Assorted Links (2/28/2011)

Here’s a list of article that I have been reading lately:

Who’s Paid More? Experts Can Disagree

“Detailed analyses of whether state workers are overpaid have come down on either side.” Not surprisingly, liberal-leaning think tank studies tend to view state workers as underpaid vis-à-vis private sector workers, whereas conservative-leaning think tanks come up with the opposite conclusion…

How Beneficial is Widespread Medical Screening?

Excellent essay on this very important topic by economics Nobel laureate Gary Becker!

Unions vs. the Right to Work

“In The Wall Street Journal, Harvard economist Robert Barro says that states should consider passing right-to-work laws that will reduce the power of unions. Collective bargaining on a broad scale, he says, is more like an antitrust violation than a civil liberty.”

Break a leg

“Do you have the claim forms with you? WITH categories like “sound mixing”, “make-up” and “art direction”, this weekend’s Oscars ceremony appears to celebrate almost every aspect of film-making. Insurers, how ever, do not make the red carpet, which may be why Fireman’s Fund has started nominating the year’s “riskiest film”.”

Atlas Shrugged Movie

“Atlas Shrugged The Movie finally makes it to the silver screen 54 years later. Based on Ayn Rand’s epic novel, the Atlas Shrugged Movie comes to a theater near you April 15th.”

Is ‘Shutting Down Government’ A Threat Or A Promise?

“Perhaps gridlock can accomplish what reason can’t.”

Risky Roadmap to $7 a Gallon Gas

“Some Persian Gulf watchers say more political uprisings, swelling strife throughout the Middle East,mean likely oil supply disruptions, higher crude prices and a bigger bite at the gas pump, perhaps as much as $7 a gallon.”

Indiana Governor Bores In on Federal Debt

“Gov. Mitch Daniels rescinded collective-bargaining rights for state employees six years before that became an issue in Wisconsin; now he ponders a G.O.P. presidential run with a stern cut-the-debt message that would usually be politically problematic but might fit the times.”

Go Ahead, America, Leave It to Bieber

“From commodity prices to the state-budget crisis, Justin Bieber has wisdom to spare, says Joe Queenan.”

B-Schools: It’s time to globalize

“New research has revealed a sizable gap between what the business world needs and what business schools provide to their students. What’s standing in the way and what can business schools do to step up their game?”

“Information Technology and Economic Change: The Impact of the Printing Press,” J. Dittmar (2011)

“Dittmar reexamines the case for economic effects of the printing press by looking at growth in city population – a good proxy for economic growth in the 1500s – in cities that had the press versus those that did not. He finds cities that got the press grew quite a bit faster than those did not.”

The Real Problem with Government Employee Unions

“Although collective bargaining by government employee unions may offend one’s sense of justice, what’s truly unacceptable is government labor’s stranglehold over the local, state, and federal governments with which they bargain.”

Federal effective tax rates (taxes as a percentage of income)

The CBO tracks “…federal effective tax rates (taxes as a percentage of income) across household income groups for the four largest sources of federal revenues–individual income taxes, social insurance (payroll) taxes, corporate income taxes, and excise taxes–as well as the total effective rate for the four taxes combined.” (Hat tip to George Mason University’s David Henderson).  The following link from CBO’s website slices and dices these data in all sorts of different directions:

Professor Henderson provides the following summary:

  • The bottom quintile paid 4.3 percent of income in taxes,
  • The top quintile paid 25.8 percent of income in taxes,
  • The top decile paid 27.5 percent of income in taxes,
  • The top 5 percent paid 29.0 percent of income in taxes, and
  • The top 1 percent paid 31.2 percent of income in taxes.

One important takeaway here is that while Social Security (i.e., the so-called “payroll” tax) “…reduces the “progressivity” of the tax system, (it) does not come close to reversing it”; federal effective tax rates are clearly quite progressive indeed!  Professor Henderson also parses some other interesting insights from these data – his blog post about this topic is well worth reading!

Assorted Links (2/25/2011)

Here’s a list of articles that I have been reading lately:

The Internet Helps Us Get Serious

“Rhetoric’s renaissance may lead us out of the current crisis, Peggy Noonan argues.”

Charles Krauthammer – Rubicon: A river in Wisconsin

“Gov. Walker is about to show what fiscal seriousness really looks like.”

Race To The Bottom?

“Is America in a race to the bottom, or are we going through what the Austrian born economist Joseph Schumpeter would call a process of “creative destruction”?”

