Richard J Grant

Published in The Tennessean , Sunday, July 25, 2010 Obama swinging but missing on economic policies by Richard J. Grant On the economy, there are three areas where the Obama administration and its congressional supporters are failing: fiscal policy, regulatory policy, and monetary policy. They are nothing if not consistent. 1. On the fiscal front, the policy focuses on a hoped-for “stimulus” through increased government spending. The idea is to increase “aggregate demand” by encouraging people to reduce saving and spend more now. Rather than let people do the natural thing at a time of uncertainty and save, the administration wishes to increase their taxes so it can spend the money for them. It matters what the national government buys for us. Starting from zero, the first dollars spent should go to the highest priorities, such as national security and the essential infrastructures of governance. The desirability of such spending is clear, but as spending increases, the marginal benefi...

Published in The Tennessean , Sunday, July 18, 2010 Pelosi’s words, like her policies, don’t add up by Richard J. Grant There is a market for bad economics. That market exists largely to service customers who are active in what we might call the politicized sectors of life. A recent example of bad economics being put to use was House Speaker Nancy Pelosi’s attempt to justify the extension of unemployment insurance benefits with a stimulus-multiplier type of argument. She now-famously extemporized, "It injects demand into the economy. It creates jobs faster than almost any other initiative you can name." There is no word yet on whether Speaker Pelosi will test her theory by putting her economic advisers on unemployment. But one begins to see the brilliance of her party's actions in ramming through or threatening legislation that serves to keep up the unemployment rate. If only we lesser souls could understand her theory: the more money we take from people who are working t...

Published in The Tennessean , Sunday, July 11, 2010 Economic recovery would have come naturally by Richard J. Grant The Obama administration's cheerleaders are having difficulty getting the crowd fired up about “Recovery Summer.” With unemployment stubbornly holding above 9 percent, and economic growth much lower than would normally be expected, expectations are depressed. The trouble with Recovery Summer is that it should have come last summer. Economies are always in “recovery” in the sense that people are always adapting their business plans to changes in their expectations as market realities change. In macro terms, we can say that the economy began to recover in 2006 when real estate prices began noticeably to fall. In accepting such prices, home sellers were adapting to the reality of market demand. We tend to see the falling wages, employment levels, and sales revenue that we experience during a recession as the problem. They hurt. But the pain is a symptom of the economic d...

Published in The Tennessean , Sunday, July 4, 2010 Nowadays problem is taxation without comprehension by Richard J. Grant Shortly after she had made the transition from prime minister to baroness, I attended a lecture by Margaret Thatcher. In a noticeably extended portion of her speech she waxed admiringly about the achievements of Thomas Jefferson. Though this was a meeting of the Empire Club, with most of the audience being Her Majesty's subjects, it was more than a punchline when she added, “But after all, he was an Englishman.” Jefferson was indeed an Englishman, as were his colleagues. Were it otherwise, it is hard to imagine what sort of society would have emerged in North America. Just as it matters where we come from, it matters even more from where our institutions come. The American rebellion against the Crown was not unprecedented in British history: the Glorious Revolution, for example, had occurred less than a century before. Observers closer to the times, such as Jose...