Essential Economics for Politicians

A Protectionist is Someone Who…
by Don Boudreaux on February 6, 2018

… upon seeing the additional sales made by pharmaceutical companies during an especially bad flu season concludes that society is enriched by the flu.

… upon seeing the additional income earned by restaurant owners and workers if government imposes a punitive tax on the preparation of home-cooked meals concludes that society is enriched by punitively taxing the preparation of home-cooked meals.

… believes that the artificial creation of more work – that is, the artificial creation of more needs to be satisfied – enriches society.
As for #3, that’s the entire basis of the Capitalist system, obviously. You don’t like it? Is that why you work for the government?
 
Go back and read the whole thing this time.....#3 that is.
The creation of more needs, leading to more jobs fulfilling those needs (like building automobiles, for example), is a foundational element of market growth, which is a requirement for the capitalist system. What am I missing?
 
The creation of more needs, leading to more jobs fulfilling those needs (like building automobiles, for example), is a foundational element of market growth, which is a requirement for the capitalist system. What am I missing?
That's not what #3 is talking about. It's talking about creating artificial jobs for artificial needs. Having said that, the auto industry is a poor example of #3 because it is actually doing the opposite of #3. In the 1950s the average worker at General Motors (GM) could make 7 cars in a year, and now they make 28--that's an unbelievable transformation. It means that for the same amount of cars sold, now GM needs 70% fewer workers. That alone means that there are fewer and fewer jobs in this sector. In some sense, this sector becomes so productive and so successful at using the best possible machinery and robots that it needs fewer and fewer workers.--Enrico Moretti, The New Geography of Jobs
 
The Solar Panel Tariff Threatens Far More American Jobs than It Protects
by Barry Brownstein

“While there are fewer than 1,000 jobs in U.S. panel manufacturing, some 260,000 jobs rely on access to imported panels.”

Today those 260,000 jobs are at risk because of a ruling by President Trump. The president — to show he is serious about his “America First” trade policy —imposed steep new tariffs on imported solar panels from China and on washing machines from South Korea.

“Solar tariffs would be another destructive exercise that benefits a handful of Suniva and SolarWorld [panel manufactures] investors at the expense of everyone else — including the rest of the solar industry. This is protectionism at its worst.”
 
How Easy Money Is Rotting America from
the Inside-Out

by David Veksler

The same thing will happen to streets, bridges, and plumbing. This is one of the ways urban decay happens: easy money policies fund unsustainable urban infrastructure projects which make politicians look good, but end up crumbling a few years or decades later. The Flint water crisis happened in large part because the Federal government funded infrastructure projects that were not sustainable by the incomes of the people of Michigan.

Easy money from the Fed also rots the guts of American corporations. New money goes to the most politically-connected businesses first, and funds projects that would not be possible in a free market. Because private investors haven’t actually saved enough to see the projects through to completion, and consumers don’t value the product enough to cover production costs, the companies getting free money from the government either fail or receive endless bailouts. For example, easy money encouraged unsustainable commitments like high union wages and pensions, forcing US automakers to sell cars for prices that consumers could not pay given their actual savings rate. When sales dipped in 2009, the government was forced to bail out GM, Chrysler, and Ford in 2009.
 
How Easy Money Is Rotting America from
the Inside-Out

by David Veksler

The same thing will happen to streets, bridges, and plumbing. This is one of the ways urban decay happens: easy money policies fund unsustainable urban infrastructure projects which make politicians look good, but end up crumbling a few years or decades later. The Flint water crisis happened in large part because the Federal government funded infrastructure projects that were not sustainable by the incomes of the people of Michigan.

Easy money from the Fed also rots the guts of American corporations. New money goes to the most politically-connected businesses first, and funds projects that would not be possible in a free market. Because private investors haven’t actually saved enough to see the projects through to completion, and consumers don’t value the product enough to cover production costs, the companies getting free money from the government either fail or receive endless bailouts. For example, easy money encouraged unsustainable commitments like high union wages and pensions, forcing US automakers to sell cars for prices that consumers could not pay given their actual savings rate. When sales dipped in 2009, the government was forced to bail out GM, Chrysler, and Ford in 2009.
Huh? Ford didn’t get a buyout and this article makes no sense at all.
 
Huh? Ford didn’t get a buyout and this article makes no sense at all.
Lol! A buyout? Obama wanted more electric cars on the road and Ford was a vulnerable key player in achieving that goal through a very quiet bailout of Ford. Make sense now?
 
Lol! A buyout? Obama wanted more electric cars on the road and Ford was a vulnerable key player in achieving that goal through a very quiet bailout of Ford. Make sense now?
They didn’t take any TARP money and their credit line was part of a program put in place by the Bush administration. You poor thing.
 
As was the case with W, we learn that Republicans don't understand economics. I think too much money from daddy and banks, with both W and Trump.
 
As was the case with W, we learn that Republicans don't understand economics. I think too much money from daddy and banks, with both W and Trump.
As was the case with BOH, we learn that Democrats don't understand economics. I think too much QE from everybody elses daddy but their own, with both Slick Willy and Barry.
 
As was the case with W, we learn that Republicans don't understand economics. I think too much money from daddy and banks, with both W and Trump.

Didn't the donald get an interest-free, no-payments-required loan from Daddy T when he had some financial difficulties early in his career? And then forgave himself that loan when he inherited Daddy's business?
 
As was the case with BOH, we learn that Democrats don't understand economics. I think too much QE from everybody elses daddy but their own, with both Slick Willy and Barry.
nope. one had us at a budget surplus an the other took us from deep recession to growth. Obviously better economy under Clinton and O than under W.
 
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