The Federal Reserve has recently received much criticism from economic conservatives who claim it has ignored inflation, thereby risking a rerun of the 1970’s inflation show. In response, renowned Princeton economist Paul Krugman has come to the Fed’s defense arguing today’s inflation is fundamentally different from that of the 1970s. (more…)
Archive for the ‘Political Economy’ Category
Re-thinking That ‘70’s Inflation Show
Monday, June 16th, 2008The Capture of Keynesianism
Monday, April 14th, 2008Communist revolutionary Che Guevara rapidly became an inspirational figure for revolutionary socialist change after his execution in Bolivia in 1967. Forty years later, Che lives on but his image now adorns t-shirts that have become popular fashion statements. This transformation reflects the extraordinary power of markets to capture and transform, turning an avowed enemy of the market system into a profit opportunity. (more…)
Demythologizing Central Bankers and the Great Moderation
Wednesday, April 2nd, 2008It is often said that the winners get to write history, which matters because the way we tell history frames our understandings. What is true for general history also holds for economic history, and the way we tell economic history affects our expectations and aspirations for the economy. (more…)
Winning the Edwards Vote
Monday, February 11th, 2008John Edwards’ exit from the presidential race puts his supporters up for grabs. Both Senators Clinton and Obama want those votes. Here’s how to win them.
The central plank of the Edwards’ campaign was restoring a prosperous and secure middle class, which requires ending wage stagnation and having wages again grow with productivity. This must be the central economic policy goal of any candidate wanting the Edwards vote. (more…)
Breaking the Neoclassical Monopoly in Economics
Thursday, February 7th, 2008For the past 25 years, the so-called “Washington Consensus†– comprising measures aimed at expanding the role of markets and constraining the role of the state – has dominated economic development policy. As John Williamson, who coined the term, put it in 2002, these measures “are motherhood and apple pie, which is why they commanded a consensus.†(more…)
The Subprime – Trade Deficit Connection
Monday, January 7th, 2008In recent months the U.S. subprime mortgage crisis has been rippling outward affecting other countries. British banks have made large loan loss provisions and there has been a run on the Northern Rock bank. German banks have incurred similar losses and Germany has suffered two large bank failures. European banks have also become leery about lending to each other, forcing the European Central bank to infuse emergency liquidity. Now, Japan’s banks are feeling the heat. (more…)
Democrats and the Meaning of Change
Wednesday, January 2nd, 2008Many people now believe the United States cannot afford to continue with the policies of the Bush-Cheney administration. Those policies have undermined global support for America – a key part of national security – and have produced an economic expansion that has bypassed working families and looks as if it will bequeath years of house-price pain. (more…)
The Flaws in Rubinomics
Tuesday, October 9th, 2007With Senator Hillary Clinton firmly cemented as the front-runner for the Democratic Party’s nomination, Rubinomics—named after former Treasury Secretary Robert Rubin, who shaped economic policy under President Clinton—has re-emerged as a critical issue. This is because Senator Clinton has firmly embraced it. Rubinomics rests on faulty economics and embodies bad politics. Progressive Democrats and the nation need to understand this. Here’s an explanation. (more…)
Beyond Red and Blue
Friday, May 18th, 2007It is widely recognized that the debacle in Iraq has contributed importantly to disenchantment with the Bush administration and Republican Party. However, less recognized is the potential long-term political impact of Iraq, which has opened the door to moving beyond the red state – blue state division that has marked US politics for the past generation. That in turn could create a lasting progressive majority. (more…)
Deep Thinking and Economic Policy: Why It Matters
Monday, January 22nd, 2007Deep thinking involves going to the root of ideas, analyzing core assumptions and the logic upon which arguments are built. In a sense it is analogous to the Research component of R&D. Research represents deep thinking, while Development takes the product of that thinking and turns it into something that can be marketed profitably. In like vein, physicists distinguish between pure and applied physics, while economists distinguish between theory and policy. (more…)