Recent quotes:

Litvaking and Lending - Bloomberg View

Investment banking is a gift economy in which banks give clients an array of thoughtful but random gifts -- free financial modeling, revolving loan facilities, introductions to potential board and executive hires, the chance to meet Barack Obama -- in the hopes that one day the clients will give them the massive gift of a merger advisory mandate.

Race to save rare breed of pig hinges on eating them

The way to save declining breeds of livestock, she argues, is to get people to eat them — thereby increasing demand that will lead to more breeding. She wants the mulefoot restored to its early 20th-century status as a premier pig. The U.S. Department of Agriculture is listening. The agency is giving her $50,000 to help increase interest in products made with mulefoot meat, and Frank is spreading her gospel to chefs, restaurants and markets around New England and New York. "I know it sounds weird, but you have to eat a rare breed to help it come back," she said. "I see it as a way to spread the word about mulefoot."

Quotation of the Day... - Cafe Hayek

Not only will power still, in practice, be exercised chiefly by a small cadre of individuals – who by this very reality will be, or will inevitably become, elite – the fact that the power that is exercised by the state will be no less, and perhaps more, than is the power that is exercised under the system displaced by populism means that the the poison remains.

Higher GDP Growth in the Long Run Requires Higher Productivity Growth

The U.S. experienced faster productivity growth in the not-too-distant past. If we could return to the productivity growth rates experienced in the late 1990s, the U.S. economy would likely see better outcomes overall. As a nation, we need to think about what kinds of public policies are needed to encourage higher productivity growth—and, in turn, higher real GDP growth—over the next five to 10 years. The above considerations suggest the following might help: encouraging investment in new technologies, improving the diffusion of technology, investing in human capital so that workers’ skillsets match what the economy needs, and investing in public capital that has productive uses for the private sector.

Economics Nobel Rewards Theories Worth Building On - Bloomberg View

In other cases, a worker may shirk so that the boss doesn’t discover how talented she is. Revealing one’s full level of talent sometimes just allows the boss to extract more effort.

Bourgeois Equality -

In other words, the new liberty and dignity for commoners was a sociological event, not a psychological one. It originated in a changing conversation in the society, not in psychological self-monitoring by the individual. People in Holland and then England (and now China and India) didn't suddenly start alertly attending to profit. They suddenly started admiring such alertness and stopped calling it sinful greed.

Why This Recovery Is So Lousy - WSJ

The dominant lesson of the Great Depression and the Great Recession is that when government overspends, overtaxes and over-regulates, economic freedom is suppressed and economic growth vanishes. When growth fades, it takes the American dream with it. Give America back its economic system of freedom and opportunity, and the ensuing growth will bring back the American dream.

How Shale Gas Is Re-energizing American Manufacturing | US News Opinion

Those claims that America doesn't produce anything anymore just aren't true. According to the Bureau of Economic Analysis, U.S. manufacturing output reached an all-time high of $2.17 trillion in 2015, making last year the best in at least a generation by all relevant measures of economic performance: output growth, employment gains and profits. In fact, today the U.S is the world's number two manufacturing nation, ranking behind only China. Also, consider that in 2014, the U.S. produced more manufacturing output than the combined output of Germany, South Korea, India, Italy and France.

Buc-ees: Texas Free Market Economics Lesson | National Review

If Buc-ee’s can afford to pay gas-station attendants $17 an hour, then why can’t we mandate a $15-an-hour federal minimum wage? Put another way: If it’s a good idea for one specific business in one specific market at one specific time, why not everywhere? You get the same thing with Walmart vs. Costco: They’re superficially similar businesses, so how come the mean meanies in Arkansas can’t pay like the nice, nice men from Washington State do? The answer, of course, is that every situation is different, and every business is a social-science experiment, trying out different approaches to solving social problems, which is what entrepreneurs and successful firms actually do. If it weren’t for the self-interest of big, nasty corporations, it wouldn’t be a question of clean bathrooms vs. less clean ones: You’d be out there on the side of the road watering Mrs. Johnson’s beloved bluebonnets.

Who Stole All the Manufacturing Jobs? - AAF

Developed countries around the world are experiencing similar trends in manufacturing employment. Germany, which consistently runs large trade surpluses, has been steadily losing manufacturing jobs for years. This demonstrates that the decline in manufacturing employment is a global phenomenon not necessarily linked to unbalanced trade.

That Confusing Berning Sensation - Story

Take comfort in this: most Bernie Sanders Millennials didn't know what they were voting for. Test Millennials yourself. Ask them, “What Wisconsin businesses would you like the government to own?”  They may be confused because they have been taught that Socialism is good, but not what Socialism is. A credible conversation points out that Socialism replaces individual liberty and choice with government decision- making. Historically, Socialism has failed and is currently causing humanitarian crises in places like Venezuela, Brazil, and Greece.    The Millennials are the most diverse generation our country has ever seen. If we can educate them on what Socialism is, then the rejection of this growing Uber-riding, micro-brew drinking, choice-loving group of consumers will be “swiping left” at Socialism's one-size-fits all policies.

Robots Are the New Seamstresses - Bloomberg View

With its integration of machines and people from multiple nations, the scene suggested a more complicated and fluid production story than the popular tales of diabolical Chinese or soulless robots out to displace hard-working Americans. The us-versus-them world of Donald Trump doesn’t have room for a Henderson Sewing attachment to a Japanese-made Juki sewing machine installed in a Mexican factory.

