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Don’t Underestimate The Importance Of Economics, Ground Zero Non-Mosque Edition…

August 18th, 2010 · 14 Comments
Decision Making · Policy · Uncategorizable

I have to admit that I’m getting bored with this whole Ground Zero mosque rhetoric, and there are enough other people ranting about it that you don’t really need to hear it from me. (It’s not that I don’t rant, it’s just that I reserve most ranting for more personal forums thankyouverymuch.) On an objective level, there are two relevant things that I know about: economics and (to a lesser extent) law and reason. On the legal front, it’s pretty clear that the constitution grants the right for a religious center to be created on this particular site, and the question of whether it’s tacky, inappropriate, antagonistic, whatever is mainly a matter of opinion, and people are entitled to their opinions.

On the economic front, I would like to have a word with those people who conclude that the group behind this Muslim whatever it is *must* be placing it near Ground Zero as a “neener-neener” to the rest of the country. From The New York Times, before this matter brought out the crazy in everyone:

The location is not designated a mosque, but rather an overflow prayer space for another mosque, Al Farah at 245 West Broadway in TriBeCa, where Imam Feisal is the spiritual leader.

Ah, so the group was in need of more space. That sounds potentially reasonable.

Kukiko Mitani, whose husband, Stephen Pomerantz, owned the building at the time, tried to sell it for years, at one time asking $18 million. But when the recession hit, she sold it in July to a real estate investment firm, Soho Properties, for $4.85 million in cash, records show. One of the investors was the Cordoba Initiative, an interfaith group founded by Imam Feisal.

So…this particular building was cheap. Hm. (If you’re curious, the building is likely cheap because it had a piece of a plane crash through the roof. No big deal.) Based on this evidence, I would argue that the problem isn’t even one of a religious group potentially wanting to taunt people with its presence, it’s one of a religious group not being willing or able to pay a lot more money to purchase something that has a lower chance of offending people. In that sense, if people really didn’t want the community center near the World Trade Center site, they should stop yelling for a minute and try paying the organization to place it elsewhere, since at the end of the day money speaks louder than words, no?

I’m pretty sure that this is Exhibit #827 on why people think economists are weird.

(Update: I noticed the other day that a future coauthor of mine’s Twitter followers were breeding like rabbits. The reason? @jasonmustian: In fairness, we’ve been building ‘ground zeros’ near Iraqi mosques since March 2003. 3:01 PM Aug 16th via Twitter for Android Retweeted by you and 100+ others. See, I told you economists and/or comedians should stay out of this. 🙂 )

Tags: Decision Making · Policy · Uncategorizable

14 responses so far ↓

  • 1 The Unqualified Economist // Aug 18, 2010 at 6:50 pm

    THANK YOU for pointing this out!

    Perhaps this has or will become their plan? Get paid off to build the center elsewhere.

    I’d also like to point out (OK, I did, on my severely less trafficked site) that Mr. Big-Government-Get-Out-Of-My-Business Rand Paul has yet to step up and defend the owners of the center’s right to build whatever they want on their privately purchased property!

  • 2 econgirl // Aug 19, 2010 at 12:25 am

    Pshhhh…there are no small blogs, just small…economists? 🙂

    I dunno…the last time Rand Paul opened his mouth on something like this ended pretty poorly for him, so if I were him I don’t know that I’d want to try again just yet.

  • 3 misterxroboto // Aug 19, 2010 at 9:02 am

    Obviously none of the people who object to this are familiar with the Coase Theorem!

    The transaction costs associated with this are significantly lower for the offended people to come to the Cordoba Initiative than it is for Cordoba to seek each of them out.

    As a result, we should give the right to the Cordoba Institute and allow them to be bought off.


    Keep in mind, this seems like what we should do rather than what’s happening. If the Coase Theorem holds as much water as I’d like it to, then the efficient outcome *should already have been reached*

    Even keeping in mind that the theorem applies most strongly to situations where there are no transaction costs, are we to assume that the transaction costs are so high in this case that it represents a market failure?

    If this is an exception, then what good is the Coase Theorem if it doesn’t have practical application?


    Please forgive the dialectic. It seems the answer lies somewhere in the middle. People might feel very strongly about this, but they’re not willing to pay cash for it.

    It’s as if they *prefer* social cost.

  • 4 Pablo Garcia // Aug 19, 2010 at 9:12 am

    If they accepted cash for relocating, I get a feeling that people would be just as upset about people not standing up for the liberties and what not.

    This would make sense (to pay them to rebuild elsewhere), if people were rational and objective. But if people were rationale and objective, this wouldn’t be an issue in the first place.

  • 5 The Unqualified Economist // Aug 19, 2010 at 9:44 am

    There was a poll released in the past day or two that says 63% of NYC residents are opposed to the location. I’m waiting for the poll of the residents to see who supports buying them out.

