{"title":"Macroprudential Policy, Leverage, and Bailouts","authors":"Allan M. Malz","doi":"10.36009/CJ.39.3.2","DOIUrl":"https://doi.org/10.36009/CJ.39.3.2","url":null,"abstract":"","PeriodicalId":38832,"journal":{"name":"Cato Journal","volume":"53 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2019-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87267110","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Optimal Top Tax Rates: A Review and Critique","authors":"Alan Reynolds","doi":"10.36009/CJ.39.3.8","DOIUrl":"https://doi.org/10.36009/CJ.39.3.8","url":null,"abstract":"","PeriodicalId":38832,"journal":{"name":"Cato Journal","volume":"42 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2019-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85061888","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Zoning Rules! The Economics of Land Use Regulation William A. Fischel Cambridge, Mass: Lincoln Institute of Land Policy, 2015, 432 pp. Something has gone terribly wrong in America's cities in the last few decades. Real estate construction has fallen behind demand in cities like New York, San Francisco, Austin, and Miami. Rents are rising, and both current and prospective residents are having a hard time keeping up. The good news is that we know why this is happening. Mainstream economists agree that burdensome restrictions on building new housing in prosperous cities hurt economic growth, exacerbate inequality, and stifle entrepreneurship. The bad news is that it's going to be a huge challenge to fix. This is the lesson that Zoning Rules! teaches us. The book is the magnum opus of Dartmouth economist William Fischel, the follow-up to his acclaimed 1987 book The Economics of Zoning Laws. In the nearly 30 years between these tomes, Fischel spent his career exploring how land use rules came to be and what role they would play in the economy and society. Through careful history, a thorough understanding of property law, and sound economics, Zoning Rules! weaves a story of the rise of the exclusionary zoning laws that have come to strangle housing development in major metropolitan areas. The early years of zoning laws were relatively harmless and mundane compared to what would come later. Urban planners and the officials they appointed generally made pragmatic decisions that reflected the opinions of their constituents. When excluded from one town, developers could find another nearby. Minority factions had trouble blocking development if they lacked political power. It was the era of "good housekeeping" zoning. Fischel defines "good housekeeping" as basic separation of activities, such as noxious industry from residential areas, without attempts to control or micromanage growth. The period saw a boom in suburban building that would taper off over time. Fischel's theory is that something changed in the 1970s. A confluence of events precipitated the rise of exclusionary laws in the suburbs of the nation's cities. Employment decentralized from areas near ports with the advent of trucking, the interstate system, and the shipping container. Freed from center cities, industry fled to places where land was cheap and plentiful. The period saw housing grow to take up a greater share of household wealth. Combined with the civil rights movement's reforms, the period saw a serious increase in demand for exclusionary housing restrictions. Yet, demand is only part of the story. The supply pressures of exclusionary laws were serious. Unlike labor or capital, moving land from one municipality to another, while not impossible because of processes like municipal annexation, is a serious challenge. With ability to relocate to places with more hospitable legal institutions, weak zoning laws play a key role in the land use decisionmaking process. The period also saw the
