Economics

Last week, Russ Roberts pointed to the government website which tracks how much stimulus has been doled out to date:

To see the total amount spent, go here and click on box number 3 in the main window at the top of the page. It's tricky. Right now the main window is about "Health Care in Indian Country" but at the bottom of the blue box, there is a "Learn More" option. Click on number 3.

There’s really no logical argument buttressed by this story, but I think it fits the traditional definition of irony:

An expedition team which set sail from Plymouth on a 5,000-mile carbon emission-free trip to Greenland have been rescued by an oil tanker.
…

The expedition was followed by up to 40 schools across the UK to promote climate change awareness.

Pretty much every media outlet ran a story about yesterday’s national food drive. Letter carriers were lauded for their work collecting donations to food shelves. But were the letter carriers being charitable? Or were they just doing their job?

A brief search of the net offered no evidence that postal workers were doing anything for free. Sure, they carried some extra weight, but should that count as “charity”?

Since they’re in uniform, in addition to all their pay and benefits, the public was also covering any additional risks the workers faced. Strained back from too many cans? Not charity, but a gateway to a compensation claim.

The world we make today is better than the world we made yesterday. In general and in aggregate, products are relentlessly improved. Sure, there are spectacular failures, like New Coke or the Yugo. We notice those biggies, but overlook routine tiny stuff that does work.

Consider the perforations added to the plastic wrapper around a stack of paper napkins. The package now doubles as a dispenser. Neato! My napkins now stay clean until I make them dirty, and they don’t scatter around the kitchen on windy days.

Most cheese seems to be sold in zipper bags these days. The zipper is cheap and fails more than I would like, but usually it outlasts the cheese, which now lasts longer thanks to better packaging.

Reducing price is the most direct path to making anything more affordable. Some colleges are remembering their mission is education, not young-adult daycare and sports entertainment:

The People’s Daily, a newspaper published by the government of China, has printed a column warning the people against hating the rich:

If viewed through the prism of social development, one can easily understand why wealth used to be so despised in traditional Chinese society. China is typically an agricultural country, and in its time-honored history, the theory of  'attaching great importance to agriculture but restraining commerce' has been hammered into the people's mind, well and truly. With time, 'poverty mentality' would come into being, which encourages the thinking that if you have more, then I must have less. Even worse, now that many of the Chinese have grown up exposed to similar thinking and similar teachings, they tend to form an abnormal psyche of 'hating the rich.'

The current President has changed his tune. He is not longer Tokyo Rose, threatening us with an economic catastrophe. Now, although it may get worse, Obama is confident that the US economy will recover. It’s almost like he took a trip on the Negative Railroad and noticed 140 million Americans still hard at work.

From what I’ve seen, Big Media has followed Barry’s lead. They’re now more apt to look past the still-rising unemployment rate and the 663,000 jobs lost in March. The figures are in scale with January and February, but apparently now it isn’t the end of the world.

You may recall the Pickens Plan from last summer. Billionaire T. Boone Pickens ran saturation advertising for a scheme to build windmills and natural gas vehicles. It was good advertising, but a stupid idea founded on false assumptions. Well, it’s back.

The mechanics of the Pickens Plan are dependent on government subsidy. Essentially nobody wants windmills if they have to pay the cost themselves. So Pickens want the taxpayer to chip in.

In a fully capitalist system, there would be no guarantees.

Quoted from: Peter Gordon

The current President and much of the Democrat leadership appear to have an affinity for Europe. For example, they insist European healthcare be a model and justification for their meddling in US medical markets. Generally, President Klink’s rhetoric about “what we owe to each other” is founded on the same principles as Europe’s various versions of social democracy.

Unfortunately, facts tarnish the Democrats’ hopey-changey dreams. Their new New Deal socialism is too progressive by European Union standards. Former Obama cabinet nominee Judd Gregg remarked this week:

China has suggested the development of a new world currency. I consider this the first ring on the gong of doom, as it would make everything sold in dollar terms worth significantly less in global markets.

The current President was asked about the issue during his prime-time press conference last Tuesday (snipped for relevance):

Supply and demand cannot be fooled.

Quoted from: Peter Gordon

We’ve seen a couple of weeks of rising stock market indexes. Today the DJIA  was up over six percent. The President, the media, and many pundits are talking about having reached a market bottom. They all forget that this recent rise has only brought the indices back to the lows reached before Timmy and Barry made their first set of fumbles. We’ve made it back up to an ordinary recession. Woo hoo.

I suggest the rise is significantly attributable to the continuing value created in the US economy. As I have documented, 142 million people are still at work. No factories have been destroyed, and no skills have been wiped from workers’ memory. The sky was not falling. A dynamic economy was realigning itself, finding its new best allocations of resources.

Tax Payment vs. Tax Burden

Tax payments are the amounts paid to the government, based on tax rates and tax rules. Tax burden reflects who a tax ultimately falls upon, after the cost of a tax payment is spread between higher prices, lower profits, and/or diminished activity. The distribution of the tax burden between various people is called the tax incidence.

Neo-neocon is musing about the debate over the role of regulation in our financial turmoil:

Conservatives and libertarians tend to be on the “it’s the fault of too much regulation” side of the question. Liberals tend to be on the “it’s the fault of too little regulation” side.

Citigroup, one of the huge banks being bailed out by taxpayers, was at the top of the headlines again this week:

Citigroup Inc. Chief Executive Officer Vikram Pandit said his bank is having the best quarter since 2007, when it last posted a profit. The shares rose 38 percent and helped spur gains for finance company stocks. “I am most encouraged with the strength of our business so far in 2009,” Pandit wrote in an internal memorandum obtained today by Bloomberg. “We are profitable through the first two months of 2009 and are having our best quarter-to-date performance since the third quarter of 2007.”

Last week the pundits and news anchors quipped that Citi’s share price, which had dropped below $1, was less than an ATM fee. This week’s positive report from the Citi CEO was cited as cause for Tuesday’s major rally in the broader markets.

My contribution to the discussion of LET THEM FAIL, at Café Hayek:

In several comments I sense a confusion between “wealth” and “money”.

The original post uses effective rhetoric. Saying “we’re going to run out of money” slams the idea home.

In repsonse to tough times, Congress is stimulating itself:

We all need to sacrifice.
Well, everyone but those lucky enough to be a member of the Pelosi-Reid Congress.

They gave themselves a raise last month.
They now make $174,000 a year for their 3 day work week.

Investment guru and entertaining TV hothead Jim Cramer appears to have joined Rush Limbaugh on the Failed Obama Administration™’s enemies list. Cramer, on his Monday show, told viewers that Barry’s budget, “is the most, greatest wealth destruction I’ve seen by a president.”

With all the talk about China financing the US debt, one would think the Chinese are running a budget surplus. They’re not. The Chinese government appears to be afflicted with neo-Keynesian foolishness, too:

China announced Thursday a fiscal deficit budget of 950 billion yuan (139 billion U.S. dollars) for 2009, a record high in six decades, as the country boosts spending to cushion the impact of the global financial crisis.