The Foundation for Economic Education The Freeman 1996

We are accustomed to looking at Europe’s woes in a purely financial context. This is a mistake, because it misses the real reasons why the EU will fail and not survive the next financial crisis. We normally survive financial crises, thanks to the successful actions of central banks as lenders of last resort. However, the origins and construction of both the the euro and the EU itself could ensure the next financial crisis commences in the coming months, and will exceed the capabilities of the ECB to save the system.

There’s just no relief from the constant drum beat for more and more government intervention in the economy. One the one hand, we have presidential candidates calling for more protectionism and more government spending.

For the past thirty or so years I have made a small annual donation to my alma mater, Boston College. I usually earmark a part or all of the donation for BC’s athletic programs, which, outside of hockey — and football for a few glorious years in the early 1980s when Doug Flutie played — have been decidedly mediocre. In recognition of my modest donations, I just received an emailed brochure from BC entitled “A Guide to NCAA Regulations for Donors, Alumni, and Friends of Boston College Athletics.” 

Some optimists are touting the hypothesis that the weakness of the economic expansion since the last cyclical trough (June 2009) means that the next recession will be mild.

In fact, such a tendency has never been observed in the 140 years of US business cycle history examined famously by University of Chicago Professor Victor Zarnowitz. The only reliable rule which he found was that “the worse the downturn the stronger the subsequent upturn” — a rule that has famously broken down under the onslaught of the Great Monetary Experiment in the present cycle.

In a targeted attack against trade with China, Donald Trump has claimed that America has lost high paying manufacturing jobs to China because China promotes its exports through subsidies, tax advantages, and currency manipulations. The reality is that we should not care what China does. The more China subsidizes its industries, the more we gain in the abundance of cheap goods and services and, contrary to what Trump believes, in the creation of high paying jobs.

Earlier this week, Charles Hugh Smith suggested that the federal government abandon its use of survey-based employment data and instead simply use IRS data on incomes and tax filings to estimate trends in employment and income.

In a live and streamed debate on 9/14 in Stockholm, Sweden, Per Bylund of Mises Institute debated Andrew Kliman from the Marxist-Humanist Initiative (MHI). The topic for the debate was “What makes a free society?” and the purpose was to raise two often overlooked perspectives on society and the economy: libertarianism and marxism.