Are we all Debt Liquidationists now? … No!

by Andreas Hoffmann A growing number of economists suggest that governments in highly indebted countries should consider liquidating debt via financial repression. In other words, they want governments to intervene in financial markets and push government borrowing costs below the rate of inflation to erode the real value of debt. In a previous post, I … Continue reading Are we all Debt Liquidationists now? … No!

Conversations Before Independence Day

by Chidem Kurdas The July 3rd, 1776, letter John Adams wrote to his wife, Abigail, after voting for the declaration of independence, is justly famous for his prediction that the occasion will be celebrated “by succeeding Generations, …..solemnized with Pomp and Parade, with Shews, Games, Sports, Guns, Bells, Bonfires and Illuminations from one End of this … Continue reading Conversations Before Independence Day

Euro Crisis from Long Perspective

by Chidem Kurdas The European crisis, in progress for years and still showing no sign of resolution, is largely the result of elite hubris. To create the euro and ram it down the throats of populations that, left to their druthers, would have stayed with their old currencies—this was a massive, top-down social engineering project. … Continue reading Euro Crisis from Long Perspective

Capitalism Loses Against Chimera

by Chidem Kurdas Gripes about capitalism go back 150 years and more. In the Communist Manifesto of 1848 Marx and Engels thundered that the specter of revolution haunted Europe, that the periodic reappearance of commercial crises “put on its trial, each time more threateningly, the existence of the entire bourgeois society.” They were not the first to … Continue reading Capitalism Loses Against Chimera

Is USPS as American as Pumpkin Pie?

Chidem Kurdas The United States Postal Service is in a deep financial hole that looks to get deeper unless the institution undergoes a major revamp.  Postmaster General Patrick Donahoe says current bills in Congress do not provide enough savings to get out of the hole. US Mail has historical roots. What would Benjamin Franklin, who was appointed … Continue reading Is USPS as American as Pumpkin Pie?

Energy Policy vs. Market

by Chidem Kurdas No matter how thoroughly public policy fails, there is no end to efforts in the same area.  Energy is a case in point. Reviewing the history of US energy policy in his new book, Columbia University legal scholar Michael Graetz writes: “The book  is, then, in one sense a story of failure…”  … Continue reading Energy Policy vs. Market

The Role of the Perverse Elasticity of Credit Money

by Andreas Hoffmann I want to bring a recent comment by Sornette and von der Backe to the attention of the reader (in Nature 471, p. 166, May 2011). Sornette and von der Backe remind us to pay more attention to disequilibria caused by the fractional reserve banking system to explain the emergence of crises. … Continue reading The Role of the Perverse Elasticity of Credit Money

Kissinger on Bismarck

by Chidem Kurdas A man described as both great and evil, Otto von Bismarck-Schönhausen makes a fascinating study,  as Jonathan Steinberg’s Bismarck: A Life demonstrates.  Henry Kissinger reviewed this biography in the New York Times Book Review, highlighting the diplomatic and political victories the unifier of Germany won through nimble maneuvers. The review is a … Continue reading Kissinger on Bismarck

Japan Nuclear Crisis vs. the Titanic

by Chidem Kurdas The Fukushima Daiichi nuclear threat and the sinking of the Titanic are both disasters caused by acts of nature – earthquake and tsunami in one case, an iceberg in the other – interacting with technology. Yet they have radically different implications. The Japanese incident has made nuclear power less acceptable, whereas the … Continue reading Japan Nuclear Crisis vs. the Titanic

Constitution Bashers’ Internet Fallacy

by Chidem Kurdas There’s a ferocious backlash against the Tea Party’s reverence for the U.S. Constitution. Court decisions against ObamaCare’s compulsory health insurance provision have further stoked the hostility. One common and obvious line of attack is that the Constitution is old-fashioned and out of synch with our world of satellites and Twitter. To take … Continue reading Constitution Bashers’ Internet Fallacy

Egypt Best Case Scenario via Korea

By Young Back Choi and Chidem Kurdas Compared to the turmoil in the Middle East, South Korea appears to be an oasis of calm. But as recently as 20 or so years ago you could  still smell tear gas on the streets of Seoul. Violent demonstrations shook the city for decades—-making it look like Cairo … Continue reading Egypt Best Case Scenario via Korea

