandoning free-market principles in favor of state-directed outcomes. They argue for industrial policy, trade protectionism, expanded subsidies, and heavier regulation, all justified as necessary to achieve cultural, national, or political goals.

This matters because it breaks the traditional coalition that defended markets across parties.

When Both Sides Drift Toward Bigger Government

Gallup’s data show Americans are overwhelmingly positive toward small business (95 percent) and free enterprise (81 percent), while holding deeply negative views of big business. That gap tells us people still believe in markets — but not in a system that feels rigged and political.

The left responds by calling for more government control. Some on the right now respond by calling for different forms of government control. The mechanism is the same.

Whether it’s progressive redistribution or nationalist industrial policy, the solution offered is top-down power — politicians picking outcomes, overriding prices, and directing capital. History shows this doesn’t fix capitalism’s problems; it replaces markets with politics.

As the fallacy of corporate subsidies makes clear, once the government starts steering the economy, competition weakens, insiders win, and ordinary people lose. Bigger government doesn’t become more precise — it becomes more entrenched — regardless of which party is in charge.

Capitalism’s Problem Is Not About Performance

The Gallup results don’t show a rejection of capitalism’s benefits. They show a rejection of cronyism mislabeled as capitalism. Americans like choice, competition, small businesses, innovation, and opportunity — all products of free-market capitalism.

What they don’t like are bailouts, favoritism, barriers to entry, and rules that protect the powerful — outcomes caused by policy distortions, not markets. Policies such as occupational licensing that create barriers to opportunity or housing restrictions raise costs and block entry, especially for younger Americans. When those failures are blamed on “capitalism,” skepticism grows.

This is why the fight matters most outside the Democratic base. If independents, young people, and market-friendly conservatives drift toward bigger government — just with different slogans — the long-run prospects for freedom dim.

The Moral Case — and the Evidence

Beyond efficiency, capitalism rests on a moral foundation. Markets respect individuals’ dignity to pursue their own conception of the good life. They reward service, not status. They generate progress through experimentation and feedback. And they decentralize power, protecting against tyranny.

The evidence is overwhelming. In 1820, more than 90 percent of the world lived in extreme poverty. Today, that figure is under 10 percent, as shown by data on extreme poverty over time. Life expectancy has doubled. Child mortality has collapsed. Access to goods and services, once considered luxuries, has become common.
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What drove this transformation? Not redistribution or industrial planning. It was the spread of market institutions: open trade, secure property rights, sound money, and the freedom to invest and innovate. The comparisons are instructive — East v. West Germany, North v. South Korea, Venezuela v. Chile. Where markets are embraced, prosperity follows. Where they’re suppressed, poverty and repression prevail.

Reclaiming Capitalism

The polling tells us the challenge ahead is not convincing Democrats who already favor more government. It is rebuilding confidence among the persuadable middle and preventing the right from abandoning markets in favor of control.

The path forward isn’t to redefine capitalism, but to reclaim it: restore sound money, limit government favoritism, secure property rights, open competition, and remove barriers that trap workers and families. And we must explain — not just defend — why free-market capitalism remains the best path to prosperity.
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Public skepticism is rising, yet the moral and empirical case for capitalism has never been stronger.