The Grumpy Economist: Energy Idiocy
johnhcochrane.blogspot.com
University of Chicago finance professor John Cochrane asks, “What is it about energy that send all sides of the political spectrum into spasms of babbling idiocy?”
The Free Market Is a Beautiful Thing
reason.com
Trade and cooperation are superior to force and command.
www.economist.com
“Margaret Thatcher, Britain’s prime minister from 1979 to 1990, died on April 8th at the age of 87. We assess her legacy to Britain and the world.” I was fascinated to learn, among other things, that the “Iron Lady” was a fan of the following Abraham Lincoln quote, “You cannot strengthen the weak by weakening the strong. You cannot bring about prosperity by discouraging thrift. You cannot help the wage-earner by pulling down the wage-payer.”
www.economist.com
Fascinating article from the Economist about the economics of the PhD degree… Here’s an excerpt, “In a recent book, Andrew Hacker and Claudia Dreifus, an academic and a journalist, report that America produced more than 100,000 doctoral degrees between 2005 and 2009. In the same period there were just 16,000 new professorships.”
online.wsj.com
The Wall Street Journal reports that under the new White House budget public debt in 2014 will hit 78.2% of the economy. This reported 78.2% number represents more than a doubling since 2007 in the size of federal debt held by the public as a percent of GDP.
Google Lets Users Plan ‘Digital Afterlife’ By Naming Heirs
blogs.wsj.com
Google on Wednesday became one of the first major Internet companies to put control of data after death directly into the hands of its users.
Is Obamacare ‘the bullet to the temple’?
money.msn.com
Bernie Marcus, who co-founded Home Depot in 1979, says the massive health care insurance overhaul will ‘kill off small business.’
When the Government Plays Favorites
reason.com
Government continues to threaten our future while claiming to help us.
Obama’s Budget: Spending Too High, But Bush Was Worse
www.cato.org
The sooner people understand that overspending it is a deep and chronic disease with bipartisan roots, the sooner we can start finding a lasting cure.
How Much Does Your Name Matter? A New Freakonomics Radio Podcast
www.freakonomics.com
“The gist: a kid’s name can tell us something about his parents — their race, social standing, even their politics. But is your name really your destiny?” (spoiler alert: the “best” social scientific response to this question is “probably not”, although filmmaker Morgan Spurlock leans in favor of the affirmative…)…
MSNBC Host Melissa Harris-Perry » All Your Kids Belong To Us
MSNBC’s Melissa Harris-Perry considers the unborn child a “thing” which takes a “lot of money” to “turn into a human,” costing thousands of dollars to care for each year of his/her life. Now it appears that Harris-Perry thinks that, after they’re born, children fundamentally belong to the state. Narrating a new MSNBC “Lean Forward” spot, the Tulane professor laments that we in America “haven’t had a very collective notion that these are our children.” “[W]e have to break through our kind of private idea that kids belong to their parents or kids belong to their families, and recognize that kids belong to their communities,” Harris-Perry argued.
capitalistpig.com
Expected to be released this week, President Obama’s budget will limit how much individuals can keep in 401(k)s, IRAs and other retirement accounts.
The Sequester: Absolutely everything you could possibly need to know, in one FAQ
washingtonpost.com
I heard an interesting sequestration story over lunch today. According to the non-partisan Congressional Budget Office, half of the $85.4 billion in “cuts” for 2013 (i.e., $42.7 billion) apparently comes out of what had been budgeted for the Department of Defense for the current fiscal year. In percentage terms, this $42.7 billion cut represents a 7.9% cut in DOD’s 2013 budget (source: http://wapo.st/15vLbrI). Anyway, a colleague mentioned that at one of the service academies, the salaries of virtually ALL civilian faculty have been cut by 20%, whereas the salaries of military faculty at the same institution have remained untouched… I can’t help but wonder how that decision (i.e., sparing faculty with military appointments while really putting it to the civilian faculty) was made – probably NOT by a civilian administrator…
It Isn’t A Question Of If Obamacare “Collapses”
www.firstthings.com
“I don’t think there is a danger that Obamacare will collapse. It is a certainty. The question is what Obamacare collapses into.”
A Slick Marketing Campaign Won’t Save ObamaCare
news.investors.com
The White House recently released details about how it plans to market ObamaCare to the uninsured. It reveals most don’t want what they’re being forced to buy.
To Sign Up For Obamacare, Start Filling Out The Forms Now (And Hire A Good Accountant)
www.forbes.com
Want to apply for Obamacare this fall? Start the paperwork now. The Obama Administration quietly released a draft copy of its “single streamlined application” for Obamacare. This is the form that the government will use to certify eligibility for the program’s subsidies. The on-line version of that…
My Baylor colleague Blaine McCormick recently produced a multimedia media iPad/iPhone app based upon Milton Friedman’s famous 1970 New York Times Magazine article entitled “The Social Responsibility of Business is to Increase its Profits”. The app includes a copy of Friedman’s essay, along with videos featuring comments and interpretations of Friedman by various Baylor faculty, including yours truly 
.
