Two Takes on Class Conflict

by Chidem Kurdas A presentation at this week’s NYU Colloquium by Ralph Raico, professor of history at the State University of New York Buffalo, generated a thought-provoking discussion.  His paper traces the early-to-mid 19th century development  of the classical liberal theory of class conflict—which long predated Marx and is different from class conflict in the Marxian … Continue reading Two Takes on Class Conflict

Gigantism in Lawmaking

by Chidem Kurdas Here’s another aspect of Obamacare. Last week we witnessed a demonstration of how politicians benefit from a massive law. President Obama signed the vast bill – 2409 pages – with great fun fare.  A video of the signing was all over the web.   The media was full of gushing reports.  Mr. Obama … Continue reading Gigantism in Lawmaking

Dodd Liquidation Panel

by Chidem Kurdas There is one new regulation that is truly needed—a way to wind down, without major disruption to markets, failing broker-dealers and other financial companies. The new financial industry bill introduced by Senator Christopher Dodd claims to do this and solve the “too-big-to-fail” problem. Reading the particulars of the bill, however, makes one … Continue reading Dodd Liquidation Panel

Mysterious Moody’s Move

by Roger Koppl The Christian Science Monitor reports that Moody’s is considering downgrading US government debt.  (HT: Mario Rizzo)   Is that a credible threat?  Moody’s is one of ten “Nationally Recognized Statistical Rating Organizations” (NRSRO) officially recognized by the SEC.  Moody’s, S&P, and Fitch are the big three and do most of the rating.  Would … Continue reading Mysterious Moody’s Move

Money and Banking in a Free Society

by Jerry O'Driscoll    At the Coordination Problem, Pete Boettke drew our attention to James M. Buchanan's paper, "Economists Have No Clothes". It's a short piece, chock full of insights.  I want to draw on some not raised by Pete.   Buchanan observes that protagonists are prone to claim "that 'the market' (or 'capitalism') either works or does not work … Continue reading Money and Banking in a Free Society

The Price of the Mega-State

by Mario Rizzo   The recent Supreme Court decision that “ruled that the government may not ban political spending by corporations in candidate elections” is a true victory for freedom of speech.    What many people do not realize, however, is that both sides in this dispute had important and valid points. The terrible truth of the … Continue reading The Price of the Mega-State

The Rule of Law Kneels Before the Welfare State

by Mario Rizzo The rule of law always suffers before the political exigencies of welfare state legislation. This is because, contrary to its name, the welfare state has little to do with the general welfare. It is essentially a vehicle by which some groups benefit at the expense of others.  The latest is the sweetheart … Continue reading The Rule of Law Kneels Before the Welfare State

The Joy of Reading Financial Regulation

by Chidem Kurdas The financial regulation bill approved last week by the House of Representatives does not, of course, refer to James Madison. But it might as well be an exhibit specifically created to demonstrate, by contrast, the advantage of limited and transparent government. “It will be of little avail to the people that the … Continue reading The Joy of Reading Financial Regulation

News Flash! Water still runs downhill only

by Roger Koppl Today's Los Angeles Times reports that "Businesspeople join the ranks of climate treaty proponents." This support is old news as I noted last May in a post entitled "Water does not run uphill."  The L A Times report nevertheless express surprise saying, "an unlikely batch of advocates has emerged to champion a … Continue reading News Flash! Water still runs downhill only

Regulating Financial Services

by Jerry O'Driscoll   On Friday, the House of Representatives passed a bill to alter the regulation of financial services.  The Senate has yet to act.  Still, the House passage advances President Obama's agenda to change how financial services are regulated.   How to regulate large, complex financial institutions remains a sticking point between the two houses. On the big issue, however, no radical … Continue reading Regulating Financial Services

New Paternalism on the Slippery Slopes, Part 6: Rent Seekers

by Glen Whitman As discussed in the previous post, the “experts” in charge of implementing new paternalist policies will have a tendency to simplify their own theories to make them useful for crafting policy. That alone creates slippery-slope potential. But that potential is magnified by the existence of rent-seekers – that is, interest groups whose … Continue reading New Paternalism on the Slippery Slopes, Part 6: Rent Seekers

Pain in the Fannie

by Chidem Kurdas As Fannie Mae goes for its next withdrawal from the $200 billion kitty the US Treasury graciously made available to this government-created and -sustained mortgage financer, it may be useful to look beyond the current housing slump and consider what it augers for the future. Having made yet another loss, the government-sponsored … Continue reading Pain in the Fannie

Elinor Ostrom and the Relevance of Economics

by Mario Rizzo   The work of Elinor Ostrom, the first woman to receive the Nobel Prize in economics, is not very well-known among economists. In fact, I would venture the guess than most economists had not heard of her before the prize was announced yesterday morning.   Two reasons for this are that her degree is … Continue reading Elinor Ostrom and the Relevance of Economics

Citi Phibro Selloff Shows Government Sham

by Chidem Kurdas You’d think that the federal government wants Citigroup to return to financial health—if for no other reason to recoup the $45 billion of taxpayer money spent to shore up the bank in the credit freeze. You’d think the government wants a real effort to boost efficiency and profits. You’d be wrong. What … Continue reading Citi Phibro Selloff Shows Government Sham

Politics in One Lesson

by Roger Koppl It is better to signal goodness than to do good. That’s it.  That’s the lesson.  (Thanks to Steve Horwitz for the title of this post.)  Democratic politics is mostly about signals not substance.  The lesson is simple, but somehow hard to learn. Okay, okay, I admit that’s not really the One Great … Continue reading Politics in One Lesson

Ghost of Socially Useful Labor Haunts G20

by Chidem Kurdas French president Nicolas Sarkozy reportedly wanted  the G20 leaders to introduce a special tax on all financial transactions, known as the Tobin tax. Mr. Sarkozy took the idea from Adair Turner, the head of the British Financial Services Authority. Lord Turner suggested last month that the tax might be used to shrink … Continue reading Ghost of Socially Useful Labor Haunts G20

The Calculus of Consent II

by Gene Callahan In Chapter 5, "Organization of Human Activity," Buchanan and Tullock discuss what constitutes a "rational" choice concerning social arrangements. They write, "We have assumed that the rational individual, when confronted with constitutional choice, will act so as to minimize his expected costs of social interdependence, which is equivalent to saying that he … Continue reading The Calculus of Consent II