This is from today's edition of The Wall Street Journal.
I know Captain Renault is shocked.
Showing posts with label Captain Renault. Show all posts
Showing posts with label Captain Renault. Show all posts
Monday, October 11, 2010
Thursday, June 17, 2010
Friday, June 4, 2010
Revolving Doors and Lobbies
According to this story in The Washington Post, there is a connection between Wall Street and Capitol Hill. Who would have guessed?
Captain Renault for one is shocked.
Captain Renault for one is shocked.
Thursday, April 29, 2010
Debt, Debtors and Financial Reform
In another confluence of resources, here is an opinion piece that appeared in last Sunday's edition of The Washington Post. It deals with the failure to do anything significant about the national debt, not just now but over the last several decades. What really got my attention was the opening, which referred to Bill Gross, a founder of the investment firm PIMCO and his reluctance to buy any more U.S. debt. In fact, according to the author, Gross is unloading some of his holdings in favor of bonds from other countries. It seems he worries about our commitment to do anything about the national debt.
Of course, there is a recently formed bi-partisan commission that is to address the problem. But, you know what - "been there, done that, got the t-shirt." Some will say, "Yes, but the situation is more serious now. We'll certainly take action." Perhaps. I think we will hear great statements and see wonderful posturing. These are, after all, the same people who think they can reform the financial system.
This brings me to this next item from The Indianapolis Star. (HT to Carpe Diem.) Seems to me this may be another Captain Renault moment.
What do you think?
Of course, there is a recently formed bi-partisan commission that is to address the problem. But, you know what - "been there, done that, got the t-shirt." Some will say, "Yes, but the situation is more serious now. We'll certainly take action." Perhaps. I think we will hear great statements and see wonderful posturing. These are, after all, the same people who think they can reform the financial system.
This brings me to this next item from The Indianapolis Star. (HT to Carpe Diem.) Seems to me this may be another Captain Renault moment.
What do you think?
Wednesday, February 17, 2010
Captain Renault is Shocked
This article was in The Wall Street Journal (HT to Division of Labour) about a week ago, but I missed it. It seems a Senator supported a bank acquisition in his home state. It also seems that there was a connection between said Senator and bank management. Captain Renault and I are both shocked.
Saturday, December 26, 2009
Monday, September 7, 2009
People Respond to Incentives...
even when they create the incentive system. We create the institutions and then deem it newsworthy (HT to Carpe Diem for the link) when we react in ways that economics would tell us is predictable. I don't blame anyone for taking advantage of different institutions and incentives. Nevertheless, Captain Renault is shocked.
Monday, July 6, 2009
Economics and a New GM Plant
According to this story from The Wall Street Journal, politics was a factor in a recent decision by General Motors. I would disagree. If decisions are made according to decisions and economic institutions, I think this is clearly a decision of economy - political economy. I suspect Captain Renault would have thoughts on the subject.
Thursday, July 2, 2009
Friday, May 29, 2009
Understanding Fiscal Policy
First, thanks to Izzit.org for the pointer.
Here's an interesting piece on business/government cooperation.
To think, businesses benefit from legislation. Next we'll be hearing that politicians backing the legislation receive contributions from these same businesses.
Captain Renault is "shocked."
(For the younger readers of this blog, if you've not seen the classic film Casablanca, one of the characters, Captain Renault, is "shocked" to discover gambling is going on in Rick's Cafe - just as his winnings are delivered.)
This post relates to the following Keystone Economic Principles:
4. Economic systems influence choices.
and
5. Incentives produce “predictable” responses.
Here's an interesting piece on business/government cooperation.
To think, businesses benefit from legislation. Next we'll be hearing that politicians backing the legislation receive contributions from these same businesses.
Captain Renault is "shocked."
(For the younger readers of this blog, if you've not seen the classic film Casablanca, one of the characters, Captain Renault, is "shocked" to discover gambling is going on in Rick's Cafe - just as his winnings are delivered.)
This post relates to the following Keystone Economic Principles:
4. Economic systems influence choices.
and
5. Incentives produce “predictable” responses.
Sunday, March 8, 2009
Rent-seeking - Captain Renault Division
This post relates to the following Keystone Economic Principles:
4. Economic systems influence choices.
and
5. Incentives produce predictable responses.
One of the questions about the stimulus plan is how effective it will be. Now we have an interesting story in today's edition of The Washington Post. Once again, I have to agree with Captain Renault, "I'm shocked."
4. Economic systems influence choices.
and
5. Incentives produce predictable responses.
One of the questions about the stimulus plan is how effective it will be. Now we have an interesting story in today's edition of The Washington Post. Once again, I have to agree with Captain Renault, "I'm shocked."
Friday, March 6, 2009
Rent-Seeking - Captain Renault Division
This post relates to the following Keystone Economic Principles:
4. Economic systems influence choices.
and
5. Incentives produce “predictable” responses.
I'm thinking this a good time to start a new category for certain stories, and I'll it dedicate to Claude Rain's character in Casablanca, Captain Renault. Really, is it news to find out that rent-seeking takes place in regulated markets? Incentives produce predictable responses; and economic systems (and institutions) are about setting up the incentives.
Captain Renault: I'm shocked, shocked to find that gambling is going on in here!
[a croupier hands Renault a pile of money]
Croupier: Your winnings, sir.
Captain Renault: [sotto voce] Oh, thank you very much.
Today's nominee is this story from The Wall Street Journal.
I know I've missed a lot of other candidates recently. I'll try to do better.