The Social Responsibility of Business
itunes.apple.com
Here’s a list of articles that I have been reading lately:
opinionator.blogs.nytimes.com
“It is easy to trace disasters like the Euro and the Arab Spring to the bursts of unfounded optimism that gave rise to them. So why is pessimism so often ignored?”
Unfit for Work: The startling rise of disability in America
npr.org
“In the past three decades, the number of Americans who are on disability has skyrocketed. The rise has come even as medical advances have allowed many more people to remain on the job and new laws have banned workplace discrimination against the disabled.” The other “startling” fact from this NPR article is that there apparently exists a fairly lucrative “business opportunity” for firms which help state governments move “disabled” people from state welfare over to federal disability status. For example, one such company asked for $2,300 per person from the state of Missouri for effectively converting its state welfare recipients into Social Security Disability Insurance (SSDI) claimants. In other words, substantial transactions costs are apparently being paid by state taxpayers to transfer the costs of state welfare programs over to federal taxpayers…
Health Insurers Warn on Premiums
online.wsj.com
Here’s a very interesting (ungated) Wall Street Journal article concerning some of the “unintended” consequences of Obamacare…”Health insurers are privately warning brokers that premiums for many individuals and small businesses could increase sharply next year because of the health-care overhaul law, with the nation’s biggest firm projecting that rates could more than double for some consumers buying their own plans.”
Memo to Staff: Take More Risks
online.wsj.com
“Want to succeed? Embrace failure…. Extended Stay CEO Jim Donald said employees were afraid of taking risks. So he is handing out “Get Out of Jail, Free” cards to 9,000 employees. They call in the card when they take a big risk on behalf of the company – no questions asked.
New York’s Coolest New Museum: MoMath
bloomberg.com
“Bloomberg’s Tom Keene goes to MoMath, the first math museum in the United States.”
Preach Like Your Faith Depends on It – 10 Big Ideas
ideas.time.com
“They can be as huge as a new constitution or as tiny as a medical microchip. In this special report, TIME explores innovations that are changing the way we work, live, pray and play.”
Jeremy Lott on the Media’s Pope-O-Rama
www.researchonreligion.org
“How well did the popular media do in covering the resignation of Pope Benedict XVI, the Conclave of Cardinals, and the election of Jorge Mario Bergoglio as Pope Francis I?”
reason.com
“Why are we screwing up the world’s best higher education system?” Here’s the answer in a nutshell, “Students arrive on campus underqualified, courtesy of an American public school system that has flatlined in quality while tripling its per-student cost. They do less academic work yet receive better grades than their parents did. And their post-college job prospects are dim, with unemployment rates for recent grads hovering at 12 percent.”
www.economist.com
Quoting from The Economist, “This is the America that China’s leaders laugh at, and the rest of the democratic world despairs of. Its debt is rising, its population is ageing in a budget-threatening way, its schools are mediocre by international standards, its infrastructure rickety, its regulations dense, its tax code byzantine, its immigration system hare-brained—and it has fallen from first position in the World Economic Forum’s competitiveness rankings to seventh in just four years.”
The Doctor Will Not See You Now. He’s Clocked Out
online.wsj.com
“In The Wall Street Journal, Scott Gottlieb writes that ObamaCare is pushing physicians into becoming hospital employees and the results aren’t encouraging.”
online.wsj.com
“Sharp recall skills have proven themselves key to future success, scientists have found. A look at what some call mental time travel.”
Soda Ban Ruling a Devastating Defeat for Mayor Bloomberg
dailycaller.com
“The judge who struck down Mayor Bloomberg’s nanny state soda ban issued a sweeping opinion that does everything but hand Mayor Poppins his umbrella and carpetbag.”
Medicaid Expansion Too Good to Be True
www.cato.org
“If implemented, ObamaCare’s Medicaid expansion will cost Michigan taxpayers $2.25 billion over the next 10 years. Fortunately, legislators can still defend state taxpayers by saying “No.”"
www.aei-ideas.org
“From the Intrade website: “With sincere regret we must inform you that due to circumstances recently discovered we must immediately cease trading activity www.intrade.com.”"
Here’s a list of articles that I have been reading lately:
Cutting Government Will Boost the Economy
reason.com
“Why Keynesianism is still wrong.”
Colleges Bleeding Students to Buy Golden Parachutes for Administrators
Instapundit
“College administrators have found an interesting new way to strike it rich: quitting their jobs.” Quoting from this article on the high cost of college, “People blame faculty, but most of the increase in cost has come from administrative bloat.” The various “Golden Parachute” examples given by NYU during recent years are quite impressive indeed!
online.wsj.com
“Hedge funds have amassed a record size of assets. If only their results were as impressive.” Brett Arends notes that given the fees typically charged by hedge funds (2% of the value of assets under management plus 20% of any profits), such funds would have to beat the market by 50 percent a year, every year, just to match a low-cost portfolio of stocks and bonds.