分区规则!William A. Fischel，剑桥，马萨诸塞州:林肯土地政策研究所，2015年，432页。在过去的几十年里，美国的城市出现了严重的问题。在纽约、旧金山、奥斯汀和迈阿密等城市，房地产建设已经落后于需求。房租在上涨，现在和未来的居民都很难跟上房租的上涨。好消息是，我们知道为什么会发生这种情况。主流经济学家一致认为，在繁荣城市建造新住房的繁重限制会损害经济增长，加剧不平等，扼杀创业精神。坏消息是，解决这个问题将是一个巨大的挑战。这是分区规则的教训!教我们。这本书是达特茅斯大学经济学家威廉·费希尔的代表作，是他1987年出版的广受好评的《分区法经济学》的续集。在这两部大部头著作之间的近30年时间里，费歇尔的整个职业生涯都在探索土地使用规则是如何形成的，以及它们在经济和社会中扮演了什么角色。通过仔细的历史，对物权法的透彻理解，以及健全的经济学，分区规则!编织了一个关于排他性分区法兴起的故事，这些法律已经扼杀了主要大都市地区的住房开发。与后来的情况相比，分区法的最初几年相对无害、平淡无奇。城市规划者和他们任命的官员通常会做出反映选民意见的务实决定。当被一个城镇拒之门外时，开发商可以在附近找到另一个城镇。如果少数派系缺乏政治权力，他们很难阻止发展。这是一个“好管家”分区的时代。Fischel将“良好的内务管理”定义为活动的基本分离，例如有害工业与居民区的分离，而不试图控制或微观管理增长。在这一时期，郊区建筑出现了繁荣，但随着时间的推移，这种繁荣将逐渐减弱。Fischel的理论是在20世纪70年代发生了一些变化。一系列事件的汇合促成了排他性法律在美国城市郊区的兴起。随着卡车运输、州际运输系统和集装箱运输的出现，就业机会从港口附近地区分散开来。从中心城市解放出来后，工业逃到了土地便宜而丰富的地方。在这一时期，住房在家庭财富中所占的比重越来越大。与民权运动的改革相结合，这一时期对排他性住房限制的需求大幅增加。然而，需求只是故事的一部分。排他法的供给压力是严重的。与劳动力或资本不同，将土地从一个城市转移到另一个城市，虽然不是不可能，但由于城市兼并等过程，这是一个严重的挑战。由于有能力搬迁到法律制度更友好的地方，薄弱的分区法在土地使用决策过程中发挥了关键作用。在这一时期，环境运动的联邦化与反对发展的法律地位的扩大以及州政府多层次审查的出现相结合。不同的部门和政府机构有权监督建筑的各个方面。开发是官僚化的，与此同时，建设过程的交易成本也增加了。地方政府的权力格局发生了根本变化。曾经的“良好的内务管理”法律制度已经腐化。最重要的是，分区规则!是一本土地利用经济学教科书。菲舍尔不是专家。事实上，他的宏大理论直到书中某一章的中间才出现。和它的前身一样，分区规则!是为了探索和解释。第一章阐述了土地经济学的基本概念，以及住房供需的基本概念。第二章解释了分区法的工作原理和实施方法。…
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The debate about rules versus discretion in monetary policy is an old one. It goes back at least to the 1930s, when a group of University of Chicago economists, led by Henry Simons, proposed that the monetary authorities should be bound by a rule that aims to achieve price-level stability.1 Although for many years that debate was confined to the academic community, it spilled over to the public arena in 1958, when Milton Friedman proposed a money-supply growth rule to the Congressional Joint Economic Committee. Recently, the issue of rules versus discretion in monetary policy has been at the heart of a debate between the former Fed chairman, Ben Bernanke, who favors what he calls “cons-trained discretion” in the conduct of monetary policy, and John Taylor, who favors a “rules-based” monetary policy. In what follows, we address the following question: What would Milton Friedman have thought about the present debate on constrained discretion versus rules-based monetary policy? To shed light on this question, we begin by briefly reviewing the positions of Taylor and Bernanke, respectively, on rules versus discretion. Next, we consider the factors that led Friedman to favor a money-supply growth rule. During the late 1940s and early 1950s, Friedman favored using fiscal policy to effectuate changes in the money supply in order to stabilize output at the full-employment level. However, during the 1950s, his growing realization that the Federal Reserve System was culpable in both initiating the Great Depression with its policy tightening in 1928 and 1929 and deepening the Depression with its policies after 1929, led him to favor a rule that limited discretion. We show that a key factor underlying the rules of both Friedman and Taylor is their common view that monetary policy should aim to reduce uncertainty.
