The ECB raised its benchmark rate in 2011 from 1.0% to 1.5%. Since then the rate has moved down to 0.15%. After their benchmark rate was raised in 2011, the Euro area went into a recession. Did the ECB cause the recession by raising their benchmark nominal rate? Some say yes. I say the story […]

Barkley Rosser at Econospeak writes an op-ed on the Washington Post’s reporting: Dana Milbank Joins Parade Of WaPo Hysterics Over Social Security And Medicare Dean Baker has posted on this more completely and effectively than I shall do here (and his url is so long on this one, I shall not link directly, sorry), but […]

Sandwichman at Econospeak writes more on the issue of ‘labor’: Lump of Labor Day Special: Advanced (Elementary) Concepts in Mathematics “…if there be but a certain proportion of work to be done; and that the same be already done by the not-Beggars; then to employ the Beggars about it, will but transfer the want from […]

I think this is too good to excerpt just read “Want better, smaller government? Hire another million federal bureaucrats.” by John DiIulio. He argues that the obsession with keeping the number of Federal civilian employees low has reduced efficiency and created powerful concentrated interests represented by powerful lobbies. The fact that he was “the first […]

Lifted from open thread Aug. 31, 2014 by Sandwichman. My latest on the lump of labor fallacy takes the story back to the 17th century and John Graunt’s Observations on the Bills of Mortality. Graunt speculated about a certain PROPORTION of work to be done. The fallacy claim alleges the assumption of a fixed QUANTITY […]

Peter Dorman at Econospeak describes a common example of thought experiments on markets and externalities, and concludes with “More complex considerations that take into account dynamics, interaction effects and the like never intrude.  What you end up with is an ideological truncation of economics, and, as the Great Airplane Debate illustrates, it is largely ideology […]

In my own state of Michigan, there was a battle in the Republican controlled state legislature to expand Medicaid for the 600,000 uninsured citizens. It did pass with some legislators such as Michigan State Senator Joseph Hune complaining loudly about how its passage made him “sick to his stomach.” Even with the passage, the state […]

Do these books include Keynes’ precious term, “Effective Demand”? ¯\_(ツ)_/¯ I watch as grand economists explain the current economy… in particular, Olivier Blanchard and Paul Krugman. They miss the eventual fight of labor to increase their share… Olivier Blanchard wrote an article, Where danger Lurks. He mentions the Dark Corners where the economy can function […]

I wonder what happens when a Democratic canidate for President campaigns on a proposal to increase taxes on high incomes and cut taxes on middle and lower class incomes (that is on the class warfare platform) ? IIRC what happens is that he gets elected. This is what Clinton did in 1992 and Obama did […]