All I Really Need to Know I Learned from Reading Higgs

“CRISIS AND LEVIATHAN is an important, powerful, and profoundly disturbing book.” —James M. Buchanan, Nobel Laureate in Economic SciencesFurther to Bob Higgs’s earlier post, Thinking Is Research, Too!, down in Texas, the Chairman of the Dallas Fed has the odd practice of looking beyond government stats and actually (gasp!) asking real people how they think the economy is going.

From a profile of the President and CEO of the Dallas Fed, Richard Fisher, “Money Makes the World Go Round:”

Every few months, Fisher calls a couple dozen CEOs to ask them how things are going. He told me that when he asks this informal focus group why they haven’t been hiring more quickly, they tell him that they want more clarity from Washington, about what their tax rates will be, about what federal spending will look like, and about what it will cost to implement new laws like the Affordable Care Act. And so the problem, in Fisher’s view, is with Congress and the president, who haven’t done enough to mitigate the uncertainty constraining the private sector.

Now, go to the little box in the upper right headed “Search,” and type in “regime uncertainty.” Read a few of the items returned, and you, too, will come to the realization that Higgs told us so, 16 years ago. Until we get Washington to listen, we can’t expect to see any change from the dismal record of the long-drawn-out Great Depression—which did not end until after World War II—now being repeated in the current Great Recession.

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