Wednesday summary: Rick Perry's Fed comments continue to garner attention; Salsman provides a history of gold; The WSJ notes the impact of higher taxes in Maryland.

RCP features Rick Perry continuing to critique the Fed.

Politico notes former Bush Administration officials critiquing Perry.

At Yahoo Finance, David Stockman endorses Rick Perry’s Federal Reserve criticism:

Reuters reports Michelle Bachmann joining the anti-Bernanke fray.

At Forbes, Richard Salsman provides an interesting history of the gold standard.

On First Trust, Brian Wesbury and Robert Stein suggest inflation is rising.

From The Kudlow Report, Brian Wesbury and Don Luskin debate inflation:




On RT America, Lew Rockwell discusses the Nixon Shock.

From 1971, Alan Reynolds blasts Nixon's price controls.

CNBC’s Squawk Box Europe features a good discussion of the gold standard:




The WSJ responds to Warren Buffett’s tax increase advocacy.

In The Washington Post, Jennifer Rubin reports Bill Bennett supports US Rep. Paul Ryan (WI) running for president.

The WSJ notes the decline of wealthy tax filers following last year’s soak-the-rich tax hikes in Maryland:

One year later, nobody's grinning. One-third of the millionaires have disappeared from Maryland tax rolls. In 2008 roughly 3,000 million-dollar income tax returns were filed by the end of April. This year there were 2,000, which the state comptroller's office concedes is a "substantial decline." On those missing returns, the government collects 6.25% of nothing. Instead of the state coffers gaining the extra $106 million the politicians predicted, millionaires paid $100 million less in taxes than they did last year -- even at higher rates.

From 1979, Ronald Reagan announces his campaign for president (h/t: James Pethokoukis):




A new website promotes the Swiss gold franc.

At COAL, Paul Krugman notes bond vigilantes are only going after countries without their own currencies.

Weekend edition: The NYT quotes Bell and Lehrman on gold; Forbes on two important dates; Lewis says gold is not deflationary.

In The NYT, Jeff Sommer quotes Jeff Bell and Lew Lehrman on rising interest in the gold standard, but commits the error of discounting gold’s price for inflation:

The last apex of the back-to-gold movement was perhaps in 1980. It may have been a signal that the price of gold was about to peak. Could we be approaching a turning point now? “You could make that argument,” Mr. Bell says. “The big question is whether the government and the Federal Reserve will be able to get the economy under control without a return to gold.”

In Forbes, Steve Forbes advises the President to heed two important dates.

Also at Forbes, Nathan Lewis explains that gold is stable, not deflationary.

On The Kudlow Report, US Rep. Eric Cantor recounts that debt-ceiling negotiations broke down because the President insisted on tax increases:




At Forbes, Peter Ferrara notes the expected tax increases in 2013 and elimination of the Fed’s duel mandate.

On Forbes, Reuven Brenner suggests the Federal Reserve is mispricing credit.

This week’s winner of the Kevin Williamson Shooting-Inside-the-Foxhole Award goes to fractional reserve banking opponent Gary North at lewrockwell.com, for his harsh attack on sound money advocates Robert Mundell and Ralph Benko.

Speaking of Williamson, last week the National Review author once again muddied the waters by rebuking pro-growth advocates including fellow NR columnist Larry Kudlow.

On Kudlow, my old roommate Tim Carney debates the debt ceiling:




In The WSJ, author Margaret Hoover suggests a “jobs, jobs, jobs” agenda will win the GOP young voters.

Reagan brought an entire generation to the Republican Party in 1980, and in 1984 he won the youth vote by 20%. The GOP needs this kind of revolution again if it hopes to recapture the White House and create a sustained majority.

The Washington Post continues the media’s fascination with anti-tax advocate Grover Norquist.

In Business Week, David J. Lynch reports that Republicans embrace Art Laffer’s tax ideas.

The WSJ notes GOP candidate Michelle Bachmann suggesting lower income workers should pay higher taxes.

Lewis on growth and reform; Brenner on a lost decade; Kudlow on malaise.

