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Debt Debate: A Pox on Both Parties | Jeffrey A. Miron | Cato Institute: Commentary: "The Republicans are correct that raising tax rates is a terrible idea. By discouraging savings, work and investment, higher rates dampen economic productivity in the long run. By reducing disposable income and corporate profits, they reduce consumption and investment in the short run. And higher rates will not raise as much revenue as initial forecasts.
But closing tax loopholes — lowering tax expenditure — is a terrific idea. Many tax expenditures distort economic decision-making and therefore slow economic growth. Crucial examples include the home-mortgage interest deduction and the preferential treatment of employer-provided health insurance. Thus Republican skepticism about explicit expenditure should apply equally to tax expenditure, regardless of the revenue implications."
Wednesday, August 24, 2011
Solving the Long-Term Jobs Problem | Arnold Kling and Nick Schulz | Cato Institute: Commentary
Solving the Long-Term Jobs Problem | Arnold Kling and Nick Schulz | Cato Institute: Commentary: "The problem today is that government policy is impeding innovation and job creation in these sectors. Both education and healthcare are already heavily influenced or controlled by federal and local government. That means that the evolution of those sectors is driven by top-down command and control, rather than by bottom-up innovation.
To revitalize these sectors and revive the American job market, we must open up these industries to competition and entrepreneurial reform."
"Imagine what might happen if government involvement in education were restricted to giving school vouchers to households below the median income. Entrepreneurs would be free to redesign education completely. Perhaps the very concept of a school would ultimately be replaced by different educational components with entirely different business models. Some companies might emerge as high-quality math educators and sell their services to individuals or schools or districts. Others might emerge as high-quality developers of social skills and builders of teamwork. Still other enterprises and services would emerge that no one can yet imagine.
Most importantly, as it relates to our current job problems, entrepreneurs would not be limited to a labor force consisting of people with teaching credentials. They could instead design their operations to use the available work force most efficiently. This could even mean taking workers without college diplomas (some of those hardest hit by the economic downturn) and training them to provide services to students. Perhaps less-educated workers could be involved in helping create and deliver rich-media content, based on guidance from experts with deep, specialized knowledge."
"In the corporate world, over the past century there has been rapid turnover in the companies making up the Dow Jones Industrial Average. Many corporate giants of three decades ago are no longer in business. In contrast, every member of the elite list of colleges of 1980 is still on such a list today.
Consider that many elite universities were founded with industrial fortunes. Think Leland Stanford, James Buchanan Duke, or Cornelius Vanderbilt. The legacy enterprises that created those fortunes have been upended, transformed, or demolished by competition and new technology. But the universities those fortunes founded remain near the top of the heap, shielded from entrepreneurial disruption."
To revitalize these sectors and revive the American job market, we must open up these industries to competition and entrepreneurial reform."
"Imagine what might happen if government involvement in education were restricted to giving school vouchers to households below the median income. Entrepreneurs would be free to redesign education completely. Perhaps the very concept of a school would ultimately be replaced by different educational components with entirely different business models. Some companies might emerge as high-quality math educators and sell their services to individuals or schools or districts. Others might emerge as high-quality developers of social skills and builders of teamwork. Still other enterprises and services would emerge that no one can yet imagine.
Most importantly, as it relates to our current job problems, entrepreneurs would not be limited to a labor force consisting of people with teaching credentials. They could instead design their operations to use the available work force most efficiently. This could even mean taking workers without college diplomas (some of those hardest hit by the economic downturn) and training them to provide services to students. Perhaps less-educated workers could be involved in helping create and deliver rich-media content, based on guidance from experts with deep, specialized knowledge."
"In the corporate world, over the past century there has been rapid turnover in the companies making up the Dow Jones Industrial Average. Many corporate giants of three decades ago are no longer in business. In contrast, every member of the elite list of colleges of 1980 is still on such a list today.
Consider that many elite universities were founded with industrial fortunes. Think Leland Stanford, James Buchanan Duke, or Cornelius Vanderbilt. The legacy enterprises that created those fortunes have been upended, transformed, or demolished by competition and new technology. But the universities those fortunes founded remain near the top of the heap, shielded from entrepreneurial disruption."
