This week marks five years since the passing of Dr. Walter E. Williams. He had the elegance to die, at 84, minutes after teaching the last class of the semester — and the wisdom to go before he had to grade finals.

Search for “Walter Williams” on The Daily Economy website, and you will find numerous tributes to Dr. Williams and his towering intellect. We mark the solemn milestone with humor and encouragement he offered to his students, inviting you to explore (or revisit) the treasure trove of his syndicated columns, articles, books, speeches, and media appearances. 

The following is a selection of AIER staff’s personal memories of Dr. Williams and the graduate microeconomics classes he taught at George Mason University. 

David Hebert, PhD, Senior Research Fellow 

My relationship with Walter was unique in two ways. First, I was his successor (after Pete Boettke) in teaching “Economics for the Citizen,” a survey course for non-majors that Williams had designed himself. He humored my hundreds of questions, mentoring me patiently and quietly. When I later became department chair at Aquinas College, we modeled the intro course after it, right down to the name. I also have a tattoo of a graph from his course, which he hand drew for me to take to the tattoo parlor. It has deep meaning for my career (even profiled in Troy University’s student newspaper while I was on faculty there). 

Walter’s passion for teaching was obvious. He used to state that, “on the day I die, I’d like to have taught a class.” Walter got his wish, passing about an hour after he taught his microeconomics class. There couldn’t be a more perfect ending for such a great man. 

William J. Luther, PhD, Director, Sound Money Project 

Walter Williams had an unrelenting smile. He would look you dead in the eye, explain precisely why you were wrong, and smile the whole way through. But apparently it wasn’t always that way. Early in his career, Williams received a call from Milton Friedman, who had seen him on TV. As Williams recounted in my first-year Microeconomic Theory course at George Mason University, Friedman said: “You were great, Walter. But you need to smile more.” It seems he took the advice. 

Paul Mueller, PhD, Senior Research Fellow 

Walter Williams believed that to understand the world, you had to get basic economic theory right. His microeconomics class was not fancy or sophisticated in terms of equations, data modeling, or econometrics. But it was rigorous and focused on understanding price theory. Dr. Williams himself was a warm, humorous, and at times eccentric, instructor. He was fiercely independent, yet he made time for students with questions or who were genuinely struggling. He was also uncompromising in his economic ideals and would apply them relentlessly, in the classroom and in print. The world, and the economics profession, are poorer without him. 

Thomas Savidge, Research Fellow 

For Dr. Williams, correct explanations were concise and clear. Anyone who tried to outsmart Williams with jargon-loaded filibusters was quickly humbled. In the few instances where Williams was asked about a subject that he wasn’t familiar with, he’d say “Let me get back to you on that.” It was a breadth of fresh air from my studies of those in government, where one has strong incentives to “fake it ‘til you make it.” 

In my research and policy work now, I often introduce folks to the ideas which I learned in Williams’s ECON 811. To be an effective ambassador of these ideas, I rely on Williams’s advice: focus on the fundamentals, use humor, and have confidence in yourself and the knowledge you seek to impart. 

Julia Cartwright, PhD, Senior Research Fellow 

Dr. Williams taught my first microeconomics course in graduate school, and truly honed my thinking and taught me how to think like an economist. He taught us not just what economists know, but, much more importantly, how economists reason. He was never impressed by jargon or a wall of equations; he wanted clear, elegant, precise explanations of how the world works through an economic lens. Many of us who arrived with a more mainstream or mathematics-heavy background (myself included) found his approach uniquely challenging but invigorating. He pushed us to rely on logic and economic theory to explain phenomena rather than simply compute them. His emphasis on microeconomics as price theory gave us a framework we could apply to almost any real-world situation.

Dr. Williams shaped my thinking as an economist, and modeled a rare blend of intellectual rigor and human generosity. I remain deeply grateful to have been his student.

Nikolai Wenzel, PhD, Senior Research Fellow

Walter Williams taught microeconomics at 7 am. And he terrified me. When he handed back our midterms, he asked, “Who’s Wenzel?” I raised my hand. “I had to grade this twice,” he said, pausing. “Because nobody gets a perfect score, except me and God.” He’d even put one of his cheeky gold star stickers on the blue book. I still have it.

There are many more outrageous stories — his wife improbably going out on a date, fat cigar-smoking men, sexy secretaries and compensating differentials, almost starting a race riot in the Jim Crow South. But we learned our price theory. May I be half the teacher he was. May all your gains be marginal. Suffer no fools.

In Fond Remembrance 

Walter E. Williams often quipped that the “E.” in his name “stands for ‘Excellence’.” Anyone who knew him knew that was true. We hope to carry Walter’s legacy forward by cherishing the memories we had of his class and using the lessons we learned as his students. 

The United States recently emerged from the longest government shutdown in its history, one that halted operations, froze budgets, and led to 1.4 million federal employees being either furloughed or working without pay for forty-three days. The most noticeable economic damage this time around, though, was not in closed museums or perhaps even the saga surrounding SNAP benefits. This time, it was in the sky. 