{"title":"Friedman and the Bernanke-Taylor debate on rules versus constrained discretion","authors":"Harris Dellas, G. Tavlas","doi":"10.7892/BORIS.93171","DOIUrl":"https://doi.org/10.7892/BORIS.93171","url":null,"abstract":"The debate about rules versus discretion in monetary policy is an old one. It goes back at least to the 1930s, when a group of University of Chicago economists, led by Henry Simons, proposed that the monetary authorities should be bound by a rule that aims to achieve price-level stability.1 Although for many years that debate was confined to the academic community, it spilled over to the public arena in 1958, when Milton Friedman proposed a money-supply growth rule to the Congressional Joint Economic Committee. \u0000Recently, the issue of rules versus discretion in monetary policy has been at the heart of a debate between the former Fed chairman, Ben Bernanke, who favors what he calls “cons-trained discretion” in the conduct of monetary policy, and John Taylor, who favors a “rules-based” monetary policy. \u0000In what follows, we address the following question: What would Milton Friedman have thought about the present debate on constrained discretion versus rules-based monetary policy? To shed light on this question, we begin by briefly reviewing the positions of Taylor and Bernanke, respectively, on rules versus discretion. Next, we consider the factors that led Friedman to favor a money-supply growth rule. During the late 1940s and early 1950s, Friedman favored using fiscal policy to effectuate changes in the money supply in order to stabilize output at the full-employment level. However, during the 1950s, his growing realization that the Federal Reserve System was culpable in both initiating the Great Depression with its policy tightening in 1928 and 1929 and deepening the Depression \u0000with its policies after 1929, led him to favor a rule that limited discretion. We show that a key factor underlying the rules of both Friedman and Taylor is their common view that monetary policy should aim to reduce uncertainty.","PeriodicalId":38832,"journal":{"name":"Cato Journal","volume":"23 1","pages":"297-313"},"PeriodicalIF":0.0,"publicationDate":"2016-03-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85917497","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2016-01-01DOI: 10.1163/2210-7975_hrd-0164-2016003
R. Vedder
Like most economics professors, I have spent my academic lifetime examining the economic and public policy effects of issues involving the production, distribution, and consumption of goods and services--political economy, if you will. There is, however, a "political economy" to die very act of producing and disseminating economic knowledge and examining public policies. And that political economy and my assessment of it has changed over a career spanning more than half a century. In this brief article, I will confine my attention mostly to the research dimension and look at five issues, most relating to the political economy of the study of political economy. Diminishing Returns to Research I have long been bemused by economists who profess to understand the principle of scarcity and the importance of opportunity costs, yet write so much trivia of little interest to anyone. They do so because of the nonmarket nature of most academic endeavors and the utter lack of incentives to be efficient. The fifteenth paper on a topic is not very likely to add as much to our stock of knowledge as the first or second. I think the nation as a whole has probably overinvested in higher education because of vast governmental subsidies (an argument best made by retired professors like me whose potential acquisition of economic rents by extolling higher education is minimal). That manifests itself in such phenomena as the overeducated Starbucks barista or in the more than 115,000 janitors with bachelor s degrees. It also means roughly 1,000 academic papers are being written on William Shakespeare annually--three per day (Bauerlein 2009: 6). Who reads them? How much does a typical paper add at the margin to the insights that Shakespeare gave us 400 years ago? The problem extends to the inputs as the well as the outputs of higher education, and too many professors are writing too many words (and equations) that, to borrow from the Bard (Shakespeare to college graduates after 1990), "signify nothing." What if professors wrote only one-third or one-half the number of papers they currently write, but taught one more class per year? My guess is that the net effects would be at least mildly positive, maybe even leading to smaller tuition increases and delaying a bit the demise of die current medieval way we do business. Belated to all that, the U.S. Department of Education can probably tell you how many anthropology professors of Hispanic origin there are in South Dakota, but cannot tell you what the average teaching load of American professors is. But I am pretty sure it is minimally 25 percent less than it was when I began fulltime teaching in tire year the Higher Education Act passed, 1965. Doing less (teaching) with more describes modern higher education. Pseudo-Science and Ideology Modern economics may be less ideologically driven dian, say, sociology, but the notion that economists are scientists who objectively observe phenomenon and derive conclusions solely on th
