Document x1xeN4G18jX1dE3ZjvyO6K2kQ

mm Infrastructure Review Population, Pigs PLAINTIFF'S EXHIBIT And Perestroika Conditions in real estate, especially housing, have a vital relationship to the region's competitiveness. Those conditions are now providing a lesson in free market economics. By Karl E. Case hese shouldn't be aay confusion' get them to market--it also fakes some time an end although there is considerable room Tabout the fact that we have ma to build buildings fin case you haven't notic jor problems in the real estate ed) and to get them to market. Since no industry today. Some very'big body sits down and plans supply responses hanks hive portfolios with a tot of tionan-pdosri-nce then: is no real coordination, by for debate and for disagreement about how long it wifi take and how painful it will be. In 1975 there was a national recession which put unemployment at about nine percent; fuiiiimg loans. Some well known as wtheell atisme the pigs get to market there is an in the Massachusetts economy it was 12 , sotw- well capitalized developers are filing ) fur protection under Chapter 11 and Chapter inevitable glut, too many pigs. If we want the benefits of a free, largely unregulated percent, second highest among all the 50 states, second only to Michigan. Wages in 7. There is a large inventory of unsold economy, we must be willing to accept cy the region were.Ming, Boston was homes, and still a largerinventory ofunsold cles and the pain that cycles bring with them deteriorating, and except for two urban re condominiums, many of which are vacant. on the downside. It is a lesson that people newal .projects, there hadn't been a new Housing prices in some locations are turn in China, in the CJSSR, in Hungary, and in building built in marry, many years. Those ing down--commercial and office vacancy Poland are going to have to learn as prices were the days when the Boston Redevelop rates, wiiile still very healthy compared to and production are deregulated. Indeed, ment Authority's job was to recruit people national conditions, are also on the rise. The there is already some instability showing up to come and invest and to develop proper employment picture is also changing. Fur- in those economies: hence the word `pere ties, rather than to slow things down which tiiermore, we have over 20,000 people on the wait list for public housing in the dty stroika.' What I want to argue is thatwe are in the seems to be their role more recently. The traditional sectors, shoes, textiles, machin of Boston--affordability is still a very impor midst ofa down cycle that is natural and one ery, furniture, had been in steady decline tant word in this region. Those who believe in the free market believe that the best way which was inevitable. It will just as natural ly and just as inevitably some day come to for more than a decade--housing prices were below the national average. for society to determine how resources are allocated across alternative uses is to leave most of the decisions to private, risk taking independent entrepreneurs. Every econom-- ASBESTOS REMOVAL ic writer since Adam Smith, includingRicar do, Marx, Alfred Marshall In the latterpart of the 19thcenturyand Keynes in the 1930s, bay insulation systems has pointed out that one of the prices we ; \^ pay for the advantages that markets bring Since ;1977 ' INC. is lack ofcoordination. The lack of coordina tion and the lack of central planning that markets bring wtth them lead to mistakes of coordination and cycles. A Full Service Asbestos Abatement Co. Commercial Industrial The 'pigs' in my title refers to what Alfred Marshall called in 1890 the `hog cycle'--ex cess demand in period one causes prices l to rise, and seeing those nice high hog prici es, farmers decide to produce more hogs. J But it takes some time to grow them and Residential Licensed in MA and Rl Fully Bonded and Insured In MA: 508-583-3930 In Rl: 401-781-5955 Indasby/May 1990 25 I 001383 BIRD 012122