Search This Blog

Friday, March 05, 2004

Whoops! An Apology

Jim, if there was a tone of condescension in my last post, please accept my apologies. I think it was more of a reflection of my exasperation over certain lines of reasoning appearing in this blog. This is obviously a reflection of my limitations and not yours. As for angst over personal circumstances, that is very understandable. Hopefully, in future posts, I can give you a convincing set of arguements as to why the country's economic future is likely to work out better than you think.

Neo-mercantilism I would describe as a modern version of mercantilism: trade surplus -good, trade deficit - bad, and the assumption that a trade deficit must invariably cause a currency to decline. There is no gold standard nor must there be blatant protectionism as in classic mercantilism. The Economist advocates free trade and I know that, but they have the modern equivalent (neo) of mercantilism stamped on some of their assumptions. In the modern world capital flows are many times larger than trade flows. A country that creates a favorable investment environment can sustain trade deficits for quite some time without sufferring a currency crisis.

I think Paul Zane Pilzer?? wrote a book called Infinite Wealth which emphasized the role of knowledge in wealth generation as Bret mentioned. The tone was less arrogant than Wanniski - I'll try to find my copy and let you know if this is a better presentation...

My preferred policy slate

flat tax
phase out tariffs
phase out corporate welfare
tort reform
more active public debate over costs versus benefits of regulations
school choice and vouchers to empower parents and children...
reform of medicare/medicaid along the lines of the Breaux Commission as a first step to dealing with health care

this would be a good start but the tough question is how to win the political battle??

No comments: