The Road to Totalitarianism

[On Freedom and Free Enterprise (1956)]

In spite of the obvious ultimate objective of the masters of Russia to communize and conquer the world, and in spite of the frightful power which such weapons as guided missiles and atomic and hydrogen bombs may put in their hands, the greatest threat to American liberty today comes from within. It is the threat of a growing and spreading totalitarian ideology.
Totalitarianism in its final form is the doctrine that the government, the state, must exercise total control over the individual. The American College Dictionary, closely following Webster's Collegiate, defines totalitarianism as "pertaining to a centralized form of government in which those in control grant neither recognition nor tolerance to parties of different opinion."

Can the Underground Economy Save Europe?

by David Howden

"The growth of unofficial employment is an entrepreneurial response to unnecessarily rigid labor markets and excess regulation."

As the old saying goes, the more expensive you are to fire, the more expensive you are to hire. Nowhere is this more apparent than on the European continent.
Even with the United States' lengthening of unemployment insurance benefits at the wake of this crisis, the benefits for the standard down-on-his-luck American pale in comparison to those of the average European. Upon job separation the average Frenchman can expect to see more than half of his salary extended in the form of unemployment benefits. Many European workers see these benefits extended for two to three years after their termination, with some countries extending benefits indefinitely.

Categories Archives Blog Home Next: Supercommittee Fails; Now Let’s Talk Specific Cuts Previous: Adios Balanced Budget Amendment Supercommittee Tax Fight Is About Increasing Spending, not Reducing Deficits

Posted by Daniel J. Mitchell

Some people have asked why I’m so agitated about the possibility that Republicans may acquiesce to tax increases as part of the Supercommittee negotiations.
Rather than get into a lengthy discourse about the proper role of the federal government or an analysis of how the Bush-Obama spending binge worsened America’s fiscal situation, I think this chart from a previous post says it all.

Republicans are considering a surrender on taxes because they are afraid that a deadlock will lead to a sequester, which would mean automatic budget savings. And the sequester, according to these politicians, would “cut” the budget too severely.
But as the chart illustrates, that is utter nonsense.
There are only budget cuts if you use dishonest Washington budget math, which magically turns spending increases into spending cuts simply because the burden of government isn’t expanding even faster.
If we use honest math, we can see what this debate is really about. Should we raise taxes so that government spending can grow by more than $2 trillion over the next 10 years?
Or should we have a sequester so that the burden of federal spending climbs by “only” $2 trillion?
The fact that this is even an issue tells us a lot about whether the GOP has purged itself of the big-government virus of the Bush years.
A few Republicans say that a sellout on tax hikes is necessary to protect the defense budget from being gutted, but this post shows that defense spending will climb by about $100 billion over the next 10 years under a sequester. And that doesn’t even count all the supplemental funding bills that doubtlessly will be enacted.
In other words, anyone who says we need to raise taxes instead of taking a sequester is really saying that we need to expand the burden of government spending.
So even though Ronald Reagan and Calvin Coolidge are two of my heroes, now you know why I don’t consider myself a Republican.

SuperCommittee Failure in Progress

Joining the Chorus for Tax Cooperation

by Richard W. Rahn

How much pressure would it take before you would sell out your intellectual integrity? Those who are given responsibilities for developing and promoting sound public policy are subject to never-ending pressure by those in the political class to serve them rather than the public.

An extraordinarily well-researched and provocative paper has just been released, tracing how the Organization for Economic Cooperation and Development (OECD), a major international organization, descended from promoting trade- and job-creation policies among the nations of the world to one that is supporting job-destroying tax cartels for the benefit of the high-tax countries. The paper, "Cartelizing Taxes: Understanding the OECD's Campaign Against 'Harmful Tax Competition,'" was clearly and interestingly written by law and economics scholar Andrew Morriss of the University of Alabama and Swedish economic researcher Lotta Moberg of George Mason University. The authors conducted many interviews and used primary and secondary sources to support their disturbing conclusions.

God: The Shakedown Artist for the Welfare State?

by Doug Bandow

God is the ultimate trump. Everyone proclaims that God is on their side. Whatever the issue, someone somewhere will argue that they are doing what Jesus would do. Even in politics.

The Right long has claimed Scriptural warrant for using government to enforce Christian moral norms and wage war to promote American values. The Left prefers to claim God as the inspiration for government income distribution. Activists currently are deploying Christianity to sell expansive, expensive, redistributionist government.

