The February shutdown of an Abbott Laboratories plant in Michigan due to contamination precipitated the nationwide baby formula shortage. The plant finally resumed production this month. Whether these events reflect corporate greed or bureaucratic bungling illustrates why we so often disagree about policy. Let’s start with some facts. Abbott is one of the four largest […]

The killing of 19 students and two teachers at Robb Elementary School in Uvalde, Texas, has outraged Americans. The malfeasance of law enforcement during the tragedy is highly disturbing and demands reforms. Police officers reportedly waited outside the classroom for over an hour. The commanding officer evaluated the situation as a “barricaded shooter,” not an […]

Elon Musk’s Twitter takeover has stirred many emotions. The deal also illustrates the unprofitability of media bias, which claims of media bias must consider. The drama began with Mr. Musk announcing on April 4 a 9% stake in the company. After turning down a seat on the Board of Directors, Mr. Musk proposed on April […]

It’s a seemingly simple request. Surely Washington can lower the price of gasoline to provide Americans relief at the pump. Democrats in the House recently passed the Consumer Fuel Price Gouging Protection Act to this effect. Yet as 4,000 years of experience shows, governments have little ability to lower market prices through command. Markets are […]

San Francisco is one of the most beautiful and affluent cities in the world. And yet San Francisco, Los Angeles, and Seattle, have significant and growing homeless populations. Anyone interested in the ills of the West Coast should read Michael Shellenberger’s book “San Fransicko: Why Progressives Ruin Cities.” His answer: “much of what I and […]

We have been told repeatedly to “follow the science,” which usually means submit to expert rule. But experts, no matter how smart, cannot run society efficiently. Recognizing the limits of experts is not anti-science. The Federal Reserve’s inflation forecasts provide more evidence on this. Adam Smith in 1776 was one of the first to recognize […]

Rapidly rising house prices are contributing to inflation but may also signal a housing market bubble. Overpriced real estate contributed to the financial crisis of 2008 and the Great Recession. Do we need to fear another housing crash in addition to inflation? How much have prices gone up? The Case-Shiller index has jumped 35% since […]

In 2020, the federal government started sending checks to many Americans in response to COVID-19. The presumption was that Uncle Sam’s checks would make us better off. But government transfers cannot make a nation wealthier and have contributed to inflation. To understand this, we must distinguish money and currency. Money is a medium of exchange, […]

Cities across America own golf courses, but analysis from the Reason Foundation shows that many lose money on them.  Is subsidizing golf a proper function of government? The Reason study found over cities reporting finances for their golf courses.  Seventy percent of cities lost money in 2020, which may have been unrepresentative due to state […]

Russia’s invasion of Ukraine sent already rising oil prices even higher. Record gas prices are fueling the highest inflation rate in 40 years. President Biden blames high gas prices on Mr. Putin, but administration policies are hampering U.S. oil production. Markets are forward-looking and incorporate new information almost instantaneously. Anticipated events will affect commodity and […]

I support free markets and economic freedom. But do all markets make society better off? The college cheating industry offers a challenge. An internet search quickly reveals the abundant assistance available. Companies and freelancers will write papers, even giving money-back guarantees. Uploading pictures of exam questions on a phone can get answers delivered. Entire classes […]

French economist and journalist Frederic Bastiat wrote, “When goods don’t cross borders, soldiers will.” That international trade contributes to peace is a tenet of classical liberal and contemporary libertarian thought. How might trade accomplish this, and what does the evidence show? Trade reduces conflict in two ways. First, war disrupts trade; goods are unlikely to […]

The COVID-19 pandemic disrupted life in many ways. Governments across America assumed new powers without explicit authorization. But laws restricting businesses were also suspended. As the pandemic ebbs, we should evaluate this deregulation experiment and consider permanent changes. Americans for Tax Reform counted 846 suspended federal and state rules. Some were narrow matters, like allowing […]

The United States and Europe imposed economic sanctions on Russia for its unprovoked invasion of Ukraine. I will let others debate the sufficiency of this response and consider the economics and effectiveness of sanctions. Economists have analyzed sanctions both theoretically and empirically. Theory helps us identify differences between observed outcomes and the unobserved alternative without […]

The Johnson Center and the American Institute for Economic Research recently held a conference on “The Future of Higher Education.”  Today I will share some of the insights from this event. Higher ed faces a crossroads if not a crisis.  As Purdue University president and former Indiana governor Mitch Daniels noted, only college has experienced […]

The New York Times’ 1619 Project examines the impact of slavery on America. One essay contends that our economic system was built on slavery. Was America’s ascension as an economic powerhouse due to slavery? Slavery was a repugnant and evil institution. Its abolition is a sign of humanity’s moral progress. Slavery taints America’s founding and […]

Inflation topped 7% in December, the highest level in forty years. The Biden administration has tried blaming rising prices on corporate greed with antitrust enforcement as a remedy. Does this make economic sense? We must first consider what is inflation. Measured by the rate of change in the Consumer Price Index (CPI), economists define inflation […]

Barry Bonds and Roger Clemens were recently not elected to the Baseball Hall of Fame in their final year of eligibility, reportedly over their use of performance enhancing drugs (PEDs). The case illustrates some of the economics of rules and the nature of “positional goods.” The case for both Bonds and Clemens based on performance […]

Over 100,000 Americans await organ transplants and over 6,000 die annually while waiting. From an economic perspective the decades-long organ shortage has a simple cause: paying organ donors is illegal. Price controls predictably produce shortages. Payment for organs has been outlawed since at least 1948. The 1984 National Organ Transplant Act established the Organ Procurement […]

2021 proved to be another challenging year due to COVID-19, although life did more resemble normal. Bad events can blind us to the ways life is getting better, and several innovations are improving life. Let’s start with messenger RNA (mRNA), employed in the Moderna and Pfizer COVID vaccines. mRNA is one of the building blocks […]

Autumn brings falling leaves and pine needles. I recently cleared the pine needles off my roof to ensure Santa a safe landing. Economics students learn that economics is everywhere in our lives. Including up on the rooftop. I made an economic choice, namely, not to hire someone to clean my roof. (I also do my […]

Inflation is currently America’s most pressing economic concern, but I believe that our disappearing workers pose a greater long-term challenge. Almost four million fewer Americans are working now than in February 2020 despite record job openings. Yet the decline in work participation predates COVID-19 and is explored in a new Congressional Joint Economic Committee (JEC) […]

As the college football regular season winds down, the coaching carousel heats up. So far in 2021, 28 of 130 FBS programs have had coaching changes. Coaching decisions illustrate some elements of economic and business decisions generally. Perhaps unexpectedly, imagination plays an outsized role. I will focus on coaching vacancies from firing, not retirements or […]

The nomination of Cornell University law professor Saule Omarova to head the Office of the Comptroller of the Currency (OCC) has drawn criticism for views offered in the professor’s research. Should expounding extreme ideas disqualify someone from government service? One of Professor Omarova’s papers proposed shifting bank deposits to the Federal Reserve. Banks would continue […]