WASHINGTON -- If New Jersey Gov. Chris Christie has his way, the unfolding presidential campaign will focus on generational fairness. It will seek to curb spending on the elderly -- mainly Social Security and Medicare -- without putting the elderly at risk. This debate would be good for the country, but whether the country can conduct it without...Read more
WASHINGTON -- Fifty years ago, in mid-April 1965, the trade magazine Electronics published an article by an obscure engineer making a seemingly preposterous prediction: The number of electronic components (transistors, resistors, capacitors) that could be squeezed onto integrated circuits -- what we now call computer chips -- would double every ...Read more
WASHINGTON -- It's mid-April, and Karlyn Bowman -- the astute public opinion analyst at the American Enterprise Institute -- has noticed something significant. Tax Day "comes and goes without a ripple," she recently wrote. There's not much fuss.
Discontent with the income tax has ebbed. To buttress the point, Bowman cited intriguing survey data...Read more
WASHINGTON -- On any given day, you can expect news of major corporate mergers. Last week, we had decisions from FedEx to buy the Dutch delivery company TNT for $4.8 billion and from Royal Dutch Shell to acquire the BG Group, a British natural gas company, for $70 billion. Mergers and acquisitions have become a staple of modern capitalism. In ...Read more
WASHINGTON -- One of the great disappointments of the weak economic recovery has been the sluggish revival of business investment -- spending on new buildings, factories, equipment and intellectual property (mainly research and development, and software). For the United States, this spending in 2014 was about 9 percent above its 2007 record high...Read more
WASHINGTON -- Concerning economic policy, it's back to the future. As the unemployment rate (5.5 percent in March) has dropped, there's been a shift in language. We're told increasingly that we should aim for more than job growth. Our goal should be "full employment." This recalls an earlier era, the 1960s and '70s, when the pursuit of "full ...Read more
WASHINGTON -- Every so often, we ought to celebrate our victories. The auto bailout is a case in point. Six years ago, it was wildly controversial, with the fate of General Motors and Chrysler hanging in the balance. Now, it's clear that the bailout was a solid success.
The revitalized auto industry has been a pocket of strength in a lackluster...Read more
WASHINGTON -- When it comes to the federal budget, what consistently unites Democrats and Republicans is their common capacity to lie to themselves, lie to the public and postpone any serious discussion of the central issues of government spending and taxes. I use the word "lie" reluctantly because it is an unforgiving moral marker. Still, it is...Read more
WASHINGTON -- How fast should the Federal Reserve tighten monetary policy? Should it tighten at all? I recently wrote about these issues but didn't have the space to explore a fascinating aspect of the debate: the mostly forgotten 1937-38 recession. To many, it's a cautionary tale against adopting tighter policies too soon. The latest to sound ...Read more
WASHINGTON -- The Federal Reserve is at a crossroads, and it doesn't know where it's going. After holding short-term interest rates near zero for six years, Fed policymakers, led by chair Janet Yellen, are prepared to raise them -- but when, how much and with what consequences they haven't said.
Higher short-term rates might trigger turmoil in ...Read more
WASHINGTON -- The latest rap against big corporations is that they're returning too much money to shareholders through dividends and stock repurchases. What they should be doing, the complaint goes, is using that money to build new factories, create new products and increase research. Their stinginess, the argument continues, is one reason for ...Read more
WASHINGTON -- For some time, I've been collecting news stories about robots and jobs. By robots, I mean almost any automated process that substitutes machines for people. Here are some examples:
--The restaurant chain Chili's installed 45,000 computer tablets in its U.S. locations, says The Washington Post. The tablets enable customers to pay ...Read more
WASHINGTON -- Wages are among our most scrutinized economic indicators. It's no secret why. We'd all like a pay raise. But there's a second, less-recognized reason. Wages are considered a precursor to higher inflation. If they rise sharply, prices will follow. That's the theory.
It's wrong -- or at least dangerously incomplete.
This matters ...Read more
WASHINGTON -- Fed bashing -- strident criticism of the Federal Reserve -- is back in style, and it's taken a new turn. Traditionally, it's been a liberal sport. When the Fed raised interest rates, liberals attacked it for driving up unemployment and oppressing small businesses. Liberal Fed bashing abated in the 1980s and '90s, as inflation and ...Read more
WASHINGTON -- As a young reporter in the 1970s, I covered the Interstate Commerce Commission (ICC). Created in 1887, the ICC regulated the nation's railroads and sought to protect the public against abusive freight rates. Congress deregulated the railroads in 1980 and ultimately abolished the ICC. The verdict was that the agency had so weakened ...Read more
WASHINGTON -- The political paralysis in Washington is often ascribed, depending on partisanship, to Republican obstructionism or President Obama's arrogance. But there are deeper causes to the stalemate. Both parties have had a hard time creating agendas that appeal across ideological, racial and ethnic lines. There's been a fragmentation of ...Read more
WASHINGTON -- If you're wondering what the 2016 presidential election will be about, here's one dark-horse possibility: the family-friendly workplace. As millions of Americans struggle to balance family and job demands, proposals requiring paid maternity leave and emergency sick leave have an obvious appeal for Hillary Clinton or any Democratic ...Read more
WASHINGTON -- Given the obsession with economic inequality, you might think it's the main force squeezing the middle class. It isn't. We have this not from some right-wing think tank but from President Obama's top economists. The bigger culprit, they show, is the slow growth of productivity -- that messy process by which the economy improves ...Read more
WASHINGTON -- To the long list of economic mysteries can now be added interest rates. They've been at rock bottom, as everyone knows. But now we've encountered something novel: negative interest rates. Lenders are actually paying for the privilege of allowing someone to borrow their money. It's occurring outside the United States, and the ...Read more
WASHINGTON -- We are not getting our money's worth from "creative destruction." For history buffs, the phrase will be familiar. Coined by Joseph Schumpeter (1883-1950) -- one of the 20th century's towering economists -- it defines a central characteristic of capitalism. Capitalism expands material well-being by replacing existing technologies, ...Read more