For instance, President Barack Obama recently declared that "God wants to see us help ourselves by putting people back to work." White House spokesman Jay Carney concocted a supporting Biblical quote: "I believe the phrase from the Bible is, 'The Lord helps those who help themselves'." There is no such verse, but never mind. Surely God wants the U.S. government to tax and spend America to prosperity.

Doug Bandow is a senior fellow at the Cato Institute. A former special assistant to Ronald Reagan, he is the author of Foreign Follies: America's New Global Empire (Xulon).

Tariff Lesson for Obama – and Us

by Daniel J. Ikenson

The US should follow Australia's example in dealing with protectionist pressures, writes Daniel Ikenson. United States President Barack Obama will pay a long overdue visit to Australia this week. Hopefully, his hosts will shed light on Australia's trade policy history, which is instructive for US policy. The discussion might also remind Gillard government officials of the successful policies and institutions of Labor governments past.

The ambitious tariff-reduction programs launched under the Hawke and Keating governments in the 1980s and early 1990s exposed Australian industry to international competition and helped transform the country from an economic laggard to one of the world's most competitive economies, ushering in two decades of sustained growth and job creation. That such success was the product of reforms that included a tariff reduction from a manufacturing sector average of 22 per cent to 5 per cent by the time of the Howard government affirms the benefits of unilateral liberalization.

Rich China, Poor China

by Richard W. Rahn

"Air in many China cities remains highly polluted." No, this is not a headline in the Onion (satirical newspaper), but the front-page lead headline in the Shanghai Daily on Nov. 8. Shanghai is a city of 23 million people, which at first glance appears to be, perhaps, the most modern city on the planet. The architecture is spectacular and varied, with some of the new edifices exceeding 100 stories. It looks prosperous — nicely dressed people; wide, tree-lined streets; well-maintained flower beds; and the world's newest auto stock on its many crowded expressways. To a lesser extent, the same thing can be said about Beijing and other Chinese cities.

Unwise to Pin Much Hope on America in Global Free Trade

by Sallie James

Is the media so starved of good news on trade liberalisation that it will laud even the most middling announcement? The huge fuss made over the leaders' speeches at the Asia- Pacific Economic Co-operation summit, announcing their commitment to a "new" trade deal — the Trans-Pacific Partnership — was perplexing, given the negotiations started years ago and are far from the finish line.

A similar fuss was made over recent US passage of trade deals. The headlines were glowing: "A Bipartisan Triumph" (The Wall Street Journal), "Admit It: It's Victory" (Investor's Business Daily). With the US Congress finally approving three trade deals after years-long delays, there was indeed much to celebrate. But the fact is significant obstacles remain to renewed US leadership in global trade liberalisation more broadly and thus to a surer recovery from the global financial crisis.

By Caroline Baum

About Caroline Baum

Caroline Baum, a columnist for Bloomberg News since 1998, is the author of "Just What I Said: Bloomberg Economics Columnist Takes on Bonds, Banks, Budgets and Bubbles."
More about Caroline Baum

Watching the finger-pointing going on in Washington from members of the supercommittee and the kibitzers on the side reminded me of Milton Friedman's solution for the Federal Reserve.
The late Nobel laureate, he of "Chicago School" fame, said he would replace the Fed with a computer that would print a specified amount of money each year to add to the money supply. He said the Fed had a few periods of good performance but for most of its existence has been a "loose cannon, and not a source of stability."
Imagine what he'd say about Congress. The Joint Select Committee on Deficit Reduction, as it is formally known, was charged with finding a minimum of $1.2 trillion of deficit reduction over the next 10 years by Nov. 23. Failure to deliver a plan, which would be subject to an up-or-down vote in Congress, would trigger an automatic $1.2 trillion of spending cuts, divided equally between defense and non-defense, beginning in 2013.
The two sides of the 12-member committee seem to be dug in.
Republicans aren't budging from their offer to increase tax revenue by $300 billion in exchange for lower tax rates while Democrats oppose entitlement cuts that hurt the middle class without higher tax rates for top earners.
Lawmakers in the House and Senate were even considering ways to prevent the sequestration should the two sides fail to reach a deal. Talk about kicking the can down the road and the road kicking the can back. Friedman was right: A computer could do better.