{"title":"Reflections on the Current State of Political Economy","authors":"R. Vedder","doi":"10.1163/2210-7975_hrd-0164-2016003","DOIUrl":"https://doi.org/10.1163/2210-7975_hrd-0164-2016003","url":null,"abstract":"Like most economics professors, I have spent my academic lifetime examining the economic and public policy effects of issues involving the production, distribution, and consumption of goods and services--political economy, if you will. There is, however, a \"political economy\" to die very act of producing and disseminating economic knowledge and examining public policies. And that political economy and my assessment of it has changed over a career spanning more than half a century. In this brief article, I will confine my attention mostly to the research dimension and look at five issues, most relating to the political economy of the study of political economy. Diminishing Returns to Research I have long been bemused by economists who profess to understand the principle of scarcity and the importance of opportunity costs, yet write so much trivia of little interest to anyone. They do so because of the nonmarket nature of most academic endeavors and the utter lack of incentives to be efficient. The fifteenth paper on a topic is not very likely to add as much to our stock of knowledge as the first or second. I think the nation as a whole has probably overinvested in higher education because of vast governmental subsidies (an argument best made by retired professors like me whose potential acquisition of economic rents by extolling higher education is minimal). That manifests itself in such phenomena as the overeducated Starbucks barista or in the more than 115,000 janitors with bachelor s degrees. It also means roughly 1,000 academic papers are being written on William Shakespeare annually--three per day (Bauerlein 2009: 6). Who reads them? How much does a typical paper add at the margin to the insights that Shakespeare gave us 400 years ago? The problem extends to the inputs as the well as the outputs of higher education, and too many professors are writing too many words (and equations) that, to borrow from the Bard (Shakespeare to college graduates after 1990), \"signify nothing.\" What if professors wrote only one-third or one-half the number of papers they currently write, but taught one more class per year? My guess is that the net effects would be at least mildly positive, maybe even leading to smaller tuition increases and delaying a bit the demise of die current medieval way we do business. Belated to all that, the U.S. Department of Education can probably tell you how many anthropology professors of Hispanic origin there are in South Dakota, but cannot tell you what the average teaching load of American professors is. But I am pretty sure it is minimally 25 percent less than it was when I began fulltime teaching in tire year the Higher Education Act passed, 1965. Doing less (teaching) with more describes modern higher education. Pseudo-Science and Ideology Modern economics may be less ideologically driven dian, say, sociology, but the notion that economists are scientists who objectively observe phenomenon and derive conclusions solely on th","PeriodicalId":38832,"journal":{"name":"Cato Journal","volume":"56 1","pages":"7-15"},"PeriodicalIF":0.0,"publicationDate":"2016-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76650693","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Thomas Piketty’s Capital in the Twenty-First Century rocketed to the top of the best-seller lists the moment it was published in 2013, and remained there for months. While this feat is quite remarkable for a weighty tome on economics, it’s no mystery why Piketty’s magnum opus created such a sensation; it is clearly articulated, accessible to the non-economist, has a sound neo-Keynesian foundation, and contains a trove of historical insights. We believe Piketty’s core message is provably flawed on several levels, as a result of fundamental and avoidable errors in his basic assumptions. He begins with the sensible presumption that the return on invested capital, r, exceeds macroeconomic growth, g, as must be true in any healthy economy. But from this near-tautology, he moves on to presume that wealthy families will grow ever richer over future generations, leading to a society dominated by unearned, hereditary wealth. Alas, this logic holds true only if the wealthy never dissipate their wealth through spending, charitable giving, taxation, and splitting bequests among multiple heirs.