College: Where Free Speech Goes to Die
www.hoover.org
“Thanks to unconstitutional university speech codes, students are losing their intellectual edge.”
townhall.com
Hoover Institution economist extraordinaire Thomas Sowell opines on the political economy of sequestration… He poses a particularly interesting thought experiment which we now see being played out in spades: “Imagine a government agency with only two tasks: (1) building statues of Benedict Arnold and (2) providing life-saving medications to children. If this agency’s budget were cut, what would it do? The answer, of course, is that it would cut back on the medications for children. Why? Because that would be what was most likely to get the budget cuts restored. If they cut back on building statues of Benedict Arnold, people might ask why they were building statues of Benedict Arnold in the first place.”
Edith Widder: How we found the giant squid
www.ted.com
“Humankind has been looking for the giant squid since we first started taking pictures underwater. But the elusive deep-sea predator could never be caught on film. Oceanographer and inventor Edith Widder shares the key insight — and the teamwork — that helped to capture the giant squid.”
online.wsj.com
“The lesson is to beware the rule of charismatic demagogues.”
Actually, the real Dow is still 11% below its record
buzz.money.cnn.com
“In inflation adjusted terms, the Dow is still 11% below its all-time high set in January 2000.”
Leigh Steinberg on Sports, Agents, and Athletes
www.econtalk.org
Leigh Steinberg is the legendary sports agent depicted in the film “Jerry Maguire”. He writes a regular column on forbes.com, and I recommend not only listening to this podcast but also reading his article “The Death of the NFL” at http://onforb.es/13El3qM. Here’s a synopsis of this very worthwhile and informative podcast: “Leigh Steinberg, legendary sports agent, talks with EconTalk host Russ Roberts about his career as a sports agent. He discusses the challenges of building a clientele, how sports agents spend their time, strategies for building a brand as an athlete, and safety issues currently affecting the National Football League.”
www.patheos.com
I highly recommend UT-Austin sociologist Mark Regnerus’ “… non-sociological compilation of thoughts on Lent, magnanimity, and dying.”
Republicans and Their Faulty Moral Arithmetic
online.wsj.com
AEI president Art Brooks argues that an important reason why conservatives find themselves continually losing at the ballot box is because they’re using a faulty moral arithmetic…
online.wsj.com
“John H. Cochrane reviews The Bankers’ New Clothes: What’s Wrong with Banking and What to Do About It by Anat Admati and Martin Hellwig.” This book review by University of Chicago finance professor John Cochrane provides the best “layman’s” explanation that I have seen concerning how regulatory complicity (by sanctioning extraordinarily high levels of debt relative to equity coupled with providing bailouts for so-called “Too Big to Fail” (TBTF) banks) not only set the stage for the GFC (global financial crisis) of 2008, but also sets the stage for future financial crises by effectively codifying TBTF and bailouts (compliments of the so-called “Dodd-Frank” financial reform law) as “essential” parts of the architecture of the US financial system…
Unfortunately, the rest of the developed world seems to be following the US lead in rendering financial markets even more susceptible to financial crises going forward by similarly designating TBTF firms as “systemically important financial institutions” (SIFI) for which bailouts are implicitly promised. No sane person would ever design a system of regulation like this, which effectively rewards large financial institutions for rolling the dice with the house’s (taxpayer) money…
The Minimum Wage Harms the Most Vulnerable
reason.com
“How long will progressives get away with pretending to care about the poor?” Abolish the minimum wage—for the sake of the poor.
online.wsj.com
“He seems to think the way to win is by trying not to make a deal, Peggy Noonan writes.”
In Cuts, a Stroll Through Obscure Parts of Budget
online.wsj.com
“The ‘sequester’ reductions range from $6 million in the Leaking Underground Storage Tank Trust to $1 million to wool manufacturers in a homeland-security program.” Still scratching my head over the following sentence from this article: “Payments to wool manufacturers, a $15 million Department of Homeland Security program, would be cut by $1 million”. To be sure, border agents on the Canadian border might require heavy wool coats, but $15 million worth?
Imagining a Post-Bundle TV World
online.wsj.com
As more consumers cut the cord, cable-TV executives are considering the end of the bundle system. That may allow customers flexibility in choosing channels, rather than subscribing to large packages.” My wife and I cut the cord back in November 2011. By dropping Time Warner’s so-called “Triple Play” service (consisting of digital cable, digital phone, and internet) and only subscribing to Time Warner’s RoadRunner Internet service, our monthly bill is now more than $100 lighter than it used to be. We still have home phone service, but it’s free and our telecom carrier is Google (see http://bit.ly/uqjPub). I purchased a “rabbit ear” style antenna from Radio Shack for $11 and we now receive all the local network affiliates plus various other channels in HD for free, although we mostly watch programs on Hulu Plus ($8 per month) and occasionally rent movies from Amazon. It’s amazing that it has taken the cable companies this long to “unbundle” – their customers have been doing their own “homemade” unbundling for some time now…
Population Decline and the Birth Dearth
www.thepublicdiscourse.com
Jonathan Last’s new book attributes population decline and the birth dearth to two trends that started in the Enlightenment era—first, an effort to limit death; second, an effort to control birth. Both trends are guided by a desire to control nature. Quoting from this fascinating article, “All Western countries have birthrates below the replacement rates, suggesting that soon all countries will experience a graying of, and a decline in, population.”
