Send in the technocrats!

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Winston Churchill said that democracy is the worst form of government except all those other forms that have been tried. The financial crisis has tested Churchill’s assertion. In Greece, the austerity measures imposed on the country by the EU and the ensuing domestic unrest led Prime Minister George Papandreou to call for a referendum to … Read more

Penny wise and pound foolish

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The institutions of government and the politicians who run them have–rightly–been criticized for many mistakes during the past few years.   The Congressional budget deadlock this past summer is a case in point.  The mismanagement at Walter Reed Army Medical Center, first publicized by the Washington Post in 2007, is another. No wonder why Gallup reports … Read more

Alan Meltzer’s straw “Keynesian”

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Remember when “liberal” became the insult of choice among Republicans? Apparently, “Keynesian” has now taken on that status for Republican economists.  Never mind that Keynesian is ill-defined (old Keynesian?  new Keynesian?  the Keynesian part of the neoclassical synthesis?)–making Keynesian a dirty word and applying it to those with whom you disagree has become the tactic … Read more

See no evil, hear no evil, and, if you are a ratings agency, speak no evil

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You don’t have to look too far to find nutty policy proposals. One of my favorites is  Herman Cain’s suggestion that Congressional bills be limited to no more than three pages. Another, reported in recent days by both the Financial Times (which claims to have seen an actual draft) and the Wall Street Journal, is the … Read more

Prize (for a) failure

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British clothing retailer Simon Wolfson (known to his friends in the House of Lords as Baron Wolfson of Aspley Guise) announced several days ago the establishment of the Wolfson Economics Prize (read the press release here).   The prize, worth a cool £250,000 (about $400,000)–second only to the Nobel Prize in Economics, in terms of … Read more

John Cogan and John Taylor confuse temporary and permanent

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In a recently published op-ed piece in the Wall Street Journal, Stanford economists John Cogan and John Taylor argue that: “Temporary, targeted tax reductions and increases in government spending are not good economics. They have repeatedly failed to increase economic growth on a sustainable basis. What may come as a surprise is that such policies … Read more

Gary Becker and the law of the jungle

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The sub-prime crisis and the ensuing economic slowdown have led many to question some widely held economic tenets, particularly the belief that unfettered markets inevitably lead to the best of all possible outcomes. Writing in yesterday’s Wall Street Journal, University of Chicago economics professor and Nobel laureate Gary Becker whines about this assault on the … Read more

A policy worth considering

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The White House has already given some indication of the sort of proposals it will put forward after Labor Day to help boost the economy.  These include extending payroll tax cuts for another year, extending unemployment benefits, and speeding the approval of free trade agreements with Colombia, South Korea, and Panama.  These are all worthwhile … Read more