By the end of October, the Federal Aviation Administration (FAA) reported that over twenty major air-traffic control facilities were operating below minimum staffing levels. This staffing shortage increased as unpaid controllers reached their limits. In an attempt to ameliorate the crisis, the FAA ordered up to ten percent of scheduled flights to be cut at more than forty major airports. Expectedly, this led to cascading delays, supply-chain disruptions, cargo backlogs, and stranded travelers. 

This shutdown, then, was not just some political stalemate, as purported enemies in DC fought over the direction of the federal government. It was a live demonstration of how fragile the institutional infrastructure of our modern interventionist economy is — and why economics remains indispensable for understanding these moments of systemic stress. 

Ostensibly, there is no mystery to air travel. Planes take off; planes land. Of course, any minor reflection upon the matter reveals that it must be — and in fact is — much more complicated. Our air travel network comprises one of the most elaborate coordination systems in human civilization, with millions of moving parts (both literally and figuratively) synchronized across time and space. This should not surprise us, for every economic system contains a coordination system. 

The shutdown, however, revealed how fragile that coordination is, especially when the government is responsible for such a system. When the FAA ordered airlines to reduce flights, other areas of the economy were also affected. You cannot turn one dial and expect nothing else to change. Not only were passengers affected, but cargo schedules were disrupted, supply chains were backed up, manufacturers had to halt production, and perishables risked spoiling — just to name a few. 

This is because the structure of production is temporal. Economic goods are not immediately made available once entrepreneurs decide to create them. No, goods must be concocted, produced, shipped, and delivered in order to reach customers. All of this, of course, takes time. The production structure spans a multitude of stages, and it relies on stable expectations. When the FAA’s operations broke down, so did these time-sensitive production processes. Entrepreneurs could not coordinate their plans because the institutional framework they relied on — in this case, flight schedules, shipping availability, and travel routes — suddenly became unreliable. Markets cannot function when the institutional infrastructure required to coordinate production collapses. 

One of the challenges of economic life, as F.A. Hayek pointed out, is the coordination of knowledge that is dispersed among millions of people, not just the allocation of resources. To even begin considering allocation, consumer preferences must be ascertained. Prices do this beautifully — when institutions let them, that is. Even ignoring the fact that government control of the entire apparatus means that much of the network operates without price signals (thus rendering it incapable of accurately reflecting consumer preferences), the price signals that are in place were weakened during the shutdown. Prices become unstable when air-traffic capacity changes by the hour. Which cargo firm can coordinate deliveries efficiently when ground stops are issued with little warning? Imagine manufacturers trying to use air freight to receive their inputs while major airports are throttled. 

Even where the market is allowed to operate regarding the use of air travel, government actions rendered those mechanisms less effective. The knowledge problem reared its ugly head, as institutional breakdown prevented information from flowing through the market, meaning prices could not accurately coordinate plans. The shutdown did not just create idle government employees — it degraded our economy’s ability to accumulate and process key economic data. The result was not just uncertainty regarding travel, but uncertainty about production itself. 

Entrepreneurs must commit capital today for goods that will only be finished months or years later. To make this type of temporal commitment, stable expectations are imperative, especially in sectors that depend on complex logistical coordination. Any hiccup can be massive — a hiccup like the shutdown. Without guaranteed staffing, air travel became too unpredictable, which in turn made the production structure unpredictable. This is no small matter. Yes, a cancelled flight is massively inconvenient. A missed input delivery can also be quite costly. A missed production window, however, can destroy a business operating on tight profit margins. 

What the shutdown did was depreciate institutional capital, what we might call the rules of the game. More than just reducing government “services”, the shutdown increased entrepreneurial uncertainty. The marginal entrepreneur is now more likely to find it unprofitable — at least in his expectations — to begin a business venture. The marginal business owner may have just missed the shipment of materials or goods that would have kept him afloat. Even the super-marginal business owner who will remain in business has to recalculate his entire model. This depreciation will continue to impact coordination long after the shutdown ends. Every missed market exchange is a missed opportunity for our society to be made better off. We are, quite literally, poorer because of this shutdown, and it has increased the possibility of being made poorer still in the future. Institutional capital, and capital in general, cannot be turned on and off like a light switch. 

Shutdowns are often discussed along political lines — which party “won” and which party “lost.” The economic impact is often only discussed in terms of its immediate consequences. The long run, though, is seldom considered. The 2025 shutdown did more than just inconvenience travelers. It exposed the fragility of our institutions due to their close connection to the government. A private, decentralized air travel network would be far less prone to the type of shock we saw recently. Our current system creates a single point of failure, both in funding and technology. When the FAA’s NOTAM system crashed in 2023, the entire country’s airspace went offline. Meanwhile, decentralized private systems — like Canada’s Nav Canada — show that decentralized distribution of control is better capable of containing disruptions instead of allowing them to cascade throughout the country. This is because polycentric governance increases resilience, as entities have stronger incentives to upgrade technology, and more importantly, introduces redundancy that can keep the system running if one touch point fails. 

A shutdown is a corrosive solvent for planning, coordination, and trust. Knowledge flows are disrupted or destroyed. Time horizons are shortened. The conditions necessary for a properly functioning economy should not be played with. We are made poorer by every missed opportunity to trade. The solution here is not more politics, but to notice how fragile our economy has become. 

