A new farm bill is due in 2007, and the nation needs a good debate to decide what exactly we want to accomplish with federal agriculture programs. Unfortunately, agriculture is not a political issue right now. We probably will get…
Category: Other
Don’t blame interest rates for housing slowdown
No question, the housing sector is slowing down. But is it the result of the Federal Reserve’s tightening of the money supply? And if so, is that bad or good? Nationwide, July’s sales of new homes were down more than…
Ethanol, river plans work at cross-purposes
Something does not compute in federal policies right now. The government subsidizes ethanol production by 51 cents per gallon and members of Congress are falling all over one another demanding even greater incentives. At the same time, the U.S. Army…
Politicians overstate their effect on economy
An observant friend asks a good question: “Gov. Tim Pawlenty has taken over the task of announcing job numbers in recent months. Is a voter to conclude that the gains are his doing?” The answer to my friend’s question is…
Health care taxes are bad economics
The Bush administration’s new rules for Medicaid limit how much states can tax health care. Such taxes are bad public policy, and eliminating them would benefit society in fairness and efficiency. But the proposed limits are part of a lousy…
ABCs of the CPI and PPI
An eagle-eyed reader caught a mistake in my column last Thursday, gently suggesting that price indexes apparently must be confusing even to experienced economists, let alone laypeople. I wrote that the Fed Funds rate was 3.9 percent when adjusted for…
How to reduce use of energy? Tax it
DFL gubernatorial candidate Mike Hatch wants to set arbitrary requirements for renewable energy use. Incumbent Gov. Tim Pawlenty, a Republican, agrees completely and notes he had the idea first. While these candidates are united in support of command-and-control environmental policy,…
Tempering news about short pause
Sometimes economic news is not as important as the media make it out to be. That was the case Tuesday when the Federal Reserve’s Open Market Committee decided to pause its constriction of the money supply, i.e. the target rate…
There is no universal fix to global pollution
Pollution from Asia increasingly is being detected in the western United States. That was the gist of a widely circulated Associated Press story a week ago. The lesson is that pollution freely crosses political and geographical borders. Even so, we…
Market jitters underscore a stormy horizon
Financial markets are as nervous as the proverbial long-tailed cat in a room full of rocking chairs. Take that lesson from stock and bond market reactions to economic news this week. Gyrations of the Dow and other indexes are highly…