There’s an interesting assumption going on behind the estimation of the output gaps (the difference between the economy’s current output and the economy’s estimated maximum potential output)–that not only did the economy decline during the recent crisis, but that the economy’s potential declined as well. This assumption leads to governments believing that their economies are less capable than perhaps they are, that the output gaps are not especially large, and that there is little revenue to be raised to offset stimulus spending, but what if it is not true? The idea comes from Capital Economics, a macroeconomics research company, has received attention from the Financial Times and Paul Krugman, and now it will receive attention from me as today’s topic.
Tag: politics
Money and Motivation: A Shocking Contradiction
Frequently, we are told by the right that progressive taxation is bad policy, that it diminishes the motivation of entrepreneurs and “job creators”. But what is the relationship between money and motivation? Does more income lead to higher productivity? It turns out, if you phrase the question correctly, the answer is already well known, and the implications of that answer comprise today’s topic.
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Obama at the UN
Barack Obama addressed the United Nations yesterday on the subject of Middle East policy. In the meantime, Mitt Romney continued to criticise the Obama administration on the same issue. Today I would like to discuss the remarks of each, and point out one key flaw at the heart of both men’s policies.
Trouble in China
There’s a lot of fear in the United States and elsewhere with regard to a rising China. Many people are worried about the amount of government debt China possesses, or how so many jobs in industry and manufacturing have moved over there. Increasingly, China and the United States are being compared to one another as if their power outlay were more or less equal–in Pakistan for instance, the numbers are more or less even on the question. However, there are several key reasons why Sinophobia is exaggerated and unnecessary, and they comprise today’s topic.
The 47%
Recently, Mother Jones leaked a video of Mitt Romney talking to some potential donors, in which he says the following:
The video (ironically discovered by a grandson of Jimmy Carter) shows Romney claiming that 47% of Americans pay no income tax, that this 47% is dependent and has a mentality of dependency, and that he has no hope of gaining their votes. Since this amounts to almost half the electorate, he argues, it will take quite a bit of money from these donors to help him win the election. But who are the 47%? Are they really dependent welfare scroungers? That is today’s topic.
Benjamin Studebaker 