Wal-Mart’s Sales Problem—And America’s
online.wsj.com
The left loves to see the retailer suffer, but does its bad February herald another recession? Apparently the Jan. 1 expiration of the payroll-tax cut on Jan. 1 (which lowered most worker’s net pay by 2 percent) was a contributing factor, as was the decision by the IRS to delay the start of its tax refunds to Jan. 31 from Jan. 17.
Varoufakis on Valve, Spontaneous Order, and the European Crisis
www.econtalk.org
This is one of the most intriguing EconTalk podcasts I have ever listened to. I particularly like his title as “economist-in-residence” at a gaming company called Valve Software (cf. http://www.valvesoftware.com/). Here’s the synopsis from econtalk.org:
“Yanis Varoufakis of the University of Athens, the University of Texas, and the economist-in-residence at Valve Software talks with EconTalk host Russ Roberts about the unusual structure of the workplace at Valve. Valve, a software company that creates online video games, has no hierarchy or bosses. Teams of software designers join spontaneously to create and ship video games without any top-down supervision. Varoufakis discusses the economics of this Hayekian workplace and how it actually functions alongside Steam–an open gaming platform created by Valve. The conversation concludes with a discussion of the economic crisis in Europe. ”
Obama’s sequester deal-changer
www.washingtonpost.com
“The president and his staff have been wrong about how the sequester came about.”
Here’s a list of articles that I have been reading lately:
The Critics Are Wrong About the Future of Free-Market Health Care Reform
www.forbes.com
“Douglas Holtz-Eakin and Avik Roy outline a market-based plan for entitlement reform and universal coverage that builds on a reformed version of Obamacare’s subsidized insurance exchanges.” In their “all-purpose rebuttal” to Matthew Yglesias, Paul Krugman, et al., Douglas Holtz-Eakin and Avik Roy provide a way forward which has as its end result “… a health-care system that resembles a slightly less-regulated version of Switzerland’s.”
Voters Grow Weary of Washington’s Drama
professional.wsj.com
No kidding (about growing weary). Consider the following quote from this article, “After two years of creating and then resolving a series of budget showdowns, lawmakers are losing the power to summon concern—or even much interest—among the public, voters here say. “It just happens so often, it’s white noise to me,” said Eric Jones, general manager and partner of the Glenn Jones Ford dealer in Casa Grande…”
Noonan: Government by Freakout
online.wsj.com
“Obama’s scare tactics aren’t much of a long-term strategy, argues Peggy Noonan.” This is what it feels like these days – it seems like we are averaging at least one major fiscal crisis per month…
online.wsj.com
“The Wall Street Journal reports how the Affordable Care Act’s new mandates are already reducing full-time employment.” Here’s a case study of the law of unintended consequences at work!
The Hollywood Tax Story They Won’t Tell at the Oscars
online.wsj.com
“In The Wall Street Journal’s Cross Country column, Glenn Harlan Reynolds writes that it’s easy to demand higher levies on the ‘rich’ when your own industry gets $1.5 billion in government handouts.” I am a big fan of the author of this article, Glenn Reynolds who blogs at Instapundit and is a law professor at University of Tennessee – check out this week’s Econtalk episode entitled “Glenn Reynolds on Politics, the Constitution, and Technology” @ http://www.econtalk.org/archives/2013/02/glenn_reynolds.html!
Generational Theft Needs to Be Arrested
“In The Wall Street Journal, Geoffrey Canada, Stanley Druckenmiller and Kevin Warsh write that a Democrat, an independent and a Republican can agree—government spending levels are unsustainable.”
The Shaky Science Behind Obama’s Universal Pre-K
www.bloomberg.com
AEI scholar Charles Murray and his assessment of the social science behind the Obama Administration’s universal Pre-K policy proposal…
www.aei.org
At an event on Tuesday, panelists joined AEI’s Peter Wallison and Alex Pollock to discuss Wallison’s new book “Bad History, Worse Policy: How a False Narrative about the Financial Crisis Led to the Dodd-Frank Act” (AEI Press, January 2013). This panel discussion from an American Enterprise Institute event that occurred last week provides insightful analysis of the so-called Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (AKA “Dodd-Frank”). The bad news is that Dodd–Frank effectively codifies notions of too-big-too-fail (“TBTF”) and bailouts into the foundations of our financial system.
Obamacare: Nothing to Brag About
www.cato.org
“The president’s health-care law increasingly does less and costs more.”
U.S. CEO to France: “How Stupid Do You Think We Are?”
blogs.wsj.com
“Instead of investing in France, the U.S. tire maker Titan is “going to buy a Chinese tire company or an Indian one, pay less than one Euro per hour and ship all the tires France needs,” its CEO said.” This is priceless – particularly the copy of the actual letter sent by Titan’s CEO to French industry minister Arnaud Montebourg that is attached to this article – well worth reading!
