The Obama Administration's Terrible Idea

Another proposed law that would let lawyers file frivolous lawsuits.

Tyler Cowen calls this the worst idea ever.  I am not sure I would go that far, but I think it could be the worst economic proposal from this administration. 

This is really saying something when this is the group that brought us Cash for Clunkers.

Obama seems too smart to think this is good for the economy.  It makes sense if he is trying to pander to lawyers for political donations, however.

The WSJ interviews an all-time great

A Robert Lucas interview here.

Great explanation of Rational Expectations - the critique that shock the economics profession (especially Keynesians) - and why it helps explains what's going on today.

Our tax dollars at work ..

Record numbers of food stamps, here's a song about it.  :/

Warning, explicit language.

Quoted in the Daily Item

Link here

“First,” said Matthew Rousu, associate professor of economics at Susquehanna University in Selinsgrove, “to see long-term job growth, the government can’t be the one creating jobs. This has never worked for the U.S., and it won’t work now.”

For short-term growth, he said, the government can help, but the focus should be on jobs that employ lower-educated or blue-collar workers who have been disproportionately hurt by the recession.

“To make good use of tax dollars,” Rousu said, “the projects funded should give taxpayers something useful, preferably that lasts for many years. Once again, the Central Susquehanna Valley Thruway project seems like an ideal ‘stimulus’ project.”

An unconventional option would be to propose a decrease in the minimum wage, which, in Pennsylvania, is $7.25 an hour, Rousu said.

“The lowest-skilled workers have the highest unemployment rate,” he said. “A decrease in the minimum wage would make the lowest skilled workers, typically teenagers, more attractive to hire and would decrease the unemployment rate.”