The International Monetary Fund is a left-leaning bureaucracy that was set up to monitor the fixed-exchange-rate monetary system created after World War II. Unsurprisingly, when that system broke down and the world shifted to floating exchange rates, the IMF didn’t go away. Instead, it created a new role for itself as self-styled guardian of economic […]
Continue reading More Hack Analysis from the IMF
I wrote last year about why Puerto Rico got into fiscal trouble. Like Greece and so many other governments, it did the opposite of Mitchell’s Golden Rule. Instead of a multi-year period of spending restraint, it allowed the budget to expand faster than the private sector for almost two decades. As the old saying goes, […]
Continue reading A Semi-Acceptable Indirect Bailout for Puerto Rico?
Much of my work on fiscal policy is focused on educating audiences about the long-run benefits of small government and modest taxation. But what about the short-run issue of how to deal with a fiscal crisis? I have periodically weighed in on this topic, citing research from places like the European Central Bank and International […]
Continue reading Lesson from Cyprus: Spending Restraint Is the Pro-Growth Way to Solve a Fiscal Crisis
In my presentations about how to deal with budgetary deterioration and fiscal crisis, I often share with audiences a list of nations that have achieved very positive results with spending restraint. The middle column shows how these countries limited the growth of government spending for multi-year periods. The next column of numbers reveals how multi-year […]
Continue reading Can Greece Tax its Way to Prosperity?
It’s very hard to be optimistic about Japan. I’ve even referred to the country as a basket case. But my concern is not that the country has been mired in stagnation for the past 25 years. Instead, I’m much more worried about the future. The main problem is that Japan has the usual misguided entitlement […]
Continue reading Japan’s Descent into Keynesian Parody