Obama Beats Romney on Extremism, Not Flip-Flops: Ramesh Ponnuru

David Plouffe, an adviser to President Barack Obama, minced no words when he talked about Mitt Romney on “Meet the Press” last week. “He has no core,” Plouffe said. “You get the sense with Mitt Romney that, you know, if he thought he -- it was good to say the sky was green and the grass was blue to win an election, he’d say it.”
It’s not only Democrats who take this view of the former Massachusetts governor. Conservative columnist George Will recently blasted Romney as a “recidivist reviser of his principles” and claimed he was “becoming less electable” as a result. Former Utah governor Jon Huntsman, who is also running, says that Romney is “unelectable against Barack Obama” because he is “on too many sides of the issues of the day.”

Germany Should Take Wisdom From Keynes Instead of Weimar: View

Illustration by Bloomberg View

By the Editors

Germany, with the help of the European Central Bank, has achieved a level of dominance in Europe it hasn’t enjoyed since World War II. It is to that period, and a bit earlier, that it might look for lessons on how to save a troubled European project.
The rapid fall of euro-area governments in recent days demonstrates the enormous influence Germany and the ECB have gained over sovereign nations. By withholding the money needed to restore confidence in struggling countries’ finances, they have helped topple the leaders of Greece, Italy and -- pending the outcome of a vote Sunday -- possibly Spain, in favor of governments more focused on austerity.

inTraders work at the New York Stock Exchange in New York. Photographer: Scott Eells/Bloomberg

U.S. stocks slumped, giving the Standard & Poor’s 500 Index its longest losing streak since September, amid concern the government will be forced to submit to $1.2 trillion in automatic spending cuts if lawmakers fail to agree on a deficit plan.
Financial stocks posted the second-biggest decline among 10 industries in the S&P 500, dropping 2.9 percent, as 493 out of 500 companies retreated. Citigroup Inc. (C) plunged 5.4 percent, while Hewlett-Packard Co., Boeing Co. (BA) and Caterpillar Inc. slumped more than 3.8 percent. The Dow Jones Transportation Average sank 3.4 percent. Gilead Sciences Inc. (GILD) tumbled 11 percent after agreeing to buy Pharmasset Inc. (VRUS) for about $11 billion in cash. Pharmasset soared 85 percent.
The S&P 500 dropped 2.3 percent to 1,187.67 at 11:14 a.m. New York time. The benchmark gauge has lost 5.6 percent in four days. The Dow Jones Industrial Average declined 292.94 points, or 2.5 percent, to 11,503.22 today after a Democratic aide said the supercommittee that was supposed to dissolve congressional gridlock in Washington is instead on the brink of failure.

Social Order? There’s No App for That

Social Order? There’s No App for That
Art Carden
Forbes

Economics studies unintended consequences. People pursue their own interests, however they choose to define them. Under the right conditions, as Frederic Bastiat reminds us, “Paris gets fed.”
Profits and losses have told Apple, for example, that iPhones and iPads are a pretty good idea. In hindsight, it also seems obvious that FedEx was a pretty good idea, too. But who would have planned it? And indeed, if we take seriously the apocryphal story saying that FedEx founder Fred Smith received a C or something on the paper in which he outlined the idea during his undergraduate studies at Yale, should we think that a benevolent planner would have given the green light for such a radical idea?
Indeed, who would have greenlighted Microsoft? The Macintosh? the iPod? Big problems emerge when you give people veto power over others’ decisions. In his book Applied Economics, Thomas Sowell recounts an example in which a bureaucrat in India prohibits the importation of face creams because he doesn’t want poor Indian women “wasting” their money on such fripperies peddled by multinational corporations when they should be buying food. After reading passages like that, I get a deep sense of sadness at the world we have lost at the margin. Somewhere, someone’s life was made a little worse by a bureaucrat who thought he knew better than she did what was good for her.
Read the full article

Capitalism and the Wall Street Protesters

Capitalism and the Wall Street Protesters
Dominick T. Armentano

With at least 12 compulsory years in public schools, one would think that most of the twenty-something Wall Street protesters would have some understanding of capitalism, its actual history, and its accomplishments. Well, maybe not. One can only wonder what passes for economic education these days.

So what is capitalism? Free market capitalism is based on the individual right to own and freely trade property. It permits owners of property (land, labor, capital, etc.) to enter (or exit) any contract on mutually agreeable terms. It gives entrepreneurs the freedom to start any business (without government permission) and to borrow money and develop products for consumers. It permits land owners to rent (or sell) their property for any peaceful purpose. It gives adult workers the liberty to lease their services to any business at any agreeable wage and to terminate that agreement at will; employers would have the same right.

