William A. Niskanen (Author at The Cato Institute)

Nightly Morphin' Bailout Dangers (Daily Podcast)

Mon, 03 Nov 2008 00:00:00 EST

In Defense Of Liberty (Commentary)

Tue, 21 Oct 2008 00:00:00 EDT

The government has responded to the credit crisis with a massive expansion of its balance sheet and its role in the economy. Is there nothing for a good libertarian to do but head for the hills? No, you can stand and fight. Libertarians and fans of small government, do not abandon all hope. There...

Helping Healthy Banks and Lessons for Libertarians (Daily Podcast)

Wed, 15 Oct 2008 00:00:00 EDT

Cato scholars assail the bailout on television and radio. (Weekly Video)

Wed, 01 Oct 2008 00:00:00 EDT

Cato Institute scholars have been out front on television and radio providing critical context for the current financial slide on Wall Street. Cato scholars have also been providing a much-needed counterpoint to the bailout bandwagon in Washington.

Bailout Round One: FAIL (Daily Podcast)

Tue, 30 Sep 2008 00:00:00 EDT

Cato Scholar Comments on Bush's Address on the Economy and Proposed Bailout (Scholar Comments)

Thu, 25 Sep 2008 00:00:00 EDT

For the second time in six years, the Bush administration has asked Congress for nearly unlimited authority without an independent professional review of the evidence that led the administration to request such authority.

In making the case for the Iraq war resolution, according to Senator John D. Rockefeller, "the administration repeatedly presented intelligence as fact when it was unsubstantiated, contradicted or even nonexistent. As a result, the American people were led to believe that the threat from Iraq was much greater than actually existed."

As it turned out, of course, no "weapons of mass destruction" were ever discovered.

The skeletal proposal for the Troubled Asset Relief Program states that "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency. The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this act without regard to any other provision of law regarding public contracts" – again without an independent professional review of the evidence that led the administration to request such extraordinary authority.

In both cases, the administration requested urgent congressional approval of these measures when members of Congress were anxious to go home to run for reelection. And a final irony: the total direct cost of the Iraq war to date has been about $700 billion, the same amount that the administration has requested to buy bad mortgages.

The $700-Billion Bailout (Daily Podcast)

Mon, 22 Sep 2008 00:00:00 EDT

Cato Scholar Comments on Fed's Decision to Hold Interest Rates Steady (Scholar Comments)

Wed, 06 Aug 2008 00:00:00 EDT

Yesterday, the Fed made it clear that they will not increase the fed funds rate until after the November election. Since the Fed has not followed its own monetary policy rule for some time, one should not be surprised that they are maintaining a low federal funds rate for political reasons for now. Unfortunately, that will lead to the highest annual inflation rate in nearly 30 years. The Fed, like many others, apparently underestimates the strength of the U.S. economy in the second quarter. Final sales increased at about twice the rate of GDP, the difference reflecting a substantial reduction in private inventories. Moreover, personal consumption expenditures increased by only about one-third the increase in disposable income, the difference leading to the highest personal saving rate in a decade; almost all of the 'economic stimulus' payments, apparently, were used to pay down debt rather than increase consumption. These two conditions are likely to lead to a higher growth rate in subsequent quarters than most expect. At such time that the Fed returns to its commitment to low inflation, it is less important how much the fed funds rate is increased at any specific meeting of the Open Market Committee than to convey a clear signal that this rate will continue to be increased until inflation is reduced to a tolerable rate.

Cato Scholar Comments on Minimum Wage Hike (Scholar Comments)

Thu, 24 Jul 2008 00:00:00 EDT

The increase in the federal minimum wage by 70 cents per hour to $6.55 effective today is only the latest example of making economic policy by wishful thinking or hypocrisy. Most of the costs of a higher minimum wage will be borne by the least skilled members of the labor force, most of which are young and many are minorities. This increase will reduce the employment of the least skilled and restrict their employment opportunities to jobs with low non-wage compensation (such as health insurance) and the least desirable hours and working conditions. Most of the beneficiaries of this increase are likely to be secondary workers in non-poor families.

These effects are documented by decades of careful empirical research.

One obvious question is raised by such policies: If this is such a good idea, why not set the minimum wage at $10.00 per hour or more?

Can the Fed Whip Inflation Now? (Daily Podcast)

Wed, 23 Jul 2008 00:00:00 EDT