Wisconsin Democrats Abuse the Quorum Call

“Today– George Washington’s Birthday–we are seeing Wisconsin politics at its worst. A state long known for policy innovation—social security, welfare reform, school vouchers, and much more—is now witnessing a seldom-seen but dreadful abuse of basic democratic practice—the abuse of the legislative quorum call.”

Run Mitch, Run

“For Mitch Daniels, the Republican governor of Indiana, the 2012 moment calls.”

Make Everybody Hurt

“Debt fighters everywhere, including Wisconsin, must establish a set of practices to help us cut spending effectively now and in the future.”

The Federal Reserve Is Causing Turmoil Abroad

“In the Wall Street Journal, George Melloan writes that few protesters in the Middle East connect rising food prices to U.S. monetary policy, but central bankers do.”

The Myth of Corporate Cash Hoarding

“In The Wall Street Journal, Alan Reynolds of the Cato Institute writes that companies hire more workers when they have income to pay them—not by liquidating financial assets.”

Apple is dictating all the terms – and we shouldn’t have to accept them

“Computer giant wants more control of media business and a bigger slice of profits.”

Why Nobody Can Match the iPad’s Price

“This Wired article discusses the economics of how Apple’s vertical integration and retail strategies enable it to keep the iPad at the $500 price point…”

How the Fed prints money without any ink

“If the Federal Reserve’s quantitative easing program is printing money, why is the growth of new currency in circulation below average?”

The showdown between public unions and cash

“The showdown between public employee unions and cash-strapped state governments on display in Madison should be bad news for President Obama and the Democrats.”

What kind of gun control?

Nobel economics laureate Gary Becker provides a very thoughtful and empirically grounded essay on the issue of gun control…

Women Likely to Continue Outpacing Men in Education

“Young women are outpacing men in educational attainment and there’s little sign males will make up ground any time soon.”

The Weekend Interview with Paul Ryan: Ryan’s Charge Up Entitlement Hill –

“In The Wall Street Journal’s Weekend Interview, Paul Gigot interviews Rep. Paul Ryan. The GOP’s fiscal leader explains why House Republicans will vote to reform Medicare and why the public is ready to listen.”

Why The King’s Speech Leaves Me Stuttering

“The royals at the center of the Oscar front-runner are simply spiffing, says Joe Queenan, but give him the proles of True Grit and The Fighter any day.”

Where Have the Good Men Gone?

“Too many men in their 20s live in a kind of extended adolescence—and women are sick of dealing with them. An excerpt from Manning Up: How the Rise of Women Turned Men Into Boys by Kay S. Hymowitz.”

Two Cheers for the Maligned Slacker Dude

“Men in their 20s may be putting off adulthood—but they are still changing the world. Nathan Rabin responds.”

The Intelligent Investor: Why Companies Are Hoarding Cash

“Politicians have been carping about the more than $2 trillion in cash sitting idle in corporate coffers. But much of it isn’t in the U.S.; it is abroad. And it isn’t likely to come back home unless U.S. tax laws change.”

Why Does College Cost So Much?

“A conversation with Robert B. Archibald and David H. Feldman, economists at the College of William & Mary and the authors of a book on the cost of college.”

Researchers Study the World’s Information Explosion

“What is information, and how much is there? Researchers are attempting to answer the question, with some very big numbers.”

Power of the Market – The Pencil

“Milton Friedman uses a pencil to explain how the operation of the free market promotes harmony and world peace.”

The case for fiscal austerity

George Mason University economist Russ Roberts makes the case for fiscal austerity in his Congressional testimony from last week in which he critiques the American Recovery and Reinvestment Act of 2009. Dr. Roberts is the proprietor of Econtalk, which Austin Frakt so aptly describes as “the best continuing education money can’t buy“.The transcript of Dr Roberts’ testimony appears here, and here’s the video:

Assorted Links (2/18/2011)

Here’s a list of articles that I have been reading lately:

Goodbye to All That — 2004-2007

“In times to come, the period between the failed campaign of John Kerry and the Democratic control of the Congress, coupled with the beginning of the successful surge, should be known as “The Insane Years.” This was the era in which Guantanamo was a gulag, renditions were the stuff of Hollywood movie”

Is Your Job an Endangered Species?

“In The Wall Street Journal, Andy Kessler writes that technology is eating jobs—and not just obvious ones like toll takers and phone operators. Lawyers and doctors are at risk as well.”

Review & Outlook: Athens in Mad Town

“The Wall Street Journal on the showdown between public unions and taxpayers in Wisconsin.”

Where the Leaders Are

“In a time of crisis, two governors show Washington the way, Peggy Noonan writes.”