托马斯·皮凯蒂(Thomas Piketty)的《21世纪资本论》(Capital in the Twenty-First Century)在2013年出版的那一刻就迅速登上了畅销书排行榜的榜首，并在那里呆了几个月。虽然这一成就对于一部重量级的经济学巨著来说是相当了不起的，但皮凯蒂的巨著为什么会引起如此轰动也就不足为奇了;这本书表述清晰，非经济学者也能读懂，具有坚实的新凯恩斯主义基础，并包含了大量的历史见解。我们认为，由于皮凯蒂的基本假设存在一些根本的、可避免的错误，他的核心信息显然在几个层面上存在缺陷。他首先提出了一个合理的假设，即投资资本回报率r超过宏观经济增长g，这在任何健康的经济体中都必然是正确的。但从这种近乎重复的论调开始，他继续假设，富裕家庭将在未来几代人的时间里变得越来越富有，从而导致一个由不劳而获的世袭财富主导的社会。唉，这个逻辑只有在富人从不通过消费、慈善捐赠、税收和在多个继承人之间分配遗产来分散财富的情况下才成立。
{"title":"The Myth of Dynastic Wealth: The Rich Get Poorer","authors":"R. Arnott, William J. Bernstein, Lillian J. Wu","doi":"10.2139/SSRN.2599827","DOIUrl":"https://doi.org/10.2139/SSRN.2599827","url":null,"abstract":"Thomas Piketty’s Capital in the Twenty-First Century rocketed to the top of the best-seller lists the moment it was published in 2013, and remained there for months. While this feat is quite remarkable for a weighty tome on economics, it’s no mystery why Piketty’s magnum opus created such a sensation; it is clearly articulated, accessible to the non-economist, has a sound neo-Keynesian foundation, and contains a trove of historical insights. We believe Piketty’s core message is provably flawed on several levels, as a result of fundamental and avoidable errors in his basic assumptions. He begins with the sensible presumption that the return on invested capital, r, exceeds macroeconomic growth, g, as must be true in any healthy economy. But from this near-tautology, he moves on to presume that wealthy families will grow ever richer over future generations, leading to a society dominated by unearned, hereditary wealth. Alas, this logic holds true only if the wealthy never dissipate their wealth through spending, charitable giving, taxation, and splitting bequests among multiple heirs.","PeriodicalId":38832,"journal":{"name":"Cato Journal","volume":"8 1","pages":"447-485"},"PeriodicalIF":0.0,"publicationDate":"2015-04-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"82008702","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2014-03-22DOI: 10.1163/2468-1733_shafr_sim290020027
Travis Evans
Foreign Policy Begins at Home: The Case for Putting America's House in Order Richard N. Haass New York: Basic Books, 2013, 208 pp. For the better part of a decade, the United States has been mired in mediocrity, settling for what feels like a new normal of low economic growth, stagnant wages, political intransigence, and an unending war or terror. Many think America's better days are behind it. Richard Haass, the president of the Council on Foreign Relations, disagrees. In Foreign Policy Begins at Home, Haass attempts to reverse American defeatism and assuage fears of American decline, arguing instead that the United States is simply underperforming, suffering from "American made" problems that can be corrected by restoring the "foundations of its power." He explains that America's true strength abroad comes from its strength at home, and if America is to provide global leadership it "must first put its house in order." While much of Foreign Policy focuses on policy prescriptions that would restore American strength, the true contribution of the book is its explanation of why such a strategy is needed. Haass uses the opening chapters to convince readers that American leadership abroad is essential because, to Haass, it is the only option. Only America has the "capacity, habits, and willingness" necessary to lead in a nonpolar world in which the "potential for disorder is considerable." Other nations lack the ability, the desire, or both, to do so. While Haass overstates the looming dangers of a nonpolar world, he correctly describes it as a forgiving place from America's perspective. Even after two prolonged "wars of choice," an economic crisis, and poor leadership and mismanagement from Washington, the United States holds considerable advantages over other nations: the strongest military, the largest economy, a stable political system, a commitment to the rule of law, and an abundance of natural resources--to name a few. And when you consider the difficulties facing other nations--the frailty of China's economy and political system, Russia's dependence on petrodollars, Europe's general economic malaise and disjointed structure, Japan's aging population, and India's corruption and lack of critical infrastructure--it is clear that a direct challenge to America is unlikely. Haass is correct, the United States faces no existential threats. The countries often cited as potential rivals to America are more concerned with internal issues, and they currently lack the ability to project power over great distances. Moreover, according to Haass, those countries are dependent on the international system for their own well-being and are therefore "disinclined to attempt to disrupt an order that serves their national purposes." Thus, Haass asserts, America has the space to fix what ails it, and it should take advantage of the opportunity to revamp both its domestic and foreign policy strategies because "changing just one would be desirable but insufficient."
