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32. Fiscal Policy Report Card on America's Governors: 2010
- Author:
- Chris Edwards
- Publication Date:
- 09-2010
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- State governments have had to make tough budget choices in recent years. Tax revenues have stagnated as a result of the poor economy, and that has prompted governors to take a variety of fiscal actions to close large budget gaps. Some governors have cut spending to balance their budgets, while others have pursued large tax increases.
- Topic:
- Economics, Government, Markets, and Monetary Policy
- Political Geography:
- America
33. Defining Success: The Case against Rail Transit
- Author:
- Randal O'Toole
- Publication Date:
- 03-2010
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- 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?"
- Topic:
- Government, Markets, and Infrastructure
- Political Geography:
- America
34. The Inefficiency of Clearing Mandates
- Author:
- Craig Pirrong
- Publication Date:
- 07-2010
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- In the aftermath of the financial crisis, attention has turned to reducing systemic risk in the derivatives markets. Much of this attention has focused on counterparty risk in the over-the counter market, where trades are bilaterally executed between dealers and derivative purchasers. One proposal for addressing such counterparty risk is to mandate the trading of derivatives over a centralized clearinghouse. This paper lays out the advantages and risks to a mandated clearing requirement, showing how, in some instances, such a mandate can actually increase systemic risk and result in more financial bailouts.
- Topic:
- Economics, International Trade and Finance, Markets, and Financial Crisis
35. The Constitutionalization of Money
- Author:
- James M. Buchanan
- Publication Date:
- 06-2010
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The market will not work effectively with monetary anarchy. Politicization is not an effective alternative. We must commence meaningful dialogue with acceptance of these elementary verities. Far too much has been said and written in elaboration of the first statement, which too often is taken to be equivalent to the assertion that "capitalism" or "the market" has failed. Admittedly claims for market efficacy without qualifiers can be found. But economists should know that anarchy can only generate disorder rather than its opposite.
- Topic:
- Markets and Monetary Policy
- Political Geography:
- United States
36. The World Economy: Bottoming Out or a Respite before the Next Crunch?
- Author:
- Eswar Prasad
- Publication Date:
- 06-2010
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- In early 2009, the world economy seemed to be headed into an irreversible decline. But a strong dose of stimulative monetary and fiscal policies—perhaps with an assist from the natural resilience of the market economy—seem to have done the trick in stabilizing the financial system and setting the stage for global recovery. Flows of private capital to emerging markets have revived and world trade has begun to rise back to levels seen before the crisis hit. Consumer and business confidence are back on the rise.
- Topic:
- Markets and Monetary Policy
37. Has the Fed Been a Failure?
- Author:
- 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.
- Topic:
- Civil Society, Government, and Markets
- Political Geography:
- United States
38. Do Vouchers and Tax Credits Increase Private School Regulation?
- Author:
- Andrew J. Coulson
- Publication Date:
- 10-2010
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- 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.
- Topic:
- Education, Government, and Markets
- Political Geography:
- United States
39. Health-Status Insurance: How Markets Can Provide Health Security
- Author:
- John H. Cochrane
- Publication Date:
- 02-2009
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- None of us has health insurance, really. If you develop a long-term condition such as heart disease or cancer, and if you then lose your job or are divorced, you can lose your health insurance. You now have a preexisting condition, and insurance will be enormously expensive—if it's available at all. Free markets can solve this problem, and provide life-long, portable health security, while enhancing consumer choice and competition. “Heath-status insurance” is the key. If you are diagnosed with a long-term, expensive condition, a health-status insurance policy will give you the resources to pay higher medical insurance premiums. Health-status insurance covers the risk of premium reclassification, just as medical insurance covers the risk of medical expenses. With health-status insurance, you can always obtain medical insurance, no matter how sick you get, with no change in out-of-pocket costs.
- Topic:
- Economics, Health, Markets, and Privatization
- Political Geography:
- United States
40. Financial Crisis and Public Policy
- Author:
- Jagadeesh Gokhale
- Publication Date:
- 03-2009
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- This Policy Analysis explains the antecedents of the current global financial crisis and critically examines the reasoning behind the U.S. Treasury and Federal Reserve's actions to prop up the financial sector. It argues that recovery from the financial crisis is likely to be slow with or without the government's bailout actions. An oil price spike and a wealth shock in housing initiated the financial crisis. Declines in stock values are intensifying that shock, threatening to deepen the current recession as U.S. consumers and investors cut their expenditures. An offsetting wealth injection from additional risk-bearing investors could initiate a quicker recovery. Thus, supporters of government intervention justify the bailout's debt-financed fund injections—in essence, they want to compel future taxpayers to join the group of today's risk bearing investors.
- Topic:
- Economics, Globalization, International Trade and Finance, and Markets
- Political Geography:
- United States