The United States recently emerged from the longest government shutdown in its history, one that halted operations, froze budgets, and led to 1.4 million federal employees being either furloughed or working without pay for forty-three days. The most noticeable economic damage this time around, though, was not in closed museums or perhaps even the saga surrounding SNAP benefits. This time, it was in the sky. 

By the end of October, the Federal Aviation Administration (FAA) reported that over twenty major air-traffic control facilities were operating below minimum staffing levels. This staffing shortage increased as unpaid controllers reached their limits. In an attempt to ameliorate the crisis, the FAA ordered up to ten percent of scheduled flights to be cut at more than forty major airports. Expectedly, this led to cascading delays, supply-chain disruptions, cargo backlogs, and stranded travelers. 

This shutdown, then, was not just some political stalemate, as purported enemies in DC fought over the direction of the federal government. It was a live demonstration of how fragile the institutional infrastructure of our modern interventionist economy is — and why economics remains indispensable for understanding these moments of systemic stress. 

Ostensibly, there is no mystery to air travel. Planes take off; planes land. Of course, any minor reflection upon the matter reveals that it must be — and in fact is — much more complicated. Our air travel network comprises one of the most elaborate coordination systems in human civilization, with millions of moving parts (both literally and figuratively) synchronized across time and space. This should not surprise us, for every economic system contains a coordination system. 

The shutdown, however, revealed how fragile that coordination is, especially when the government is responsible for such a system. When the FAA ordered airlines to reduce flights, other areas of the economy were also affected. You cannot turn one dial and expect nothing else to change. Not only were passengers affected, but cargo schedules were disrupted, supply chains were backed up, manufacturers had to halt production, and perishables risked spoiling — just to name a few. 

This is because the structure of production is temporal. Economic goods are not immediately made available once entrepreneurs decide to create them. No, goods must be concocted, produced, shipped, and delivered in order to reach customers. All of this, of course, takes time. The production structure spans a multitude of stages, and it relies on stable expectations. When the FAA’s operations broke down, so did these time-sensitive production processes. Entrepreneurs could not coordinate their plans because the institutional framework they relied on — in this case, flight schedules, shipping availability, and travel routes — suddenly became unreliable. Markets cannot function when the institutional infrastructure required to coordinate production collapses. 

One of the challenges of economic life, as F.A. Hayek pointed out, is the coordination of knowledge that is dispersed among millions of people, not just the allocation of resources. To even begin considering allocation, consumer preferences must be ascertained. Prices do this beautifully — when institutions let them, that is. Even ignoring the fact that government control of the entire apparatus means that much of the network operates without price signals (thus rendering it incapable of accurately reflecting consumer preferences), the price signals that are in place were weakened during the shutdown. Prices become unstable when air-traffic capacity changes by the hour. Which cargo firm can coordinate deliveries efficiently when ground stops are issued with little warning? Imagine manufacturers trying to use air freight to receive their inputs while major airports are throttled. 

Even where the market is allowed to operate regarding the use of air travel, government actions rendered those mechanisms less effective. The knowledge problem reared its ugly head, as institutional breakdown prevented information from flowing through the market, meaning prices could not accurately coordinate plans. The shutdown did not just create idle government employees — it degraded our economy’s ability to accumulate and process key economic data. The result was not just uncertainty regarding travel, but uncertainty about production itself. 

Entrepreneurs must commit capital today for goods that will only be finished months or years later. To make this type of temporal commitment, stable expectations are imperative, especially in sectors that depend on complex logistical coordination. Any hiccup can be massive — a hiccup like the shutdown. Without guaranteed staffing, air travel became too unpredictable, which in turn made the production structure unpredictable. This is no small matter. Yes, a cancelled flight is massively inconvenient. A missed input delivery can also be quite costly. A missed production window, however, can destroy a business operating on tight profit margins. 

What the shutdown did was depreciate institutional capital, what we might call the rules of the game. More than just reducing government “services”, the shutdown increased entrepreneurial uncertainty. The marginal entrepreneur is now more likely to find it unprofitable — at least in his expectations — to begin a business venture. The marginal business owner may have just missed the shipment of materials or goods that would have kept him afloat. Even the super-marginal business owner who will remain in business has to recalculate his entire model. This depreciation will continue to impact coordination long after the shutdown ends. Every missed market exchange is a missed opportunity for our society to be made better off. We are, quite literally, poorer because of this shutdown, and it has increased the possibility of being made poorer still in the future. Institutional capital, and capital in general, cannot be turned on and off like a light switch. 

Shutdowns are often discussed along political lines — which party “won” and which party “lost.” The economic impact is often only discussed in terms of its immediate consequences. The long run, though, is seldom considered. The 2025 shutdown did more than just inconvenience travelers. It exposed the fragility of our institutions due to their close connection to the government. A private, decentralized air travel network would be far less prone to the type of shock we saw recently. Our current system creates a single point of failure, both in funding and technology. When the FAA’s NOTAM system crashed in 2023, the entire country’s airspace went offline. Meanwhile, decentralized private systems — like Canada’s Nav Canada — show that decentralized distribution of control is better capable of containing disruptions instead of allowing them to cascade throughout the country. This is because polycentric governance increases resilience, as entities have stronger incentives to upgrade technology, and more importantly, introduces redundancy that can keep the system running if one touch point fails. 

