Assorted Links (2/24/2012)

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

Richard Epstein on Oil Prices

Libertarian law professor Richard Epstein’s column this week is about $4 a gallon gasoline: “Politicians should neither panic nor pander.”

Obama’s Virtual Economy

“In The Wall Street Journal, Wonder Land columnist Daniel Henninger writes that in the president’s Sim City Economy, you really can make it up.”

Obama’s Budget Flunks the Marshmallow Test

Quoting from this essay, “The government expunges sacrifice, smooths the risk out of our economic lives, and protects us from the consequences of our actions. It is aggressively moving us away from the national entrepreneurial ethos, teaching dependency and changing our relationship to the state.”

‘Stupid’ and Oil Prices

Quoting from this article “…not even Forrest Gump could believe the logic of what Mr. Obama is trying to sell… To wit, that a) gasoline prices are beyond his control, but b) to the extent oil and gas production is rising in America, his energy policies deserve all the credit, and c) higher prices are one more reason to raise taxes on oil and gas drillers while handing even more subsidies to his friends in green energy. Where to begin?”

America’s ‘Unbanked’ Masses

Banking analyst Meredith Whitney writes about unintended (negative) consequences of ill-planned and ill-timed financial regulatory reform, including the Credit Card Accountability, Responsibility, and Disclosure Act of 2009 (CARD), overdraft protection (“Reg E”) reform, and Dodd-Frank (2010).

Santorum—Moralizer in Chief?

“In The Wall Street Journal, Potomac Watch columnist Kimberley Strassel writes that Americans are open to candidates of faith, but less so to any hint that they might impose their moral views if they’re elected.”

Tax Cuts Should Create Growth, Not Junk Spending

Amity Shlaes reviews the international empirical evidence on the relationship between economic growth and tax cuts and finds the following: “payroll-tax cut “no,” corporate tax “yes” and personal income-tax cut “yes””…

The Safety Net Isn’t Free

“It’s all too easy to forget to calculate the impact of the cost of the safety net on the taxpayers who pay for it, an economist writes.”

Should We Regulate Sugar Like Alcohol or Tobacco?

“No. It probably won’t work anyway.”

Getting Off Track and the Panic of 2008 Revisited

Stanford economist John Taylor on Lehman and TARP!

Europe’s Supply-Side Revolution

“In The Wall Street Journal, Donald Luskin and Lorcan Roche Kelly write that following Germany’s lead, euro-zone nations are pursuing pro-growth reforms that Reagan and Thatcher would admire.”

Crunching the numbers of tax rates

Scott Burns, who has a weekly personal finance column in the Austin American Statesman, makes the same point here that I have made on numerous occasions – because of double taxation of dividends, $1 of corporate income is taxed at the corporate rate of 35 cents, leaving 65 cents to distribute to shareholders as dividends; since the personal tax rate on dividends is 15%, this means that 55 cents of the original dollar earned at the corporate level is left over – 45 cents of the original dollar has been taxed. Thus virtually anyone who earns taxable investment-related income – not just the Warren Buffetts and Mitt Romneys of the world – currently faces an effective marginal tax rate of 45%. This point seems lost not only on Buffett and Romney, but also the Obama administration which has recently proposed a 2013 fiscal year budget which would impose a minimum 30% rate at the personal level on the 1 percenters and 5 percenters and so forth – not sure offhand what the percentile ranking is these days for “rich” married households filing jointly with income of $250,000 … Anyway, doing the arithmetic, this translates into an effective marginal tax rate of 54.5% on investment-related income. Sounds like a job killer to me…

Over-regulated America

The (UK) Economist magazine warns of a “…real danger: that regulation may crush the life out of America’s economy.”

Overreach: Obamacare vs. the Constitution

“A trifecta of rights denied.”

The Grumpy Economist: Where your money goes

My favorite “grumpy economist” blogger (AKA University of Chicago professor John Cochrane) advises us to “…leave the roads, bridges, the poor and the environment out of the debate over higher taxes” since as a matter of fact, “The main function of our government is to write checks to middle-class and wealthy voters. And that’s the reason its finances are in the toilet.” Professor Cochrane backs his argument up quite impressively with data from a New York Times article entitled “Even Critics of Safety Net Increasingly Depend on It” (located at…

Government Spending and Private Activity

Sorry to disappoint “fans” of “stimulus spending” by the federal government. Here is the link to UCSD macroeconomist Valerie Ramey’s newest (January 2012) empirical study on fiscal stimulus. She uses quarterly (U.S.) data on variables such as GDP, private and public sector employment, taxes, defense spending, etc. for the past 70-80 years and concludes that on balance, “… government spending does not appear to stimulate private activity.”

