By John R. Graham •
Thursday November 19, 2015 9:05 AM PST •
October’s Producer Price Index declined 0.4 percent, month on month, and dropped 1.6 percent, year on year. Mild deflation continues to take hold in the general economy. However, it is not so in health care. Of the 14 sub-indices for health-related goods and services, only three declined month on month. Only six declined year on year (see Table I).
Outside health care, producer prices for both final and intermediate demand goods have declined precipitously since September 2014. This makes the increases in producer prices of health-related goods especially disturbing. Pharmaceutical preparations increased in price by 8.4 percent year on year, versus a 4.8 percent decline in prices of final demand goods. That is, using final demand goods as a baseline, prices for pharmaceutical preparations increased 13.2 percent! Price increases for other health-related goods have not been so dramatic.
Producer prices for health services are broadly moving in line with prices for other services. As I noted last month, what is interesting is the difference in the rate of inflation for hospital inpatient versus outpatient services. Outpatient prices are declining, while inpatient prices are rising, resulting in a gap.
Tags: health spending, Inflation
By Vicki Alger •
Wednesday November 18, 2015 5:49 PM PST •
Today a House and Senate conference committee met to reauthorize the Elementary and Secondary Education Act (ESEA), which was last reauthorized in 2002 as the No Child Left Behind Act (NCLB).
There are numerous problems with the proposed compromise being considered (see here, here and here, for example).
But the bigger question we should be asking of Congress is why reauthorize the ESEA in the first place?
We’ve endured 50 years of federal meddling in elementary and secondary education, and we have scant (if any) hard evidence that DC politicians—whether it’s members of Congress, presidents or their education secretaries–know what’s best for other people’s children.
Tags: Elementary school, esea, NCLB, No Child Left Behind, Secondary school
By Randall Holcombe •
Wednesday November 18, 2015 2:50 PM PST •
While I’m reluctant to attribute movements in stock prices to specific events, this article says that the big run-up in stock prices (around 1.5%) today was due to the release of the Federal Reserve’s minutes of their last meeting indicating that “a core of officials backed a possible rate hike in December.”
The conventional wisdom is that lower interest rates boost stock prices, and that one of the drivers of the healthy stock market since 2009 has been the Fed’s low interest rate policy. I don’t disagree with the conventional wisdom in general. Lower interest rates tend to raise asset prices. But in this case investors seem to believe the Fed maintained that low interest rate policy too long.
The conventional wisdom emphasizes lower borrowing costs of low interest rates that promote investment, but tends to overlook the fact that interest rate manipulation often leads to the wrong types of investment, causing events like the dot-com bubble in the 1990s and the housing bubble of the 2000s.
Investors seem to have the right reaction to the news that the Fed is likely to raise interest rates, and the fact that the news has boosted stock prices should make the Fed less reluctant to make the right move.
Tags: Economics, Federal Reserve, Money and Banking
By Abigail Hall •
Wednesday November 18, 2015 7:26 AM PST •
It has been nearly a week since terror attacks in Paris claimed the lives of nearly 130 people and injured countless others. Not more than a day later, France launched air strikes against ISIS in Raqqa, the de facto capitol of the Islamic State.
As soon as news broke of the strikes, my social media feeds were filled with praise for the French government, applauding them for acting so quickly after the attack and for going on the offensive. Many criticized President Obama for not launching similar or more intense strikes sooner.
These individuals included not just friends of conservative political views, but many who are quick to pronounce themselves as lovers of liberty, proponents of limited government, and protectors of individual rights. Yes, even some of these individuals called for outright war in the Middle East in the wake of Friday’s attacks. One of my acquaintances pulled no punches, saying, “they [the U.S.] should burn Syria [ISIS] to the ground.”
Tags: Costs of War, Foreign Intervention, France, ISIS, Liberty, Robert Higgs, Terrorism, War, WWI, WWII
By Sam Staley •
Monday November 16, 2015 2:41 PM PST •
On Sunday, November 22, 2015, CNN will present The Hunting Ground, an advocacy film about sexual assault on college campuses. This is likely to stir up another national debate on college rape and sexual assault, and my employer, Florida State University, will inevitably be caught in the cross hairs. Does this film get anything right about campus sexual assault? Despite broadsides leveled at the film from conservative and libertarian analysts aimed at discrediting the film, I think it gets several things right. It also gets several important things wrong.
First, some background. I have written several articles on this blog about sexual assault on campus as well as elsewhere (see here and here), and I am currently working on a book, Sexual Assault on College Campuses: Why It’s Problem and What We Can Do About it, that will be published in 2016 by Southern Yellow Pine Publishing. In preparation for CNN’s premiere, libertarians and others interested in this issue might find the following posts useful and relevant:
Tags: Civil Society, CNN, college rape, rape, rape culture, sexual assault, The Hunting Ground
By Robert Murphy •
Friday November 13, 2015 12:00 PM PST •
In a recent New York Times piece, economist Robert Shiller built an argument that was a non sequitur resting on two false premises. Specifically, Shiller argued:
(Premise 1:) Economics courses teach students that market outcomes are “Pareto optimal.”