Charles Krauthammer – Obama’s Louis XV budget

“Obama’s first post-commission budget marks a return to obliviousness.”

The Madison Blues

“The world has been watching the upheavals and protests shaking the Middle East these days, but it’s just possible that the disturbances in Madison, Wisconsin mark what will ultimately prove to be a bigger turning point in world history.”

Tomorrow Never Comes

“President Obama keeps promising to get serious about the national debt, but nothing’s happening. Where’s the leadership?”

The President’s proposed deficits and “primary balance”

“Today we’ll look at President Obama’s proposed deficit path, as yesterday we looked at his spending and revenue paths.”

Till Debt Do Us Part

“The European marriage between its peripheral and core countries shows all the signs of the parties having irreconcilable differences.”

Will Green Nukes Save the World? | Fast Company

“Amidst the darkening clamor over global warming, declining fossil fuel reserves, conflicts over oil supplies, and rumors of heavy-handed governmental attempts to curb our carbon-hungry lifestyles, a welcome glow of hope is emerging on the energy technology horizon.”

Your Spousonomics Questions, Answered

“Last week, we solicited your questions for Paula Szuchman and Jenny Anderson, co-authors of the new book Spousonomics: Using Economics to Master Love, Marriage, and Dirty Dishes. Here are their answers, covering everything from sex to divorce to … gulp … apology.”

Race to the Top of the Laffer Curve

“David Leonhardt of the New York Times has it exactly backward: America’s corporate tax rates are driving economic activity abroad.”

The Contradictions of ObamaCare

“Why does Health and Human Services want to exempt millions of consumers from an ObamaCare regulation it just implemented to protect consumers?”

The long term budget problem begins now

“The dotted red line shows us that, over the past 50 years, federal government spending averaged just over one-fifth of the economy (20.2% of GDP). The dotted blue shows us that, over the past 50 years, federal revenues averaged just over 18% of GDP…”

The Experience Economy

“What happens when wealth and living standards diverge?”

After Obama’s Budget, Republicans Need a New Strategy

“In The Wall Street Journal, David Malpass says the big spenders are setting the GOP up for another phony debt ceiling debate. The party should unify around a proposal to put a ceiling on debt as a share of the economy.”

Ecuador Court Orders Chevron to Pay

“Hat tip to my good friend, Tom Butler, for pointing this article out to me. Here are some of his legal perspectives on this case: “What an interesting legal tangle this Chevron Ecuadorian case is. Multinational, competing int’l jurisdictions, The Hague Court, conflicting injunctions, etc… Better than a Grisham novel.”

Budget Battle Lines Drawn

“President Barack Obama offered a 2012 budget Monday that would reduce the federal deficit over time but still leave spending at historically high levels because of mushrooming health and retirement programs.”

Understanding the Muslim Brotherhood

“In The Wall Street Journal, Global View columnist Bret Stephens reflects on an earlier revolutionary moment—namely, Iran in 1979—in which Western thinkers were too quick to embrace fundamentalist Muslims they little understood.”

Want to Boost the Economy? Lower Corporate Tax Rates

“Harvard economist Martin Feldstein writes in The Wall Street Journal that the increased flow of capital to the U.S. from lower corporate taxes would result in greater productivity and higher real wages.”

A Way Forward for the Mortgage Market

“In The Wall Street Journal, Peter J. Wallison writes that the housing system can function perfectly well without government backing. The key, he argues, is making sure most mortgages are prime loans.”

ObamaCare and the Medicaid Mess

“In The Wall Street Journal, Peter Suderman,an editor at Reason magazine, discusses the severe state budgetary crisis posed by escalating Medicaid costs, and why the crisis will get worse under ObamaCare. He discusses reforms such as federal block grants.”

Review & Outlook: The Cee Lo Green Budget

“The Wall Street Journal on the cynical and unrealistic White House budget.”

Investment in financial literacy and saving decisions

“Previous research has suggested that low levels of financial literacy can often be blamed for poor financial decisions by individuals, with knock-on effects for the wider economy. This column adds empirical evidence based on cross-country aggregate and micro-data, showing that indeed countries with higher financial literacy also have higher saving rates and greater wealth.”

CoCo bonds as a way of preventing risk

“Contingent Convertible (CoCo) bonds have been suggested as a way to ensure that banks keep aside enough capital to help them through financial crises. This column proposes a market-triggered CoCo buffer to maintain risk incentives during periods of high leverage. It argues that this will also activate risk information discovery through the market prices of bank securities and increase activism by outside shareholders.”