Insider Trading Regulatory Bubble

by Chidem Kurdas After going easy for years on the fraudster Bernard Madoff, the Securities and Exchange Commission is now engaged in an all-out war against insider trading.  After financial crisis comes regulatory frenzy—so it has been for some 300 years. Both the SEC and the Dodd-Frank Act are right on cue in this long-running … Continue reading Insider Trading Regulatory Bubble

Thanksgivings Past

by Chidem Kurdas Thanksgiving was originally a spontaneous celebration. Over time it grew into a social custom. It did not become an official holiday until Lincoln issued a Thanksgiving proclamation in 1863. Then in 1939 Franklin D. Roosevelt moved the date. New England Puritans must have needed an alternative holiday because they did not like … Continue reading Thanksgivings Past

Brad DeLong Should Read More

by Mario Rizzo   In March of this year Brad DeLong wrote a post called “More from the History of Economic Thought: John Stuart Mill Contra Say's Law, 1844”   It contained a long quotation from John Stuart Mill from his essay “Of the Influence of Consumption on Production,” in Some Unsettled Questions of Political Economy (1844, … Continue reading Brad DeLong Should Read More

Two Visions Fuel Political Attacks

by Chidem Kurdas Apparently left-liberal pundits are convinced that people oppose government expansion either out of stupidity or cupidity—not, say, out of a sincere belief in freedom. The oft-repeated story is that ignorant and misguided masses are being led by greedy business interests. Paul Krugman’s recent column is one of  many examples in the genre … Continue reading Two Visions Fuel Political Attacks

Anti-Intellectualism and Freedom

by Chidem Kurdas Anti-Intellectualism in American Life by Richard Hofstadter, a historian who died in 1970, is very much part of politics several decades after it was written. The past two years brought many charges of anti-intellectualism by left-liberals against people on the other side of the political divide.  The latest in Hofstadter-inspired critiques is … Continue reading Anti-Intellectualism and Freedom

The Method of History

by Gene Callahan I’m currently reading Bryan Sykes excellent book, The Seven Daughters of Eve. Well, excellently written, and, I have to assume, excellent on the genetics. But there are a couple of fundamental misunderstandings of history present in the book, that I think are worth noting, because of the frequency with which people believe … Continue reading The Method of History

Broadening Economics Education

by Mario Rizzo   Policy Ideas in the History of Economic Thought It is no exaggeration to say that if a bright undergraduate wants to get into a top Ph.D. program he needs to take a good deal of mathematics. Many advisors will recommend a minor in mathematics or even a double major in mathematics and … Continue reading Broadening Economics Education

Just the “Basic Facts,” Mam

by Gene Callahan I was recently in a conversation with a very bright economist who declared "We are in agreement about the basic historical facts here; we are just interpreting them differently." This is a common but very damaging misunderstanding of historical knowledge: that there are a set of "basic facts" that historians are "given" … Continue reading Just the “Basic Facts,” Mam

China Catch-Up and Two Freedoms

by Chidem Kurdas China is expected to produce more than Japan this year, thereby becoming the world’s second largest economy after the US.   Chinese annual output is only $5 trillion compared to American $15 trillion and per person income is only a fraction of the US, but it is clear that China is catching up. … Continue reading China Catch-Up and Two Freedoms

Constitutionalism: Point/Counter-Point

By Chidem Kurdas and Thomas McQuade In our previous post, Thomas argued that voter feedback is weak in constraining the exercise of legislative power. Chidem countered that the other fundamental constraint, the constitution, is therefore all-important. Commentators were divided, with cogent arguments pro and con. We continue this discussion. Chidem:  Constitutionalism is the idea of … Continue reading Constitutionalism: Point/Counter-Point

Understanding Politics: Point/Counter-Point

by Thomas McQuade and Chidem Kurdas Our previous post and the ensuing discussion raised points for and against the appropriateness of understanding markets as complex adaptive systems. We discuss here whether the same approach can say something useful about modern political systems, taking the US as the illustrative example. Thomas: I think it could be … Continue reading Understanding Politics: Point/Counter-Point