Monday, December 24, 2012
Why Thomas Friedman is wrong again
But Friedman continues to make the same objectionable mistake in writing about politics that he always does...because he either knows little about electoral political history and public policy or chooses to ignore the evidence. He claims the Republicans need a DLC, an organized force to try to bring them to the corporatist middle. Ignoring the fact that the Democratic Party already fills that space and that when it followed his much praised pattern it did not achieve 50% of the vote in a presidential election even during the two Clinton victories. He claims there was some substantial split in the party because of "pragmatism" that resulted in Ralph Nader allowing GW Bush to win in 2000. How wrong could he be? The problem was the the fact that Nader could have a substantial impact on a poorly run election by getting so few votes. There was no split in the party as there was no substantial constituency from within the party that supported Nader in his candidacy. Most all Nader votes came from states that were not competitive.
That aside, Friedman continues on his desire to have two parties with no differences. It is a shame he does not think that the US is ready for democracy. He argues for "market based solutions" to public policy decisions but not to politics? The best way to get the Republicans to moderate their positions would be for people not to vote for them and for the "market" to reject their product. But what space is their for the "right-of-center" policy he seeks? Isn't the Democratic Party already the "right-of-center" offering? On most any policy issue the Democratic Party is to the right of the mainstream of thought in other advanced countries. Isn't the real opening for a more social democratic party in the US leaving the middle for the Republicans?
The challenge is lack of consensus in contemporary American politics. With a fight to the death to protect Social Security and Medicare the divide between the parties is substantial but we should not mistake that for left and right. Rather the center right and the hard right.
Wednesday, November 21, 2012
Europe (read Euro Zone) at it again
If Greece had their own currency then the balance of payments would require much if not all of the funds to return to the country as asset purchases. However, since Greece is paying its bills in Euros the funds can flow back into any Euro Zone country causing net flows out of the country. Not until the economy becomes exceedingly depressed will the Greek competitive advantage be significant enough to generate capital inflows. (Oh Greece lets invest there because they work so cheap.)
Germany benefitted from the weakening of the Greek position because it provided a market of higher income consumers for its products. And now they are threatening the spigot that provides Greece's lifeline. Even this article which tries to condemn Greek public finance choices (tax is too low, spending too high) they clearly show how Germany has benefitted from the situation in the past. Shouldn't they participate significantly in rectifying the imbalances?
Wednesday, July 25, 2012
UK Economy and Excuses
The UK announced second quarter GDP fell for the third quarter in a row. In fact the downturn is slowly increasing (-.4, -.3, -.7). In the middle of the article from FT.com describing the downturn is the following...
"The output drop was exacerbated by the one-off effect of the Queen’s diamond jubilee bank holiday, which removed a working day from the quarter. The Office for National Statistics said it was too soon to try to quantify this distortive effect, but most economists had predicted it would knock about 0.5 percentage points from gross domestic product growth."
but here is the same set of excuses from the same period in a previous year...
Finally, the ONS believes that a whole range of one-off factors – including the extra bank holiday for the royal wedding and the disruption to industry's supply chains caused by the Japanese tsunami – depressed activity by around 0.5% in the three months to June. (The Guardian)
While there are certain types of economic output that would be lost due to holidays, it isn't a one time event if it happens every year. The cause of the downturn in the UK is the same austerity that is plaguing the continent.
Monday, July 2, 2012
SF FRB on fiscal policy
FRBSF Economic Letter: U.S. Fiscal Policy: Headwind or Tailwind? (2012-20, 7/2/2012) http://www.frbsf.org/publications/economics/letter/2012/el2012-20.html?utm_source=tw&utm_medium=social&utm_campaign=el20
Friday, June 1, 2012
David Cay Johnston on the bad economics of retail subsidies
Thursday, May 17, 2012
Excellent but technical explanation of stock trades and short selling. Business Insider http://www.businessinsider.com/john-carney-how-to-understand-naked-shorting-2009-9?op=1
Public Private effort to combat world hunger
I think Harry Chapin would be proud.
NYT: White House Enlists 45 Firms t http://mobile.nytimes.com/2012/05/18/business/white-house-enlists-45-firms-to-give-3-billion-to-grow-food-for-worlds-poor.xml
Friday, May 11, 2012
JP Morgan's Loss: The Explainer | Marketplace from American Public Media
By the way, Jamie Dimon of Chase has been a vocal critic of the efforts to rein in the financial services sector. Perhaps he should pay more attention to the business and less to the politics.
JP Morgan's Loss: The Explainer | Marketplace from American Public Media
Wednesday, May 2, 2012
Great piece in challenges in Europe 2012
EconoMonitor : EconoMonitor » The Coming Revolt Against Austerity http://www.economonitor.com/blog/2012/05/the-coming-revolt-against-austerity/
Thursday, March 29, 2012
The Iron Grip of Accounting Identities
Important information for Political Economy students
Tuesday, March 13, 2012
Good discussion of taxes and rates
Bruce Bartlett: Would a Higher Top Tax Rate Raise Revenues? - NYTimes.com http://economix.blogs.nytimes.com/2012/03/13/would-a-higher-top-tax-rate-raise-revenues/?smid=tw-nytimeseconomix&seid=auto
Saturday, March 10, 2012
Will market concentration come to pass in PC's?
What the New iPad means for Apple rivals: "No Air." - OriginalSpin http://originalspin.posterous.com/what-the-new-ipad-means-for-apple-rivals-no-a
Monday, March 5, 2012
UK Industrial Policy at work
BBC News - Infiniti unveils UK-made supercar http://www.bbc.co.uk/news/business-17190806?utm_source=twitterfeed&utm_medium=twitter
Monday, February 27, 2012
Adam Smith on morality
Adam Smith's Lost Legacy: The Limits of Self-Interest According to Adam Smith http://adamsmithslostlegacy.blogspot.com/2012/02/limits-of-self-interest-according-to.html?m=1
EconoMonitor : Don't Shoot the Messenger » Staring Into the Ukrainian Economic and Political Abyss http://www.economonitor.com/edwardhugh/2012/02/26/staring-into-the-ukrainian-economic-and-political-abyss/
Market mechanisms and climate change
Beyond Cap and Trade, A New Path to Clean Energy by Ted Nordhaus and Michael Shellenberger: Yale Environment 360 http://e360.yale.edu/feature/nordhaus_shellenberger_beyond_cap_and_trade_a_new_path_to_clean_energy/2499/#.T0u4RUu6f14.twitter
World Bank report in China for Macro and Political Economy Students
NYT: A Call for Beijing to Loosen I http://mobile.nytimes.com/2012/02/28/business/global/world-bank-calls-for-changes-in-chinese-economy.xml
Excellent overview of fiscal policy for students
Quick Thoughts on Modern Monetary Theory | CEPR Blog http://www.cepr.net/index.php/blogs/cepr-blog/quick-thoughts-on-modern-monetary-theory