Even the most innocent novel can give its reader a fresh perspective on the economy during the author’s time. Economic writings and economic conditions often inspired great writers who, in turn, allowed us to contemplate either a glimpse or a detailed picture of economic reality. Stendhal was influenced by Malthus, Flaubert by Bastiat, and Ayn Rand by Mises. Other novelists faithfully described the economic times of their lives.
This week, Janet Yellen was again before Congress to once again kick the can down the road. The position of Yellen and the Fed appears to be, yet again, that they’ll some day move back toward what might be called more “normal” monetary policy.
In 2012, Robert Higgs analyzed the role of government purchases in the calculation of GDP and suggested that a more reliable reading of domestic product would exclude government purchases.
Higgs explained that — while government spending is fundamentally different from private-sector spending — the orthodox Keynesian notion of including government spending in calculations of economic growth has now become the norm:
Fed Vice Chairman Stanley Fischer’s February 11th speech at Warwick Economics Summit was built around a story from his youth:
According to the flow of funds data published by the Fed, the US debt to GDP ratio remains at a lofty level. Non-financial sector debt as a percentage of GDP stood at 251.7% in Q3 2016 against 230.1% in Q1 and 184.3% in Q1 2000.
Consumer credit as a percentage of GDP also remains at a record high — it stood at 19.9% in Q3 2016 against 15.8% in Q1 2000.
Donald Trump has been using and abusing national homicide statistics to suit his own political ends. But, using nationwide statistics — even correct ones — has long been problematic.
Mercantilism has had a “good press” in recent decades, in contrast to 19th-century opinion. In the days of Adam Smith and the classical economists, mercantilism was properly regarded as a blend of economic fallacy and state creation of special privilege.
Should we blame technology for the growth in healthcare spending? Austin Frakt, a healthcare economist who writes for the New York Times, thinks so. Citing several studies conducted over the last several years, he claims that technology could account for up to two-thirds of per capita healthcare spending growth.
When one takes a closer look at federal budgets over the past decade, one is sure to notice a watershed budget year: 2009.
This was the year that federal outlays increased by a whopping 18 percent (in inflation-adjusted dollars) from the previous fiscal year.
How to interpret this budget increase, however, remains controversial because both presidents Obama and Bush are responsible for portions of the budget. the 2009 budget is bipartisanship at its worst.