How Scientists Sank the U-Boat
online.wsj.com
“Marc Levinson reviews Stephen Budiansky’s Blackett’s War: The Men Who Defeated the Nazi U-Boats and Brought Science to the Art of Warfare.” This is a fascinating book review which describes, among other things, how WW II led to the development of operations research (a field which involves the application of statistical analysis to decision-making) and related fields such as game theory. To this day, these disciplines profoundly affect how decisions are made and strategies formulated, not only in the military but also myriad other public and private sector settings. I might have to read this book (that is, after I finish reading Andrew Roberts’ superb book about WWII entitled “The Storm of War” (cf. http://amzn.to/YjnGec)…
The Minority Youth Unemployment Act
online.wsj.com
“The Wall Street Journal says in an editorial that a higher minimum wage will most hurt President Obama’s most loyal supporters.” This article calls to mind the famous Thomas Huxley quote, “The great tragedy of Science: the slaying of a beautiful hypothesis by an ugly fact” (the “beautiful hypothesis” here being the claim made by the Obama administration that “…modestly raising the minimum wage increases earnings and reduces poverty without measurably reducing employment”).
I was impressed that this article references the highly cited 2006 monograph by Neumark and Wascher which looks at more than 100 (mostly peer reviewed) academic studies on the minimum wage and notes that the vast majority (85%) of these studies “…find a negative employment effect on low-skilled workers.” The article goes on to note, among other things, that “…the minimum wage has nothing to do with poverty or unemployment. It’s a political play to reward unions and box in Republicans. The minimum wage polls well because Americans naturally want everyone to make more money, and the damage in foregone jobs isn’t obvious.”
The Art and Politics of ‘Zero Dark Thirty’
online.wsj.com
“In The Wall Street Journal, Matthew Kaminski interviews the man behind the film about the hunt for bin Laden talks about how he combined facts with imagination and calls his Senate critics ‘intellectually dishonest.’”
While I am interested in a fairly wide variety of public policy issues, my knowledge about many (perhaps most?) things tends to be somewhat superficial, and locavorism is no exception. What little I do know about locavorism comes primarily from a recent article written by a pair of agricultural economists entitled “The Locavore’s Dilemma: Why Pineapples Shouldn’t Be Grown in North Dakota” (available from http://bit.ly/egKUki) and from the following 3 “EconTalk” (fairly recent) podcasts which address various aspects of locavorism:
1. “David Owen on the Environment, Unintended Consequences, and The Conundrum” (@ http://www.econtalk.org/archives/2012/02/david_owen_on_t.html),
2. “Cowen on Food” (@ http://www.econtalk.org/archives/2012/04/cowen_on_food.html), and
3. “Lisa Turner on Organic Farming” (@ http://www.econtalk.org/archives/2012/12/lisa_turner_on.html ).
These podcasts (and article) provide examples concerning how eating local food can at times be environmentally better (and tastier ) than non-local food. They also enumerate myriad examples in which this is clearly not the case – i.e., lots of times locavorism can be environmentally worse than eating non-local food. I guess it all “depends”…
P.S.: This posting came about as a result of a conversation that I had recently had about locavorism with a friend who reminded me of the famous 1st episode of Portlandia located at in which locavores Peter and Nance ask their waitress about the chicken (named “Colin”)…
Here’s a list of articles that I have been reading, podcasts that I have been listening to, and videos that I have been watching lately:
Obama’s Executive Death Warrants
www.cato.org
“Can a president really serve as judge, jury and executioner over any American he deems a security threat?”
From His Very First State of the Union Utterance, President Obama Got It Wrong
www.cato.org
By Roger Pilon
“Not since FDR have we had a president with so little appreciation for our basic constitutional system, or so little understanding of basic economics.”
www.cato.org
“President Obama’s new proposal to raise the federal minimum wage would bad for workers and the economy, but the administration seems to be ignoring the large body of theory and evidence on the issue.” Cato (correctly) notes that “President Obama’s plan to raise the minimum wage ignores 70 years of economic research.”
Four Key Questions for Health-Care Law
“The success or failure of the Affordable Care Act relies on what employers, individuals and states do in the next few years. David Wessel takes a look at what each will do.”
online.wsj.com
“University of Rochester study finds people who put their spouses needs first make themselves happier too.”
Freakonomics Radio – How to Think About Guns
www.wnyc.org
“No one wants mass shootings. Unfortunately, no one has a workable plan to stop them either.” This is definitely worth spending thirty minutes listening to. Freakonomics is really good at exposing the “the hidden side of everything” – particularly unintended consequences of public policy initiatives…
www.freakonomics.com
“President Obama has proposed increasing the federal minimum wage from $7.25 to $9. Since the demand for low-skilled labor is quite elastic, this will kill off a few jobs that would otherwise have been created. Not very many, because relatively few people would otherwise be paid between $7.25 and $9 anyway (in an economy with an average wage of about $20/hour); but this is a job-killing idea.”
State of the Union 2013: AEI scholars respond
AEI President Arthur Brooks writes, “What did AEI scholars think of the president’s State of the Union address? Watch this quick video for play-by-play commentary on a variety of issues from entitlement and immigration reform to minimum wage hikes and gun control.”
