Great New Blog

by Bill Butos

Friends of ours, including Richard Ebeling, Steve Horwitz, Gerry O’Driscoll, George Selgin, and Larry White, and others, are contributors to a new blog on “Free Banking”.

Quoting its credo, 

“The Free Banking blog is a venue for leading free banking advocates to share their insights with the world. This illustrious cast includes academics, public policy experts, government officials, and rabble rousers. Guest bloggers will feature financial gurus, entrepreneurs, historians, celebrities, and many other different perspectives.
We hope that making these ideas and conversations more accessible will help educate the lay public, amateur economists, and influential intellectuals. Most importantly we aspire to promote and facilitate the transition to free banking in both developed and developing countries.”

Update on Government and Science

by Bill Butos

The New York Times of January 22 reports that the Obama administration has created a “billion-dollar government drug development center to help create medicines”  as part of the federally funded National Institutes of Health.

According to the article, its rationale is to undertake research leading to the commercial development of drugs that has mysteriously lagged in the U.S. The article makes no mention of the regulatory costs drug firms face. Continue reading

Up, Up and Away (Again)

by Bill Butos

Federal Reserve Chairman Ben Bernanke is pushing for another significant round of “quantitative easing” – now dubbed “QE2” by Fed observers – on the grounds that the economy’s response to simulative macro policies since 2008 has been anemic.  What the economy needs, this thinking goes, is some inflation.  While much of the public sees the run-up of  growth in government and exploding deficits as keys concerns, Bernanke,  continuing his soft stance on deficits, has argued that fiscal restraint would threaten the recovery.   Instead, he argues that monetary policy still has arrows in its quiver that should be used to lower the unemployment rate and rejuvenate the economy while also preempting the dreaded prospect of deflation .  Continue reading

The High Line Park: Turnstyles Anyone?

by Bill Butos

The recently opened High Line Park in the hip Chelsea area on New York’s West Side is all the rage.  The High Line sits on a stretch of a defunct elevated freight railway along 10thAvenue from Ganesvoort St. (which is just south of 14th St.) to 20th street.  The City plans to extend it to 34th St.   A green urban advocacy group, Friends of the High Line, has steered this part of the project to completion.  It’s become a tourist destination and a favorite platform for celebs and fashionistas.  And it fits perfectly into the nearby Meatpacking and Chelsea areas with their trendy eateries, late night clubs, and designer clothes shops.  By all accounts it purports to represent the future of urban eco-friendly planning and judging by the number of visitors (about 20,000 per week), it’s a grand success.  (See here and a video appreciation by supporters here.)

After my second walk-through, my appreciation turned slightly positive.  It is fun walking above the streets and catching new perspectives of the City from 30 feet above.  But the empty-lot weeds masquerading as (carefully maintained) indigenous flora still look ugly and many of the views are rather uninspiring.  And I am also a taxpayer. Continue reading

Tracking Obscure Quasi-Public Govt Agencies

by Bill Butos

In December 2008 Princeton economist Alan Kreuger suggested “paying close attention to warnings concerning obscure, quasi-public agencies known by their abbreviations” and their “dull but critical functions”

Consider what follows a short “update” on one such quasi-public government agency that caught my attention.  In a little noticed article in the Wall Street Journal on July 23, the Pension Benefit Guaranty Corporation (PBGC) agreed to assume responsibility of “$6.2 billion in pension liabilities …from Delphi Corporation.”  Delphi just happens to be the holder of GM’s pension funds. Continue reading

Why Only Fed Transparency?

by Bill Butos

Fed independence has come to mean the absence of operational control by non-Fed entities in designing and implementing monetary policy. It also means a presumption (long asserted by the Fed) that its effectiveness in conducting “business” justifies that it operate under a cloak of secrecy, although one that for several decades has adapted to Congressional and “freedom of information” pressures for greater transparency.  The call for greater transparency is a public concern because government and its agencies have the ability to affect us directly and massively.  But it does not address the more fundamental question of choices in monetary regimes.   Transparency matters only because we have central bank. Continue reading