In his classic Fable of the Bees: or, Private Vices, Publick Benefits (1724), Bernard Mandeville, the Dutch-born British philosopher and satirist, described – in verse – a prosperous society (of bees) that suddenly chose to make a virtue of austerity, dropping all excess expenditure and extravagant consumption. What then happened?
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Wednesday, January 18, 2012
Sunday, January 15, 2012
Spend, Spend, Spend. It’s the American Way.
GRIDLOCK in Congress implies that there won’t be any collective decision to spend more as a nation to get out of our slump. Increases in deficit spending seem unlikely, and so does the balanced-budget stimulus I’ve been advocating in this column. For now, we must pin our hopes for a robust recovery on the willingness of millions of consumers to spend substantially more.
But what really drives consumer spending? Economists are reasonably good at divining how consumers tend to react to changes in government policy, but in the absence of such policy, and when the economy is in the doldrums, they aren’t very good at predicting spending shifts.
A new book, “Beyond Our Means: Why America Spends While the World Saves” (Princeton University Press), offers some insights. It was written by Sheldon Garon, a Princeton professor who is not an economist but rather a historian with a sociological bent.
Read more
But what really drives consumer spending? Economists are reasonably good at divining how consumers tend to react to changes in government policy, but in the absence of such policy, and when the economy is in the doldrums, they aren’t very good at predicting spending shifts.
A new book, “Beyond Our Means: Why America Spends While the World Saves” (Princeton University Press), offers some insights. It was written by Sheldon Garon, a Princeton professor who is not an economist but rather a historian with a sociological bent.
Read more
Sunday, January 1, 2012
A Tax Credit to Fix A Housing Mess
WE used to talk a lot about helping homeowners in trouble.
Instead, the bankers were bailed out — and now we hardly talk at all about aiding ordinary Americans.
Yet the problems facing homeowners today are even bigger than they were in the dark days of the financial crisis. According to the S.& P./Case-Shiller 20-city Home Price Index, home prices have fallen 13.2 percent since Lehman Brothers collapsed in September 2008. Over the same period, of course, unemployment has climbed.
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Instead, the bankers were bailed out — and now we hardly talk at all about aiding ordinary Americans.
Yet the problems facing homeowners today are even bigger than they were in the dark days of the financial crisis. According to the S.& P./Case-Shiller 20-city Home Price Index, home prices have fallen 13.2 percent since Lehman Brothers collapsed in September 2008. Over the same period, of course, unemployment has climbed.
Read more
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