Not that many politicians are innocent when it comes to demagoguery and "saying whatever it takes to win". But I did find Hillary Clinton's remarks about OPEC particularly over the top.

"We’re going to go right at OPEC. They can no longer be a cartel, a monopoly that get together once every couple of months in some conference room in some plush place in the world, they decide how much oil they’re going to produce and what price they’re going to put it at."

Um, last I checked, counties can do anything they damn well please regarding the exporting of their natural resources. I also don't recall hearing about any sort of "World Constitution" that would regulate things like this.

Next thing you know, Hillary is going to call for the abolition of the law of supply and demand. Go ahead girl, knock yourself out.

I'm reading this article in the New York Times about various economic pressures such as the continued housing slump and concerns over inflation when I came to this paragraph:

The latest inflation report appears to corroborate a broader trend of higher prices across the economy. Last week, the Labor Department reported elevated readings for consumer prices. The consumer price index was up 4.3 percent last month from a year ago, up from a 4.1 percent increase in December. read more »

Today the International Herald Tribune reported on gasoline price increases:

Gasoline prices, which for months lagged the big run-up in the price of oil, are suddenly rising quickly, with some experts fearing they could hit $4 a gallon by spring. Diesel is hitting new records daily and oil closed at an all-time high on Tuesday of $100.88 a barrel.

The increases could not come at a worse time for the economy. With growth slowing, high energy prices that were once easily absorbed by consumers are now more likely to act as a drag on household budgets, leaving people with less money to spend elsewhere. These costs could exacerbate the nation's economic woes, piling a fresh energy shock on top of the turmoil in credit and housing. read more »

I read an excellent piece at Rod Dreher's blog yesterday about the housing crash. The media is looking for easy targets to turn into villains as well as creating tragic heroes as part of this story. But the truth is much more complicated as evidenced by a friend of Dreher commenting on a recent ABC News piece: read more »

Today Congressional leaders announced an agreement with the White House for an ecomomic stimulus package that would provide for rebate checks for American families.

House Speaker Nancy Pelosi, D-California, said at a Capitol Hill news conference.

"Tens of millions Americans will have a check in the mail. It is there to strengthen the middle class, to create jobs and to turn this economy around."

House Minority Leader John Boehner, R-Ohio, said,

"I'm looking for quick action in the House. I hope that the Senate will follow quickly so that we can put this money in the hands of middle-income Americans as soon as possible."

Hubris, thy name is Congress. read more »

I was reading my local paper and came across this article about broadband access and cost in Japan versus the US.

Apparently, "Broadband service [in Japan] is eight to 30 times as fast as in the United States -- and considerably cheaper. Japan has the world's fastest Internet connections, delivering more data at a lower cost than anywhere else, recent studies show."

How did this happen? Well, two things contributed to this rapid improvement in internet infrastructure. read more »

Generally when I read an article from the AP wire, I expect a piece that sticks to the facts. I found one Friday about housing in NYC that could not be more wrong.

According to Citi Habitats, a Manhattan rental brokerage firm, rental rates have risen in Manhattan to $2,000 a month for a studio apartment. Where this story gets interesting is the explanation for the steep rising in housing costs.

The report reflects that "we're the center of everything," said Citi Habitats spokesman Christopher Dente. "There's a lot of relocation—thousands of people are coming in." read more »

Yesterday, the House passed a bill that would make gasoline price gouging a federal offense. How does the House of Representatives, in their infinite wisdom, define gouging?

(1) IN GENERAL- It shall be unlawful for any person to sell crude oil, gasoline, natural gas, or petroleum distillates at a price that--

(A) is unconscionably excessive; or

(B) indicates the seller is taking unfair advantage unusual market conditions (whether real or perceived) or the circumstances of an emergency to increase prices unreasonably.

So who defines "unconscionably excessive"? Since when was there anyone in Congress with a full understanding of the economics of gasoline and the entire supply chain to be able to definitively state what the price of gasoline should be?

This is exceeding foolish legislation that ignores the basics laws of economics. The law of supply and demand dictates that prices must rise when demand rises. This is a basic economic fact that isn't open to interpretation.

As a result there is a fairly obvious solution to rising gasoline prices - STOP DRIVING. The great irony here is that while there is much talk about decreasing our dependency upon oil, this bill ensures that we will continue our dependency upon oil. Those clamoring for more hybrid cars and a more "green" energy policy should be calling for higher gas prices if they were honest. A corrollary to the law of supply and demand is that increased prices will create a decrease in demand. Isn't that what we want???

I know this isn't the usual topic for GWH, but it does indirectly hit on economics, so maybe it is fair fodder. Otherwise, just consider this a light Sunday afternoon topic to throw around...Mrs. Expat Teacher and I are seriously looking to buy a place here in DC and we've been to plenty of open houses and even viewed some new condo construction, but I've avoided getting a real estate agent since the MLS listings are now available via ReMax. I can just contact the seller directly. If I use a real estate agent, the seller pays a 6% commission on the sale, usually split 3% between the buyer and seller agent. read more »

In Ray Bradbury's classic sci-fi short story, A Sound of Thunder, an entrepreneur has created a business called Time Safari, Inc. Customers pay to travel back in time to hunt dinosaurs. Great care is taken not to cause a time paradox. The hunters must remain on hi-tech pathways that don't touch any of the flora or fauna. The hunters must remove the bullets from their trophies and never, never, never step off the paths. Well, of course, that's exactly what happens in the story. A man named Eckels steps off the path, kills a butterfly, and when his party returns to the present, everyone is speaking in Old English and, in place of the democratic leader who was in power before they left, a Hitleresque despot name Deutscher has won the election. read more »

My husband sent me an email saying that he "owed" me and citing this article.

