What This Episode Is About
Why is it that in the city where rents are hardest to raise in the whole world, poor people have the hardest time finding an affordable place to live? Why did the strictest laws protecting disabled people’s employment make the unemployment rate among disabled people rise instead of fall? In this episode, we’ll take a close look at Thomas Sowell’s Applied Economics: Thinking Beyond Stage One (written by Thomas Sowell)—a primer on economics that teaches you how to see through “political makeup.”
Sowell uses a question that a Harvard professor asked in class—one that stayed with him for the rest of his life—to expose countless “good policies” that look flawless at first glance: “Then what?” This book has no charts and no equations, only a string of historical cases you absolutely wouldn’t expect: the absurdity of New York having more abandoned apartments than homeless people; the brutal fact that 90,000 people died while waiting for organ transplants; and how California’s policy of “protecting open space” pushed poor people and minorities more than 100 miles away… The good intentions of every Stage One produced their opposite in the stages that followed.
Highlights:
• Three policy traps where things backfire: price controls, “protection” that turns into harm, and risk shifting—once you understand these three patterns, you’ll be able to smell trouble in the air before you assess any new policy
• Why “free” is one of the most expensive things: from Nixon’s price freeze to free healthcare for everyone, why does “free” so often end in shortages, queues, and death?
• The deadly logic of the FDA’s asymmetric incentives: approve the wrong person and you end up testifying before Congress; fail to approve a treatment and kill ten thousand people, and it becomes just another string of anonymous statistics—this is the most hidden killer inside modern regulatory agencies
Jump to a section
- 00:00 The book politicians hate most: What does “Then What?” mean?
- 02:29 The moment a professor left Sowell stumped at Harvard
- 03:09 Three classic traps of “Stage One thinking”
- 03:21 Trap One: Price controls—how rent control created a New York with more “abandoned apartments than homeless people”
- 08:38 Putting the price under price controls at zero: organ-transplant blacklists and 90,000 lives
- 11:01 Drug price controls: why European pharmaceutical companies all ran to the United States
- 14:08 Trap Two: “Protection” turns into harm—why employment among disabled people fell after the disability rights law passed
- 15:44 The paradox of apartheid in South Africa: how the free market quietly dismantled racial discrimination
- 18:01 The truth about California housing prices: how “environmental” policies drove poor people and Black people out of San Francisco
- 23:18 The FDA’s deadly asymmetry: why knowledge that aspirin could save lives was suppressed for more than a decade
- 25:33 Medical malpractice lawsuits: how laws meant to protect patients left pregnant women unable to find a doctor after making 28 calls
- 27:16 Trap Three: Risk shifting—why houses in the hurricane belt are always rebuilt in the same places
- 29:24 ”Every healthy French person has a patient inside them longing to be diagnosed”: the truth about free healthcare
- 31:21 The ultimate question: why is politics, at its core, a game that only plays Stage One?
- 33:37 I worked backward from “Then What?” and “surprisingly” ended up with a planned economy
The Book
- Title: Applied Economics: Thinking Beyond Stage One
- Author: Thomas Sowell (United States)
- Publisher: Houlang | Jiangxi People’s Publishing House
- Publication date: 2018-12
- ISBN：9780465003457
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