The Mexican Drug Cartel Threat in Central America

By Karen Hooper
Guatemalan President-elect Otto Perez Molina told Mexican newspaper El Universal on Nov. 9 that he plans to engage drug cartels in a “full frontal assault” when he takes office in 2012. The former general said he will use Guatemala’s elite military forces, known as Los Kaibiles, to take on the drug cartels in a strategy similar to that of the Mexican government; he has asked for U.S. assistance in this struggle.
The statements signal a shifting political landscape in already violent Central America. The region is experiencing increasing levels of crime and the prospect of heightened competition from Mexican drug cartels in its territory. The institutional weakness and security vulnerabilities of Guatemala and other Central American states mean that combating these trends will require significant help, most likely from the United States.

Obama's Indefensible Pipeline Punt

By Vaclav Smil

Obama’s delaying consideration of the Keystone XL pipeline is what is called a spherically perfect decision, because no matter from which angle you look at it, it looks perfectly the same: wrong.

President Obama made yet another bold decision by refusing to consider the fate of the Keystone XL pipeline until after the 2012 election. Here is a brief primer for those who know nothing about Canada, for those who have only a hazy notion of America’s energy supply, and for those who do not know what the months of protests in front of the White House—with the placards about the Earth in peril and with pipeline-like black plastic tubes—have been all about.

It’s Europe’s Economic Growth, Stupid

By Desmond Lachman

European policymakers are clinging to the forlorn hope that the eurozone crisis can readily be defused by putting in place national unity governments in Greece and Italy.

Hope springs eternal among European policymakers. As Greece now verges on a hard default and as Italian bond yields soar to dangerous levels, European policymakers cling to the forlorn hope that the European crisis can readily be defused by putting in place national unity governments in Greece and Italy. By so doing, they choose to turn a blind eye to the highly compromised public finances that brought us to this impasse and that are all too likely to drive the eurozone apart in the year ahead.

Don’t Ditch Taiwan

By Michael Mazza

Would selling out a democratic ally help America’s economy? Don’t count on it.

As America’s economic recovery continues to lag, politicians and pundits are scrambling to find ways to kick-start growth. One of the oddest such proposals appeared recently in the New York Times. Paul V. Kane, a Marine and former international security fellow at the Harvard Kennedy School, argued that the United States should agree to “terminate the United States-Taiwan defense arrangement,” in return for which Beijing should “write off the $1.14 trillion of American debt currently held by China.” The New York Times headline summed up the argument nicely: “To Save Our Economy, Ditch Taiwan.” While the idea of eliminating all of that debt is an attractive one, Kane fails to make the case that such a deal would ultimately be in America’s best interests.