A shutdown is a corrosive solvent for planning, coordination, and trust. Knowledge flows are disrupted or destroyed. Time horizons are shortened. The conditions necessary for a properly functioning economy should not be played with. We are made poorer by every missed opportunity to trade. The solution here is not more politics, but to notice how fragile our economy has become. 

Objections to income inequality are commonplace. We hear these today from across the ideological spectrum, including, for example, from the far-left data-gatherer Thomas Piketty, the far-right provocateur Tucker Carlson, and Pope Leo XIV. 

Nothing is easier – and, apparently, few things are as emotionally gratifying – as railing against “the rich.” The principal qualification for issuing, and exulting in, denouncements of income inequality is first-grade arithmetic: One billion dollars is a larger sum of money than is ten thousand dollars, and so subtracting some dollars from the former sum and adding these funds to the latter sum will make incomes more equal. And because income is what people spend to achieve their standard of living, such ‘redistribution’ would also result in people being made more equal. What could be more obvious?

Countless careful researchers have convincingly shown that popular accounts of the magnitude of differences in monetary incomes are vastly overstated. But let’s here grant, for the sake of argument, that differences in monetary incomes within the United States are indeed vast. And then let’s pose some probing questions to proponents of using the state to tax and ‘redistribute’ high incomes.

• Do you teach your children to envy what other children have? Do you encourage your children to form gangs with their playmates to ‘redistribute’ toys away from richer kids on the schoolyard toward kids less rich? If not, why do you suppose that envy and ‘redistribution’ become acceptable when carried out on a large scale by the government?

• Suppose that Jones chooses a career as a poet. Jones treasures the time he spends walking in the woods and strolling city streets in leisurely reflection. His reflections lead him to compose poems critical of capitalist materialism. Working as a poet, Jones earns $40,000 annually. Smith chooses a career as an emergency-room physician. She works an average of 60 hours weekly and seldom takes a vacation. Her annual salary is $400,000. Is this “distribution” of income unfair? Is Smith responsible for Jones’s relatively low salary? Does Smith owe Jones money? If so, how much? And what formula would you use to determine Smith’s debt to Jones? What, in short, is the “fair” amount by which Smith’s income should be lowered in order to raise Jones’s income?

• While Dr. Smith earns more money than poet Jones, poet Jones earns more leisure than Dr. Smith. Do you believe that leisure has value to those who possess it? If so, are you disturbed by the inequality of leisure that separates leisure-rich Jones from leisure-poor Smith? Do you advocate policies to ‘redistribute’ leisure from Jones to Smith – say, by forcing Jones to wash Smith’s dinner dishes or to chauffeur Smith to and from work? If not, why not?

• Nobel-laureate economist William Nordhaus found that entrepreneurial innovators in the US from 1948 through 2001 captured, on average, only 2.2 percent of the total social value of their technological innovations. As Nordhaus put it, nearly 98 percent “of the benefits of technological change are passed on to consumers rather than captured by producers.” Does the fact that market competition obliges entrepreneurs to share the vast bulk of their wealth creation with consumers give you pause in your demands for ‘redistributing’ the wealth that these entrepreneurs manage to retain for themselves?

• Surveys show that Americans in general are not as bothered by income inequality as are academics and media pundits. Are the many Americans who don’t suffer searing envy of others’ monetary incomes stupid, naïve, or uninformed? Do the professors and pundits who agonize incessantly over income inequality know something that most Americans don’t? If so, what?

• You allege that great differences in incomes are psychologically harmful to relatively poor people even if these poor people are, by historical standards, quite wealthy. How, then, do you explain the great demand of very poor immigrants to come to America, where these immigrants are relatively much poorer than they are in their native lands?

• Do you believe that someone to whom government gives, say, $100,000 annually, year in and year out, simply because that person is a citizen of the country, feels as much psychological satisfaction as that person would feel if he learned a trade or a profession at which he earns an annual salary of, say, $80,000?

• Would you prefer to live in a society in which everyone’s annual income is $50,000 or in a society with an average annual income of $75,000 but in which annual incomes range from $30,000 to $3 million, and in which no occupation is obstructed by government-erected barriers to entry? And regardless of the choice you would make, do you believe that others who choose differently from you are in error?

• You often speak of income inequality as being a market failure. Can you identify an economic theory that predicts that every well-functioning market economy generates incomes that are equal or close to equal? I’m an economist and have never encountered such a theory, so I’d be delighted if you expand my intellectual horizons.

• You also warn that large differences in incomes make society unstable – or, as Paul Krugman insists, jeopardizes “the whole nature of our society.” Can you point to historical evidence in support of this claim? But remember: To be valid, the evidence must be from market economies in which the great majority of people – rich and not rich – earn their incomes through voluntary market activities and where the size of the economic pie isn’t fixed.

