Russell Roberts's Blog, page 1569

Growth and Inflation

Robert Samuelson makes many good points in his column in today's Washington Post.  But unfortunately he accepts the pop wisdom that rapid economic growth causes inflation.

Real economic growth happens when technology and social institutions improve in ways that raise productivity.  Higher productivity not only lowers cost per unit of output, it increases total output.  This higher output, in turn, lowers prices (unless it is matched by an increased supply of money).

If inflation is caused (as i...

Ravitch on Education

The latest EconTalk is Diane Ravitch talking about education and the ideas in her recent book, The Death and Life of the Great American School System. The book and the podcast show just how bad an OK policy reform can turn out once its implemented. Testing with carrots and sticks for performance is not a horrible idea on paper. We all understand that it encourages teachers and schools to teach to the test. But it's hard to imagine just how destructive testing and what is called...

Some Links

GMU econ student Caleb Brown did this short video on one example of the courage of entrepreneurs.

The Washington Post's Jonathan Yardley reviews a new collection of writings from the incomparable H.L. Mencken.

George Will exposes Charlie Crist for the wasteful and fraudulent person – that is, the typical politician – that he is.

Mark Perry, over at Carpe Diem, features this 1978 video of Milton Friedman discussing responsibility to the poor.

The X-istence of Externalities

Pingry, commenting on this post, writes

And so if continued growth can reduce pollution and environmental harm after some point, why should third parties be subjected to dangerous spillover costs before that point?

Should they just "deal with it" so that future generations can face less spillover costs after reaching a certain point?

Or should polluters be forced to internalize their spillovers so that all innocent people can be spared such a market failure?

Why assume that greenhouse-gas...

The Environmental Kuznets Curve

Writing in today's Washington Post, Arthur Kroeber explodes five myths about China's economy.  It's a very good read.

In the course of doing so, Krober reports two facts that, when considered together, explode an additional myth – namely, a myth about the environmental impact of economic growth.

The first of these facts is that China's economy is "barely one-third the size of the $14 trillion U.S. economy."  The second fact is that "China is now the biggest producer of carbon dioxide and other ...

Pity the Virgins

Bob Beckel and Cal Thomas wonder why politics is uglier today than in the past.

One reason is that with fewer and fewer constitutional restraints on the exercise of Uncle Sam's power, struggles among politicians and interest-groups to get that awesome power – and struggles by ordinary people for protection from that power – grow more intense.

Politicians and interest-groups use the state to further their own narrow goals.  And in this greedy quest they are cheered on unwittingly by...

No-All Party

Here's a letter sent earlier today to the WTOP Radio:

Your interview yesterday with someone from (I think) the New America Foundation was replayed today during the 5am hour.  That person – a supporter of Pres. Obama's activist legislative and regulatory agenda – said, very poetically, of the President's opponents "They can't achieve anything by saying no to everything."

I write not to defend Republicans but, rather, to correct the widespread myth that saying "yes" to government interventions...

Spending: Good or Bad?

Here's a letter sent today to the Washington Post:

You wisely criticize Sen. Schumer's call for punitive taxes on Americans who buy Chinese goods ("Progress with China," April 9).  In the course of doing so, though, you inadvertently reveal a confusion that infects discussions of today's economic slump.

You write that "But China kept the party going by accumulating $2.3 trillion in reserves and plowing much of it back into U.S. bonds – rather than letting China's currency appreciate freely...

A Famine of Critical Thinking

Here's a letter that I sent today to the Wall Street Journal:

John Lahey alleges that the Irish potato famine was caused by "British laissez-faire policies" (Letters, April 8).  Not so.  This calamity was caused by British prohibitions on land-ownership by the Catholic Irish, burdensome taxation, and public-works projects that built roads that were useless for carrying goods and foodstuffs from places where they were abundant to places where they were in short supply.

The great 19th-century...

Some Links

Tonight's Stossel (Fox Business, 8pm EDT) explores libertarianism.  Guests include the Cato Institute's David Boaz, writer P.J. O'Rourke, feminist Wendy McElroy, and economist Jeff Miron.

Richard Rahn questions the IRS's morality.

Shikha Dalmia is pessimistic about Pres. Obama's approach to immigration reform.

David Harsanyi is fed up with Michelle Obama's anti-obesity campaign:

No offense, but the next time I hear Michelle Obama lecture me about feeding kids locally farmed kumquats, I'll be...