Americana
- What’s the Matter with Michigan? DUNCAN CURRIE 08/13/2008
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From the Associated Press:
“Michigan’s unemployment rate held steady in July, but the state continued to lose jobs.
“The Department of Labor and Economic Growth announced Wednesday that the seasonally adjusted jobless rate remained flat at 8.5 percent for the third consecutive month.
“Michigan has had the nation’s highest average annual unemployment rate since 2006. The national jobless rate for July was 5.7 percent.”
- The MBA Way DUNCAN CURRIE 08/13/2008
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The state of the global economy has contributed to an increase in business-school applications.
- A Warning for Ukraine DUNCAN CURRIE 08/13/2008
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American Enterprise Institute scholar Leon Aron analyzes the fallout from Russia’s war in Georgia:
“If Russia indeed has reverted to the traditional role of warlike authoritarianism and if, as seems to be the case, it pays no or a very small price internationally for this war, then the next victim is not at all hard to name. It is the pro-Western, struggling democracy of Ukraine, teeming with millions of ethnic Russians (or Russian-speakers). In fact, in the past few months a steady and increasingly loud propaganda drumbeat has sounded in Moscow, echoed in the parliament, the Duma: Do not vacate the Black Sea fleet’s base of Sevastopol and, furthermore, reclaim the entire Crimean Peninsula from Ukraine! (‘George,’ Putin reportedly told President Bush at the NATO summit in April in Romania, ‘Ukraine is not even a real state!’) That is why Kiev has been so vociferous in its support for Georgia.
“There could be big trouble ahead and the United States, regardless of who the next president will be, should be ready.”
- ‘Football and Property’ DUNCAN CURRIE 08/13/2008
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How will the credit crunch affect Arsenal FC, one of England’s most famous soccer clubs? According to BBC News business reporter Bill Wilson, “there are fears that the credit crunch and falling property prices could now hit Arsenal’s financial plans, both on and off the playing field.” Read the whole thing.
- ‘Faster, Higher, Stronger’ DUNCAN CURRIE 08/13/2008
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Cato Institute scholar James Dorn examines China’s progress. Here’s an excerpt:
“It would be foolish to focus only on China's flaws without recognizing the progress made in improving people's lives—progress due to the removal of restrictions on economic and personal choices, rather than to central planning. In particular, globalization and the information revolution have played crucial roles in China’s development. Without the benefits of trade, China would still be poor.
“The slow pace of political reform and the violation of human rights should be of serious concern, but using trade sanctions against China to promote human rights would do the opposite. Unlike trade, protectionism denies individuals the freedom to expand their effective alternatives, thus limiting their choices. Sanctions would fuel the flames of economic nationalism, harm U.S. consumers, and embolden hardliners in Beijing.”
Earlier this year, Dorn contributed to our symposium on the Beijing Olympics.
- ‘A Russian Patriot’ DUNCAN CURRIE 08/08/2008
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Historian Robert Conquest remembers Alexander Solzhenitsyn.
- The McDonald’s ‘Winning Streak’ DUNCAN CURRIE 08/08/2008
- Hoop Dreams DUNCAN CURRIE 08/08/2008
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Sunday’s Olympic basketball game between Team USA and Team China “is likely to be the most widely viewed in basketball history.”
- Testing the Fed DUNCAN CURRIE 08/06/2008
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From a recent speech by Charles I. Plosser, president and CEO of the Federal Reserve Bank of Philadelphia:
“I want to make clear that the rise in inflation expectations in the 1970s was not caused by a wage-price spiral. That story has things backwards. The wage-price spiral was a consequence of the inflation and the unanchoring of expectations of inflation, not the other way around. And the unanchoring of inflation expectations was caused by the public’s loss of confidence in the Federal Reserve’s resolve to bring inflation back down. The credibility of the Fed’s promise to deliver price stability was lost.