The Hubris of Attacking Syria

Doug Bandow

The U.S. government once believed in peace. Today, hardly a day goes by without someone proposing that Washington bomb, invade or occupy another nation. Matthew Brodsky targets Syria.
Not that Brodsky is alone. Senator Lindsey Graham (R-S.C.), who has yet to find a war he doesn’t want to start, also has been beating the war drums against Damascus.
War is not just another policy option, an alternative to increasing foreign aid or imposing sanctions. It means sacrificing the lives of one’s citizens, wasting untold resources, unleashing death and destruction on other peoples, wrecking foreign societies, and triggering an unpredictable cascade of unintended and sometimes catastrophic consequences. Wars almost always turn out more costly than expected for everyone.
In short, there are more than enough reasons to make war a last resort to safeguard vital interests, not a first resort to advance lesser objectives.
Why attack Syria? Damascus is a nasty actor in the region but poses no threat to America. Although Brodsky complains that Syria obstructs U.S. objectives “with impunity,” that provides no case for war. After all, Washington’s foreign-policy goals are infinite: there is virtually no nation which does not interfere with one or another American of foreign-policy design. The U.S. often objects when another country merely decides to act in its own interest.
In the case of Syria, the strongest argument for military action is a shameless bootstrap: The Bush administration invaded Iraq, Syria’s neighbor, sparking a devastating civil war and destabilizing the region. Washington now is upset that Damascus has responded in kind, failing to halt bad actors entering—and perhaps encouraging them to enter—Iraq. It is extraordinary hubris: Washington goes to war with Iraq, thereby threatening Syria. Leading American analysts suggest launching a preventive war against Damascus. When Syria seeks to protect itself by undermining the U.S. occupation of Iraq, Washington declares that to be another justification for going to war with Syria.
It was a bad enough argument when American forces were battling Iraqi insurgents. It is a bizarre argument to make when American forces are out of combat and slated to return home.
Another claim is that Washington should take out Syria because it is an ally of Iran. But if the United States isn’t willing to bomb Tehran, why should it bomb Tehran’s ally? Iran is another nasty actor, but that doesn’t warrant Washington starting a regional conflict. Washington can ill afford to attack every nation that interferes with the über-hawk dream of maintaining American hegemony everywhere, forever.
Some in Washington have been reduced to arguing that the United States should bomb countries today because, if it does not, they may develop weapons to deter Washington from bombing them tomorrow. Of course, this is one of the most important reasons that pariah states desire nuclear weapons: doing so is the only sure way to forestall attack by Washington. The allied attack on Libya makes it unlikely that any dictator ever again will be credulous enough to yield up any WMDs.
The humanitarian argument for bombing Damascus is particularly weak. Some three thousand Syrians have died in months of protests against the Assad regime. That’s a tragedy, but a modest casualty toll in a world awash in violence.
Humanitarian intervention once was touted as necessary to stop genocide. Now it is proposed as a measure to stop the sort of limited conflicts which dot the globe. If three thousand deaths warrant war, then there no longer is any meaningful standard against making war everywhere, all the time. In countries like India, Nigeria and Pakistan, deadly conflict between varying religious and ethnic groups is common. Equally appropriate for intervention are Bahrain and Belarus, Burma and Congo, Cuba and Iran, North Korea and Russia, Sri Lanka and Sudan, Venezuela and Zimbabwe.
Indeed, Libya demonstrates how claims of humanitarian intervention are routinely misused. There was no evidence that Muammar Qaddafi, though a thug, planned civilian massacres in Benghazi. He had recaptured other cities and murdered no civilians; his rabid rhetoric regarding Benghazi was directed at armed rebels.
Moreover, the allies caused the deaths of tens of thousands of Libyans by prolonging a low-tech civil war in which the fighting was the greatest killer of civilians. The United States and NATO wanted to achieve regime change on the cheap, not humanitarian rescue. Nor is it clear that the conflict is really over as different armed factions vie for power.
Of course, Brodsky is right to wish for “an end to the violence, the fall of the Assad regime and the creation of conditions for a stable democratic system that protects the rights of the Christian, Kurdish and Alawite minorities.” However, what evidence is there that Washington can guarantee these results? In fact, Washington would have no control over the outcome of an attack on Syria.
Brodsky bizarrely points to the Obama administration’s past failures as reason to roll the die yet again: “Perhaps more compelling is that as autumn turns to winter, the result of U.S. engagement in the so-called ‘Arab Spring’ has so far empowered the Muslim Brotherhood in countries relatively friendly to Washington.” So if the United States doesn’t oust Assad, he worries, the administration will have no gains from the Arab Spring.

That’s 1,000 olives, please

By Gillian Tett
Even in the ‘unimaginable’ scenario of a eurozone break-up, it would be less messy than in the USSR in 1991 when barter became the norm
illustration of olives and purse

A few weeks ago, I stumbled on a Soviet 10-rouble note, tucked into an old notebook. Gazing at the crumpled piece of paper, with the iconic face of Lenin, invoked a frisson – particularly given all that is now happening in the eurozone.

Back in the late 1980s, I lived in the former Soviet Union as a PhD student, where I received a (pretty generous) monthly stipend of Rbs430. As I collected notes each month, I never questioned whether that paper would always be “money”; to me it seemed self-evident that this money had value and could be spent anywhere across the USSR. The Soviet Union – and its monetary union – seemed to be permanent.

Cali to Business: Get Out!

Steven Malanga

Firms are fleeing the state’s senseless regulations and confiscatory taxes.

Last year, a medical-technology firm called Numira Biosciences, founded in 2005 in Irvine, California, packed its bags and moved to Salt Lake City. The relocation, CEO Michael Beeuwsaert told the Orange County Register, was partly about the Utah destination’s pleasant quality of life and talented workforce. But there was a big “push factor,” too: California’s steepening taxes and ever-thickening snarl of government regulations. “The tipping point was when someone from the Orange County tax [assessor] wanted to see our facility to tax every piece of equipment I had,” Beeuwsaert said. “In Salt Lake City at my first networking event I met the mayor and the president of the Utah Senate, and they asked what they could do to help me. No [elected official] ever asked me that in California.”
California has long been among America’s most extensive taxers and regulators of business. But at the same time, the state had assets that seemed to offset its economic disincentives: a famously sunny climate, a world-class public university system that produced a talented local workforce, sturdy infrastructure that often made doing business easier, and a history of innovative companies.
No more. As California has transformed into a relentlessly antibusiness state, those redeeming characteristics haven’t been enough to keep firms from leaving. Relocation experts say that the number of companies exiting the state for greener pastures has exploded. In surveys, executives regularly call California one of the country’s most toxic business environments and one of the least likely places to open or expand a new company. Many firms still headquartered in California have forsaken expansion there. Reeling from the burst housing bubble and currently suffering an unemployment rate of 12 percent—nearly 3 points above the national level—California can’t afford to remain on this path.