理查德·n·哈斯(Richard N. Haass):《外交政策从国内开始:整顿美国国内秩序的理由》纽约:基础书籍出版社，2013年，208页。在过去十年的大部分时间里，美国陷入了平庸的境地，勉强适应于一种新的常态:低经济增长、停滞的工资、政治上的不妥协，以及无休止的战争或恐怖。许多人认为美国的好日子已经过去了。美国外交关系委员会主席理查德·哈斯不同意这种说法。在《外交政策从国内开始》一书中，哈斯试图扭转美国的失败主义，减轻人们对美国衰落的恐惧，相反，他认为美国只是表现不佳，受到“美国制造”问题的困扰，这些问题可以通过恢复“其权力的基础”来纠正。他解释说，美国在国外的真正实力来自于它在国内的实力，如果美国要在全球发挥领导作用，它“必须首先把自己的房子收拾好”。虽然《外交政策》的大部分内容都聚焦于恢复美国实力的政策处方，但这本书的真正贡献在于它解释了为什么需要这样的战略。哈斯用开篇的章节来说服读者，美国在海外的领导地位是必不可少的，因为对哈斯来说，这是唯一的选择。只有美国有能力、习惯和意愿领导一个“无序的可能性相当大”的无极世界。其他国家缺乏这样做的能力或愿望，或者两者兼而有之。虽然哈斯夸大了一个无极世界的潜在危险，但从美国的角度来看，他正确地将其描述为一个宽容的地方。即使在经历了两次旷日持久的“选择战争”、一场经济危机、华盛顿的领导不力和管理不善之后，美国仍比其他国家拥有相当大的优势:最强大的军事力量、最大的经济体、稳定的政治体系、对法治的承诺以及丰富的自然资源——仅举几例。当你考虑到其他国家所面临的困难——中国脆弱的经济和政治体制，俄罗斯对石油美元的依赖，欧洲普遍的经济萎靡和脱节的结构，日本的人口老龄化，以及印度的腐败和缺乏关键的基础设施——很明显，对美国的直接挑战是不可能的。哈斯是对的，美国没有面临生存威胁。那些经常被认为是美国潜在竞争对手的国家更关心的是国内问题，它们目前缺乏远距离投送力量的能力。此外，根据哈斯的说法，这些国家为了自身的利益依赖于国际体系，因此“不愿试图破坏为其国家目的服务的秩序”。因此，哈斯断言，美国有空间解决困扰它的问题，它应该利用这个机会修改其国内和外交政策战略，因为“只改变一个是可取的，但还不够”。美国必须在国内重建，在国外重新聚焦，哈斯称之为“重建”战略。哈斯认为，恢复外交政策需要美国在海外行动上更加克制，更多地依靠外交和经济手段来影响他人，而不是军事手段。美国将避免国家建设和战争的选择，并将其资源集中在美国利益最重要的地区——即亚太和西半球(远离中东)。它将与其他国家合作，促进贸易和外国投资，打击恐怖主义，并处理来自弱国的问题。而且，它将在很大程度上否定民主推广、人道主义和反恐等虚假教义，而只在成本低、成功可能性高的情况下承担此类任务。然而，哈斯的其他一些外交政策建议似乎与他明智的克制处方不一致。．．．
{"title":"Book Review -- Foreign Policy Begins at Home: The Case for Putting America's House in Order","authors":"Travis Evans","doi":"10.1163/2468-1733_shafr_sim290020027","DOIUrl":"https://doi.org/10.1163/2468-1733_shafr_sim290020027","url":null,"abstract":"Foreign Policy Begins at Home: The Case for Putting America's House in Order Richard N. Haass New York: Basic Books, 2013, 208 pp. For the better part of a decade, the United States has been mired in mediocrity, settling for what feels like a new normal of low economic growth, stagnant wages, political intransigence, and an unending war or terror. Many think America's better days are behind it. Richard Haass, the president of the Council on Foreign Relations, disagrees. In Foreign Policy Begins at Home, Haass attempts to reverse American defeatism and assuage fears of American decline, arguing instead that the United States is simply underperforming, suffering from \"American made\" problems that can be corrected by restoring the \"foundations of its power.\" He explains that America's true strength abroad comes from its strength at home, and if America is to provide global leadership it \"must first put its house in order.\" While much of Foreign Policy focuses on policy prescriptions that would restore American strength, the true contribution of the book is its explanation of why such a strategy is needed. Haass uses the opening chapters to convince readers that American leadership abroad is essential because, to Haass, it is the only option. Only America has the \"capacity, habits, and willingness\" necessary to lead in a nonpolar world in which the \"potential for disorder is considerable.\" Other nations lack the ability, the desire, or both, to do so. While Haass overstates the looming dangers of a nonpolar world, he correctly describes it as a forgiving place from America's perspective. Even after two prolonged \"wars of choice,\" an economic crisis, and poor leadership and mismanagement from Washington, the United States holds considerable advantages over other nations: the strongest military, the largest economy, a stable political system, a commitment to the rule of law, and an abundance of natural resources--to name a few. And when you consider the difficulties facing other nations--the frailty of China's economy and political system, Russia's dependence on petrodollars, Europe's general economic malaise and disjointed structure, Japan's