“In recent months I have heard some analysts suggest that the current economic situation is not like the 1970s because unions are less prevalent and there is no evidence as yet of a wage-price spiral. Thus, a weak economy, with rising unemployment and declining payroll employment, will presumably prevent workers from demanding higher wages. But, again, that story has things backwards. It is not demands for higher wages that kick off the spiral, but the loss of confidence that the central bank will keep inflation controlled, which, in turn, leads to a rise in inflation expectations. The wage-price spiral is not the cause of the inflation, but the result.
“This means that if monetary policymakers wait until they see the evidence of a wage-price spiral, they will be too late—the public will have lost confidence in the Fed’s ability to keep inflation under control, and this will make the job of bringing inflation down much more costly and difficult. Moreover, we could end up with a period of both low economic growth and high inflation.
“I want to emphasize that what we have been seeing in the economy this past year, and in my own outlook going forward, is very different from the 1970s, because I see the Fed as committed to keeping inflation expectations well-anchored. I agree with a statement Fed Chairman Bernanke made in June that the Fed will strongly resist an erosion of longer-term inflation expectations, because an ‘unanchoring’ of those expectations would be destabilizing for economic growth as well as inflation.”
- The Oprah Factor DUNCAN CURRIE 08/06/2008
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Harvard economist Greg Mankiw directs us to a new paper by University of Maryland economists Craig Garthwaite and Tim Moore, which argues that “Oprah Winfrey’s endorsement of Barack Obama prior to the 2008 Democratic Presidential Primary generated a statistically and qualitatively significant increase in the number of votes Obama received as well as in the total number of votes cast.” All told, Garthwaite and Moore “estimate that the endorsement was responsible for 1,015,559 votes for Obama.”
- The Olympic Effect DUNCAN CURRIE 08/01/2008
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“On balance, the award of the [Olympic Games] has done more harm than good to the opening up of China,” argues The Economist magazine.
Earlier this year, THE AMERICAN asked several China experts to discuss how hosting Olympics might affect the course of Chinese liberalization. Their comments were published as a symposium in our May/June issue.
- The Economics of Arenas DUNCAN CURRIE 07/31/2008
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Does the city of Baltimore “need” a new sports arena?
- ‘The New Solid South’ DUNCAN CURRIE 07/31/2008
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Joel Kotkin and Mark Schill write that “America’s urban areas have evolved into a political monoculture that increasingly resembles the ‘solid South’ that provided a base for Democrats from the late 19th century to the 1960s. Since 1972, the year of the Nixon landslide, the Democratic share has grown 20 percent or more in most of the largest urban counties.”
Read the whole thing.
- The Case for Romney DUNCAN CURRIE 07/31/2008
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RealClearPolitics blogger Jay Cost argues that John McCain should pick the former Massachusetts governor as his running mate.
- Californians for Drilling DUNCAN CURRIE 07/31/2008
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From The San Francisco Chronicle:
“A majority of Californians favor more oil drilling off the coast, according to a statewide survey released Wednesday, for the first time since oil prices spiked nearly three decades ago.
“The support by 51 percent of residents polled this month by the Public Policy Institute of California represents a shift caused by renewed Republican advocacy for drilling as well as motorists’ reaction to soaring pump prices, according to the pollster.”
- Goolsbee and Furman DUNCAN CURRIE 07/31/2008
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Cesar Conda takes a closer look at two of Barack Obama’s chief economic advisers.
- Doha Hits a Roadblock DUNCAN CURRIE 07/30/2008
- The Latest S&P/Case-Shiller Data DUNCAN CURRIE 07/30/2008
- Bush and Truman DUNCAN CURRIE 07/30/2008
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Writing in the British magazine Prospect, Edward Luttwak defends President Bush’s foreign policy legacy and argues that talk of American decline is overblown. His article can be found here.
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“For a country so steeped in the free market, America can show some strikingly socialistic tendencies,” writes Martin Waller.