Households On Foodstamps Rise To New Record
www.zerohedge.com
“Since Obama’s first inauguration, the US has generated 841,000 new jobs through November 2012. That number is dwarfed by the 17.3 million new food stamp and disability recipients added to the rolls over the same time period.”
online.wsj.com
“Paul Harvey’s ad was terrific, Peggy Noonan write, but Steve Kroft’s interview was shameful.” Peggy Noonan opines that the Fourth Estate is in a particularly bad state these days…
When Species Extermination Is a Good Thing
online.wsj.com
“Foundations tied to Bill Gates and Jimmy Carter report progress.” Interesting article by Matt Ridley, author of The Rational Optimist and various other tomes. He’s sort of in a similar category as writers like Malcolm Gladwell and Michael Lewis…
Work Disincentives, Still Crazy After All These Years
online.wsj.com
“Economist Art Laffer writes that, in the spirit of Jack Kemp, a pro-growth agenda is needed for America’s pockets of poverty.” Dr. Laffer runs the numbers and finds that “…People with low incomes who receive various forms of welfare subsidies in any number of states—with and without children, whether married or not—face enormous disincentives in trying to improve their lives by working.”
Dr. Benjamin Carson’s Speech at the National Prayer Breakfast (February 7, 2013)
video.foxnews.com
“Pediatric neurosurgeon targets political correctness in National Prayer Breakfast speech.” Besides being a gifted and inspiring speaker, Dr. Carson is also an accomplished neurosurgeon who is famous for his ground-breaking work separating conjoined twins (see http://www.biography.com/people/ben-carson-475422). For the Wall Street Journal’s take on Dr. Carson’s speech, see “Ben Carson for President” @ http://on.wsj.com/WBmGGh.
“Carthage, TX resident describes the ’5 States’ of Texas.” This is a succinct and highly informative explanation of Texas for non-Texans!
Should States Participate in the Medicaid Expansion?
blogs.baylor.edu
As my Baylor colleague, economics professor James Henderson notes, “Only 18 states have agreed to expand the Medicaid program according to Obamacare guidelines. Is it a mistake to decline federal funding to expand a flawed program or should states accept the Faustian bargain? Short-run gain will likely translate into long-run pain for state budgets.”
Seidman on the Constitution | EconTalk
www.econtalk.org
I listened to this EconTalk episode earlier this week, which involves a lively debate (featuring a prominent constitutional law professor) concerning whether the US Constitution should be relied upon to guide the process by which laws and public policies are enacted. The official description of this podcast (taken from the EconTalk website) is as follows:
“Louis Michael Seidman of Georgetown University talks with EconTalk host Russ Roberts about the United States Constitution. Seidman argues that the we should ignore the Constitution in designing public policy, relying instead on the merits of policy regardless of their constitutionality. Seidman defends his position by citing examples in the past where constitutionality has been ignored and says it would be better to recognize our disdain for the Constitution in a transparent way. In this lively conversation, Roberts pushes back against these ideas, citing the limits of reason and the dangers of using popular sentiment to determine policy.”
I think most people understand that the United States has a debt problem, but I am not sure all that many people necessarily understand the magnitude of this debt. According to the treasurydirect.gov website, US federal government debt (as of Monday, February 4) stands at $16.48 trillion (source: http://www.treasurydirect.gov/NP/BPDLogin?application=np)). Since US GDP (as of Q4 2012; see http://bit.ly/kM8cxa) is $15.83 trillion, this implies that the US debt to GDP ratio currently stands at more than 100%.
Using the resources cited in the previous paragraph, one can determine US debt totals and debt to GDP ratios at various points in recent history. On the day that George W. Bush was first inaugurated (January 20, 2001), US federal government debt stood at $5.73 trillion, and the US debt to GDP ratio at the time was 57%. By the time that President Bush’s second term came to an end (on January 20, 2009), US federal government debt had grown by $4.9 trillion (to $10.63 trillion), and the US debt to GDP ratio stood at 74%. Since President Obama first took office on January 20, 2009, US federal government debt has grown by an additional $5.85 trillion, going from $10.63 trillion to $16.48 trillion.
Thus, the Obama administration (after one full term plus two weeks into a second term in office) accounts for 5.85/16.48 = 35.5% of the current national debt, President Bush’s two administrations account for 4.9/16.48 = 29.7% of the current national debt, and the previous 42 presidents cumulatively account for 5.73/16.48 = 34.8% of total US federal government debt.
The graph below (source: http://bit.ly/PxbO63) shows the US debt to GDP ratio over the period 1966-2012. I don’t about y’all, but the fact that this ratio is accelerating as we move through time is very disconcerting. Economists Carmen Reinhart and Ken Rogoff note that episodes in world history where debt ratios exceed 90% are not only rare, but also impede economic growth (see “Debt and growth revisited” (source: http://www.voxeu.org/article/debt-and-growth-revisited)).
Here’s a list of articles that I have been reading lately:
Travis Kalanick: The Transportation Trustbuster
online.wsj.com
Travis Kalanick is the John Galt of his generation! Quoting from this article, “Andy Kessler interviews Travis Kalanick, co-founder of Uber, on how he’s bringing limo service to the urban masses—and how he learned to beat the taxi cartel and city hall.”
