Donate
Donate

COMMENTARIES

Where Have All the Economists Gone?

Where Have All the Economists Gone?

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.

read more
How the Fed Slows Money Growth While Supporting Massive Government Borrowing at the Same Time

How the Fed Slows Money Growth While Supporting Massive Government Borrowing at the Same Time

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.

read more
Savings and Gramm: How the Fed is Slowing Monetary Growth

Savings and Gramm: How the Fed is Slowing Monetary Growth

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.

read more
Kotlikoff: Government Debt is like a Ponzi Scheme

Kotlikoff: Government Debt is like a Ponzi Scheme

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.”

read more
Study: Inequality Greatly Exaggerated

Study: Inequality Greatly Exaggerated

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.

read more
SCOTUS Punts Obamacare Back to Congress

SCOTUS Punts Obamacare Back to Congress

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.

read more
How a Questionable Drug Turned into a Goldmine at Taxpayers’ Expense

How a Questionable Drug Turned into a Goldmine at Taxpayers’ Expense

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.

read more
What’s Behind the Vaccine Slowdown?

What’s Behind the Vaccine Slowdown?

What’s behind the slowdown in vaccinations? The consensus among experts is those not yet vaccinated either 1) don’t want the vaccine 2) harbor some doubts about vaccine safety or efficacy, or 3) simply lack the motivation to find vaccine providers and make an appointment. Vaccine hesitancy accounts for about one-third of adults. For example, the Kaiser Family Foundation ran a survey in April that found 15 percent of respondents who had not received the vaccine plan to “wait and see.” Another 6 percent will get vaccinated “only if required,” and 13 percent refuse to get the vaccine. 

read more
Correcting Misconceptions of Health Care Reform

Correcting Misconceptions of Health Care Reform

One reader posed the question, how does the tax break for employee health insurance harm our health care system? Short answer: over time the practice reduced competition, which weakened cost-control and resulted in health care inflation three times that of consumer inflation. Consider this: once covered by generous health plans, workers cared less about what medical care cost because their health plans paid most of the tab. Employers didn’t care what things cost because they were passing on the costs to workers (indirectly) in lieu of higher cash wages. Third party administrators (TPAs), who manage the benefits for employers, didn’t much care what things cost because they were passing on the costs to employers with a mark-up. The more money spent, the more TPAs earn.

read more