Although public schools are usually the biggest item in state and local budgets, spending figures provided by public school officials and reported in the media often leave out major costs of education and thus understate what is actually spent.
Topic:
Economics, Education, Government, and Monetary Policy
Over the past four decades, American cities have spent close to $100 billion constructing rail transit systems, and many billions more operating those systems. The agencies that spend taxpayer dollars building these lines almost invariably call them successful even when they go an average of 40 percent over budget and, in many cases, carry an insignificant number of riders. The people who rarely or never ride these lines but still have to pay for them should ask, “How do you define success?"
Recently, the Federal Reserve has significantly altered the procedures and goals that it had followed for decades. It has more than doubled its balance sheet, paid interest to banks on reserves held as deposits with the Fed, made decisions about which institutions to prop up and which should be allowed to fail, invested in assets that expose taxpayers to large losses, and raised questions about how it will avoid inflation despite an unprecedented increase in the monetary base.
Topic:
Economics, Government, Political Economy, Politics, and Financial Crisis
George A. Selgin, Lawrence H. White, and William D. Lastrapes
Publication Date:
11-2010
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
As the one-hundredth anniversary of the 1913 Federal Reserve Act approaches, we assess whether the nation's experiment with the Federal Reserve has been a success or a failure. Drawing on a wide range of recent empirical research, we find the following: (1) The Fed's full history (1914 to present) has been characterized by more rather than fewer symptoms of monetary and macroeconomic instability than the decades leading to the Fed's establishment. (2) While the Fed's performance has undoubtedly improved since World War II, even its postwar performance has not clearly surpassed that of its undoubtedly flawed predecessor, the National Banking system, before World War I. (3) Some proposed alternative arrangements might plausibly do better than the Fed as presently constituted. We conclude that the need for a systematic exploration of alternatives to the established monetary system is as pressing today as it was a century ago.
School voucher and education tax credit programs have proliferated in the United States over the past two decades. Advocates have argued that they will enable families to become active consumers in a free and competitive education marketplace, but some fear that these programs may in fact bring with them a heavy regulatory burden that could stifle market forces. Until now, there has been no systematic, empirical investigation of that concern. The present paper aims to shed light on the issue by quantifying the regulations imposed on private schools both within and outside school choice programs, and then analyzing them with descriptive statistics and regression analyses. The results are tested for robustness to alternative ways of quantifying private school regulation, and to alternative regression models, and the question of causality is addressed. The study concludes that vouchers, but not tax credits, impose a substantial and statistically significant additional regulatory burden on participating private schools.
President Barack Obama, former U.S. Senate majority leader Tom Daschle, and others propose a new government agency that would evaluate the relative effectiveness of medical treatments. The need for “comparative-effectiveness research” is great. Evidence suggests Americans spend $700 billion annually on medical care that provides no value. Yet patients, providers, and purchasers typically lack the necessary information to distinguish between high- and low-value services.
A financial-institution bailout involves government intervention through a transaction or forbearance targeted to a financial institution or group of financial institutions. The action is preemptive as the financial institution does not fail and go out of business, but remains a going concern, benefiting creditors, shareholders, or counterparties. In the absence of a bailout, the financial institution would either be forced to go through receivership or bankruptcy in the prescribed legal form, or have its role in financial intermediation disrupted.
Topic:
Economics, Government, Political Economy, and Privatization
President Obama has made it clear that reforming the American health care system will be one of his top priorities. In response, congressional leaders have promised to introduce legislation by this summer, and they hope for an initial vote in the Senate before the Labor Day recess.
The Forest Service, Bureau of Land Management, National Park Service, and Fish and Wildlife Service collectivelymanagewell over a quarter of the land in theUnited States.Although everyone agrees that the landsandresourcesmanagedbytheseagencies are exceedingly valuable, the lands collectively cost taxpayers around $7 billion per year.
Topic:
Agriculture, Civil Society, Environment, Government, and Privatization
This article examines the effect of government consumption on economic growth in 23 Latin American countries over the years 1974–2003. Employing the Armey Curve, we show that the typical Latin American government is spending beyond the optimal point. Using panel data and a fixed effects (FE) model, we find that increases in government consumption lead to unambiguous decreases in economic growth.