Lessons from Norway's Horror | Gene Healy | Cato Institute: Commentary
Lessons from Norway's Horror | Gene Healy | Cato Institute: Commentary: But blaming Sarah Palin for Jared Loughner, or Al Gore for the Unabomber makes about as much sense as blaming Martin Scorsese and Jodie Foster for inciting John Hinckley. There's little to be learned from the acts of "the obsessed and deranged." But these incidents ought to teach us not to use tragedy to score partisan points.
Financial Chaos Winners | Richard W. Rahn | Cato Institute: Commentary
Financial Chaos Winners | Richard W. Rahn | Cato Institute: Commentary: "The U.S. government holds gold worth about $400 billion at present market prices. The president has the legal authority to sell the gold plus many other government assets. So even if Congress has not completed a debt-ceiling increase by Aug. 3, the administration could sell gold and other assets to cover any short-term revenue need before it received the legal authority to sell more bonds.
In addition, Mercatus Institute research fellow Veronique de Rugy has identified an additional couple of trillion dollars of U.S. government physical and trust fund assets that could be legally sold to cover budget shortfalls."
"The president has had months to present a plan to avoid the debt-increase chaos — and yet he has presented nothing on paper — only vague outlines of a plan that cannot be scored. The Republicans have passed a debt-limit increase, only to see it die in the Senate. The Senate has yet to come back with an alternative, as would be normal order. If the Senate is unhappy with the House bill, it ought to modify it and then take it to a House-Senate conference committee to work out the differences. It is fairly obvious that the Democrats see more of an advantage in market disruptions than the Republicans."
In addition, Mercatus Institute research fellow Veronique de Rugy has identified an additional couple of trillion dollars of U.S. government physical and trust fund assets that could be legally sold to cover budget shortfalls."
"The president has had months to present a plan to avoid the debt-increase chaos — and yet he has presented nothing on paper — only vague outlines of a plan that cannot be scored. The Republicans have passed a debt-limit increase, only to see it die in the Senate. The Senate has yet to come back with an alternative, as would be normal order. If the Senate is unhappy with the House bill, it ought to modify it and then take it to a House-Senate conference committee to work out the differences. It is fairly obvious that the Democrats see more of an advantage in market disruptions than the Republicans."
Tuesday, August 23, 2011
Repudiation Is an Option - Paul Cwik - Mises Daily
Repudiation Is an Option - Paul Cwik - Mises Daily: "Should we really feel bad for those who have purchased government bonds? They are the ones who have been feeding the monstrously reckless actions of the government. When they get (partially) burned, will they be willing to finance more government debt? Of course not. Suppose the Chinese decide not to lend any more to the US government. Is this really so bad? The government would have to deal with its future overspending.
Fundamentally, there is the issue of justice. Some people loaned the government their money for a return. Why should they have assumed that there was zero risk? When I invest in any other venture, there is always default risk. Why should the creditor to the government get to live under different rules?"
Fundamentally, there is the issue of justice. Some people loaned the government their money for a return. Why should they have assumed that there was zero risk? When I invest in any other venture, there is always default risk. Why should the creditor to the government get to live under different rules?"
Government, So Five Years Ago! | The Freeman | Ideas On Liberty
Government, So Five Years Ago! | The Freeman | Ideas On Liberty: "Being able to connect your laptop to the Internet wirelessly on a citywide or even regional basis was the wave of the future – five years ago. All you needed was a $4 million investment and a private partner. If ever there were a surefire “shovel ready” infrastructure project that our elected officials believed could extend into the foreseeable future, this was it. The problem is, the future is very hard to foresee.
In this case, the project lasted two years. Then everyone starting buying iPhones and iPads and Droids and – poof! – all of a sudden you don’t need a laptop anymore to access the New York Times or email or Facebook. The superfluous Wi-Fi devices today have zero scrap value."
In this case, the project lasted two years. Then everyone starting buying iPhones and iPads and Droids and – poof! – all of a sudden you don’t need a laptop anymore to access the New York Times or email or Facebook. The superfluous Wi-Fi devices today have zero scrap value."
