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Economy, Taxes and Free Markets
85 posts, newest first (page 3 of 4).
Cuba's ration book and more than sixty years of promises at the bodegaCuba introduced its ration book in 1962 as a stopgap. Its survival across generations is the plainest verdict on the revolution, embargo included. Britain's postwar socialism, from nationalized coal to the Winter of DiscontentBritain won the war, nationalized its commanding heights, and by 1976 was borrowing from the IMF. How that record made the Thatcher reforms possible. Why Soviet shoppers stood in line, and the calculation problem behind itCentral planning failed because planners without market prices cannot know what anything is worth. The argument, from Mises to Novocherkassk. Venezuela was once Latin America's success story, and then came socialismVenezuela sat on the largest oil reserves on earth. Two decades of nationalization, price controls and money printing turned that wealth into hunger and exodus. Eleven questions about recessions and who decides when one has startedThe two-quarter rule is a rule of thumb. A private committee makes the official call, months late. Eleven plain answers on how recessions are dated. A central bank digital currency is a dollar Washington could programA retail CBDC would give government a ledger of every purchase and the power to restrict or expire money. Here is how it works and why to refuse it. Inflation hurts the poor most, and the arithmetic of a fixed paycheckInflation is a tax nobody voted on, and it falls hardest on wage earners, retirees and savers. The arithmetic, worked out on a labelled $50,000 paycheck. Gold standard, Friedman's rule or today's Fed, three answers comparedConservatives disagree about money. Here are five monetary regimes on one table, with a fair hearing for each camp before a verdict. The Fed's dual mandate and the 1977 law that gave it two mastersCongress told the Fed to pursue maximum employment and stable prices at once. That double mandate invites tolerating inflation for jobs. Greedflation is a story that skips the question of why greed took a breakCorporate greed was as constant in 2019 as in 2021, so the real question is what changed to let companies raise prices. What caused the inflation of 2021 to 2023, weighing the honest evidenceSupply shocks played a part, but the biggest driver was demand pumped up by trillions in federal spending and near-zero interest rates. Cash for Clunkers destroyed working cars in 2009 to stimulate the economyWashington paid people to trade in working cars, had the engines ruined on purpose, and later studies found it mostly moved sales forward in time. The Great Inflation of the 1970s was a policy choice, not bad luckInflation from 1965 to 1982 began with money creation and political pressure on the Fed before the oil shocks, and blaming OPEC lets policymakers off the hook. Seven myths about the national debt that Washington finds convenientBoth parties tell comfortable stories about the debt. Tested against Treasury and CBO data, the problem is spending growth, not a revenue shortage. Earmarks came back, and the conservative argument over pork never endedEarmarks are a small share of spending and a large symbol. Conservatives split on whether banning them restrained spending or just empowered agencies. A balanced budget amendment, the case for it and the conservative doubtsA constitutional rule may be the only restraint that can stop permanent deficits. Conservatives disagree over whether it would work. From Gramm-Rudman to PAYGO, a timeline of fiscal rules that bentCongress keeps writing rules to force itself to stop borrowing, and keeps waiving them when they bite. Here are the dates. Modern Monetary Theory says deficits do not matter, and 2022 answered itMMT holds that a country borrowing in its own currency need only watch inflation. The inflation of 2021 and 2022 showed how fast that limit arrives. Baseline budgeting, where a smaller increase gets reported as a cutWashington measures spending against a baseline that assumes automatic growth, so a program that gets more money can be reported as cut. How to read it. Hamilton's 1790 Report on Public Credit and what honest borrowing requiresHamilton built American credit by paying the Revolution's debts in full and planning to retire them. Read the 1790 report, then judge today's deficits. The debt ceiling began in 1917 to make borrowing easier, not harderThe debt limit was created so Treasury could borrow without asking Congress for each bond issue. How it became a leverage point, and whether it is a real brake. Do the arithmetic on $40 trillion and the interest bill it carriesThe debt rose $2.51 trillion in a year to $40.56 trillion. The math on that jump, on each point of interest, and on why interest crowds out everything else. The corporate rate cut to 21 percent and the inversions it brought to an endBefore 2018 the corporate rate was 35 percent and firms moved their legal homes abroad. Here is what the 2017 law changed, and the answer to the buyback charge. Tax the rich more? The wealth tax failed across Europe and was repealedMost European countries that taxed net wealth dropped it: it raised little, drove capital abroad and cost a lot to run. The record, the math, Article I.
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