Today’s Brew 5-5-17

Learn Liberty has put out this video featuring our friend Brian Domitrovic where he discusses “Economic Growth in the Gilded Age.” The video runs just under five minutes, take a look:


Sean Rushton joined John Batchelor’s radio show for a discussion on the dollar, and Robert Mundell was even discussed.


Donald Lambro looks at the nation’s economy until we get tax reform or tax cuts.

A subpar economy looms

Obama’s higher taxes will continue so tax reform is needed now

Excerpt:

The Obama economy was stuck in the 2 percent growth range for most of his presidency, and many economists say it will likely remain in that range — even though Mr. Trump has promised that his policies will boost growth to 3 percent.

That’s not much to write home about. Shortly after the 1981-82 recession, the Reagan economy was soaring by 5.6 percent and 7.7 percent respectively in the third and fourth quarters of 1983, as a result of his across-the-board tax cuts.

By 1984, GDP was growing by 7.3 percent and Mr. Reagan won re-election in a landslide, carrying 49 states.

Throughout the 2016 presidential election, the Gallup Poll asked voters to name their biggest concerns about our country. The economy was consistently at the top of their list.


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Today’s Brew ☕ 4-19-17

Asia Times

Sean Rushton appears in the Asia Times today, talking currency:

Should the world’s two largest currencies be so unstable?

Excerpt:

Speaking in 2010, Dr. Robert Mundell, the Nobel Laureate and iconoclastic dean of international monetary economics, made an intriguing observation.

The global economy was like a solar system, he said. And for many decades, due to the overwhelming size of American GDP, the US dollar had been like the sun, the behemoth at the center whose gravity dominated and defined the system.

The dollar’s centrality was a fact, despite the supposed monetary independence nations attained in the early 1970s, when the Bretton Woods system of pegged exchange rates broke apart and currencies were allowed to float relative to one another.


Forbes

Steve Forbes makes some great points about why we tolerate the “atrocity” of the tax code.

Why Do We, A Free People, Put Up With The Atrocity Of The Federal Income Tax Code?

Excerpts:

But try to get an American politician to make it a front-burner cause! Most are too scared to attempt it. They’ll mumble about the need for a tax code that is “simpler and fairer,” but that’s it. They fear getting in the lobbyists’ crosshairs. They tremble at being accused of benefitting the rich, while shafting the poor and gutting health care and the tax breaks of home ownership and charitable giving.
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Ultimately, this is a moral issue. Just think back over 20 years and add up the, literally, tens of billions of hours, the trillions of dollars and the immense brainpower that have been wasted on this utterly unnecessary activity. Then think of all the new products and services, the new medical devices and cures for diseases that could have been created with these resources that went down the drain of the current and ever more complex and corrupt tax code.


☕ Do not miss this chance to hear from George Gilder.

Supply-Side Notes 6-9-12

An interview with Robert Mundell:

Robert Mundell: Euro is here to stay

The euro has ‘passed its youth with flying colours,’ is a world currency par excellence and has great future as an international reserve asset

FP COMMENT:Paul Krugman and others are now claiming that your original paper, “The Theory of Optimum Currency Areas,” required labour mobility and fiscal union. Europe didn’t have either; therefore the euro was a mistake.

MUNDELL: My argument for Optimal Currency Areas said nothing about fiscal union. Very few countries in the world have a fiscal union. It would be almost impossible for a large country to have a complete fiscal union. Canada and the United States do not. In the United States, the central government spends maybe 22% of GDP while total government spending is about 37%. Every country’s fiscal structure is different, depending on the way in which spending and taxes are divided among the federal government, the state or provincial government and the municipalities.

A fiscal union is not a prerequisite for a monetary union. The argument that monetary unions require fiscal unions is a recent idea based on new functions of government to give assistance to specific economic groups hit by asymmetric shocks. This kind of specific relief to hard-hit segments would be better carried out at the federal government level, as in the U.S. or Canada, rather than the local level. But it does not require fiscal union in any comprehensive sense.

Historically, monetary unions have been established in ancient empires and nation states without regard to fiscal union. Even after the U.S. consolidated state debts into a national debt in 1792, states were sovereign with respect to debts and deficits. When several defaulted in the 1840s they were not bailed out and nobody imagined that the problem had anything to do with the U.S. monetary union.

This is not to say that Europe might not be better off with a redistribution of functions from the nation-state to the “federal” level, including defense and social security unification. But if these shifts of responsibility are made along with corresponding shifts in the powers of taxation, they should be made on grounds of efficiency and economic justice, not on grounds that they are necessary for monetary union.

Read the entire interview here