There Are No Longer Any Excuses For Obamanomics

Job seekers attend a job fair in Los Angeles o...

Image by AFP via @daylife

The history of America’s recessions is provided at the website of the National Bureau of Economic Research (NBER). Before this last recession, since the Great Depression recessions in America have lasted an average of 10 months, with the longest previously lasting 16 months. Yet here we are 47 months after the last recession started, and we still have no real recovery.
Instead, unemployment has been stuck at 9% or above for the longest period since the Great Depression. Unemployment for blacks has remained over 15% for over 2 years, with Hispanic unemployment stuck well into double digits over that time as well. Teenage unemployment has persisted at nearly 25%, with black teenage unemployment still nearly 40%.
The U6 unemployment rate, reflecting all of the unemployed still wanting work and the underemployed who can’t get full time work, is still 16.2%. That includes an army of the unemployed or underemployed of over 26 million Americans. And that still doesn’t fully count the millions of Americans who have given up and dropped out of the work force altogether.
On September 13 came the Census Bureau report fleshing out the full meaning of no economic recovery under Obama. Median family income has fallen all the way back to 1996 levels. The Wall Street Journal further reported on September 14, “Earnings of the typical man who works full time year round fell, and are lower—adjusted for inflation—than in 1978.”
The poverty rate climbed to 15.1%, higher than in the late 1960s when the War on Poverty was getting underway, $16 trillion ago. The child poverty rate climbed to 22%, nearly a quarter of all American children. The total number of Americans in poverty is higher than at any time in the over 50 years that the Census Bureau has been tallying it. Moreover, the number of Americans ages 25-34 living with their parents has soared by 25%.
Yes, I know NBER declared the recession technically over in June, 2009, still the longest recession on record since the Depression. But the point is next month will be 4 years since the recession started, and there is still no sustained real recovery. Or as economist John Lott has emphasized, Obamanomics has produced the worst recovery since the Great Depression.
Obama apologists can’t continue to blame the depths of the previous recession, and they can’t because the historical record makes plain that the worse the recession, the stronger the recovery. Based on that historical record, we should be completing the second year of a booming economy by now.
In the second year of the Reagan recovery, real economic growth boomed by 6.8%, the highest in 50 years. In the first two years of that recovery, 7.6 million new jobs were created, on the way to 20 million jobs created during the first 7 years. Presently, we are still 6 million jobs below the peak before the last recession, four years ago.
The chief excuse of the Obama apologists is “this time is different,” citing the book of that title, This Time Is Different: Eight Centuries of Financial Folly, by Carmen Reinhart and Kenneth S. Rogoff. But the theme of that book is exactly the opposite of what it is cited for here – that “this time is different” is never true.
The apologists cite the book to argue that what we have suffered this time was not just a recession, but a financial crisis, and the data in the book shows, they argue, that recovery from a financial crisis takes a lot longer than recovery from a recession.

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Wannabe Homebuyers Get No Encouragement From Fed: Caroline Baum

About Caroline Baum

Caroline Baum, a columnist for Bloomberg News since 1998, is the author of "Just What I Said: Bloomberg Economics Columnist Takes on Bonds, Banks, Budgets and Bubbles."
More about Caroline Baum

Yes, there can be too much of a good thing.
Like most observers of the business cycle, I have been thinking a lot about housing, the small sector of the U.S. economy with the big footprint. Housing started the ball rolling -- both uphill and down, you might say -- and because of the overwhelming number of bad loans, underwater mortgages and foreclosed properties, it still can’t get up off the ground.
Specifically, I’ve been wondering to what extent the presumed incentives for buying a home -- super-low mortgage rates and discounted prices, down by one-third nationwide from their 2006 peak -- are being neutralized by the Federal Reserve’s tell-it-all communications policy.

THE LIBERTARIAN

Monday, November 21, 2011

The Road to Totalitarianism

The Road to Totalitarianism