Related to that Christmas Eve post...

There's a piece in today's Wall Street Journal called "The Fed's Needless Flirtation With Danger" in which Martin Feldstein writes that in order to stimulate demand, "Well-designed tax rules are a safe and effective alternative to quantitative easing".  

Dr. Feldstein argues that we'd have been better served by tax policies that induce businesses to make new investments and help consumers consume, instead of unleashing so much QE, but some of his contemporaries would challenge that assertion.   Major economists in the media often disagree in practice and do so with the type of certainty reserved for hard science and their views are frequently colored by their political leanings.   

I once saw an Economist on Squawk Box who insisted that professional economists collectively agree on nearly all major policy prescriptions.  I

Nassim Taleb, Wikipedia

wish I could recall his name.  His remarks still strike me as wishful.  Maybe he was right, but it sounded as though he wanted viewers to believe that the discipline of economics breeds the kind of metaphysical certainty found in the natural sciences.  There's a reason that the name for the field of study has long been referred to as "Political Economy". 

To help settle the issue or at least test it, a long form Krugman-Feldstein debate or a Taleb-Krugman debate would be an interesting spectacle, like the sort we could watch years ago.

Paul Krugman, Wikipedia

I'm referring to the old TV debates on public television that featured thought leaders from opposite ends of a policy spectrum who respectfully but forcefully hashed out their differences on politics and economics.  

My favorite debater remains the late William F. Buckley.  Though not a PhD economist, he did hold an undergraduate degree in economics from Yale.  Amazon Prime members can access some of WFB's old "Firing Line" debates for free.

WFB, Wikipedia

Holiday gifts for the American consumer

Have you read about the recent boost in U.S. consumer spending?  Of course you have and you know it is attributed -- at least in part -- to a steep drop in energy prices, particularly a drop in gasoline prices.   

Office.com clip art

This development is described by some in the financial press as a tax cut because the benefit accrues to the consumer in much the same way a tax cut does.  That is, by paying less at the pump, we automatically keep more of what we earn.  I wonder how Keynesians who routinely advocate for enormous government spending to stimulate demand are reacting.  Putting money directly in the hands of taxpayers can also spur consumption.