Only in America: Neither the Homeless nor the Yachtless are Economic Problems

Abstract

In December 1988, President Reagan stated that the homeless in America were not an economic problem. By sleeping in the streets, the so-called homeless were merely revealing their preference for the great outdoors. For some members of the public, this Scrooge-like statement from the President must have seemed particularly heartless, coming as it did just before Xmas. Those bleeding-heart liberals who might take issue with the Reagan statement, however, are merely revealing their ignorance of the principles of neoclassical economics as currently taught at America’s Universities. If President Reagan’s remark regarding the homeless had been offered as an answer to an exam question on demand theory, it probably would have received a grade of A+ from many orthodox economics departments.

Journal of Post Keynesian Economics, 12 (1) (Fall 1989).