Contra Conventional Measures of the Growth of Government - Robert Higgs - Mises Daily
Contra Conventional Measures of the Growth of Government - Robert Higgs - Mises Daily: "That is, why should government's transfer spending increase whenever the economy's output of final goods and services increases? Indeed, such constancy would seem to betoken a kind of relative growth of government in its own right, inasmuch as people in a more productive economy presumably can get by more readily without government assistance; hence, as a rule, the ratio of transfers to GDP might be expected to fall in a growing economy rather than rise or even remain constant."
"people occupied with regulatory compliance are not truly privately employed"
"people occupied with regulatory compliance are not truly privately employed"
Heavy Overall Expense Makes Such Rapid Transit Unfeasible | Randal O'Toole | Cato Institute: Commentary
Heavy Overall Expense Makes Such Rapid Transit Unfeasible | Randal O'Toole | Cato Institute: Commentary: "Take the Boston-to-Washington corridor, by far the densest in the nation. Amtrak's Acela may be the fastest way to get from downtown to downtown, but few people live or work downtown anymore, so the Acela carries only about 2 percent of passenger traffic in the corridor.
To cover its operating costs (but not its capital costs), Acela fares from New York to Washington begin at $139. By comparison, JetBlue fares begin at $39, while a variety of bus companies offering rides for $15 to $20 carry almost 50 percent more passenger miles than Amtrak. Buses take about 80 minutes longer than the Acela but offer free wireless Internet so travelers' time isn't wasted."
"Nor are trains particularly environmentally friendly. Intercity buses use 60 percent less energy per passenger mile as Amtrak trains, and when full life-cycle costs are counted, the difference is even greater."
To cover its operating costs (but not its capital costs), Acela fares from New York to Washington begin at $139. By comparison, JetBlue fares begin at $39, while a variety of bus companies offering rides for $15 to $20 carry almost 50 percent more passenger miles than Amtrak. Buses take about 80 minutes longer than the Acela but offer free wireless Internet so travelers' time isn't wasted."
"Nor are trains particularly environmentally friendly. Intercity buses use 60 percent less energy per passenger mile as Amtrak trains, and when full life-cycle costs are counted, the difference is even greater."
Saturday, August 20, 2011
E-Verify Threatens American Jobs and Liberties | Daniel Griswold | Cato Institute: Commentary
E-Verify Threatens American Jobs and Liberties | Daniel Griswold | Cato Institute: Commentary: "E-Verify sounds reasonable in principle, but a pilot program has exposed potential problems. A government-commissioned study by Westat found that the system failed to flag more than half of the unauthorized immigrants who applied to work at companies using the system.
The system also exposes too many legal workers to the risk of being falsely denied permission to work. As my Cato Institute colleague Jim Harper concluded in a study of the program, 'It would deny a sizable percentage of law-abiding American citizens the ability to work legally. Deemed ineligible by a database, millions each year would go pleading to the Department of Homeland Security and the Social Security Administration for the right to work.'"
"A 2009 study for the Cato Institute found that a 28.6 percent reduction in the number of unauthorized low-skilled immigrants in the United States through increased border and interior enforcement actually would cost U.S. households $80 billion a year. The study found that a resulting decline in immigrant labor would mean less investment, more money diverted to smuggler fees and other unproductive uses, and relatively fewer jobs further up the skills ladder."
The system also exposes too many legal workers to the risk of being falsely denied permission to work. As my Cato Institute colleague Jim Harper concluded in a study of the program, 'It would deny a sizable percentage of law-abiding American citizens the ability to work legally. Deemed ineligible by a database, millions each year would go pleading to the Department of Homeland Security and the Social Security Administration for the right to work.'"
"A 2009 study for the Cato Institute found that a 28.6 percent reduction in the number of unauthorized low-skilled immigrants in the United States through increased border and interior enforcement actually would cost U.S. households $80 billion a year. The study found that a resulting decline in immigrant labor would mean less investment, more money diverted to smuggler fees and other unproductive uses, and relatively fewer jobs further up the skills ladder."
Greek Bailouts, Free Speech Impediments and a Faux Debt-Ceiling Wrestling Match | Edward H. Crane | Cato Institute: Commentary
Greek Bailouts, Free Speech Impediments and a Faux Debt-Ceiling Wrestling Match | Edward H. Crane | Cato Institute: Commentary: "the Greek government owns so much private industry (and monopoly industries) that it could cover its debt obligations simply by creating a free enterprise system."
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