In their campaigns, George W. Bush and John Kerry studiously avoid a certainly crucial issue for the next president: what to do about dual deficits in the federal budget and current account. Such avoidance is understandable. Neither candidate could respond…
Category: Other
Bush can’t have it both ways on economy
The Bush administration should heed the Old Testament warning that “no man can serve two masters” in explaining its economic policies. Specifically it must clarify whether its policies are Keynesian or supply-side in design. They can’t be both at the…
Making a move is more difficult with the euro
While driving Interstate 40 in the South recently, it became readily apparent why Federal Reserve Chairman Alan Greenspan has an easier job than European Central Bank President Jean-Claude Trichet: U-Hauls. These vehicles tow belongings and cars with license plates from…
Which insurance fees are fair?
Which factors may insurance companies use in setting rates? This is a subjective issue that only can be answered through the political process. Whatever the outcome, incentives — or the lack of them — always have consequences. That’s one lesson…
Republicans divided by fiscal policies
If pundits who discern a swing to long-term Republican majorities are correct, U.S. policy making may become like that long common in Mexico. When the Partido Revolucionario Institutional dominated, important policy fights were not between it and other parties, but…
The indirect costs of U.S. security
After the Sept. 11, 2001, terrorist attacks, it became common to hear that we needed to increase security and that nothing else mattered. This had a nice rhetorical ring, but it is leading to self-destructive policies. Now that the adrenaline…
Obesity plan sparks debate over rationing
The recent announcement by the U.S. Health and Human Services Department that Medicare will pay for obesity treatments touched off much controversy. Analysts at conservative think tanks argue that Social Security will soon be paying for diet plans, health club…
Would an airport landing auction fly?
Last week’s warning by the Federal Aviation Administration that it may cap takeoffs and landings at Chicago’s O’Hare airport just reinforces old economic insights. If the price of some useful good is zero, people will want to consume large —…
Who’s to blame when the economy struggles
Who bears blame if economic policies or the nation’s economic performance are not what one likes — Congress or the president? In an election year like 2004, visitors from other planets who read our newspapers and watch TV might assume…
Short-term numbers have shortcomings
Most people assign far too much importance to short-term changes in economic indicators, such as consumer spending, unemployment and prices. Understandably, a high level of public interest in economic matters prevails right now. We are coming through a slowdown after…