Archive for the ‘Economics’ Category

Thomas Sowell, senior fellow of the Hoover Institution, argues that the Affordable Care Act (Obamacare) is just an old program:

An Old ‘New’ Program

What is older than the idea that some exalted elite know what is good for us better than we know ourselves?

Insurance is an institution for dealing with risks. It is a costly and counterproductive way to pay for things that are not risks […] Your annual checkup does not cost any less because it is covered by insurance.

Sowell also points out that Obamacare was initially supported by the idea to help the minority of people lacking health insurance. But instead of directly helping those people, the new health care policy now affects everyone.

Since there has never been a society of human beings without at least some segment with some problem, this is a formula for a never-ending expansion of government power.


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Thomas Sowell, senior fellow at the Hoover Institution, on the use of words in politics:

Words That Replace Thought

At neither end of the income scale is a “fair share” defined as a particular number or proportion, or in any other concrete way. It is just a political synonym for “more,” dressed up in moralistic-sounding rhetoric.

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Milton Friedman on the single most important side effect of social policies:

One of the things I hold against the welfare system most seriously is that it has destroyed private charitable arrangements which are far more effective, far more compassionate, far more person-to-person in helping people.

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In a recent comment by Mark J. Perry, professor of economics at Michigan, the argument has been made that the decline in the middle class is the result of a positive trend: many middle-class families of the 1960s have risen into the upper class.

Over the same time period, however, the share of families with $25’000 and less has decreased only from 22 to about 18 percent.

Yes, the middle class has been disappearing

America’s “middle class” did start largely disappearing in the 1970s, but it was because they were moving up to a higher-income category, not down into a lower-income category.

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Michael D. Tanner, senior fellow at the Cato Institute, has a new article arguing that for many people in the US it pays off not to work.

Welfare Can Make More Sense than Work

We shouldn’t blame welfare recipients. By not working, they are simply responding rationally to the incentive systems our public policy-makers have established.

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Recently, three researchers from Canada published a new study showing that girls have overtaken boys in American high schools. Among other things, their study also shows the importance of ambition. This is in sharp contrast to many political commentators who use every statistical disparity as proof that some people simply cannot make it. Also, the results suggest that good behavior still seems to pay off.

Leaving Boys Behind: Gender Disparities in High Academic Achievement

Our findings show that the predominance of girls at the top of the GPA distribution is rooted in their higher educational expectations, themselves linked to career plans that include a graduate degree.

The second dominant factor accounting for the lower grades of boys is a measure of the frequency of having been set to the office or to detention over the previous year.

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Nobel laureate Milton Friedman makes an important point about the availability of resources:

What matters are the resources which are available to be used, not those that will be discovered later on.

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Walter E. Williams shared his views on deficits and debt in 1994. Almost twenty years later, the issue is as urgent as ever.

You went to war with us for ‘taxation without representation’.
So how do you feel about it with representation?

One of the things we have to recognize is that there is little private incentive among all of us to downsize government spending.

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Great quotation from Jacob Schmookler’s book Invention and Economic Growth (1966):

Consumer goods inventions that cut both cost and quality but reduce the former more than the latter, such as the Model T, have historically been an important means for transforming the luxuries of the rich into the conveniences of the poor.

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Joachim Voth, professor of economics at Pompeu Fabra in Barcelona, describes and discusses four scenarios for the Euro’s future:

We are destroying a huge amount of the good work created by the European Union, almost over night as a result of the current policy mix.

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