Dan Mitchell
May 8, 2012

With both France and Greece deciding to jump out of the left-wing frying pan into the even-more-left-wing fire, European fiscal policy has become quite a controversial topic. But I find this debate and discussion rather tedious and unrewarding, largely because it pits advocates of Keynesian spending (the so-called “growth” camp) against supporters of higher taxes (the “austerity” camp).
Since I’m a big fan of nations lowering taxes and reducing the burden of government spending, I would like to see the pro-tax hike and the pro-spending sides both lose (wasn’t that Kissinger’s attitude about the Iran-Iraq war?). Indeed, this is why I put together this matrix, to show that there is an alternative approach.

Predrag Rajsic
May 1, 2012

If you are taking or have taken some of the typical courses in economics, it is quite likely that you asked yourself questions like the following: If an economic model is not like the real world, why should I trust the results of that model? One of the answers I would often get when posing this question goes something like this: Of course the model is not like the real world; it is not supposed to be like the real world. If it were, then it would not be a model!

John P. Cochran, April 25, 2012

Paul Krugman, in his recent New York Times column "Not Enough Inflation" (April 5, 2012), argues that what is most needed now to increase employment is more inflation. The Federal Reserve's duel mandate, full employment and price stability, is relevant and important. Since we have "more or less price stability" but are "nowhere near full employment," the "Fed is doing too little, not too much."
Joseph Salerno, in a recent post on Circle Bastiat, included Professor Krugman in an "elite" group of economists, including the IMF's Olivier Blanchard, Ivy League Professors Ken Rogoff and Greg Mankiw, and Fed chairman Bernanke, who believe, a la a stable Phillips curve, that "an acceleration of the inflation rate is the panacea for the still ailing U.S. economy."

Andrew Foy, MD
April 24, 2012

The US healthcare system is a huge bubble fueled by misguided policies that are sustained by the government's ability to borrow money at artificially low interest rates. When either the policies change or the flow of credit to the US government stops, the bubble will burst.

Daniel James Sanchez
April 8, 2012
In chapter 1 of his groundbreaking treatise, The Theory of Money and Credit, Ludwig von Mises explains what money is: a universally, or at least commonly, used medium of exchange.[1] In chapter 2, Mises stresses what money is not. Contrary to the common fallacy, it is not a measure of value.

Doug French on April 5, 2012

There's plenty of blame for the financial crisis being spread around. Those on the left say Wall Street wasn't regulated enough, while those on the right claim government mandates required lenders to make bad loans. The argument is made that the Federal Reserve was too loose, while the other side says Bernanke wasn't loose enough. Some blame greed. Others blame Wall Street's investment products. And then there's mathematics.

Ninos P. Malek
April 1, 2012
Texas ranchers are doing more for animal conservation than animal-rights groups, because they allow animals to be hunted and killed on private ranches. Charly Seale, executive director of the Exotic Wildlife Association, makes this bold — and likely controversial — point on a recent CBS 60 Minutes report. Although this seems counterintuitive, a small dose of economic thinking will unravel this enigma.
Aristotle said, "What is common to many is least taken care of, for all men have greater regard for what is their own than for what they possess in common with others." This is the famous "tragedy-of-the-commons" concept, which Garrett Hardin wrote about in 1968. He was discussing a pasture without clear property rights and overgrazing by cattle. As Hardin explained, "Therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit — in a world that is limited.… Freedom in a commons brings ruin to all."

Loyd S. Pettegrew
March 22, 2012

One of Wolfman Jack's favorite tongue-in-cheek commercials, delivered in his raspy voice, went like this: "You say ya kids ain't got no clothes, ya ain't got no food in the frigerator — THEN BUY YOURSELF A COLOR TV BABY!"
This facetious admonition, spending way beyond ones means, is exactly how government at the federal, state, and local levels have been behaving over the past 50 years. Even worse, government at all levels has been enabling Americans to do the same.

Frank Shostak
March 15, 2012

In their economic analyses economists utilize a range of statistical methods that vary from highly complex models to a simple display of historical data. It is generally held that by means of statistical correlations one can organize historical data into a useful body of information, which in turn can serve as the basis for assessments of the state of the economy. In short, it is held that through the application of statistical methods on historical data, one can extract the facts of reality regarding the state of the economy.

David Greenwald
February 28, 2012

In a recent conversation about global warming, my conversation partner, an old friend who is a professor of North American studies at a German university, opined that climatologists were being "irresponsible" if they contradicted the official line that climate change would spell certain disaster for the human race if capitalist industry were not swiftly reined in. This got me to thinking about the meaning of the word "responsibility" and how it is used in everyday discourse.