Overpromising was a central feature of Donald Trump’s campaign for the presidency. He was going to build a big, beautiful wall and make the Mexicans pay for it. He was going to unleash a secret plan to defeat ISIS. And he was going to repeal Obamacare and replace it with something really terrific. Unfortunately, Donald Trump and the Republicans aren’t the only ones making unrealistic promises.
It must be frustrating to be a Congressional Democrat these days. The minority party in both the House and Senate and having lost the White House, the only thing keeping the Democrats relevant is a dysfunctional White House and a disunited Republican majority in Congress. There is, however, one area in which they should drop any obstructionism and play ball with the Republicans—raising the debt ceiling.
No one enjoys paying taxes. Remember receiving your first paycheck and discovering how much of your hard-earned money you would be sharing with the government? Most of us recognize that some taxes are necessary. Although economics recognizes the need for taxes to fund the government, it is pretty clear-eyed about the downside of taxes. One example is the tax on cigarettes.
Emmanuel Macron has completely upended French politics. Just over a year after founding a new centrist political party, En Marche (“On the move”), the former investment banker and Minister of Economy and Finance was elected president of France on 7 May by an overwhelming majority.
The Trump Administration released its $4 trillion budget on 23 May. Like the president himself, the budget promises a lot, delivers very little, and is full of misinformation. The administration promises to eliminate the federal government’s budget deficit within 10 years, while at the same time offering tax cuts to the wealthiest Americans. To get a sense of the scale of this task, consider the current fiscal position of the US government.
Was there ever a more hollow and impotent piece of legislation than the UK’s Fixed Term Parliaments Act? Trumpeted by the Conservative-led coalition as a way of stopping opportunist prime ministers ever again calling snap elections to capitalize on hefty poll leads – by complicating simple confidence votes in ways that prompted Labour to condemn it as a constitutional “stitch-up” – within six short years of receiving Royal Assent it has proved itself wholly incapable of doing any such thing.
Last month, Prime Minister Theresa May announced that Britain would hold a general election on 8 June. The election raises three crucial questions. First, why did the Prime Minister call an election now? Under British law, she could have remained in office without facing the voters until 2020 and, in fact, had promised on multiple occasions that she would not call early elections.
On 16 March, less than nine months after the public voted to leave the European Union (EU) in a hotly contested referendum, Britain enacted a law authorizing the government to begin the process of negotiating “Brexit,”— Britain’s withdrawal from the EU. Although there was much talk of “Bregret” following the referendum, recent polling suggests that British attitudes have not changed much since June.
Firms and individuals depend on honest accountants. Managers make decisions on the basis of information they provide. Investors decide whether to buy, sell, or hold on the basis of their pronouncements. And the advice of an accountant can make the difference between collecting a fat refund and going to prison for tax fraud. Honest accounting is as important for countries as it is for firms and individuals.
We economists spend a lot of time writing about the job market. Can the unemployment rate drop any further? Will the number of unemployed people increase when the Fed starts to raise interest rates? And will wages begin to pick up if the unemployment rate does drop?To pursue these questions, economists construct theoretical models of the labor market, gather hiring and wage data from a variety of industries and regions.
2016 was a rough year for globalization. And 2017 may get even rougher. By globalization, I mean the growing interconnectedness between economies through cross-border flows of goods and services, money, and people. The world has undergone two “eras of globalization” during the past century and a half. The first occurred during the 40 years or so before World War I.
Candidate Donald Trump’s policy proposals ranged from the bizarre to the truly frightening. Remember his “secret plan” to defeat ISIS? Turns out it consists of working with our Middle Eastern allies and tightening border security. Now that the election is over, a number of pundits predict that Candidate Trump’s extremism will give way to a more moderate, pragmatic President Trump. We can only hope.
Following the 2016 US Presidential election, we have curated a series of reading lists with resources that provide insight into electoral politics, key themes that stimulated some of the major debates from the election season, and important topics of discussion relating to the potential outcomes of the election. We have selected books and resources that detail American politics and investigate issues that influenced the recent presidential campaigns,
Some good ideas take a long time to gain acceptance. When Adam Smith argued forcefully against tariffs in his 1776 classic The Wealth of Nations, he was very much in the minority among thinkers and policy-makers. Today, the vast majority of economists agree with Smith and most countries officially support free trade. Index investing, sometimes called “passive investing,” has taken somewhat less time to gain acceptance.
A few weeks ago, I received an e-mail inviting me to sign a statement drafted by a group calling itself “Economists Concerned by Hillary Clinton’s Economic Agenda.” The statement, a vaguely worded five paragraph denunciation of Democratic policies (and proposed policies) is unremarkable — as are the authors, a collection of reliably conservative policy makers and commentators whose support for Donald Trump appear with some regularity in the media.
Inspired by the 11 Tony awards won by the smash Broadway hit Hamilton, last month I wrote about Alexander Hamilton as the father of the US national debt and discussed the huge benefit the United States derives from having paid its debts promptly for more than two hundred years. Despite that post, no complementary tickets to Hamilton have arrived in my mailbox. And so this month, I will discuss Hamilton’s role as the founding father of American central banking.