Dodd-Frank Starves Congo; Advocates Win

by Chidem Kurdas While I decided the financial regulation act Dodd-Frank is a gigantic dud after scanning its thousands of pages, I missed the bit on Congo that David Aronson brought to light in a NYT op-ed column this Monday. Activist-lobbyists apparently inserted into the act a requirement that public companies buying minerals from Congo show … Continue reading Dodd-Frank Starves Congo; Advocates Win

Austrian Law and Economics: The Definitive Collection

by Mario Rizzo Edward Elgar has announced the publication of a two-volume collection of Austrian law and economics articles. The marks the first definitive collection of articles in this field. It is a book for your university or public library. Please recommend it!    Edited by Mario J. Rizzo, Department of Economics, New York University, … Continue reading Austrian Law and Economics: The Definitive Collection

Policy Makers and Irrational Exuberance

by Chidem Kurdas Robert Shiller says the speculative bubble in real estate was driven by “a contagion of optimism” that pushed up prices and expectations in a feed-back loop. This epidemic apparently engulfed regulators as well.  “Government policy makers breathed in the same optimism, which no doubt encouraged them to be lax on regulatory restraint,” … Continue reading Policy Makers and Irrational Exuberance

Japan Reveals Regulatory Trap

by Chidem Kurdas Once upon a time, people tried to explain the post-war “Japanese Miracle” of rapid growth. Then in the current century, the puzzle shifted to Japanese stagnation since 1990. The lesson from these two distinct phases of Japanese history is germane for current American policy. Chalmers Johnson’s influential book, MITI and the Japanese … Continue reading Japan Reveals Regulatory Trap

Why Dodd-Frank is Dud-Blarney

by Chidem Kurdas It is a shame that Christopher Dodd  did not become a lobbyist earlier, before he teamed up with Barney Frank to sponsor the Dodd-Frank Act. Mr. Dodd first helped set into motion a fast-expanding web of obscure bureaucratic dicta for almost all financial activity, then took a lucrative job as Hollywood lobbyist. … Continue reading Why Dodd-Frank is Dud-Blarney

Consumer Data: Who Owns It?

by Mario Rizzo Richard Thaler is one of those academics with an excess of nervous energy. He is constantly on the look-out for ways that he and his soft-paternalist sympathizers can tinker around improving our welfare, suitably defined. The latest scheme is to force companies who have gathered data about product usage from particular individuals … Continue reading Consumer Data: Who Owns It?

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

Libya and the Rule of Law

by Mario Rizzo   Frank H. Knight had an important insight about economics. Howsoever we may seek to narrow it, the basic human interests that make the subject important lie at the intersection of ethics, the theory of knowledge, and psychology (at least in a broad sense).  Friedrich Hayek was also right to think that the … Continue reading Libya and the Rule of Law

Public Unions vs. the Real Underdog

by Chidem Kurdas Wisconsin governor Scott Walker successfully made the financial case to limit collective bargaining by public unions. Not only have the unions imposed an immense burden on taxpayers, present and future, but they create bureaucratic rigidities that cause dysfunction and, in financial crunches, layoffs of promising employees. Yet in recent weeks it has … Continue reading Public Unions vs. the Real Underdog

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

Toward a Libertarian-Progressive Alliance

by Roger Koppl Ralph Nader recently appeared on Judge Napolitano’s “Freedom Watch” to herald the rise of a coalition between “libertarian conservatives” and progressives.  Within Congress, he says, both groups put principle above party.  The first episode in this new alliance will be cooperation on the whistleblower bill. Let’s hope it happens! Libertarians and progressives have … Continue reading Toward a Libertarian-Progressive Alliance

Voters’ Best Interest

by Chidem Kurdas Ronald Dworkin, a well-known legal scholar, describes last month’s election results as depressing and puzzling. In a commentary in the New York Review of Books, he asks, “Why do so many Americans insist on voting against their own best interests?”  The New York University law and philosophy professor is not the only … Continue reading Voters’ Best Interest

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

Equality Destroyed in the Name of Equality

by Chidem Kurdas Law and government should treat people equally. This old principle may seem obvious and firmly in place, but in fact it’s much violated. Instead, the focus is on income distribution. Thus Robert H Frank in the NYT points to the bad effects of income inequality – like people spending too much money … Continue reading Equality Destroyed in the Name of Equality

Limited Purpose Banking?

by Jerry O’Driscoll   The following is a book review from the Cato Journal, Vol. 30, No. 3 (Fall 2010).   Jimmy Stewart Is Dead: Ending the World’s Ongoing Financial Plague with Limited Purpose Banking Laurence J. Kotlikoff      (Hoboken, N.J.: John Wiley & Sons, 2010, 241 pp.)   Chapter 1 of the book is titled “It’s a Horrible … Continue reading Limited Purpose Banking?

Broken Banks, Durable Delusions

by Chidem Kurdas Some 829 commercial banks are at risk of failure, according to the Federal Deposit Insurance Corp.  This year 118 banks already failed and were taken over by the FDIC. At this rate, more banks will fail in 2010 than in 2009. If bank regulators were a commercial bank, they too would have … Continue reading Broken Banks, Durable Delusions

Fannie, Freddie and Mortgage Addiction

By Chidem Kurdas In the first inning of what looks to be an intricate political game, the Obama administration and its financial industry allies suggested that the economy needs the federal government full force in the mortgage market. The case was pithily made  by bond honcho Bill Gross,  who oversees more than $1 trillion of … Continue reading Fannie, Freddie and Mortgage Addiction

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