World War II Spending Did Not End the Great Depression
reason.com
“The aggregate statistics fail to capture essential details of life.”
Powers of prophesy: Davos looks to the future
www.stltoday.com
Interesting multidisciplinary assortment of predictions; I am especially looking forward to owning a driverless car and my own 3D printer!
www.nytimes.com
“As the winners of our meritocracy hold the reins of progressive power, they may struggle to mitigate the inequality their own ascendance has helped produce.”
College Degree, No Class Time Required
online.wsj.com
“University of Wisconsin will grant bachelor’s degrees based on a person’s knowledge as demonstrated in online tests, not on class time or credits, the first such offering from a public university system.”
Revolution Hits the Universities
www.nytimes.com
“Nothing has more potential to let us reimagine higher education than massive open online course, or MOOC, platforms.”
Yes, Mr. President, We Are a Nation of Takers
online.wsj.com
“AEI scholar Nicholas Eberstadt writes that since 1960, entitlement transfers have grown twice as fast as personal income—to $2.3 trillion annually.”
professional.wsj.com
“Environmentalist Bjorn Lomborg writes that fear-mongering exaggeration about global warming distracts us from the real job of finding affordable and effective energy alternatives.”
www.nytimes.com
“President Obama’s second Inaugural Address makes a compelling case for a pragmatic and patriotic progressivism.”
In his inaugural address, Obama suggested burgeoning entitlements aren’t a problem…
www.aei-ideas.org
Excellent critique of President Obama’s second inaugural address by the AEI’s Nick Eberstadt…
Roe v. Wade at 40: Attitudes about abortion
www.aei.org
AEI just put out a very interesting and informative summary of polling data from myriad sources (on (U.S.) public attitudes toward abortion, circa 2013. Quoting fromthis article, “Although opinion about abortion is stable (over time), it is also deeply ambivalent. Americans are simultaneously pro-life and pro-choice.”
Attorney general’s Web campaign invites N.Y. gun-lovers to ‘move to Texas’
www.dallasnews.com
“The Texas attorney general has launched an Internet ad campaign inviting New Yorkers who feel their state’s new gun laws are too restrictive to move to Texas.”
Gold, Greenbacks and Inflation—A History and a Warning
professional.wsj.com
“In The Wall Street Journal, Paul Moreno writes that the Federal Reserve’s 100th birthday is no cause to break out the champagne.”
Moody’s now has negative outlook for all U.S. universities
news.yahoo.com
“Moody’s Investors Service now has a negative outlook for the entire U.S. higher education sector, the rating agency said on Wednesday, citing “mounting fiscal pressure on all key university revenue sources.”
Find the Perfect Sleep Position
online.wsj.com
“Stomach, back or side? There is no one right way to sleep. But for people with certain types of pain and medical conditions, there are positions that can help keep problems from getting worse and may even alleviate them.
aei.org
I make similar points in my April 2011 blog posting entitled “Make the rich pay their “fair” share!” (cf. http://wp.me/pBo4U-B9) which, among other things, documents that the U.S. has by far and away the most progressive personal income tax system amongst 24 OECD countries. Quoting from this article, “For many years, left-wing intellectuals have exalted Western Europe as the paragon of redistributive equity, contrasting it with the trickle-down nightmare that is America. But on tax policy, at least, that characterization is flat-out wrong, especially after the latest round of tax increases.”
online.wsj.com
“Richard Vedder writes that labor-force participation has declined since 2000, and among the reasons are soaring government benefits. Here are some highlights:
1. There are over 30 million more Americans receiving food stamps today than in 2000 (increase from 17.1 million in 2000 to 47.5 million in October 2012).
2. Three million Americans received work-related disability checks from Social Security in 1990; this number increases to 5 million in 2000 and stands at 8.6 million today.
3. The traditional 26-week unemployment-insurance benefit has been continuously extended over the past four years—many persons out of work a year or more are still receiving benefits.”
New budget fix: Pawn Mount Rushmore?
money.msn.com
“Hey, the country has been talking about minting a massive platinum coin. Could selling a giant granite tourist trap be any more ludicrous?”
Here’s a list of articles that I have been reading lately:
blogs.wsj.com
“Earning more money tends to make people happier, at least up to a point. But new research suggests the reverse may also be true: happier people actually make more money.”
online.wsj.com
“Doris Donnelly writes that novelist and poet Victor Hugo was anticlerical, yet the hero in his famous novel is set on his course by a Catholic bishop.” The following quote from this Wall Street Journal article succinctly explains the story behind Les Misérables : “During the night he spent at the bishop’s home, mere days after his release from serving 19 years as galley prisoner 24601, Jean Valjean stole six silver place settings, was apprehended, and returned the next morning under police guard to face the consequences of his crime. Unruffled, the bishop brushed off the police, added valuable silver candlesticks to the bundle, “bought” Jean Valjean’s soul from evil and claimed it for God. He redirected the life of a man chained to hatred, mistrust and anger, and he enabled Jean Valjean to emerge as one of the noblest characters in literature.”
online.wsj.com
“Asteroid 2012 DA14 will pass very close to Earth—much, much closer than the moon—on Feb. 15. Its path won’t lead to a collision with Earth, but it will pass close to a ring of orbiting satellites.”
www.washingtonpost.com
“After the fiscal cliff, the president is free to be himself — a committed big-government social democrat.”
