I frequently hear that the US has closed its factories or moved them to China and "doesn't make anything anymore". This is not true. Depending on which numbers you pick, The United States makes about as much or more than anyone else in the world, including China. The industrial sector of American GDP is 17% higher than China. The US produces 21% of ( Read more... )

Field experiments and natural observations are two kinds of tests that aid in understanding big complex systems. In the former, you verify your theories by messing with the system and see how it reacts. In the latter, you make inferences from observing the system as it behaves normally. An observer might watch a colony of beavers working on a dam ( Read more... )

There's been an awful lot of discussion about debt, and very little discussion about what debt and interest are, why they exist, and where this stuff comes from ( Read more... )

This website is making the rounds in a few of my circles, and it frustrates me. Numbers ending in "-illion" and require context, but visualizations comparing giant things to other giant things seem unproductive or counterproductive. Visualizing the size of a stack of $100 bills representing "US unfunded liabilities" is meaningless without a similar ( Read more... )

Lots of people these days are concerned about mounting public debt, particularly in light of the TARP and stimulus programs. On one hand I see some cause for concern. Our public debt to GDP ratio isn't as high as it was during World War 2, so maybe we've got some breathing room. On the other hand at the end of World War 2 we had a ton of ( Read more... )

I became a big fan of Planet Money during the recent financial crisis. I listened to their simplified version of things and then assumed I knew a lot about it, but lately ctd has been challenging my assumptionsA key point in the Meltdown narrative of September 2008 is the widely reported freezing of the commercial paper market. This American Life ( Read more... )

If you subscribe to only one RSS feed this week, make it congbudgetoffic (rss). The stuff he writes about is not only topical but the definition of well-grounded, since for better or worse the CBO is about as nonpartisan and credible as sources get for no-BS perspectives on what's going on.

In particular this post, short and sweet, flogs the same issue that I've ( Read more... )

One of the best things I've written in the last year (if I may say so) is this post on John Haidt's Five Moral Dimensions. I keep coming back to that post, mentally at least, because it explains why people have such a hard time seeing eye to eye politically.

Take the TARP "bailout", often inaccurately characterized as a $700 billion giveway to ( Read more... )

Earlier this month I wrote about the problem with spending cuts: the government programs that actually spend stuff are very popular, and the programs that are most popular to cut don't spend much money in the first place.

Rep Eric Cantor (R-VA) apparently doesn't read my blog because he's proudly trumpeting YouCut, a revolutionary new GOP program ( Read more... )

Everyone agrees that the national deficit is a problem, but there's less agreement about what to do about it. Everyone agrees that you get rid of theoretical deficits by increasing taxes and cutting spending, but getting rid of real deficits by raising real taxes and cutting real spending is somehow a completely different deal ( Read more... )