The IMF has a new paper out that confirms what I have long suspected–when a state with a depressed economy reduces spending, the spending cuts lead to sufficient contraction to result in the cancellation of savings for the state. How does it work? Let’s explore.
Continue reading “How Spending Cuts Make Debt Problems Worse”
So yesterday, Rand Paul decided to use a filibuster–an old school, talking filibuster, no less–to stall the approval of Barack Obama’s proposed CIA head, John Brennan. The reason for this is that Rand Paul disapproves of the administration’s use of drones, specifically the administration claim that it could, in a sufficiently dire situation, kill a citizen within the territory of the United States with one. I’ve wanted to do the drone post for a while, but I haven’t gotten around to it, so Rand Paul can consider himself to have inspired me in this one rather trivial respect. Continue reading “Begun, the Drone War Has”
It’s time for another (and perhaps the final?) round of the Stark/Studebaker Minimum Wage Debate. For those new to this back and forth, Stark, a broadly Keynesian blogger who has my respect, came out against Obama’s proposal to raise the minimum wage to $9 an hour. I responded to his argument, and since then we have had a back and forth. Stark has done us the service of compiling the relevant posts in order here. Stark took issue with some of the casual terminology I employed in my last post, and in the interval between that one and this one we have messaged back and forth via Facebook to sort out for our mutual benefit precisely what one another means. In some cases, I thought Stark’s terminological criticisms pedantic, but in other cases he was right to press for clarification. Fundamentally, if I write a post and an intelligent person (which Stark is) has trouble sorting out what is meant, that’s on me. Now that we have sorted out our positions, Stark has posted his latest attack on the minimum wage hike, and I think myself ready to take it on. So here goes.
The last time I talked about health care economics was a mere couple weeks into the lifespan of this blog. In that post, I noticed that Medicare’s costs, while increasing, have increased at a much slower pace than private insurance costs in the United States. Then, today, I ran across this study from Leighton Ku and Matthew Broaddus and learned that it’s not Medicare that should serve as the poster boy of the potential benefits of a “government takeover of healthcare”, it’s Medicaid and SCHIP. Let me show you. Continue reading “The Awesome Efficiency of Medicaid”
Even I failed to anticipate that the end of February would approach and the president would make no serious effort at preventing the March 1 budget sequestration from taking effect. At the end of January, we noticed that, with sequester included, the United States was prepared to see an austerity package 1.9% the size of GDP in 2013, more austerity as a share of the economy than was seen in Britain in 2011 or 2012 (though not both combined). What’s important to note is that, despite Obama’s recent token effort to get congress to repeal or further delay sequestration, which accounts for $78 billion of the $304 billion in spending cuts and tax increases planned for this year, all of this is his fault and his fault alone. Continue reading “The Obama Austerity Package”
Benjamin Studebaker 