Most people are more worried by government debt than about taxation. “But it’s trillions” a friend of mine recently expostulated about the United Kingdom’s national debt. He exaggerated a bit: it is £1.7 trillion. But one website features a clock showing the debt growing at a rate of £5,170 per second. Although the tax take is far less, the … Continue reading The Scarecrow of National Debt

LONDON – The horrendous attack by a French-Tunisian man on a crowd in Nice celebrating Bastille Day, which killed 84 and injured hundreds more, will give National Front leader Marine Le Pen a massive boost in next spring’s presidential election. It doesn’t matter whether the murderer, Mohamed Lahouaiej-Bouhlel, had any links to radical Islamism. Throughout … Continue reading The Failure of Free Migration

Most rich countries now have millions of “working poor” – people whose jobs do not pay enough to keep them above the poverty line, and whose wages therefore have to be subsidized by the state. These subsidies take the form of tax credits. The idea is a very old one. England implemented its “Speenhamland” system … Continue reading Minimum Wage or Living Income?

LONDON – Britain isn’t the only country holding a referendum this month. On June 5, Swiss voters overwhelmingly rejected, by 77% to 23%, the proposition that every citizen should be guaranteed an unconditional basic income (UBI). But that lopsided outcome doesn’t mean the issue is going away anytime soon. Indeed, the idea of a UBI … Continue reading Basic Income Revisited

LONDON – As a biographer and aficionado of John Maynard Keynes, I am sometimes asked: “What would Keynes think about negative interest rates?” It’s a good question, one that recalls a passage in Keynes’s General Theory in which he notes that if the government can’t think of anything more sensible to do to cure unemployment (say, building … Continue reading The False Promise of Negative Interest Rates

LONDON – The European Union has never been very popular in Britain. It joined late, and its voters will be asked on June 23 whether they want to leave early. The referendum’s outcome will not be legally binding on the government; but it is inconceivable that Britain will stay if the public’s verdict is to … Continue reading A British Bridge for a Divided Europe

LONDON – In recent decades, economics has been colonizing the study of human activities hitherto considered exempt from formal calculus. What critics call “economics imperialism” has given rise to an economics of love, of art, of music, of language, of literature, and of much else. The unifying idea underlying this extension of economics is that … Continue reading The Economist’s Concubine

LONDON – In 1935, John Maynard Keynes wrote to George Bernard Shaw: “I believe myself to be writing a book on economic theory which will largely revolutionize – not, I suppose, at once but in the course of the next ten years – the way the world thinks about its economic problems.” And, indeed, Keynes’s … Continue reading Keynes’s General Theory at 80

LONDON – Is there a “safe” debt/income ratio for households or debt/GDP ratio for governments? In both cases, the answer is yes. And in both cases, it is impossible to say exactly what that ratio is. Nonetheless, this has become the most urgent macroeconomic question of the moment, owing not just to spiraling household and … Continue reading How Much Debt Is Too Much?