aging population, and India's corruption and lack of critical infrastructure--it is clear that a direct challenge to America is unlikely. Haass is correct, the United States faces no existential threats. The countries often cited as potential rivals to America are more concerned with internal issues, and they currently lack the ability to project power over great distances. Moreover, according to Haass, those countries are dependent on the international system for their own well-being and are therefore \"disinclined to attempt to disrupt an order that serves their national purposes.\" Thus, Haass asserts, America has the space to fix what ails it, and it should take advantage of the opportunity to revamp both its domestic and foreign policy strategies because \"changing just one would be desirable but insufficient.\" ","PeriodicalId":38832,"journal":{"name":"Cato Journal","volume":"70 1","pages":"438-442"},"PeriodicalIF":0.0,"publicationDate":"2014-03-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"72667793","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The planners of a European monetary union would be well advised to study the reasons the pre-World War I gold standard was a successful monetary regime. --Anna J. Schwartz (1993) The entry of Greece into the eurozone in 2001 was widely expected to mark a transformation in the country's economic destiny. During the decade of the 1980s, and for much of the 1990s, the economy had been saddled with double-digit inflation rates, double-digit fiscal deficits (as a percentage of GDP), large current-account imbalances, very low growth rates, and a series of exchange rate crises. Adoption of the euro--the value of which was underpinned by the monetary policy of the European Central Bank (ECB)--was expected to produce a low-inflation environment, contributing to lower nominal interest rates and longer economic horizons, thereby encouraging private investment and economic growth. The elimination of nominal exchange-rate fluctuations among the former currencies of members of the eurozone was expected to reduce exchange rate uncertainty and risk premia, lowering the costs of servicing the public sector debt, facilitating fiscal adjustment, and freeing resources for other uses. And that is precisely what happened--at least for a while. In the years immediately prior to and immediately after Greece's entry into the eurozone, nominal and real interest rates came down sharply, contributing to high real growth rates. From 2001 through 2008, real GDP rose by an average rate of 3.9 percent per year--the second-highest growth rate (after that of Ireland) in the eurozone. Inflation, which averaged almost 10 percent in the decade prior to eurozone entry, averaged only 3.4 percent over the period 2001-08. Then, beginning in 2009, everything changed as Greece became the center of a major financial crisis. Interest rates on long-term government debt soared from the low single digits prior to the crisis to a peak of 42 percent in early 2012; the country had to resort to two successive adjustment programs (in May 2010 and March 2012) with official international lenders; and the Greek government restructured its debt. Between the end of 2008 and mid-2012, the economy contracted by a cumulative 20 percent (and it continues to contract), and the unemployment rate jumped from less than 8 percent to about 25 percent. Like Odysseus's return trip home from the Trojan War, the road to Ithaca led to a Tartarean hell. What happened? And why did it happen? To answer these questions, we begin by describing the origins of the Greek financial crisis, highlighting the crucial role of growing fiscal and external imbalances. Next, we identify what we believe was a key factor that abetted those imbalances--namely, the absence of an automatic eurozone adjustment mechanism to reduce members' external imbalances. To illustrate our argument, we compare the adjustment mechanism in the eurozone with the adjustment mechanism for the participants of the classical gold-standard regime of the late 19t
