“Questioning growth is deemed to be the act of lunatics, idealists and revolutionaries. But question it we must.”

“the only thing that has actually remotely slowed down the relentless rise of carbon emissions over the last two to three decades is recession.”

– Tim Jackson

What politicians should be discussing in the mid-term election campaigns.

Discussion of the virtually extinct species once known as Rockefeller Republicans – those individuals known for being liberal on many social issues but conservative on economic issues.

The debate in Washington continues to be centered around conservative policy prescriptions. The popularity of tax cuts may be just a mirage, though, and the right kind of tax hikes might produce some genuine enthusiasm.

Cross posted from Pruning Shears.

To the surprise of no one who’s paying attention to the American economy’s stall, Nobel Prize-winning economist Joseph Stiglitz yesterday called for a second federal stimulus, saying Americans face a significant reduction in standard of living because they no longer have home equity on which to borrow, spend, and live.

When bad news breaks it has become almost routine for those at the top to disavow all knowledge and let the hammer come down on those well down in the hierarchy. The pattern showed up again twice this week, and is now so common as to be almost standardized.

For more on pruning back executive power see Pruning Shears.

One of the bedrock assumptions of economic theory for the last few decades has never been true. When an error is both generally acknowledged and fervently embraced there is usually a good (and unfortunate) explanation, and this is no exception.

Cross posted from Pruning Shears.

Consider this our second lesson in economics; Economics 102.

Lets talk about high corporate (or business) taxes versus low taxes. I argued with a die-hard Conservative for about an hour this weekend, and he refused to see the sense of what I am about to tell you. Let’s see if it makes sense to you, or if I am wet behind the ears. I’ll use the same examples I gave him.

Let’s say I have two tax scenarios; one is with corporate/business taxes at 25% and one is at 75%. Please keep in mind that no one is suggesting even close to a 75% tax rate, but let’s use it for an example.

My Conservative friend said that trickle down economics works because if he had lower corporate taxes (he doesn’t own a business) he would use that extra money saved with the lower taxes to buy equipment, which would trickle down to the factory that made the equipment and the people employed there. Well enough.

Except that’s not the way it works in business. It sounds good, it almost sounds right, but it isn’t. It’s an anecdote that has no basis in reality. I answered that any business person waiting until after he had paid his taxes to see what he had left for capital equipment purchases is a moron and deserves to get gouged by taxation. That wasn’t met with a great deal of understanding or approval, so I explained why I said it.

As our economies and markets advance ever further forward, and we gain tremendous efficiencies in production, we should be retiring earlier; not later.

For some unknown reason, the NYT prints on its front page a confusing column by Floyd Norris, who seems surprised, shocked that interest rates are at record low levels when everyone the Times normally cites/quotes predicted just the opposite.