I was listening to the news recently when I was struck by a connection between two seemingly unrelated stories. The first one was international: Ecuador’s President Jamil Mahuad was forced from office as a result of a prolonged economic crisis. The second was regional: Minnesota’s Attorney General Mike Hatch said he’s going to audit some health maintenance organization to determine whether recent price increases were justified. You don’t see...
Is there anything wrong with the richest 5 percent of families earning six times as much as the poorest 20 percent? What if the disparity were only half that? If there is something wrong with unequal incomes, should the government do something to make things more equal? People frequently hold very strong opinions about these issues. Two studies released last week may add fuel to the flames in an...
Environmental consciousness is one of the great developments of the last decades of the 1900s. Before the 1960s, pollution was like that famous quip about the weather: Everybody complained, but nobody did anything about it. That began to change slowly in the 1960s. Thirty years later, visible pollution is much less severe in the United States and other wealthy countries, though concerns about global warming and loss of biodiversity...
Inflation is at one of the lowest levels seen in the last half-century. The federal budget is closer to being balanced than in most of the preceding 30 years. Now is a good time for Congress to take back its historic role of deciding what particular level of Social Security benefits is most fair to all members of society. It should start by ending the automatic annual cost of...
A new economy in the new millennium? A new year, a new decade, a new century, a new millennium—take your pick—started yesterday. Just what will this new period hold for the economy of the United States and the world? I’m too cautious to hazard a guess, but many others are less inhibited. Take James Glassman and Kevin Hassett. Their new book, Dow 36,000: The New Strategy for Profiting from...
Should dairy farmers get a higher price for their milk? Here in the Midwest, where a lot of people have ties to farms, many would answer yes. Should government force consumers to pay more for milk so that farmers can have higher incomes? Again, at least some people would answer yes. If a democratic society decides that government should act to raise dairy farmers’ incomes, is it fairer to...
What is the fairest way to take care of the elderly and disabled? Should Social Security pay every retiree the same amount, or should benefits vary somewhat with individuals’ prior earnings? Or, should benefits vary according to need, so that people with other assets or income got less, and those with no assets or other income got at least enough to have a decent lifestyle? These questions illustrate the...
It is unfortunate that British social activist Richard Cobden wasn’t able to make it to Seattle earlier this month to join the protestors who said they were concerned about justice and treatment of the poor. He might have enlightened them with a moral insight that has been conspicuously absent in recent public debate about the WTO. Cobden knew that most trade restrictions are a regressive tax on the poor,...
China’s agreement with the United States on joining the WTO caused some editorial writers and labor leaders to work themselves into a frenzy of opposition. Letting China in the WTO forces U.S. workers to compete with slave labor some argue. Admitting China to this international organization gives unmerited support to a harsh dictatorial regime complain others. Relax everybody. This agreement largely confirms an existing status quo. It will have...
Why is the U.S. economy doing so well right now? Why are the Dutch so much wealthier than the Portuguese? Why is Japan so much richer than nearby China? Economists have been studying these questions for more than 200 years, and they still can’t give very good answers. One thing they do know, however, is that putting new, more-efficient technology to work makes economies grow faster. Whether it was...