- Why Are Oil Prices So High? DUNCAN CURRIE 07/25/2008
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“The big conclusion of the Interim Report on Crude Oil, the product of an interagency task force led by the [Commodity Futures Trading Commission], is that ‘current oil prices and the increase in oil prices between January 2003 and June 2008 are largely due to fundamental supply and demand factors,’” writes Fortune senior editor Bryan O’Keefe.
“And it makes a really strong case. Global GDP has grown at close to 5% annually since 2004, the report points out, driving rising consumption of oil. And production has not been able to keep pace. In June, world surplus production capacity, the task force says, was a mere 1.35 million barrels per day, or about a third of what it average from 1996 to 2003. The market is getting tighter and tighter.
“Just as compelling are the report’s conclusions about what’s not happening: Analysis of the futures markets showed no evidence of speculators driving up prices.”
Read the whole thing.
- Bidding for the Cubbies DUNCAN CURRIE 07/24/2008
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From The Chicago Sun-Times:
“The Chicago Cubs have culled the number of bids for the team to five, all at $1 billion or more, and tossed out an offer from a group regarded as the favorite of Major League Baseball, sources said Wednesday.
“The Cubs, owned by Tribune Co., have rejected an offer from a large investment group led by John Canning Jr., chairman of Madison Dearborn Partners LLC. Canning, a part owner of the Milwaukee Brewers, is a close associate of baseball Commissioner Bud Selig.
“Making the cut as the Cubs winnowed the list of bids from an original 10 respondents was Mark Cuban, owner of basketball’s Dallas Mavericks, said a source familiar with the process. The identity of the other finalists couldn’t be learned.”
- The CBO on Income Volatility DUNCAN CURRIE 07/24/2008
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According to a recently released Congressional Budget Office (CBO) paper, “the year-to-year variability of [individual] earnings has changed little since the mid-1980s.”
What about household income? “Overall,” the CBO reports, “the fraction of households experiencing large changes in income has been relatively constant since the mid-1980s. Income tends to vary more for low-income households and for households headed by younger people, by those with less education, and by those who are not married.”
The full paper can be found here.
- Heading to Uruguay DUNCAN CURRIE 07/24/2008
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From Bloomberg News:
“A third of Uruguay’s agricultural property may now be owned by foreigners, according to Uruguay’s Rural Association. They include farm companies PGG Wrightson Ltd. of New Zealand and Buenos Aires-based Adecoagro, which is backed by billionaire investor George Soros.
“International buyers, seeking to take advantage of rising global food prices, are attracted by the South American country’s relatively cheap land, policies that encourage foreign investment, and no tariffs on farm exports, said Roberto Vazquez Platero, a former agriculture minister. As a result, farm prices have more than doubled in three years.”
- Cooling Off DUNCAN CURRIE 07/24/2008
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From a recent article by Danish environmentalist Bjørn Lomborg (which was linked on the excellent website Climate Debate Daily):
“There is a kind of choreographed screaming about climate change from both sides of the debate. Discussion would be on much firmer ground if we could actually hear the arguments and the facts and then sensibly debate long-term solutions.
“Man-made climate change is certainly a problem, but it is categorically not the end of the world. Take the rise in sea levels as one example of how the volume of the screaming is unmatched by the facts. In its 2007 report, the United Nations estimates that sea levels will rise about a foot over the remainder of the century. While this is not a trivial amount, it is also important to realize that it is not unknown to mankind: since 1860, we have experienced a sea level rise of about a foot without major disruptions. It is also important to realize that the new prediction is lower than previous Intergovernmental Panel on Climate Change (IPCC) estimates and much lower than the expectations from the 1990s of more than two feet and the 1980s, when the Environmental Protection Agency projected more than six feet.
“We dealt with rising sea levels in the past century, and we will continue to do so in this century. It will be problematic, but it is incorrect to posit the rise as the end of civilization.”
Read the whole thing.