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351. In Fed We Trust: Ben Bernanke's War on the Great Panic

Author:
William Poole
Publication Date:
02-2010
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
David Wessel is a fine journalist; In Fed We Trust is a fine book. It belongs on the shelf of every student of the 2007–09 financial crisis. It is, as well, a good read for recreational observers of the economic scene. Wessel focuses on Fed Chairman Ben S. Bernanke, but he discusses the role of all the other key players as well. The biographical information on Bernanke is interesting, as are Wessel's comments on the policy approaches and personalities of the other policymakers.
Topic:
War and Financial Crisis

352. Unchecked and Unbalanced: How the Discrepancy between Knowledge and Power Caused the Financial Crisis and Threatens Democracy

Author:
Mark Calabria
Publication Date:
02-2010
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Arnold Kling's Unchecked and Unbalanced is a novel and insightful take on both the financial crisis and broader trends in the provision of government services. Its central point is best summarized by its subtitle, “How the discrepancy between knowledge and power caused the financial crisis and threatens democracy.” This is a brief, very readable book for two distinct audiences, those interested in further understanding the financial crisis and those interested in improving the accountability and efficiency of services provided by government.
Topic:
Financial Crisis

353. The Making of Americans: Democracy and Our Schools

Author:
Neal McCluskey
Publication Date:
02-2010
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Historian David Tyack breaks educational progressives into two types: pedagogical and administrative (Tyack 1974). The former are champions of “child-centered” instruction in the classroom, while the latter want centralized, government control of the schools.
Topic:
Education
Political Geography:
America

354. They Spend WHAT? The Real Cost of Public Schools

Author:
Adam B. Schaeffer
Publication Date:
03-2010
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
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

355. 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

356. The Case for Auditing the Fed Is Obvious

Author:
Arnold Kling
Publication Date:
04-2010
Content Type:
Policy Brief
Institution:
The Cato Institute
Abstract:
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
Political Geography:
United States

357. 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

358. The DISCLOSE Act, Deliberation, and the First Amendment

Author:
John Samples
Publication Date:
06-2010
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
The United States Supreme Court decided in Citizens United v. Federal Election Commission that Congress may not prohibit spending on political speech by corporations. President Obama and several members of Congress have sharply criticized Citizens United, and Sen. Charles Schumer and Rep. Chris Van Hollen have proposed the DISCLOSE Act in response to the ruling. DISCLOSE mandates disclosure of corporate sources of independent spending on speech, putatively in the interest of shareholders and voters. However, it is unlikely that either shareholders or voters would be made better off by this legislation. Shareholders could demand and receive such disclosure without government mandates, given the efficiency of capital markets. The benefits of such disclosure for voters are likely less than assumed, while the costs are paid in chilled speech and in less rational public deliberation. DISCLOSE also prohibits speech by government contractors, TARP recipients, and companies managed by foreign nationals. The case for prohibiting speech by each of these groups seems flawed. In general, DISCLOSE exploits loopholes in Citizens United limits on government control of speech to contravene the spirit of that decision and the letter of the First Amendment.
Topic:
Civil Society, Democratization, and Human Rights
Political Geography:
United States

359. Editor's Note

Author:
James A. Dorn
Publication Date:
06-2010
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
This special issue of the Cato Journal was made possible by a generous grant from the Arthur N. Rupe Foundation. The question posed in this issue—Are Unions Good for America?—has both normative and positive aspects. Normatively, if one takes freedom as a fundamental principle, then compulsory unionism cannot be justified in a free society; it violates the rights of both workers and employers. Under current U.S. labor law, workers are often compelled to join unions and employers are compelled to negotiate "in good faith." Public sector unions are even more onerous than private sector unions; they limit consumer choices and impose heavy tax burdens.
Political Geography:
United States and America

360. 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