If you’ve been paying any attention to the media over the past few weeks, you’ve heard about the looming Fiscal Cliff that threatened to push the fragile U.S. economy back in to recession. As a New Year’s gift to the U.S. people, Congress decided to pass a bill averting this cliff. It’s commendable that Republicans and Democrats could overcome their petty differences to pass a bill that actually makes sense. My biggest annoyance with all this talk about the 1% paying their “fair” share in taxes, was that Democrats proposed couples with $250,000 in annual income pay higher taxes. In …
Macro-Economic Follies
Every year, especially around Thanksgiving and Christmas, we hear the mainstream media tell us how important consumer spending is for our economy – after all consumer spending is 70% of our economy. So by that logic, consumption is good and savings must be bad, right? Well maybe if you’re a Keynesian economist. But if you follow Adam Smith or Hayek, you believe that increased productivity leads to more wealth. Forced spending just leads to improper allocation of resources. Here’s a fun explanation, in tune with the Christmas spirit: [embedplusvideo height=”370″ width=”608″ standard=”http://www.youtube.com/v/7uKnd6IEiO0?fs=1″ vars=”ytid=7uKnd6IEiO0&width=608&height=370&start=&stop=&rs=w&hd=0&autoplay=0&react=0&chapters=¬es=” id=”ep4924″ /] You can read …