Tradeoffs are real. This is an obvious statement, which makes it strange how much political rhetoric is organized around denying it.
Political scientists usually define populism as a conflict between “the pure people” and “the corrupt elite,” while technocracy claims authority through expertise and problem-solving. But the important policy consequence is simpler: once every problem has a villain, every constraint starts looking like sabotage. (Mudde, Caramani)
On the left, corporate power and the rich are why we cannot have generous public services, high wages, cheap housing, and cheap energy all at once. On the right, elites, immigrants, bureaucrats, and the deep state are why we cannot have low taxes, secure borders, strong communities, cheap housing, and a booming economy all at once. Different enemies, same promise: if the right people were in charge, nothing would have to give.
Sometimes the villains are real. They still do not repeal budget constraints, supply constraints, or second-order effects. Scarcity can be distributed unfairly without being invented by the people who benefit from that distribution.
Policy is where denying this gets expensive.
- Rent control protects current tenants. It can charge some of that protection to future tenants. A San Francisco study found that rent control increased covered tenants’ likelihood of remaining at their address by nearly 20 percent, while landlords reduced rental housing supply by 15 percent.
- Greater trade integration supported growth and poverty reduction in many developing countries. Increased import competition from China also produced persistent losses in employment and earnings in some American labor markets. The beneficiaries and the casualties are both real. (World Bank, Autor, Dorn, and Hanson)
- Environmental review catches real harms. It can also delay clean-energy projects for years. A recent study found average environmental-impact-statement timelines of 27 months for solar projects and 45 months for wind projects.
In each case, both things are true. Which matters more is a values question. Pretending one of them is not happening is not conviction. It is refusing to do the arithmetic.
A tradeoff is not an argument against a policy. It is the argument the policy has to answer.
By a tradeoff sensibility, I do not mean centrism or splitting the difference. Sometimes the right answer is to pay the cost. Sometimes it is to stop paying it. The discipline is to count the cost before announcing that it is free.
The obvious objection is correct: “it’s complicated” is also the house style of everyone defending a status quo that suits them. But there is a tell. Deflection invokes complexity and stops. Analysis names the assumptions, the distributional effects, and the evidence that would change the conclusion. Nobody hiding behind complexity volunteers to go through the elasticities.
The fiscal debates of 2009 and 2021 show the risks in opposite directions. In early 2009, critics warned that the proposed stimulus might be too weak for the size of the recession. In early 2021, economic analyses projected that the American Rescue Plan could push output above its pre-pandemic potential; San Francisco Fed researchers later estimated that it could add about 0.3 percentage points to annual inflation through 2022. Subsequent research attributed the inflation surge to both strong demand and supply disruptions, with their relative importance changing over time.
You can dispute the estimates. That is the point: the dispute is stated in terms that evidence can resolve. Output gaps. Multipliers. Supply constraints. Inflation. Put numbers on them and let reality grade the test.
The real advantage of a tradeoff sensibility is not that it always gets the answer right. It is that when it gets the answer wrong, the assumptions are visible, the miss has a size, and the model can be updated.
The anti-tradeoff alternative is emotionally easier. When reality fails to deliver every promised good at once, find another villain.
Tradeoffs are real. Scarcity is not a conspiracy. A politics that will not say who pays is not offering abundance. It is hiding the bill.