The Grumpy Economist: Wallison on financial regulation

Quoting from this blog posting by University of Chicago finance professor John Cochrane: “The Dodd-Frank/Fed approach seems to be “we don’t know what happened, really, so we’ll just regulate everything that moves.””

In Praise of ‘Enviropreneurs’

“In The Wall Street Journal, Terry L. Anderson writes about environmentalists’ attempts to keep Texas ranchers from saving exotic wildlife that are threatened in their native African habitat.”

Sex, Singles And The Presidency

“The increasing role of the childless may already be shifting Democrats toward a post-familal secularism associated with Europe. But to address millennials, they need to craft a message that appeals to a demographic that looks like the current First Family.”

Assorted Links (2/11/2012)

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

Notable & Quotable

“Thomas Sowell on the self-aggrandizing social vision of intellectuals in Intellectuals and Society (2010).”  This excerpt from Thomas Sowell’s book entitled “Intellectuals and Society” reminds me of British historian Paul Johnson’s famous 25-year old essay entitled “The Heartless Lovers of Humankind” (cf., which is also well worth reading. Johnson notes, among other things, that “…Almost all intellectuals profess to love humanity and to be working for its improvement and happiness. But it is the idea of humanity they love, rather than the actual individuals who compose it.”

The States Are Leading a Pro-Growth Rebellion

“In The Wall Street Journal’s Cross Country column, Arthur B. Laffer writes that the message from Indiana and elsewhere is that aligning yourself too closely to unions is a losing strategy.”

Immaculate Contraception

“The Wall Street Journal reports on President Obama’s ‘accommodation’ that makes the birth-control mandate worse.”

The Gospel according to Obama

Quoting from this article by Charles Krauthammer, “Now, I’m no theologian, but I’m fairly certain that neither Jesus nor his rabbinic forebears, when speaking of giving, meant some obligation to the state. You tithe the priest, not the tax man.”

$25 Billion Bank Job

“The Wall Street Journal argues the Barker Gang would have loved this housing caper.” See the “Barker Gang” Facebook page at so you can “get” the Barker Gang analogy…

Dodd-Frank and the Myth of ‘Interconnectedness’

“In The Wall Street Journal, Peter Wallison writes that there’s no evidence exposure to Lehman imperiled other banks—so why are we basing law on that premise?”

United We Stand for Religious Freedom

“In The Wall Street Journal, Cardinal Donald Wuerl, Charles Colson and Rabbi Meir Soloveichik write that ObamaCare’s contraception mandate stands the First Amendment on its head.”

Consumer group seeks Texas insurance data to identify ‘junk’ policies

Texas Watch has taken a page right out of the playbook of Richard Cordray, who is the former attorney general of Ohio and was recently named by President Obama to head the new Consumer Financial Protection Bureau. The CFPB is a creature of the Dodd-Frank financial reform law which is charged by Dodd-Frank to act as an “independent” consumer “financial watchdog” agency – see “The Dodd-Frank Act: Creative Destruction, Destroyed” (@

The underlying premise behind the action described in this article from today’s Dallas Morning News would appear to be that the consumer has virtually no protections whatsoever against being taking advantage of by “Big Finance” or “Big Insurance” (or Big “fill-in-the-blank-with-the-name-of-whatever-industry-you-feel-like-demonizing” for that matter). Texas Watch (and the legions of similarly named so-called “consumer” groups) demonstrate (at best) quite limited understanding and appreciation concerning the role that competitive market forces play in “regulating” the financial services industries. You have got to love the quote provided by the executive director of Texas Watch concerning the alleged harm: “…consumers are hard-pressed to find a policy that offers the same level of protection they had 10 years ago”. What a scandal – as consumer needs and preferences change over time, then so do policy forms. I am shocked!

The Real Trouble With the Birth-Control Mandate

“In The Wall Street Journal, John Cochrane writes that there are good reasons that your car-insurance company doesn’t add $100 to your premium and then cover oil changes—and the same logic applies to birth control.”  Hat tip to my colleague and coauthor Jim Hilliard for pointing this article out to me (as well as his many other FB friends). Jim also says (and I agree): “Wow, what a great article. It’s kind of long, but the most concise description of the problem with health insurance today that I have ever seen.” I also highly recommend University of Chicago finance professor John Cochrane’s blog “The Grumpy Economist” (

Capitol Assets: Mapping the earmarks

“Interactive map of congressional earmarks near the personal property of members of Congress.”  Also see the Washington Post article “Congressional earmarks sometimes used to fund projects near lawmakers’ properties” at for further context…

The Media’s Blinders on Abortion

“Half of the country wants to restrict or end abortion, but you wouldn’t know that from the coverage of the Planned Parenthood-Komen controversy.”