4. Economic systems influence choices.
and
5. Incentives produce “predictable” responses.
I'm thinking this a good time to start a new category for certain stories, and I'll it dedicate to Claude Rain's character in Casablanca, Captain Renault. Really, is it news to find out that rent-seeking takes place in regulated markets? Incentives produce predictable responses; and economic systems (and institutions) are about setting up the incentives.
Captain Renault: I'm shocked, shocked to find that gambling is going on in here!
[a croupier hands Renault a pile of money]
Croupier: Your winnings, sir.
Captain Renault: [sotto voce] Oh, thank you very much.
Today's nominee is this story from The Wall Street Journal.
I know I've missed a lot of other candidates recently. I'll try to do better.
Tuesday, December 4, 2007
It's the Economy....I'm Shocked, Shocked
It really should not come as a surprise, but a front page story in today's issue of The Wall Street Journal states "Economy Moves to Fore as Issue for 2008 Voters" Even before reading the article (it’s quite good) I find myself reduced to quoting Captain Renault in the movie Casablanca.
Actually, given the confluence of sub-prime, oil prices, and twin concerns about economic overheating and slowdown, one would actually be surprised if it wasn't the topic. And given the focus on things economic, teachers all across the nation will be using the economy and the elections to spice up their lessons in economics, political science, American history and current events, among other thing. This gives all of us an opportunity to discuss a very fundamental aspect of economic literacy and thinking.
Economics is parsed a number of ways, but one way is to distinguish between positive and normative economics. Positive economics is based on fact. It describes economic conditions as they are. Normative economics describes things as one thinks they should be. Politicians (of all stripes) generally are huge fans of normative economics, using normative economics to describe their future policies and the wonderful benefits that will derive from those policies.
Politicians generally shy away from positive economics; although they do like to use data to disguise normative statements in a way as to appear positive. By throwing in an occasional statistic, a politician can seem to base their proscription in economic reality. But the reality too often is that while they may start from a positive statement, they seem to rarely provide a full explanation of how and why their policies are expected to work, and the extent to which they will actually change behavior; and by extension, the expected impact on the economy.
There are reasons for this. First and foremost, they frequently don't know. Second, we the electorate frequently don't care about the positive because the normative sounds good. The normative also frequently doesn't address issues of cost - either monetary or opportunity cost. And we know that we like to hear what the benefits will be, but we don't want to hear about costs -- unless it's to be told that someone else will pay the costs.
But this is a good opportunity to use current events to reinforce economic learning. Have your students dissect the sound bites (or the entire presentations if you can) that come out of press conferences, stump appearances, and debates. Have them analyze what the candidates say and sort them in to positive and normative statements. I suspect you and your students will find few, if any positive statements. And what they do find will be dwarfed by the normative statements.
As a follow up, ask your students "why do the candidates do this?" And ask them if they think the statements actually enhance their opinions of the candidates' ability to solve economic problems, or whether the candidates are just acting in their own self-interest.
Finally, you may also want to consider reading Russ Roberts' essay, "Pigs Don't Fly: The Economic Way of Thinking about Politics". I would recommend you read it first, and then you can decide whether you need to distill it, or whether you can give it to your students straight. Either way, it could generate some good discussion.
I look forward to your comments.
Actually, given the confluence of sub-prime, oil prices, and twin concerns about economic overheating and slowdown, one would actually be surprised if it wasn't the topic. And given the focus on things economic, teachers all across the nation will be using the economy and the elections to spice up their lessons in economics, political science, American history and current events, among other thing. This gives all of us an opportunity to discuss a very fundamental aspect of economic literacy and thinking.
Economics is parsed a number of ways, but one way is to distinguish between positive and normative economics. Positive economics is based on fact. It describes economic conditions as they are. Normative economics describes things as one thinks they should be. Politicians (of all stripes) generally are huge fans of normative economics, using normative economics to describe their future policies and the wonderful benefits that will derive from those policies.
Politicians generally shy away from positive economics; although they do like to use data to disguise normative statements in a way as to appear positive. By throwing in an occasional statistic, a politician can seem to base their proscription in economic reality. But the reality too often is that while they may start from a positive statement, they seem to rarely provide a full explanation of how and why their policies are expected to work, and the extent to which they will actually change behavior; and by extension, the expected impact on the economy.
There are reasons for this. First and foremost, they frequently don't know. Second, we the electorate frequently don't care about the positive because the normative sounds good. The normative also frequently doesn't address issues of cost - either monetary or opportunity cost. And we know that we like to hear what the benefits will be, but we don't want to hear about costs -- unless it's to be told that someone else will pay the costs.
But this is a good opportunity to use current events to reinforce economic learning. Have your students dissect the sound bites (or the entire presentations if you can) that come out of press conferences, stump appearances, and debates. Have them analyze what the candidates say and sort them in to positive and normative statements. I suspect you and your students will find few, if any positive statements. And what they do find will be dwarfed by the normative statements.
As a follow up, ask your students "why do the candidates do this?" And ask them if they think the statements actually enhance their opinions of the candidates' ability to solve economic problems, or whether the candidates are just acting in their own self-interest.
Finally, you may also want to consider reading Russ Roberts' essay, "Pigs Don't Fly: The Economic Way of Thinking about Politics". I would recommend you read it first, and then you can decide whether you need to distill it, or whether you can give it to your students straight. Either way, it could generate some good discussion.
I look forward to your comments.
Wednesday, October 10, 2007
People Respond to Incentives, Apparently (Part II)
Perhaps I'm a cynic, but after reading this article in The Wall Street Journal - Weekend Edition, I can only say I'm reminded of the scene in Casablanca, where Captain Renault is informed there is gambling in Casablanca.
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