Monetary Policy

The Debt Crisis and Fiat Money

by Tim Kelly December 5, 2011

The European Union (EU) has a sovereign-debt problem. Greek government bonds have been downgraded to junk status, and there is talk of default. Italy, Spain, and Portugal appear to be next, as they face skyrocketing interest rates just when their governments must borrow more to service their debt. Should these countries default, some of Europe's largest banks which are heavily ...

Central Planning at the Federal Reserve

by Sheldon Richman November 25, 2011

While it is understandable that inflation hawks keep a close watch on the Federal Reserve’s money-creation activities, an equally worrisome Fed activity is taking place right under their noses. Whether or not the Fed is expanding the money supply, it has undoubtedly moved into a new activity under cover of addressing the financial crisis and recession: central planner of ...

Ron Paul’s De-Stimulus Plan

by Tim Kelly November 4, 2011

Congressman Ron Paul has put forth an economic plan that calls for serious cuts in the size, budget, and power of the federal government. He has also proposed policies that would end the Fed-driven inflation responsible for the global economic meltdown. This is truly a de-stimulus plan. Paul’s plan would immediately cut $1 trillion from the federal budget by closing ...

Censoring Cash

by Wendy McElroy October 28, 2011

If “money talks,” then a global campaign is being waged to silence it or, at least, to let cash speak only with permission. The Economic Collapse blog states, “All over the world, governments are either placing stringent reporting requirements on large cash transactions or they are banning them altogether. We are being told that such measures are needed to ...

A Historic Fiscal Solution, If We Overcome Convention Fears

by Fergus Hodgson September 23, 2011

If you haven’t noticed, the major problems at the federal level are bipartisan. The debt-ceiling charade, in particular, demonstrated that leaders of both major parties have no desire to balance their books. Sure, they’ll propose minor cuts to spending projections, but the status quo of deficits suits them just fine. The status quo does not, however, suit taxpayers, ...

Federal Reserve Grabs New Powers

by Sheldon Richman August 25, 2011

While inflation hawks understandably keep a close watch on the Federal Reserve’s money-creation activities, an equally worrisome Fed activity is taking place right under their noses. Under cover of addressing the financial crisis and recession, the Fed has become the central allocator of credit. As San Jose State University economics professor Jeffrey Rogers Hummel points out in The Independent Review ...

Yes We Can

by Laurence M. Vance August 9, 2011

Speaking from the Rose Garden last week after Senate approval of the bill to raise the debt ceiling, President Obama said about the federal deficit, And since you can’t close the deficit with just spending cuts, we’ll need a balanced approach where everything is on the table. Yes, that means making some adjustments to protect health-care programs like ...

An Amy Winehouse Government

by Ralph R. Reiland August 3, 2011

It feels like we’re dealing with an Amy Winehouse form of governing. “These overdoses happen because these guys drink 20 beers and then reach for their heroin,” a friend of mine said after the late star’s recent death, at 27. “You can’t think straight once you’re totally blitzed.” It seems the same with our politicians, overdosed on their own importance. Their ...

A Cheer and a Half for the Tea Party

by Sheldon Richman August 1, 2011

Were it not for the Tea Party, the debt-ceiling controversy might never have taken place. Kudos on that count alone. It comes as no surprise that the governing class and its boosters in the media portray the Tea Party folks as a collection of bumpkins and idiots who “don’t know the difference between campaigning and governing” — indeed, who would ...

Shared Sacrifice: Obama’s Demagoguery

by Sheldon Richman July 29, 2011

The most offensive claim made during the debt-ceiling controversy is that there’s a moral equivalence between cutting government spending and raising taxes. President Obama asks for “shared sacrifice” to reduce the budget deficit. In his view, if the government spends more than it takes in — it currently borrows more than 40 cents of every dollar spent — the ...

The Collateral Is Us

by Rich Schwartzman July 28, 2011

The witching hour is nigh and the threat of the U.S. defaulting on the federal debt is being bandied about as if it were the boogeyman. Fear mongers from the left and right both say the country will go belly up unless the debt ceiling is raised by the Aug. 2 deadline, that it will no longer be able to ...

The Cause of Current U.S. Deficits and Debt

by Laurence M. Vance July 18, 2011

Except for a brief period of time in 1835 under President Andrew Jackson, the United States has been in debt since the founding of the Republic. The first reported national debt in 1791 was over $75 million. Congress now spends more than that every ten minutes. Since the last year of the Bush administration, annual federal deficits have exceeded $1 ...