ObamaCare’s Great Awakening

“The Wall Street Journal argues that HHS tells religious believers to go to hell. The public notices.”

The STOCK Act’s Muzzle — How “Insider Trading” Bill Could Shut Down Grassroots Communication

From the department of unintended consequences: “…if the STOCK Act is passed, the SEC may require meetings and calls in which Congress members and staffers participate to be open to the public or not occur at all. The result would be less outflow of information from Congress and a less-informed public.” It’s amazing how a bill that was supposedly designed to close a glaring loophole in the securities laws which allowed members of Congress to lawfully engage in insider trading will likely muzzle free speech, whistleblowers, and grassroots communication, all in the name of stopping “insider trading” by members of Congress…

Assorted Links (2/6/2012)

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

The Fallout from Christian Legal Society

“Since the Supreme Court’s sharply divided and startlingly wrongheaded decision two years ago in Christian Legal Society v. Martinez, those concerned about religious liberty on campus have known that the fallout was on its way. At Vanderbilt University, it has arrived — and it’s as bad as anticipated… Vanderbilt believes that requiring “all comers” to be welcome in all organizations, no matter how ill-suited they are for one another, is such an overriding concern in fighting discrimination that it has overruled or ignored every objection including pluralism itself — and basic common sense.  Oh, wait, did I say all organizations? Actually, Vanderbilt has exempted its fraternities and sororities from the rule. The imperatives of social justice, it seems, lose all force at the door of the Deke house.”

Facebook and the St. Petersburg Paradox

“Investors thinking about Facebook should consider a mathematical riddle that shows how growth stocks can get overvalued so easily.”  The author of the Wall Street Journal’s “Intelligent Investor” column, Jason Zweig, draws some interesting parallels between buying into Facebook’s IPO and the famous “St. Petersburg Paradox” game proposed in 1738 by Dutch-Swiss mathematician Daniel Bernoulli…

A Battle the President Can’t Win

“His decision on Catholic charities makes Romney’s big gaffe look trivial, Peggy Noonan argues.”

Did Early Humans Ride the Waves to Australia?

“Until 150,000 years ago, all our ancestors lived in Africa—and then they started spreading out. Matt Ridley examines the theories around the exodus.”

Record 1.2 Million People Fall Out Of Labor Force In One Month, Labor Force Participation Rate Tumbles

With a 1.2 million person drop in the number of people participating as members of the labor force, the proportion of the population either working or seeking work has fallen from 64.2 percent to 63.7 percent (also see the Boston Globe article on this @

Obama’s Louis XV budget

Charles Krauthammer delivers again! Quoting from this article, “Five days before his inauguration, President-elect Obama told The Post that entitlement reform could no longer be kicked down the road. He then spent the next two years kicking – racking up $3 trillion in new debt along the way – on the grounds that massive temporary deficit spending was necessary to prevent another Great Depression.”

The Great Divorce

“Charles Murray’s “Coming Apart” describes the most important cultural trends today and offers a better understanding of America’s increasingly two-caste society.”

The Real “Truth About the Economy:” Have Wages Stagnated?

George Mason University economics professor Don Boudreaux debunks one of central claims of the OWS movement – particularly, the role that “wage stagnation” supposedly plays in the income inequality debate…

Price Controls for Harvard?

“In The Wall Street Journal, former Major League Baseball Commissioner and college trustee Fay Vincent writes that President Obama wants to unleash more lawyers and bureaucrats on higher education.”

Obama’s Enemies List

“In The Wall Street Journal, former U.S. Solicitor General Ted Olson writes that David and Charles Koch have been the targets of a campaign of vituperation and assault, choreographed from the very top.”

The Wireless Equivalent of Fracking

“In The Wall Street Journal, Business World columnist Holman Jenkins writes that the Wi-Fi revolution shows how far the FCC is behind the curve.”

What the Bible Teaches About Capitalism

Rabbi Aryeh Spero provides us with one of the best essays ever on the moral foundations of capitalism – right up there with the work of Catholic scholar Michael Novak (author of, among other things, the book entitled “The Spirit of Democratic Capitalism” (cf.…

Occupy AstroTurf

“In The Wall Street Journal, Information Age columnist Gordon Crovitz writes that the Occupy Wall Street movement was an ersatz creation of social media and a weak-kneed city government.”

The Myth of Starving Americans

“In The Wall Street Journal, Warren Kozak writes that according to the Census Bureau, 96% of parents classified as poor in the United States said their children were never hungry.”

Scoring Last Week’s RomneyCare Debate

“In The Wall Street Journal, Grace-Marie Turner of the Galen Institute writes that Rick Santorum correctly challenged Mitt Romney on the similarities between his Massachusetts health-care legislation and ObamaCare.”