2 months until next budget crisis?
money.msn.com
“A prominent economist known as ‘Dr. Doom’ says the country’s budget dispute will come roaring back soon.” This (another budget crisis in 2 months’ time) seems like an eventuality, in view of the facts that 1) the fiscal cliff legislation passed 2 days ago delays $110 billion in spending cuts for two months, and 2) this is around the same time that Congress will need to debate whether or not to raise the debt ceiling… So definitely expect more 11th hour brinksmanship around the beginning of March…
The Morning Ledger: Cliff Dive Averted
online.wsj.com
For those of you who are wondering what was in the so-called fiscal cliff legislation that was literally passed last evening in the 11th (pm) hour, I recommend reading the first four paragraphs of the article “The Morning Ledger: Cliff Dive Averted” (@ http://on.wsj.com/VAkXwB). Basically we get a two month reprieve from political theater and last-minute brinksmanship. As former Obama chief of staff (and now Chicago mayor) Rahm Emanuel once famously remarked, “A crisis is a terrible thing to waste”…
professional.wsj.com
“Holman Jenkins writes that bitter politics over taxing and spending will be our lot for years to come.” Quoting from this article, “The fiscal cliff turned into just another trial of strength by advocates of the welfare state to prove the welfare state is not rationally reformable in advance of a funding crisis. But we already knew that.”
Nothing Is Certain Except More Debt and Taxes
online.wsj.com
“In The Wall Street Journal, David Malpass writes that the Senate fiscal-cliff bill still means higher taxes on every working American—so much for just going after ‘the rich.’”
reason.com
“If Government spending wasn’t out of control, no one would have wanted to kill Bush tax cuts.”
www.nytimes.com
“The voters get what they want.”
Hummel on Moss on Limited Liability
econlog.econlib.org
Economist JR Hummel’s informative review of David A. Moss’s book, When All Else Fails: Government as the Ultimate Risk Manager – on the history and nature of liability rules, including limited liability…
Some clear thinking on the national debt and the real fiscal problem
www.aei-ideas.org
Some clear thinking on the national debt and the real fiscal problem: Government’s spending on entitlement programs…
The Fiscal Cliff and Congress’s Dysfunction
www.cato.org
“Spending every year is now twice what it was when Bill Clinton left office, and the national debt is three times as high. Republicans and Democrats alike should be able to find wasteful, extravagant, and unnecessary programs to cut back or eliminate.”
americanradioworks.publicradio.org
Here’s the story line for this podcast: “Ever heard of the self-employed college professor? Thanks to the efforts of the for-profit education company Straighter Line, some professors will now be able to go into business for themselves and set the price on how much their teaching is worth.”
Over the Cliff at Steven Landsburg
www.thebigquestions.com
Here’s a positive spin about going over the fiscal cliff from University of Rochester economist Steven Landsburg (AKA the Armchair Economist)…
online.wsj.com
France’s Constitutional Court struck down the new 75% top French income tax rate, not because it is confiscatory; rather on grounds of—get this—unfairness. While it is apparently “fair” to take 75% of what someone earns, it isn’t fair unless the law confiscates 75% from all rich households equally…
Top 10 Economic Charts of 2012
blogs.wsj.com
The charts include 1) a look at what the largest and smallest parts of the economy have been, going back to 1949, 2) where Americans have been spending their money from 1901 to the present, 3) a snapshot of people moving in and out of the U.S. labor force, 4) a look back at the economic performance of the U.S. during presidents’ first terms, 5) a listing of how many weeks of unemployment benefits are offered by each state, 6) which states have the worst unemployment rates (going back to 1976), 7) the numbers behind the U.S.’s deficits, 8) how student loan debt outpaces all other forms of nonhousing consumer debt, 9) how overall food prices don’t move as much as corn prices do, and 10) how Germany’s economic performance compared to the rest of the euro zone.
online.wsj.com
“You don’t have to be Warren Buffett to be considered wealthy. It all depends on who is setting the bar. Here’s why it matters for your taxes, investment options and college aid—and what you can do about it.”
www.nytimes.com
“This is the moment to get out of your rut and visit the rest of the political spectrum.” One of my New Year’s resolutions is to follow Ross Douthat’s advice to: 1) take out a subscription to a magazine whose politics I don’t share, 2) expand my reading geographically as well as ideologically, and 3) make a special effort to read entirely outside existing partisan categories.
The Most Important Speech So Far in the 21st Century?
blogs.wsj.com
George Will at Washington University in St. Louis. The transcript of Mr. Will’s speech entitled ” titled “Religion and Politics in the First Modern Nation” is available for downloading from http://rap.wustl.edu/wp-content/uploads/2012/02/George-Will-lecture-text.pdf; the video is @ http://www.c-span.org/Events/Conversation-with-George-Will-on-Religion-in-Politics/10737436348/.
