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Michael O’Dowd on the SA economy – August 2000

16 December 2011
In considering the general state of the South African economy, it is essential that we should recognise that South Africa is a middle level performer. While it is not one of the high flyers, what used, absurdly, to be called miracles, it is even further from the basket cases, and…

Is Buying Local Really Lekker?

17 November 2011
According to a Business Day news article by Setumo Stone (Buy-SA bid to channel billions to local companies, 1 Nov. 2011), “Business, the government and labour signed an accord on local procurement on Monday, pledging to increase their purchasing of goods and services from South African producers to an "aspirational…

Good Governance

04 Nov 11   Eustace Davie
Governments face difficult decisions in formulating economic policies. Not only do they receive conflicting advice from economists and policy analysts putting forward very different, even totally opposite solutions to economic problems, they also have to contend with sometimes ill-considered or partisan pressure from their political supporters. Politicians are subject to perverse…

SA can achieve a 7 per cent growth rate

27 Oct 11   Jasson Urbach
Finance Minister Pravin Gordhan recently said that, “South Africa needed to set itself a target of growing by around 7 per cent over a 20-year period in order to deal with unemployment and poverty in the country”. The fact that Mr Gordhan recognises economic growth as an important factor in…

Creative destruction makes the world go around

21 Oct 11   Jasson Urbach
Is it a selfish desire that drives individuals to seek new ways to make life easier, more enjoyable, and more rewarding? Does this selfish desire require a God-like presence to steer it and manage it so that whatever developments take place become available to everyone in the country? Or should…

Two Cheers for a Big U.S. Trade Deficit

14 Oct 11  
News that the U.S. trade deficit narrowed this summer has brought the usual cheers from commentators. Meanwhile, opponents of pending free trade agreements with South Korea, Panama and Colombia claim that the trade deficit is still too large and the trade deals should be abandoned. But the truth is there's…

Would More Infrastructure Spending Stimulate the Economy?

07 Oct 11   FMF Policy Bulletin
Four years into the deepest recession since World War II, the U.S. economy expanded at a rate of only 0.7 per cent in the first half of 2011. This means that the economy is growing at a slower pace than the population and that capita output continues to fall, say…

Learning from Solyndra

07 Oct 11  
Solyndra's declaration last month that it intended to shut down manufacturing operations and declare bankruptcy has set off a political firestorm in Washington. And no wonder. The California-based solar panel manufacturer was the poster child of the Obama administration's much-ballyhooed green jobs campaign and was the recipient of a staggering…

The Government Shouldn't Guarantee Mortgages or Mortgage-Backed Securities

07 Oct 11   FMF Policy Bulletin
One of the arguments occasionally put forward by proponents of a government housing market guarantee is that the government will always come in and rescue the housing market, so we might as well start with a government guarantee and charge for it. That way, it's argued, the taxpayers will at…

Most US Lawmakers Lack Education in Economics

30 Sep 11   FMF Policy Bulletin
The vast majority of U.S. lawmakers lack an academic background in business or economics, according to a study by the Employment Policies Institute (EPI), reports Politico.   Only 13.7 per cent majored in business or accounting and 8.4 per cent have an economics degree.   On the Senate budget committee, five out of 23…

Did Stimulus Dollars Hire the Unemployed?

30 Sep 11   FMF Policy Bulletin
To test the effect of job incentives included in the 2009 American Recovery and Reinvestment Act (AARA), or stimulus package, researchers at the Marcatus Center conducted a survey of hundreds of firms, non-profit institutes and local governments to gather information on worker and employer behaviour in response to certain provisions.…

Ten-Point Plan to Create US Jobs

30 Sep 11   FMF Policy Bulletin
The Competitive Enterprise Institute released a 10-point plan to create US jobs in response to President Obama's jobs speech last week. Suggestions include: Repeal financial "reform" laws, such as Dodd-Frank and the Sarbanes-Oxley Act, that are causing economic uncertainty and dissuading businesses from expanding, investing and hiring for new projects.…

The Dirty Secret behind Clean Jobs

22 Sep 11   FMF Policy Bulletin
Politicians have shifted their focus from the threats posed by global warming to creating green jobs. Under the guise of creating a "clean energy" market, political leaders can claim they are "investing" in the economy, creating new jobs and saving the planet, say Nick Sibilla, a research assistant, and Todd…

Give US-EU Free Trade a Chance

15 Sep 11  
As both the United States and the European Union struggle to conjure the right combination of fiscal and monetary tools to rein in deficits while boosting economic growth, they risk overlooking the role that trade policy can play. If the two powers want a non-inflationary way to inject more dynamism…

Number of Green Jobs in US Fails to Live Up to Promises

15 Sep 11   FMF Policy Bulletin
In the Bay Area of the US, as in much of the country, the green economy is not proving to be the job-creation engine that many politicians envisioned. President Obama once pledged to create 5 million green jobs over 10 years. California Gov. Jerry Brown promised 500,000 clean-technology jobs state-wide…

Hurricane Irene Rebuilding Is No Economic Boost

15 Sep 11   FMF Policy Bulletin
Get ready for a bunch of demand-side economists telling you the post-Hurricane Irene rebuilding phase is a good thing for future economic growth. Don't believe it, says Lawrence Kudlow, host of CNBC 's The Kudlow Report. Recall the parable of the broken window, introduced by French free-market philosopher Frederic Bastiat in…

American Millionaires Go Missing

09 Sep 11   FMF Policy Bulletin
In 2007, 390,000 US tax filers reported adjusted gross income of $1 million or more and paid $309 billion in taxes. In 2009, there were only 237,000 such filers, a decline of 39 per cent. Almost four of 10 millionaires vanished in two years, and the total taxes they paid…

Made in China

01 Sep 11   FMF Policy Bulletin
The United States is running a record trade deficit with China. This is no surprise, given the wide array of items in stores labelled "Made in China." Researchers at the Federal Reserve Bank of San Francisco examine what fraction of U.S. consumer spending goes for Chinese goods and what part…

Solving the US Jobs Problem

18 Aug 11   FMF Policy Bulletin
As the American Recovery and Reinvestment Act winds down, the unemployment rate remains over 9 per cent and the economy is idling. It is increasingly clear that Keynesian stimulus has failed to get the economy where it needs to be. Now what? The U.S. economy faces problems that are structural…