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APRIL 5, 2011 | Compilation by ANTONY DAVIES, LAURA VICINIE, JONATHAN SCOTT, KAIT WOLF, LAUREN MONDSCHEIN, DEVIN BOWEN, NATHAN BENEFIELD
Public Policy and Free Enterprise in Pennsylvania
A Compilation
Public Policy and Free Enterprise in Pennsylvania represents a partnership with the Commonwealth Foundation and the department of economics at Duquesne University. Key findings in these five papers include Over the past sixty years, increases in union membership rates correlate with slower growth in real per
APRIL 10, 2006 | Commentary by MATTHEW BROUILLETTE
Renouce the "Faith"
NOTE: This commentary was originally published on June 15, 2004. Politicians are fond of saying, "Government doesn't create jobs, the private sector does." Yet the machinations of state and federal government--and the news releases that follow--reveal that most politicians truly believe a booming or a busting economy hinges on t
Recent Blog Posts
JANUARY 21, 2010
Brief History of the Great Depression
Investor's Business Daily has an excerpt from Thomas Sowell's new book Intellectuals and Society, which outlines the policies which cause the great depression. For instance, Sowell notes that unemployment never reached 10% in the 12 month following the 1929 stock market crash - but never dropped below 20% in 35 months following government interventions.
Sowell highlights how
- The federal reserve mistakenly raised interest rates and shrunk the money supply while banks were failing.
- How Congress passed the Smoot Hawley tariffs to "save" American jobs...after which unemployment jumped from 6% to 25% in two years.
- How Hoover and later FDR increased taxes on upper income brackets, and tried to force companies not to cut wage
It is well worth the read.
posted by NATHAN BENEFIELD | 08:29 AM | 0 comment
JUNE 14, 2009
"Stimulus" Kills Pennsylvania Steel Jobs
Redstate notes how the "buy American" provision of the so-called stimulus bill is already putting some Pennsylvania's out of of work. See the original Canadian Press article here.
Stateside, the sting is also being felt. As many as 600 steelworkers in Pennsylvania, whose union lobbied for the Buy America law, are slated to lose their jobs at Duferco Farrell after the company lost orders from its biggest customer because some of its goods are partly produced abroad.
posted by NATHAN BENEFIELD | 06:24 PM | 0 comment
DECEMBER 16, 2008
Buchanan: GOP should embrace xenophobia, not economics
Pat Buchanan on Townhall.com calls for an automakers bailout based on xenophobia and on repeating the mistakes of the past, rather than sound economic policy.
Is the Republican Party so fanatic in its ideology that, rather than sin against a commandment of Milton Friedman, it is willing to see America written forever out of this fantastic market, let millions of jobs vanish and write off the industrial Midwest?
And, unlike Mitsubishi, General Motors didn't bomb Pearl Harbor.
The use of "xenophobia" here is akin to the misapplication of the word "homophobia" by homosexuals in their debate with those who oppose same-sex marriage, et al. One can support tariffs or bailouts without being a xenophobe. That being said, I am against the bailout; however Buchanan raises two interesting realities about the GOP's view of the current role of government in the economy and the fairness of trade:
1) How does the GOP go from approving a $700 billion bailout for bankers to drawing a line in the sand over a $14 billion bailout for the automakers? Can you say "erratic"?
2) Yes, the "foreign" plants operate more efficiently, but no one seems to mention they are getting their fair share of taxpayer subsidies to be here. In fact I didn't know that, and it angers me. If we shut down the bailout for the Big Three then we ought to cease the subsidies to foreign competitors, too.
One more thought on "free trade." Adam Smith offered free trade as ONE leg in a stool that presupposed many other legs being in place, i.e. equalized labor and wage laws and regulatory environment. To take all the legs out from under the stool but one and assume that one leg (free trade) will hold up the stool is foolhardy.
My response:
All of these are weak points -- Buchanan is attempting to justify a bad policy by using other bad policies as a historical reference.
1) Some argued that the financial sector was different. We disagreed, but regardless, there has to be a line drawn in the sand somewhere. The financial bailout was a bad policy, but even those who think it was good agree than endless bailouts are a bad policy. Two wrongs don't make a right.
2) "Domestic" manufacturers also get subsidies/incentives from state and local governments when building plants and such — as we have shown these are poor economic policy. So stop doing it. Don't give GM/UAW more money.
You are not entirely correct about equalized wages and regulations. Free Trade is good for our economy regardless of the wage laws in Mexico and China. And as Don Boudreaux points out, that logic would imply Pennsylvania would be better off with high tariffs on products from other states - right-to-work states, states with lower taxes, and states with lower minimum wage laws, which is of course preposterous.
Yes, our wage laws, tax climate, and regulations hurt our economic competitiveness (both PA and the US), so change them. This does not justify protectionism, which make us all poorer.
posted by NATHAN BENEFIELD | 02:13 PM | 0 comment