Even if Apple's iPhone manufacturing came to America, the jobs wouldn't - AEI | Pethokoukis Blog » AEIdeas

But the story of manufacturing is one of greater productivity through automation. We are not returning to mass manufacturing employment. The 1960s ain’t coming back.

In honor of his birthday, 7 great quotes from Friedrich Hayek - AEI | Pethokoukis Blog » AEIdeas

To act on the belief that we possess the knowledge and the power which enable us to shape the processes of society entirely to our liking, knowledge which in fact we do not possess, is likely to make us do much harm

How to Boost Economic Growth Through Competition - Real Time Economics - WSJ

Most prescriptions for boosting growth involve macroeconomic policy: increased government spending, for instance, or lower interest rates.

Economics Builds a Tower of Babel - Bloomberg View

Is this the fault of the general public for misunderstanding? I think it’s economists’ fault for not explaining. Economics is a social science, and it practitioners tend to live in their little silos, proudly ignoring the outside world. But beyond those silos, real policy decisions are getting made that will affect the lives of millions of agents … er, human beings. As jargon creates a greater and greater disconnect between what economists really believe and what the public thinks they believe, the chances grow that the discipline will suffer a Humpty-Dumpty-like fall in prestige and influence.

Welcome to the Machines | City Journal

If labor is the biggest expense on the ledger, then that’s the likeliest target for cuts. “With government driving up the cost of labor, it’s driving down the number of jobs,” Puzder said. “You’re going to see automation not just in airports and grocery stores, but in restaurants.”

Michelle Ray: Be wary of minimum wage, Medicare price controls | Dallas Morning News

A company simply can't afford to pay workers more than the value of their work. And so, under Sanders' proposal, any position that generates less than $15 per hour in value for a company would likely be eliminated, leading to more unemployment. One should expect a similar outcome from the proposal for extending overtime pay. To see this link between wage mandates and joblessness, just look at the European Union. According to a 2014 analysis by John Hopkins University economist Steve H. Hanke, the average unemployment rate for the 21 European Union countries with minimum wages was 11.8 percent. For the seven countries without a minimum wage, average unemployment was only 7.9 percent.

Socialism and hunger: a quick reminder - CapX

I was reminded of that parade of horribles when I came across Benjamin Zycher’s table of the greatest famines of the 20th century. As Zycher notes, six out of the 10 worst famines happened in socialist countries. Other famines, including those in Nigeria, Somalia and Bangladesh, were partly a result of war and partly a result of a government’s economic mismanagement.

Oregon grapples with consequences of landmark minimum wage law | US news | The Guardian

Jessie Burke is concerned about the impact it might have on her business, Posies Bakery & Cafe, in North Portland. “Small businesses like mine are frequently communicated with as if we were a Fortune 500 operation, but we are not,” she said. “When wages go up, prices have to go up. There’s no margin to absorb that cost.”

Understanding Say's Law of Markets | Foundation for Economic Education

One’s ability to demand goods and services from others derives from the income produced by one’s own acts of production. Wealth is created by production not by consumption. My ability to demand food, clothing, and shelter derives from the productivity of my labor or my nonlabor assets. The higher (lower) that productivity, the higher (lower) is my power to demand.

Beyond Exports: A Better Case for Free Trade | Cato Institute

Most Americans enjoy the fruits of international trade and globalization every day: driving to work in vehicles containing at least some foreign content, relying on smart phones assembled abroad from parts made in multiple countries (including the United States), having more to save or spend because retailers pass on cost savings made possible by their access to thousands of foreign producers, designing and selling products that would never have been commercially viable without access to the cost efficiencies afforded by transnational production and supply chains, enjoying fresh imported produce that was once unavailable out of season, depositing bigger paychecks on account of their employers’ growing sales to customers abroad, and enjoying salaries and benefits provided by employers that happen to be foreign-owned companies.

On Business Taxes, Liberals Invert Economic Reality—and Damage U.S. Prosperity - Opportunity Lives

Unfortunately, liberals such as Van Hollen, Levin and their ilk fail to realize that inversions are only a symptom of an economic problem rather than the problem itself. The underlying cause of inversions is twofold: U.S. corporate taxes are too high and too complicated.

D.C.’s Minimum Wage Goes Up and Walmart Backs Off on Opening Stores. Coincidence? | U.S. Chamber of Commerce

It doesn’t cause businesses to cut jobs immediately. Instead, it prevents future jobs from being created. It’s costly to close a store (or factory or warehouse). So once one has been built, companies will often do their best to deal with higher wage costs by adjusting business hours, automating some operations, cutting back on employee training, or postponing future planned improvements. Hiring more staff gets put on the backburner. The real effect is in the jobs not created, a number that is often difficult, or impossible to capture. Which is what makes this Walmart example so valuable—it presents a clear example of jobs that won’t be created.

Profits Are What Drive the Economy – InsideSources

Profits are what drive employment, not the other way around. Profits let business owners and investors know what consumers want, and provide an incentive to produce more of it—often creating or protecting jobs in the process. And if you like government services and non-profit organizations, you should also like profits, since without them there would be far less to tax or donate. Emphasizing profits over jobs is not popular, but ultimately it’s the value that businesses create, not the number of workers they hire, that generates economic prosperity.

$15 Foolishness | Workforce Freedom Initiative

Millions of Americans work at jobs that pay less than $15 an hour, and do so for a variety of reasons. While certainly everyone would like to earn more money, it is doubtful that anyone would want his or her job eliminated because the rate of pay offends the sensibilities of political activists.