This reminded me of a favorite cartoon from the WSJ editorial page. Visually, it was very simple, a woman at a kitchen table with a list of figures and an infant in a high chair. She is looking up at a man suited up and with a briefcase, presumably her husband. She said, "I've just figured how much I am worth as a housewife. The only trouble is that it's more than you earn." In our case, considering that we had six children and I home schooled them, we knew it was true. read more »

The criticism that capitalists have an irrational faith in the free market is often heard from their critics. While I think the confidence to which this criticism refers is neither irrational nor fideist, the criticism itself hides an irrational faith in the government to fix the alleged failures of the market. Confidence in the free market is not a blind assumption that individuals will work in the best interest of others. In fact, capitalism assumes that individuals will act according to their own interests, whether they be altruistic or selfish. Neither is confidence in capitalism a naive assumption that the free market will right all wrongs. read more »

New Employment Numbers Out.

Jobless Rate Falls, 180,000 Jobs Added

Unemployment Matches 5-Year Low; Jobs Surge by 180,000

WASHINGTON (AP) -- If you were looking for a job as a teacher last month, you were in luck. Same goes for health workers, retail clerks and building contractors.

All told, the economy added 180,000 new jobs, dropping unemployment to a 4.4 percent rate that matched a five-year low.

But there were many more job winners than losers. Construction jobs led the way, especially for contractors and for commercial building. Retailers, health care providers, educational services and leisure and hospitality companies were among those boosting their payrolls.

"Businesses have a very good appetite for hiring workers. The job market is sturdy," said Mark Zandi, chief economist at Moody's Economy.com. "It is a good time to be looking for a job, particularly if you have skills and education." read more »

One of the most common critiques of raw capitalism is that it doesn't adequate deal with some of the environmental externalities from products and services. For example, you are not charged the cost of disposing of your Coke bottle or your blue jeans when you purchase them. Often times, when these items are produced in 3rd world countries, the producer didn't have to pay for disposing any of the products required to make them because he could just dump them back onto the land, river, air, etc. Therefore the producer can provide a product/service to you cheaper than the actual cost of producing it. read more »

In many of my conversations with fiscal conservatives, they place an amazing amount of faith in 'the market' to be correct at all times. In the few instances when it does go wrong in the short term (i.e. a big drop in the stock market, property or PS3 bubbles), the market is quick to react and fix it.

And generally that is true. But is isn't always. On Saturday, I paid $30 for a bad haircut and a shave. And I'll do it again in 3 weeks and again next month and the following month and so on and so on.

read more »

I have long puzzled at how conservatives can effectively govern if they think that fundamentally government is the problem. Apparently, there is now a lot of empirical evidence that the economy anyway, is better off in Democratic hands. Kevin Drum has the goods.

Technorati Tags: Democratic Party, Economics, Politics read more »

Yesterday I listened to a piece on NPR by Michelle Norris in which she interviewed a few experts about President Bush's newly submitted budget. One segment was a discussion with Christopher Joyce regarding energy policy.

Joyce said that Bush has recommended an overall increase of 3% for the Department of Energy's budget and that much of the focus would be placed upon fuel alternatives. In fact the new budget asks for 20% more funding for fuel alternatives. Joyce made a comment that farmers of corn and other crops that can be turned into ethanol stand to make a lot of money in the coming years because of these increased subsidies.

Unfortunately this is yet another example of corporatism that I have been critical of over the years. Whether it be big business, big oil, small businesses, the family farmer, etc., the federal government should not be subsidizing, and therefore promoting, one business or industry over others.

When will we learn that the market is best equipped to determine these things? read more »

James Howard Kunstler has restated his responses to what he calls "The Long Emergency." Kunstler often ruffles feathers with his harsh critiques of our nation's suburban wasteland and dependence on the automobile, and many label him a loon for his dire predictions on the world's oil supply. That said, Kunstler is a reactionary, and he longs for a "small" America--a country where localism reigns. Though he does not say it here, I find his course of action to be rather hopeful. It is a call to community and the "little way," where we buy our food from local farmers, work down the street from our homes, and care for one another. A few notable suggestions: read more »

At least that is what many articles about Wal-Mart and business would have you believe. I came across this very interesting story at MSNBC about a high school senior in Minnesota who has bought a local grocery store and is trying to save the small-town, Mom-and-Pop feel of Truman, MN. Only in America would a teenager have the moxie and ability to do such a thing. However, the feel good story takes a sinister turn at the end.

"Yes, it's a fairy tale, complete with Prince Charming. But as for happily-ever-after? Maybe not. Soon, and not that far away, a Wal-Mart is scheduled to open."

Ah yes! The scourge of America. The dreaded Wal-Mart. That company that kills at who stand in its path. The company that is sucking away the soul of America. The great inevitability. read more »

Joseph Pearce has started the discussion of his new book, Small Is Still Beautiful with this insight into the ideas driving his work:

What do we mean by economics? Or, perhaps, what do we not mean by it?

We do not mean “economics” as it is defined in the Collins English Dictionary as being merely “the social science concerned with the production and consumption of goods and services and the analysis of the commercial activities of a society”. True, this is the conventional definition, hence its appearance in the dictionary, but it is not its original meaning. The word “economics” comes from the Greek, oikonomia, a combination of oikos (house) and nomos or nemo (manage). It is, therefore, in its root or radical meaning, the managing of a home. And this brings us to the family, and to the sub-title of my book: Economics as if Families Mattered. If we forget the family we forget to live economically. We begin to live hedonistically.

Allow me to elaborate. read more »