Evidence of social unrest in pre-industrial and nonmarket societies doesn’t count. Economic arrangements in such societies are fundamentally different than in our own. And unlike in our market economy, the amount of wealth in nonmarket economies is largely fixed. Therefore, in nonmarket economies, more wealth for some people does indeed mean less wealth for other people. Our economy differs categorically: Because the amount of wealth in market economies isn’t fixed, people get rich by creating more wealth rather than by seizing the wealth of others. In market economies, more wealth for rich people means, not less, but more wealth for other people.

• When you describe growing income inequality in the United States, you typically look only at the incomes of the rich before they pay taxes and at the incomes of the poor before they receive noncash transfers from the government such as food stamps, Medicare and Medicaid. You also ignore noncash transfers that the poor receive from private charities. Why? If you’re trying to determine whether or not more income ‘redistribution’ is warranted, doesn’t it make more sense to look at income differences after the rich have paid their taxes and after the poor have received all of their benefits from government and private sources?

• Have you considered that greater income inequality might result from demographic changes that reflect neither weakness nor injustice in the economy, nor any increasing differences in economic well-being? For example, do you account for the fact that retirees rely heavily on consuming their capital – for instance, by selling their expensive large homes, moving into less-expensive smaller homes, and using the differences in sales proceeds to fund some of their living expenses? People’s annual incomes are typically lower when they are retired than when they were working, but their wealth – their ability to maintain their standard of living – isn’t necessarily lower.

• Do you not worry that creating government power today to take from Smith and give to Jones – simply because Smith has more material wealth than Jones – might eventually be abused so that tomorrow the government takes from Jones and gives to Smith simply because Smith has more political influence than Jones?

• Do you disagree with Thomas Sowell when he writes that “when politicians say ‘spread the wealth,’ translate that as ‘concentrate the power,’ because that is the only way they can spread the wealth. And once they get the power concentrated, they can do anything else they want to, as people have discovered – often to their horror – in countries around the world.” Asked differently, if you worry that abuses of power are encouraged by concentrations of income, shouldn’t you worry even more that abuses of power are encouraged by concentrations of power?

Americans love a garage, but we don’t park cars there. We store old bikes with bent wheels, parts of beds and dressers, and a wide variety of tools and old clothes. Personally, I have a box of old electronic parts and cables that I’m sure I’ll use…. someday.

It was not always like this. People had only a few things, and shared by allowing reciprocal borrowing. Often there was some communal arrangement for bigger things, as with the neighborhood bread ovens of medieval Europe.

Today, though, separate private ownership is the norm. To understand why, one has to understand transaction costs. Of course, I would say that, since I think the answer to almost every question in economics is “transaction costs.” But in this case, it’s actually true.

Coase’s Other Question: Why Do We Own Instead of Rent?

Ronald Coase famously asked, “If markets are so great, why are there firms?” His answer was “transaction costs.” Using markets is costly. Prices are important signals at broad levels, but for many small and routine choices, it’s much cheaper to “internalize” the costs of using markets. Firms arise to bypass markets and reduce transaction costs.

If Coase were alive today, he might ask a different question: If renting is cheaper and more efficient for most durables, why do we own almost everything?

Different question, but the same answer: transaction costs. Ownership internalizes the costs of using rental markets or sharing arrangements. The transaction cost of renting a ladder, a car, a spare room, or kitchen appliance wildly exceeded the value to the potential user, or the revenue an owner could hope to earn.

To share any asset or tool, you must account for certain costs:

1. Triangulation – finding someone who wants to rent it to you.
2. Transfer – moving the item or coordinating access and payments.
3. Trust – ensuring the renter will not damage, steal, or misuse the asset.

Ownership was a workaround for high transaction costs. We purchased goods we barely used because we wanted reliable access to them without depending on others.

But what if dependence and sharing were easy, and as cheap, even invisible?

Platforms as Middlemen Selling Reductions in Transaction Costs

Transactions “take place.” That means exchanges happen, but they also require a “location.” That place was once a physical market, or a mall. Today, the “place” can be virtual, on a platform. A platform’s true output is not a product but a service: the reduction of transaction costs that make commodifying excess capacity expensive. Amazon, Uber, Airbnb, and thousands of other platforms sell connections. If I have a car, and a few minutes, and you need a ride, we can now transact at low cost. Platforms are factories that produce reliable cooperation between strangers. The result is that the idle time of durable assets becomes legible to markets. What was once an expensive object to be stored becomes an income-producing asset.

We buy durable goods only for the stream of services they provide. I don’t actually want a power tool; what I want is two holes in this wall, now. The lowest solution (to triangulate, transfer, and trust) to that problem has been ownership. But that comes bundled with idle storage time: a drill may be used for 10 minutes a year, yet occupies physical and financial space for 365 days.

The same is true for cars, guest bedrooms, clothing, tools, musical instruments, and row after row of kitchen equipment quietly rusting under our sinks. We “store to renew” future access: we want the option to use the thing immediately when we need it. But for most of our lives, we are simply paying a two-part tax — the opportunity cost of capital tied up in stuff, and the costs of storage — for the privilege of being able to get these two holes in this wall, right now, or for two extra chairs used only when company visits.

It’s not just garages being used to store stuff we don’t use. The US has more than 23 million individual storage units in 50,000 facilities, with annual revenues of nearly $45 billion. Well over 10 percent of US households rent at least one storage unit; many rent several.