(Premise 2:) In reality, market forces lead to systematic deception and manipulation of the public.
(Conclusion:) Therefore, we shouldn’t have blind reliance on unregulated markets, but instead we need sensible government oversight such as the kind that the FDA provides to the medical arena.
To repeat, Shiller’s conclusion doesn’t follow from his premises, but beyond that, his premises are false. So it’s a rather dubious argument, all around.
Tags: Austrian School of Economics, FDA, government regulation, market competition, Pareto optimal, Regulation, Robert J. Shiller, Shiller
By Abigail Hall •
Thursday November 12, 2015 5:01 PM PST •
Last week, Senators Jeff Flake (R-AZ) and John McCain (R-AZ) released a report revealing the Department of Defense paid professional sports teams to host “patriotic events.”
Anyone who has ever attended a sporting event knows these well. Military personnel are featured on the jumbotron, huge flags are spread across the field, returning veterans are named “hometown heroes,” or asked to participate in half-time contests, ceremonial first pitches, and other activities intended to honor the U.S. military.
Though seemingly a spontaneous illustration of national pride, the report revealed such actions to be anything but genuine. In fact, the report found that the Department of Defense had contracted with the NFL, NHL, MLB, and Major League Soccer to host such events, to the tune of $10.5 million taxpayer dollars.
In releasing the report, Senator McCain expressed his disappointment that sports franchises took federal funds for such purposes saying,
Americans across the country should be deeply disappointed that many of the ceremonies honoring troops at professional sporting events are not actually being conducted out of a sense of patriotism, but for profit in the form of millions in taxpayer dollars going from the Department of Defense to wealthy pro sports franchises. Fans should have confidence that their hometown heroes are being honored because of their honorable military service, not as a marketing ploy.
Tags: DOD, Hitler, John McCain, Paid Patriotism, Sports, war on terror
By Vicki Alger •
Wednesday November 11, 2015 5:05 PM PST •
Today we say ‘thank you for your service’ to our veterans willing to sacrifice their lives for our liberties. But we need to back up our words with actions.
As the National Military Family Association notes:
In today’s all-volunteer force, more than half have families, and as they transition out of the military, these new veterans and their families need a tremendous amount of support. ...Our military children need support long after their parent becomes a veteran. We can’t ignore the need for resources and empowerment for each member of the veteran family.
One of the best ways to show our gratitude is to fight for veterans’ freedom to educate their children where—and how—they see fit. Thankfully, a growing number of states are expanding education options for military families—including California, which leads the country with the largest military population. As Nereida Moreno reported for the Daily Breeze:
Tags: Education, Military, Personal Liberty, Politics
By Robert Murphy •
Wednesday November 11, 2015 10:07 AM PST •
Former House Speaker Dennis Hastert has pleaded guilty in what has been called a “hush-money” case. Hastert could receive up to five years in prison, though prosecutors have recommended six months as part of his plea deal. The amazing thing about this case is that such a harsh sentence comes not from any misconduct in the distant past. As the NPR story explains: “The former Republican speaker was charged with one count of evading bank rules about currency transactions and one count of lying to federal investigators. Under the plea agreement Hastert pleaded guilty only to the charge involving currency violations.” When an individual can get six months in prison–to avoid five years–for the crime of withdrawing his own money out of the bank, you know we have left the realm of economic freedom.
The public understandably has little sympathy for Hastert because he was apparently withdrawing large sums in order to pay off a blackmailer. Hastert reportedly withdrew some $3.5 million to pay to “Individual A,” who was a former student back when Hastert was a high school teacher and wrestling coach. But to repeat, Hastert’s law-breaking has nothing to do with whatever harm he may have caused decades ago. Instead, Hastert is now facing prison time because he (apparently) intentionally kept his withdrawal amounts small enough to avoid automatic bank reports, and then lied to federal agents about the nature of these withdrawals once his bank had tipped the government off that something looked fishy.
Tags: Dennis Hastert, Ludwig von Mises, Mises
By Melancton Smith •
Wednesday November 11, 2015 6:03 AM PST •
In an act of cowardice, the University of Missouri’s system president and chancellor resigned on Monday. Protestors, led by master’s student Jonathan Butler who went on a hunger strike, complained that the University did not side with Michael Brown against the Ferguson police force and has not taken action against “a slew of racist, sexist, homophobic, etc., incidents that have dynamically disrupted the learning experience” at MU. His letter referenced incidents of the MSA (Missouri Students Association) President Payton Head being called the n-word on campus from a passing pick-up truck, termination of graduate student health insurance subsidies, and cancellation of Planned Parenthood contracts on campus, and someone drawing a swastika in a student residential hall with their own feces. Protestors demanded that the chancellor “acknowledge his white male privilege, recognize that systems of oppression exist, and provide a verbal commitment” to meeting demands of the protestors. ( Interestingly, it has recently been reported that Jonathan Butler is the son of a railroad executive who made $8.4 million last year. That’s a lot of privilege buying power.)
Tags: campus police, free speech, Jonathan Butler, protests, Racism, University of Missouri