Ben Bernanke, chairman of the Board of Governors of the Federal Reserve System, made his academic reputation as an advocate of “inflation targeting.” Monetary policy, he and other Fed governors have argued, should attempt to maintain a long-run annual rate of price inflation of around two percent. The target cannot be a rate of zero price inflation, they say, because the Federal Reserve needs leeway to prevent price deflation. But what is so bad about falling prices?

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There are a number of ways today to get information about our credit card balances, transaction histories, and the like. We can set up weekly emails, use internet banking any time of day, or even get text message updates sent to our phones. But despite these and other options, most of us still rely on printed statements that appear in our mailboxes once each month to inform us of what we owe. Many of us, however, have noticed that attached to our bills are perforated “access checks,” or cash advance checks, that can be used like ordinary checks but are charged to our credit cards. While these checks may seem like a convenient way to pay contractors, landlords, or others that do not have the means of accepting a credit card directly, there are reasons to be wary of their use.

An Interview with Professor John Cawley

This entry is the second in a two-part interview with Cornell University health economist John Cawley. The interview is based on a survey (and forthcoming paper in the Journal of Health Politics, Policy, and Law) that he conducted with his colleague Michael Morrisey. In 2005, they received survey responses from 359 health economists from academia, government, non-profits and private industry regarding their views on health policy. Their responses shed light both on the major issues in health economics and on the state of (the pursuit of) knowledge in the economics profession in general.

Gross Domestic Product expanded at a 0.6 percent annual rate during the first quarter, the same pace as during the fourth-quarter and substantially slower than the 3.4 percent average since World War II. Overall, the latest batch of economic data showed little change in the cyclical trends of our leading indicators of business-cycle conditions this month. The percentage of leaders appraised as expanding (an index that reflects the judgments of AIER's research staff) increased to 38, up from 33 last month. Our cyclical score (which is based on a separate, purely mathematical analysis of the same leading indicators) increased to 47, while last month's score was revised downward from 50 to 46. Both of these indexes remain below 50, indicating that recession is likely.

Millions of people around the world gather every May 1st to celebrate the social and economic achievements of the labor movement. Sadly, those societies that were organized in the name of workers and the equality of all individuals were forced to create a new class of individuals responsible for enforcing equality. This new class not only made themselves "more equal" than the workers they were supposed to be representing, they committed mass murder on a scale that has never been replicated in human history.

The costs of the experiments in utopia were staggering. They took a huge toll on human lives. R.J. Rummel estimates that over 169 million human beings were killed at the hands of communist governments in the 20th century. The cost in lives of the two world wars was less than half this amount. Some defenders of this system viewed the purging as necessary in order to achieve the final, good and just outcomes envisioned by the ruling class. That nothing resembling utopia ever emerged from this fiasco should never be forgotten.

The phrase “big government” is bandied about by people along the political spectrum. But how “big” is government, and in comparison to what and when? One useful benchmark that may be used is around a hundred years ago, not much more than three generations of Americans ago, and when the size of government was much more in line with its original prescribed responsibilities under the Constitution.

An Interview with Professor John Cawley

This entry is the first in a two-part interview with Cornell University health economist John Cawley. The interview is based on a survey (and forthcoming paper in the Journal of Health Politics, Policy, and Law) that he conducted with his colleague Michael Morrisey. In 2005, they received survey responses from 359 health economists from academia, government, non-profits and private industry regarding their views on health policy. Their responses shed light both on the major issues in health economics and on the state of (the pursuit of) knowledge in the economics profession in general.