Two-Sided Markets

In two-sided markets, a person can be both buyer and seller, as suits them. Consider an example: A person who is normally a consumer of housing is leaving town for two weeks. She is now a seller or producer of housing services, renting out her flat on AirBnB. When she drives her car to the airport, “buying” transport services from herself, she parks in the Turo lot. The car is then rented out for 10 days, and is available for her when she returns from her trip. She both saved the costs of parking the car in the airport lot, and made money from renting the car out when it was otherwise idle. Overall, between renting her flat and renting out her car, she makes more than $4,000: enough to pay for most of her vacation expenses.

The bright-line distinction between producer and consumer, a relic of the Industrial Revolution, dissolves in platform space. This has consequences for policy, taxation, labor regulation, and even our intuitions about property. When excess capacity is commodified, ownership becomes less a categorical state and more a bundle of transferable rights that can be partitioned and sold temporarily.

In this sense, the “sharing economy” is poorly named. Nothing is being shared in the gift-exchange sense. What is being shared is temporary access. What is being commodified is excess capacity. Fifty years from now, observers will look back on our era with incredulity. Why did people buy all their own tools? Why did cities devote up to 30 percent of their usable road area to storing empty cars? (In Manhattan, it’s more than 40 percent!) Why did we allow trillions of dollars of capital to sit idle for 95+ percent of its lifespan?

The answer we will give — “Well, transaction costs were too high!”— will seem quaint.

Platforms are revealing that much of what we think of as “ownership” is really just expensive access insurance. Once platforms reliably provide that insurance, the original rationale for owning evaporates.

The commodification of excess capacity is not a fad. It is the natural consequence of entrepreneurs discovering that the most valuable thing they can sell is not a product or a service, but the reduction of friction that once made sharing impossible.

The most common cancer in America is also one of the most preventable — if people simply had access to effective sunscreen. We spend $9 billion a year treating the cancerous effects of sun damage, not to mention the billions we spend to soothe the sun’s more minor effects. So many people get skin cancer that the statistics aren’t even reportable to cancer registries. But nearly all skin cancer is the result of sunlight and UV exposure, which means it is preventable. 

But that’s the (often greasy) rub: in the United States, sunscreen is locked inside a bureaucratic vault built in 1938, guarded by the Food and Drug Administration as if it were an experimental medical treatment. 

The FDA’s Precautionary Paralysis

Americans don’t hate sunscreen. We hate American sunscreen. Thick, greasy, chalky — our “broad spectrum” formulas barely block the most dangerous rays, meaning damaging UVA rays still get through. Even when you’re wearing “good” American sunscreen, you remain vulnerable to aging-accelerating sunspots and cancer-causing skin damage. 

Why? Because American sunscreen is trapped in a regulatory time warp. Since the late 1990s, the FDA has refused to approve a single new UV filter. Europe and Asia now use more than 30 modern filters, with similar safety standards. The US? Just 17 — most of them older, less effective, and less pleasant on the skin. Foreign formulations reach beyond visible sunburns well into the UVA wavelength, offering superior protection from the rays that cause 90 percent of visible aging and much of the skin cancer burden. That’s protection Americans are being deliberately denied.

Susan Swetter, MD, is exactly the person you’d want to ask about that kind of thing. She’s a professor of dermatology and the physician in charge of cutaneous oncology (skin cancers) at Stanford University Medical Center. She was blunt: “The best sunscreens abroad contain Tinosorb, Mexoryl or Uvinul — none of which are currently FDA-approved.”

The reason is almost comical. Because sunscreen prevents cancer, the FDA classifies it as a drug, not a cosmetic. Approving a new UV filter drug here requires decades of animal testing, multi-million-dollar studies, and years — sometimes decades — of regulatory limbo before a new ingredient can hit US shelves. The result of this “precautionary principle” is not more safety but less. By locking out proven, widely used ingredients like bemotrizinol — sold abroad for more than 20 years under EU standards without incident — the FDA has left Americans with weaker protection, higher cancer rates, and ballooning medical costs. 

It’s inaction in the name of public health, and the costs are becoming more visible.

“The sunscreen issue has gotten people to see that you can be unsafe if you’re too slow,” economist Alex Tabarrok told NPR. Regulation by delay doesn’t always prevent harm. In many cases, it guarantees harm.

Consumers vote with their wallets, importing bottles of Korean and European brands through web outlets, Reddit fora, and TikTok recommendations. New formulas are chemically superior: some are sweat-proof even in humid conditions, others defend skin against air pollution. Australian sunscreens are among the best in the world, and their SPF claims are rigorously checked and enforced. When sunscreen feels better, looks better, and works better, people are more likely to wear it.

Around the world, innovation races ahead where sunscreen is treated as skincare. 

The Incentive to Do Nothing

Industry has little reason to push the FDA to move faster. The cost of approval can reach $20 million, yet the reward is just 18 months of exclusivity. After that, competitors can copy the formula, leaving innovators to cover all the upfront costs.

Congress prompted the FDA to reconsider its classification and speed up approvals (in November 2025’s continuing resolution, but also 2020, 2014, 2011, and 2005 to absolutely no effect). If bemotrizinol wins FDA approval in 2026, it will be the first new filter in a generation.