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Pub Date : 2009-01-01DOI: 10.1002/9781118266588.CH56
Lawrence H. White
The U.S. housing bubble and the fallout from its bursting are not the results of a laissez-faire monetary and financial system. They happened in an unanchored government fiat monetary system with a restricted financial system. What Happened and Why? Our current financial turmoil began with unusual monetary policy moves by the Federal Reserve System and novel federal regulatory interventions. These poorly chosen public policies distorted interest rates and asset prices, diverted loanable funds into the wrong investments, and twisted normally robust financial institutions into unsustainable positions. There is no doubt that private miscalculation and imprudence have made matters worse for more than a few institutions. Such mistakes help to explain which particular firms have run into the most trouble. But to explain industry-wide errors we need to identify price and incentive distortions capable of having industry-wide effects. Here I will make two main points. First, the Federal Reserve's expansionary monetary policy supplied the means for unsustainable housing prices and unsustainable mortgage financing. Elsewhere (White 2008) I have discussed the growth in regulatory mandates and subsidies that exaggerated the demand for riskier mortgages, most importantly the implicit guarantees to Fannie Mae and Freddie Mac that combined with HUD's imposition of "affordable housing" mandates on Fannie and Freddie to accelerate the creation of a market for securitized subprime mortgages. (1) Second, the Federal Reserve has undertaken self-initiated new lending roles that constitute a shadow bailout program more than twice the size of the Treasury's $700 billion bailout program. There is unfortunately little evidence that the Fed's new lending has helped to resolve our financial problems, rather than to delay their resolution. The Credit Supply Bubble Some authors, considering the relationship of Federal Reserve policy to asset bubbles, ask only: Should the Fed actively burst a growing bubble? If so, how? As posed, their questions suggest that asset bubbles arise independent of monetary policy, and the only Fed role to be discussed is that of bubble-buster. A more important pair of questions is: Does Fed policy as currently conducted tend to inflate assets bubbles? If so, how can we reformulate policy to avoid that tendency? Call our objective a non-bubble-prone or "non-effervescent" monetary policy. The economics profession has not reached a consensus on what the optimally non-effervescent monetary policy is, but it is now widely agreed that it isn't holding interest rates too low for too long. It should also now be clear that a Fed policy that deliberately ignores asset prices, as though consumer prices alone were a sufficient indicator of excessive Fed expansion, is also not the way to avoid inflating asset bubbles. In the recession of 2001, the Federal Reserve System under Chairman Alan Greenspan began aggressively expanding the U.S. money supply. Year-over-
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