    @Econ Girl…you can probably tell I wasn’t serious about Rand speaking up, but it would be fun! 🙂

  • 6 Amarsir // Aug 19, 2010 at 9:58 pm

    I’ve been trying very hard not to pay attention, but didn’t Governor Patterson offer the group some State-owned property free of charge just to get them to move? They turned it down, so that might be a little problem with the market-driven-location explanation.

    I thought you were going to go in a different direction. Having a Mosque near potential targets would increase the cost of action for potential radical Islamist terrorists, who presumably would prefer to avoid killing fellow Muslims.

  • 7 econgirl // Aug 19, 2010 at 11:21 pm

    I will have to check on that, since it doesn’t seem particuarly kosher (pardon the word choice) to give public property to a religious group.

  • 8 Joao Pedro Afonso // Aug 20, 2010 at 5:08 am

    I think the presumption of preference “to avoid killing fellow Muslims” is based on quick sand. Religiously, Muslim religion is quicker to condemn apostates than infidels (of the book). Ones are renegades of the faith, the others are possible conversions. The problem is that, for the more fanatical Muslim factions born in the more conservative flavors of Islam (The Wahhabism came to my mind), the other factions are apostates. For some reasoning, the strong majority of most of the killings in Iraq due to Al-Qaeda’s terrorism are Muslims. No “easy on them”, goes there. And due to the nature of WTC, many direct victims were presumably Muslim (some claim 200, others 300, although I searched and found no list… however, with the controversy, I found at least a daughter of one, against the Mosque construction, so, they existed). That didn’t stopped the towers from being targeted.

    What I think “funny” is that Bin-Laden’s fight was primarily against the Saudi family, which he thought corrupt. Americans became entangled in that fight as supporters of corrupts, and as maintainers of troops in Saudi Arabia. “Too near the holy places”, he said. “Too near the ground zero”, they say now. The meme is the same. The World Trade Center through at least its name, was a monument to world connections (and since this is a economical blog, a world wide recognized economical symbol). From a meme perspective, denying the construction for the reasons presented, would be the ultimate victory of Bin-Laden.

  • 9 Amarsir // Aug 21, 2010 at 12:27 pm

    @Joao, Agreed. I tried to find wording that would imply the concept without taking it as given or using more words than I wanted to. “Presumably” was the best I could come up with, but I grant what you’re saying.

    @Jodi, I could be wrong. But my understanding is that Patterson’s offer was made despite expectations of legal issues, and that the lame-duck Governor isn’t exactly a strict constructionist anyway.

  • 10 Midwest Econ // Aug 22, 2010 at 4:57 pm

    I wonder what would be the bigger problem: Them building at the site near Ground Zero, or them getting state land and the money needed to build a new office/storage/whatever for the state

  • 11 The Unqualified Economist // Aug 24, 2010 at 2:50 pm

    Finally, a Paul finally weighed in, but it wasn’t a Rand…

    Ron on the mosque:

  • 12 Dan L // Aug 24, 2010 at 8:28 pm

    Amusing, but irrelevant. For the anti-mosque crowd (i.e. the bigots), one of the only things worse than allowing the “terrorists” to build a mosque near Ground Zero would be to give money directly to the “terrorists.”

  • 13 Joao Pedro Afonso // Aug 28, 2010 at 6:19 am

    Before, I tried to access the number of Muslin victims. Despite claims of hundreds, I was only sure they existed. A newspaper I trust offered me this Saturday a number: 59.

    An interesting information I ignored: the promoter of the center is a cleric so moderated that he is been asked by the actual administration (like he was asked by the previous Bush administration) to preach in the Muslin countries about tolerance. Even this month he was sent to Saudi Arabia to do that. While Obama stance was to be expected, I was curious about the more than very supportive stance of Bloomberg…

    @Amarsil, despite my arguments, you might be right in your presumption. I was guessing too, an educated one I hope, but guesses has that problem: they can be wrong 🙂

  • 14 Charles Dolci // Sep 1, 2010 at 2:22 am

    “On the legal front, it’s pretty clear that the constitution grants the right for a religious center to be created on this particular site…”
    Try as I might, I am unable tolocate that provisionof the federal constitution that grants (or – the more technically correct term “guarantees” , since the Constitution does not grant or create rights, it merely recognizes the rights already enjoyed by the people) sucha right. The 1st Amendment does say that “Congress shall make no law regarding the establishment of religion or the free exercise thereof, …” I see nothing about property rights.
    Moreover, EVERY town and hamlet in this nation imposes restrictions on what can be done on or to private property. You can not build a home or any sort of structure on “your” property without getting permission from the city, you can’t cut down a tree or even prune it, without a permit. The government can tell you the kind, quantity and size of structures you can put up.
    Does the first amendment guarantee me the right to open an adult bookstore and video archade next to an elementary school? Can I open a liguor store anywhere I want?
    In the city in which I reside you need to get a permit to replace your water heater.
    When I hear people say “Well, they have a right to build whatever they want on private property.” I have to ask “What parallel universe are you living in? Since when are you able to do what you want on your property?”

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