Swiss-Dutch skincare company DSM-Firmenich, branding the compound as PARSOL Shield, has petitioned and lobbied the FDA for nearly a decade.

US companies keep recycling the same tired formulas. L’Oréal, Neutrogena, and others already sell better versions of their products abroad. Sephora is reportedly eager to supply better products to US buyers, but will have to settle for intentionally formulated inferior alternatives until the FDA moves. For 20 years, the discriminating skin care buyer could pay extra to import the good stuff.

And speaking of paying a premium for imported goods…

Tariffs Make a Bad Problem Worse

In 2024, the Trump administration slapped a 25 percent tariff on Korean imports, including cosmetics like sunscreen. Though the rate has seesawed since — sometimes 15 percent, sometimes zero — the uncertainty has sparked panic buying and price spikes. Retailers warn that if the full tariff returns, they’ll have no choice but to pass costs onto consumers.

Now, the administration has also eliminated the de minimis exemption, which used to let individuals import up to $800 in goods tariff-free. Without that protection from costly customs duties, millions of American consumers who rely on direct-to-door K-beauty orders will see the cost of reliable skincare soar overnight.

The Cost of Bureaucracy and Protectionism

First, the FDA blocks innovation, so American products are distinctly inferior. Reform (say, to streamline FDA approvals, remove required animal testing, or approve new UV filters) moves slower than skin cancer spreads across an unprotected brow. Now, ill-conceived trade policy threatens to choke off the only affordable workaround consumers have left. 

Bipartisan glimmers exist. Rep. Alexandria Ocasio-Cortez and Sen. Mike Lee have called for regulatory reform to streamline FDA approvals and allow modern testing methods without the requirement for mandatory animal testing (funny enough, we could rely on a 30-year longitudinal study on the human populations of Europe and Southeast Asia).

Busybody-bullies make it their job to get in the way of consumers’ choices for themselves and entrepreneurs’ attempts to meet those needs. As usual, the twin idols of American bureaucracy — safety theater and national security hobgoblins — generate fear, feed lobbyists, and prop up campaign funding, but produce the opposite of their intent.

The results of FDA protection:

Not safety, but exposure — to the sun, to higher prices, to worse health outcomes, and an estimated 8,000 preventable deaths a year. Medicare and Medicaid are likely to pay billions annually to treat skin cancer that could’ve been prevented, had the FDA not, well, prevented that. 

American standards force companies here and elsewhere to produce deliberately inferior products at higher prices than those freely available to buyers in other countries. American manufacturers are excluded from a booming global skin care market. 

One of our best tools for reliable, risk-free cancer prevention is being treated as a luxury good. 

COVID may be on its way to being a chapter in our history books, but it’s left its fingerprints all over life as we know it. The world post-pandemic is not the same as the one we had in the early days of 2020. Work-from-home is now normalized; many companies are partially (and even fully) remote. Entire city populations have shifted as large numbers of Americans relocated around the country.

Perhaps less obvious to the naked eye — although not less significant — is COVID’s effect on the public school system.

The pandemic, and all the social changes that came with it, shattered some of our culture’s biggest educational taboos. More importantly, it shattered the illusion that our public schools are a great and trustworthy American institution.

Everybody talks about “COVID learning loss” (and the large gaps in learning students are still suffering months after school closures and missed lessons). Far less discussed is the “COVID trust loss” in our public schools (at a 25-year low) and all the ways that the social norms that bound public school together as an American bedrock have begun to fragment.

Since 2020, a wave of school choice policy has swept across the country. Its seeds were sown long before the pandemic, but COVID trust loss created the culture ripe to harvest them.

Four shifts post-pandemic are changing the fabric of American education: increased transparency inside the classroom (and more light shed on all the shortcomings of public schooling), the breakdown of the homeschooling taboo, the shift toward remote work, and demographic migrations into states prioritizing school choice.

Each of these paradigm shifts is quietly rewriting the education world. Each is important, and each is reshaping education in its own way.

If you’re a skeptic of government-run schools, there’s a lot to be excited about.

Zoom School Revealed the Rot in Public Education

In the early days of COVID, public schools went online, and parents had the chance to watch what was happening in their child’s classroom in real time. Many were not pleased.

Teachers and administrators were trying to translate an already broken model of education onto a format it didn’t fit, breaking it even further in the process.

Parents, also shut up inside their houses and in close proximity to their children, saw Zoom school and were horrified — is this really what my kid does all day?

Some chalked it up to the shortcomings of the medium: public school was designed for real-life rooms and three-dimensional interactions, not computer screens.

Others (more astutely) blamed the model itself.

It’s no secret that America’s public school outcomes aren’t great — the Nation’s Report Card, published by the federal government, publicly documents as much. But many parents were confused by the content of their children’s classes — like the parents documented in the Sold a Story podcast, who were horrified to discover their children weren’t learning to read.

Public school enrollment dropped sharply. Many families switched to private schools (which re-opened faster than public schools) or began homeschooling. Some of those families returned to public school after the lockdowns ended, but many didn’t, and public school enrollment is trending downward. Nationally, enrollment dropped 2.5 percent between 2019 and 2023, and continues to decline.

