June O’Neill, an economist who used to direct the Congressional Budget Office, and her husband Dave O’Neill produced a comprehensive survey of the economic research on this issue almost a decade ago. They concluded that while discrimination may exist, it’s not the main determinant of overall wages and incomes.
If you search the economics departments of our nation’s colleges and universities you would be hard pressed to find a real socialist. That’s because economists know a lot about socialism. They have been studying it and thinking about it for over a hundred years. Outside economics departments, things are different. It has often been humorously estimated that there are more Marxists on the faculty of American universities than there are in Russia or China today. How is that possible? John Goodman blames the economists.
The Bureau of Labor Statistics says there are 18,650 economists in the United States. You have to wonder what they are all doing? No one is better qualified to comment on the economic effects of public policies than economists. Yet, only a handful of them routinely do so. Instead, they yield the public square to non-economists who are only too happy to fill the void and whose opinions are often wrong.
“Where Have All the Economists Gone?” asks John Goodman. In four separate editorials on socialism, racism, taxes and the environment, Goodman says economists who have a lot to say are holding back while too much nonsense dominates the public policy discussion.
In the Wall Street Journal, Goodman Institute Senior Fellow Tom Saving and Phil Gramm write that the Federal Reserve is buying Treasury bills and mortgage-backed securities at a rate of $120 billion a month. This is apparently being done to support large borrowing by the federal government. At the same time, the Fed has pulled almost a trillion dollars of liquidity out of the financial system by “reverse-repo borrowing.” This has reduced bank reserves and private sector lending. Not surprisingly, the growth of the M2 money stock fell from around 25% in 2020 to around 10% on an annualized basis in the first six months of 2021.
The Federal Reserve is buying Treasury bills and mortgage-backed securities at a rate of $120 billion a month. This is apparently being done to support large borrowing by the federal government. At the same time, the Fed has pulled almost a trillion dollars of liquidity out of the financial system by “reverse-repo borrowing.” This has reduced bank reserves and private sector lending. Not surprisingly, the growth of the M2 money stock fell from around 25% in 2020 to around 10% on an annualized basis in the first six months of 2021.
At the very time leftist politicians are proposing to finance their programs with mammoth deficit spending, leftist economists are giving them cover with the argument the country may never have to pay off the debt.
But Goodman Institute Senior Fellow and Boston University Economist, Professor Laurence Kotlikoff and his colleagues challenge this conclusion in two papers posted at the highly prestigious National Bureau of Economic Research Working Paper site. Deficits used to finance current consumption “are like Ponzi schemes,” they say.”
Lifetime spending inequity is one-third of wealth inequality. The main reason: government taxes and transfers, which make the system far more “progressive than we are led to believe. In 2018, for example, the top 1 percent of taxpayers paid 40.1 percent of all federal income taxes. The top 10 percent paid 71.4 percent. The bottom half of the country paid less than 3 percent of all federal income taxes.
The solution to Obamacare’s high out-of-pocket costs and narrow networks is to let people buy insurance that meets their medical and financial needs. That’s why people are turning to short-term insurance, limited benefit insurance and health sharing insurance.
Obamacare has two very bad features: unaffordable out-of-pocket costs and perilously narrow networks. If you combine last year’s average (unsubsidized) premium with the average deductible, a family of four had to pay $25,000 before getting any benefits at all from their plan. Also, the average plan looks like Medicaid managed care with a high deductible, excluding access to the best doctors and the best hospitals.
On June 7th the U.S. Food and Drug Administration approved a new drug to treat early-stage Alzheimer’s disease. Is this good news for patients suffering with Alzheimer’s disease? Probably not and certainly not for taxpayers. The clinical trial data found little evidence the drug works. One Phase 3 clinical trial showed a slight slowing in cognitive decline, while the second clinical trial failed to show any improvement.