An Economic Lesson From Kim Kardashian and Kanye West

Power couple Kanye West and Kim Kardashian West are not just leading by example by getting involved with criminal justice reform; they are also teaching the world a valuable lesson on the importance of free market mechanisms and how to save properties and lives.

As the Camp and Woolsey fires consumed California, destroying more than 8,000 structures, devastating entire towns, and forcing thousands of Californians to flee, the Kardashian Wests noticed their property was at a major risk. As the flames started to creep up on their Hidden Hills mansion on Friday, the duo did what we all would in a true free market economy: they called private firefighters.

While a mandatory evacuation order was issued for their neighborhood, the couple or their home's insurer may have realized the property sits in an extremely delicate spot at the end of a cul-de-sac, bordering a field. If the flames engulfed their home, it would only be a matter of time before the rest of their neighborhood succumbed. Calling on a private team, the couple managed to battle the flames on their property and, as a result, keep their neighbors safe.

The private firefighting squad used hoses and dug ditches, creating a fire break that helped save the couple’s $60 million property.

According to TMZ, their neighbors were extremely grateful for the Kardashian Wests’ quick thinking. But do you know who wasn’t happy about the couple using a private enterprise to save their property? The media, of course.

Private Firefighting Should Be Accessible to All

Vice’s Motherboard ran an article complaining that “rich people pay for private firefighters while the rest of us burn.” While the author explains that private fire-mitigating enterprises are commonly available to the rich and famous thanks to the high insurance rates they pay, they fail to explain these services could be more competitive and affordable if government got out of the way.

Instead of offering a glimpse into the economics behind this reality, they simply fault the rich for doing all they can to protect their property, while blaming climate change for the fires and stating that these events are now more common because of President Donald Trump’s anti-climate agenda.  

While President Trump is far from a free market politician, it's more than clear that the problems ailing California have been around for a long, long time, and that local land and security regulations are to blame for both the fires and the lack of competition in the firefighting scene.

In a true market economy — where the government abstains from meddling by imposing regulations, artificially raising the cost of housing through outdated rules, or hurting those with low incomes by imposing wage laws and other rules that prevent willing employees from having independent contracts with employers — private firefighting services wouldn’t be inaccessible.

Currently, many of the members of AIG’s Risk Management and Loss Prevention policy group are wealthy and powerful figures, with nearly half of them occupying the Forbes list of 400 richest Americans.

This policy, which often qualifies for AIG’s Wildfire Protection Unit services, may be exclusive, meaning it may cost subscribers a pretty penny, but that doesn’t mean it should be that way.

After all, private security and firefighting entrepreneurs have a hard time competing and entering the market thanks to strict regulations forcing individuals to go through difficult and expensive training so they can meet licensing requirements.

But that’s not all that makes fighting wildfires in California so expensive. In addition, a huge percentage of land in the Golden State is publicly owned, making fire prevention a difficult or, more often, impossible task.

In the South, where land is more forested than in California, wildfires are not a problem, because land is privately managed.

As economics professor Christopher Westley explains, landowners have more than enough incentives to maintain their property fire-free. They will monitor their land and flag potential flammable material before it becomes a problem, such as high concentrations of deadwood. And during dry seasons, they will perform controlled burns, which will eliminate timber and other fuel buildups, making fires sparked by lightning strikes less likely.

Because landowners act in their self-interest, Westley adds, “they willingly perform actions that serve the social interest too.”

And that’s exactly what the Kardashian Wests did in this case. However, others couldn’t do the same, thanks to the heavy cost of hiring such services — which, as you have seen, is fueled by government’s meddling with the security business and its hold of vasts swaths of land.

But the rich, who can afford to hire private firefighters, are the ones who often get the bad reputation in the media, when they should be celebrated and used as examples to this and the next generation, helping us all understand that government is not the answer to our problems.

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Chloe Anagnos

Chloe Anagnos is AIER's Publications Manager. She is a writer and digital marketer and has been an AIER contributor since 2017. Her work has been the subject of articles in FOX News, USA Today, CNN Money, and WIRED. She has been a writer, commentator, and panelist for media outlets around the country on subjects like political marketing, campaigning, and social media. Follow @ChloeAnagnos.