Popular economics suggests that economic activity results from a circular flow of money in the economy: One person’s spending is a second person’s income, and the second person’s spending is a third person’s income, and so on. According to this theory, recessions occur because psychological factors cause individuals to increase savings, which interrupts the circular flow of money, leading to a vicious downward cycle. When this happens, the central bank—the Federal Reserve—is supposed to increase the amount of money in the economy by lowering interest rates. Once people have more …
Despite a recent spate of good economic data, including last week’s jobs report, the U.S. economy remains deeply depressed. Don’t take my word for it. That’s how Paul Krugman, leftist econo-pundit extraordinaire, describes the economy. In a recent column in The New York Times, he wrote, “our economy remains deeply depressed.” As Krugman pointed out, given an honest appraisal, one finds that “every silver lining comes with a cloud.” And thus it is with the recent good data, which while decidedly good and will hopefully persist, nevertheless cannot disguise the …
President Obama and President of the Republic of Georgia Mikheil Saakashvili recently announced that the two countries should start free-trade negotiations. Let’s hope both presidents are serious. Presidents Obama and Saakashvili should instruct the appropriate government agencies to expedite preparation of the agreement. The most recentU.S.trade agreements, with Colombia, Panama, and South Korea, each took more than five years to get from inception to implementation. This deal could get done in a fraction of that time. Both countries are already relatively open to international trade and investment, and the volume …
The Obama Administration and the nation have cause to breathe a sign of relief as today’s monthly jobs report shows 243,000 jobs were created in January. Those numbers are of course good news, another positive sign of recovery, and another clear indication of the enduring strength of the American economy and American economic system. But, really, so long after recession’s end, we should be doing much better — and would be but for President Barack Obama’s debilitating anti-growth policies. In reality, the economy is recovering despite — not because of …
More than 15 months after the Obama administration lifted its ban on offshore drilling in the Gulf of Mexico, oil and gas supply and service companies report they are suffering significant financial hardships from the government’s actions. The moratorium — as well as the slow pace of permitting that followed — have suffocated businesses, costing jeopardizing millions in business revenue and even forcing some to close their doors, according to a survey conducted by Greater New Orleans Inc. Louisiana, home to 88 percent of the country’s offshore rigs, has absorbed …
Join us live at Noon Eastern as U.S. Senator Jim DeMint (R-SC) speaks at The Heritage Foundation Bloggers’ Briefing. Senator DeMint will discuss his book, “Now or Never: Saving America from Economic Collapse.” Watch live streaming video from heritagefoundation at livestream.com
President Obama unveiled a long list of economic policies during the State of the Union address that he wanted Congress to focus on this year. Click here to join us right now for our “Lunch with Heritage” chat. We are joined by Bill Beach, Heritage’s Director of the Center for Data Analysis, and he is taking your questions on the President’s proposals. Lunch with Heritage feat. Bill Beach
President Obama will release his annual budget proposal late yet again. Choosing the date is not merely a convention. By law, the President must release the budget by the first Monday in February, which falls on February 6 this year. Yet yesterday the Administration announced it will release its fiscal year (FY) 2013 budget a week late, marking the third such delay in four years. Right now, when the economy is struggling, annual deficits consistently exceed $1 trillion, and Americans are demanding that Washington govern responsibly, this delay is beyond …
IMF Managing Director Christine Lagarde has been talking up the need for greatly expanded resources to bail out ailing European economies. European nations have offered to channel about $200 billion of their own funds to themselves through the IMF (a kind of gentleman’s money-laundering to avoid restrictions in their own treaties). Lagarde wants others to add $300 billion to that kitty. The U.S. Treasury has said no, and rightly so. Replacing current euro-debt with IMF loans, no matter how rigorously structured, will only prolong the agony. The failing euro-zone economies …
Leading up to his third State of the Union (SOTU) address tonight, President Obama appears once again less interested in facilitating real job growth than in creating the mere appearance of job creation. In a SOTU preview video released over the weekend, Obama declared that American energy fueled by homegrown and alternative energy sources is an important step toward rebuilding the economy. This statement in conjunction with last week’s rejection of the Keystone XL pipeline suggests a continuation of the misguided focus on the government pushing so-called “green jobs,” whether …