Even in cities like Austin (with population trending upward), public school enrollment is falling — Austin’s school district has lost 10,000 students over the past decade, despite the city population growing by 10 percent (nearly 100,000 new residents) over the same period.

If public schools were private companies, and surveyed their customers (the parents) — or just looked at their retention data — the market feedback would be clear. Parents aren’t happy with the results public schools are delivering, and are looking elsewhere.

Zoom School Made Homeschooling Less Taboo

Millions of parents pulled their kids out of public school in 2020 and started homeschooling them, confident that their homespun instruction would be better than whatever Zoom school was meting out.

Nearly overnight, homeschooling — once a strange practice reserved for the hippies and religious zealots and social outcasts — became normal. It went from a fringe concept to a shared cultural experience.

Nearly everybody knows somebody who homeschooled for at least a few months during the pandemic. And you can’t say “homeschoolers are weirdos” without a tinge of irony if you yourself (or your sister, or your best friend, or your cool neighbor) were once a homeschooling parent, no matter what the extenuating circumstances.

More importantly, even if you weren’t homeschooling, you still had your kids at home all day — one of the core (unimaginable?) realities of homeschooling life. Pre-COVID, parents could say “I could never homeschool my kids, I can’t imagine having them home all day.” Post-COVID, no longer: having your kids home all day was something everyone could imagine, because it was something everyone had experienced.

By the time the lockdown had abated, having your child home all day had gone from unimaginable, to practical, to a very viable possibility for the future.

Work-From-Home Broke Up “Default” Childcare 

At the same time Zoom school was in full swing, COVID was permanently rearranging the workplace. Technology had long before made remote work possible; the pandemic forced employers to catch up. Parents went from 9-5 office residencies to commuting only as far as the kitchen table, taking meetings while waiting for their sourdough to rise.

One of the core services public school offers, to families and to society generally, is childcare. Parents who go to work need somewhere for their kids to go. But if parents work from home, they can be the adult in the room while kids do school — especially if their child is enrolled in an online program (so mom doesn’t have to be the teacher).

For many kids, especially an older student who doesn’t need constant supervision, doing school online (with mom or dad in the other room for support if you need them) is a viable option. If your child doesn’t like the public school curriculum, or prefers working at their own pace, or is on the butt end of public school bullying and social hierarchies, online school can offer a compelling prospect.

During COVID, all sorts of online schools grew quickly: Sora School, an online project-based middle and high school; Synthesis, the game-based spinoff program from Elon Musk’s Ad Astra school; Kubrio, a “world school” with three time zone swaths and students from all around the globe — to name just a few.

More traditional models like online charter schools and public cyber schools are also on the menu; but for families with self-directed children, more custom combinations of tools and programs (Khan Academy paired with Teaching Company lectures, IXL supplemented with Coursera MOOCs) abound.

Post-COVID, remote work appears to be here to stay. As Cal Newport wrote in his book Slow Productivity, referencing Apple employees refusing to go back to the office: “These frustrated Apple employees [are] at the vanguard of a movement that’s leveraging the disruptions of the pandemic to question so many more of the arbitrary assumptions that have come to define the workplace.” 

This questioning of assumptions, not incidentally, applies equally to schooling.

Perhaps equally importantly, remote work also frees families from work-induced geographic constraints, making it easier for them to relocate to states with the best schools or robust school-choice supports.

COVID Migration Moved Families To Choice-Friendly States

COVID policy rearranged the demographic spread of the country en masse: people fled in droves from locked-down states (like New York and Illinois and California) to open ones (like Texas and Tennessee and Florida).

States with less-restrictive school closure policies also tend towards freer education policy (both are correlated with the relative power of teachers unions). Many fewer states have since passed sweeping school choice policies, where families have access to public vouchers for use at private schools.

The effect is that a large number of kids — who would’ve otherwise been stuck in states without school choice — now live in states with a huge number of school options emerging.

Eighteen states have implemented universal school choice since 2020. Some of those states, like Florida and Texas, are becoming hotbeds for education innovation, and many are seeing an increasing number of private school options emerging.

Incidentally (or perhaps not incidentally at all), many of these school choice-friendly states are also the places people are having the most kids — a positive indicator of the education market’s future growth. Where there is demand (young students) and capital (school choice dollars), supply (interesting new schools) will follow.

Part of the reason public schools in America have had such a monopoly on education is because of other extenuating circumstances: parents need to work all day; no one was at home to watch the kids; tax dollars were exclusively bundled into the public school system — and everybody trusted the public school system. After all, it’s one of the great American institutions (or so we’re led to believe).

But with those undergirdings starting to shift, public school’s Herculean hold on the American psyche (and the American way of life) is shifting too. Logistically, we don’t need public schools the way we did a decade ago. We’re more skeptical of them. And alternatives have been destigmatized.

The 2.5 percent public school enrollment drop is still small; it’s early days. Nearly 50 million kids are still enrolled in public schools. Public education is still the default.

But the cultural landscape — and the cultural paradigm — has shifted. And the education landscape will continue to shift in response — slowly now, but more and more, until the unquestioned “default” of one school for all children feels as distant as normal reality did during the height of the pandemic.