Is fairness the enemy of the possible?

Is fairness the enemy of the possible in Europe? James Surowiecki seems to think so, which is why he suggests that “voters and politicians on all sides need to stop asking themselves what’s fair and start asking themselves what’s possible.” In one sense, Surowiecki is right: the ultimatum game, when at least one of the [...]

All warfare is based on deception

If “all warfare is based on deception” (Sun Tzu), the biggest deception concerns the costs of warfare. That’s why the work done by the folks at costsofwar.org is so important. They have attempted to estimate the human, economics, and sociopolitical costs of the ongoing wars in Iraq, Afghanistan, and Pakistan. Here are some of their [...]

“Inequality wasn’t the answer”

A friend suggested, in an email, that I may have been “on to something” when I presented my “Mind the Gap” paper at the Volcano symposium. The evidence is a recent column by Heather Stewart, who reports on last week’s OECD forum in Paris. For a long time, the growing gap between rich and poor [...]

Economist of the day

Austerity is painful, which is why austerity tomorrow is not credible. Yet shared tax increases and spending cuts can instil a sense of national purpose to help a country weather tough times. Raghuram Rajan, “Sensible Keynesians see no easy way out”

A stopped clock. . .

A stopped clock is right twice a day, and even Robert Samuelson has to get something right once in a while. American capitalism is on trial. When Americans vote in November, they will unavoidably choose between these competing visions of capitalism. One would try to improve capitalism by controlling it more. The other would aim [...]

“It’s a war between people and capitalism”

Time is running out for capitalism in Greece. That, apparently, is what mainstream economists like John Kay and Paul Krugman are afraid of. Alexis Tsipras, head of the Syriza party, explains why: “I don’t believe in heroes or saviours,” says Alexis Tsipras, “but I do believe in fighting for rights … no one has the [...]

Against conventional wisdom

Here are a few things to keep in mind while I take a brief hiatus. . . 1. Notwithstanding the conventional wisdom, Social Security is not going broke. In fact, last year it ran a surplus and, as David Cay Johnston argues, the growth of that surplus has had two major negative effects: One effect [...]

Inequality and the “miracle” of Asian growth

Changyong Rhee, chief economist at the Asian Development Bank, clearly recognizes the problem of growing inequality in Asia: Over the past 20 years, the gap between Asia’s rich and poor has widened so that the richest 1 per cent of Asian households now account for 6 per cent to 8 per cent of expenditure. Income [...]

Brother, can youse paradigm?

Thomas Kuhn’s The Structure of Scientific Revolutions, first published 50 years ago, is one of the few classics I tell students in pretty much all my classes they have to read before they leave college, whether or not it’s assigned in one of their courses. It contains important lessons, especially for economics, of radical paradigm [...]

“Working the dark side of the moon”

David Barstow’s explosive investigation of corruption within Wal-Mart reveals that Eduardo Castro-Wright, currently Wal-Mart’s vice-chairman, oversaw a culture of bribery when he was CEO of Wal-Mart Mexico. And when a key player in that bribery scheme blew the whistle, Walmart in Bentonville buried the investigation, and didn’t report anything to the authorities in either Mexico [...]