27 July 2010
Bankruptcy of Supply-Side Economics
Martin Wolf presents a pretty good analysis in the Financial Times on July 25, 2010, of how supply-side economics were created in a stroke of political genius to ensconce the Republican Party in power in the U.S. under Reagan. Reading it, I kept envisioning Boehner and McConnell spouting their nonsense in search of restoring their majorities in Congress. Their objective is so parochial--just like Wall Street, they seek to win for the sake of winning. In their minds the score is kept in numbers of seats rather than in bonus awards. Wouldn't it be refreshing if their objective were to create a better life for the people of the country?
Is fiscal stimulus better accomplished through cutting taxes or through increasing spending? This may seem to be two sides of the same coin. On the other hand, give a capitalist more money by reducing his taxes (i.e. give him a free lunch) and you can’t expect him to create more jobs just out of the goodness of his heart. More jobs (a.k.a. fiscal stimulus) result from increased demand, not the supply side. Employers do not increase their payrolls in order to grow their business empires. Their businesses expand when they can make more money by filling demand for their products. Yes, that is easier to do when the government doesn’t reduce cash flow through high taxes; but lower taxes won’t force investment in job-producing enterprise. Only successful enterprises hire wage- (and, for that matter, bonus-) earners.
Martin Wolf presents a pretty good analysis in the Financial Times on July 25, 2010, of how supply-side economics were created in a stroke of political genius to ensconce the Republican Party in power in the U.S. under Reagan. Reading it, I kept envisioning Boehner and McConnell spouting their nonsense in search of restoring their majorities in Congress. Their objective is so parochial--just like Wall Street, they seek to win for the sake of winning. In their minds the score is kept in numbers of seats rather than in bonus awards. Wouldn't it be refreshing if their objective were to create a better life for the people of the country?
Is fiscal stimulus better accomplished through cutting taxes or through increasing spending? This may seem to be two sides of the same coin. On the other hand, give a capitalist more money by reducing his taxes (i.e. give him a free lunch) and you can’t expect him to create more jobs just out of the goodness of his heart. More jobs (a.k.a. fiscal stimulus) result from increased demand, not the supply side. Employers do not increase their payrolls in order to grow their business empires. Their businesses expand when they can make more money by filling demand for their products. Yes, that is easier to do when the government doesn’t reduce cash flow through high taxes; but lower taxes won’t force investment in job-producing enterprise. Only successful enterprises hire wage- (and, for that matter, bonus-) earners.
22 July 2010
Kagan and the Military--What Really Matters
Despite Pete Hegseth’s OpEd opinion in the July 21, 2010, Wall Street Journal, Don’t Ask Don’t Tell is indeed the military’s policy. The military’s role in our society is to take orders from civilian authorities. As the enforcer of a congressionally and presidentially imposed law, the military cannot escape responsibility for the effects of DADT. Moreover, the military was really complicit in the formulation of DADT. If the military brass did not oppose homosexual behavior as threatening to unit integrity, the law would have demanded total non-discrimination towards sexual orientation.
But the real issue for Elena Kagan as dean in restricting military recruitment at Harvard Law School must have been the priority in her mind of protecting personal rights in our constitutional system over enabling the federal government to use unilateral military power for international adventures like Iraq. After all, obstructing manpower recruitment for a misguided war is a reasonable trade for preserving the freedoms our constitution guarantees.
Despite Pete Hegseth’s OpEd opinion in the July 21, 2010, Wall Street Journal, Don’t Ask Don’t Tell is indeed the military’s policy. The military’s role in our society is to take orders from civilian authorities. As the enforcer of a congressionally and presidentially imposed law, the military cannot escape responsibility for the effects of DADT. Moreover, the military was really complicit in the formulation of DADT. If the military brass did not oppose homosexual behavior as threatening to unit integrity, the law would have demanded total non-discrimination towards sexual orientation.
But the real issue for Elena Kagan as dean in restricting military recruitment at Harvard Law School must have been the priority in her mind of protecting personal rights in our constitutional system over enabling the federal government to use unilateral military power for international adventures like Iraq. After all, obstructing manpower recruitment for a misguided war is a reasonable trade for preserving the freedoms our constitution guarantees.
14 July 2010
Smart Grids Don’t Enlist All Stakeholders
The nation’s Electric Power System serves an all–inclusive range of stakeholders, including fuel suppliers, power generators, power distributors, as well as direct power users and indirect ones: manufacturers, service providers and consumers. What turns the system into a smart grid is employing intelligent criteria for judging the most efficient and advantageous use of its enabling product—purchased energy. This has historically been mediated by the commercial market. However, it has been asserted that using the market’s pricing mechanisms is not sufficiently comprehensive for making those judgments.
There are many other considerations that must be taken into account, including environmental protection, physical and mental health, balanced economic growth, energy conservation, international balance of payments and strategic dependency. The cost of using electric power involves much more than the price determined in the marketplace.
It’s tempting to think that smart grids could be designed to subsume all political decisions that are implicated in the production, distribution and consumption of energy. Unfortunately, society’s issue resolution process is probably not yet able to be replaced by an electronic algorithm.
The nation’s Electric Power System serves an all–inclusive range of stakeholders, including fuel suppliers, power generators, power distributors, as well as direct power users and indirect ones: manufacturers, service providers and consumers. What turns the system into a smart grid is employing intelligent criteria for judging the most efficient and advantageous use of its enabling product—purchased energy. This has historically been mediated by the commercial market. However, it has been asserted that using the market’s pricing mechanisms is not sufficiently comprehensive for making those judgments.
There are many other considerations that must be taken into account, including environmental protection, physical and mental health, balanced economic growth, energy conservation, international balance of payments and strategic dependency. The cost of using electric power involves much more than the price determined in the marketplace.
It’s tempting to think that smart grids could be designed to subsume all political decisions that are implicated in the production, distribution and consumption of energy. Unfortunately, society’s issue resolution process is probably not yet able to be replaced by an electronic algorithm.