From Forbes, Nathan Lewis suggests ideas for spurring economic growth and reforming government.

On Forbes, Reuven Brenner explains how to avoid a lost decade.

Cato’s Dan Mitchell warns Republicans not to cave on tax rates.

On The Kudlow Report, Larry Kudlow discusses the ongoing slow-growth malaise:




At Wall Street Pit, William Anderson quotes Paul Krugman saying, in 2004, that 70 percent tax rates were insane.

On Fiscal Times, Bruce Bartlett challenges Tim Pawlenty’s claim that tax cuts pay for themselves.

At Seeking Alpha, Tom Lindmark says Bartlett’s article is a mishmash which conflates numbers to prove a point.

On his website, Robert Reich responds to Republican tax cuts claims.

At a progressive conclave, the White House communications director gets lambasted over unemployment:




At Caffeinated Thoughts, Ralph Benko expands his discussion of money quality versus quantity.

From last week at Lew Rockwell, Bob Murphy defends the gold standard.

At IBTimes (UK), Gabriel Mueller suggests the world may be returning to a gold standard.

On COAL, Krugman criticizes the Obama Administration for giving up on Keynesian stimulus.

In The Washington Post, Chris Cillizza notes Tim Pawlenty getting tougher on Mitt Romney after last week’s low key debate performance.

Monday round up: Grant on the Fed; Tamny on bankruptcy's virtues; Kudlow on the dollar.

Reprinted at Lew Rockwell, the excellent James Grant recounts the regrets of a Federal Reserve founder.

From Forbes, John Tamny suggests bankruptcy is better than bailouts for damaged companies.

On The Kudlow Report, Larry discusses the dollar’s weakness, commodity price inflation, and slower growth:



The NY Sun notes the irony of punishing a gold coin seller while monetary authorities enjoy prominence and prestige.

At Forbes, Steve Forbes explains that government policy distorts the housing market.

From RCM, Joe Calhoun reviews End Game by John Mauldin and Jonathan Tepper on the debt crisis.

Cato’s Dan Mitchell highlights a Center for Freedom and Prosperity video on the Federal Reserve’s historical failures:



In The WSJ, Andy Kessler argues for a stronger dollar by weakening the economy with higher interest rates.

In The Journal, Stephen Moore examines the administration’s budget position.

On NRO, Kevin Williamson notes that increased consumption has China running a trade deficit.

At Institutional Investor, Steve Rosenbush reports the euro’s rise to $1.41. As followers of supply-side guru and Nobel Laureate Robert Mundell will note, he believes if the euro rises significantly it will push the continent back into recession.

The progressive Think Progress blames speculators for high oil prices but omits the falling dollar from its analysis.

Tuesday update: Domitrovic on SSE; Benko predicts the Fed will cost Obama his job; Goldman is bullish on Japan.

From Forbes, Brian Domitrovic exposes a flawed academic treatment of supply-side economics.

Also at Forbes, Ralph Benko predicts Federal Reserve tightening in the next 18 months will doom the President’s reelection.

On The Kudlow Report, David Goldman sounds bullish on Japan:



At The WSJ, George Melloan explains that rebuilding Japan’s destruction will not be economically stimulative.

From Forbes, Charles Kadlec links high oil prices to Federal Reserve policy.

In The Journal, Joel Kotkin notes that low tax, pro-oil North Dakota is booming:

The biggest impetus for the good times lies with energy development. Around 650 wells were drilled last year in North Dakota, and the state Department of Mineral Resources envisions another 5,500 new wells over the next two decades. Between 2005 and 2009, oil industry revenues have tripled to $12.7 billion from $4.2 billion, creating more than 13,000 jobs.

Already fourth in oil production behind Texas, Alaska and California, the state is positioned to advance on its competitors. Drilling in both Alaska and the Gulf, for example, is currently being restrained by Washington-imposed regulations. And progressives in California—which sits on its own prodigious oil supplies—abhor drilling, promising green jobs while suffering double-digit unemployment, higher utility rates and the prospect of mind-numbing new regulations that are designed to combat global warming and are all but certain to depress future growth. In North Dakota, by contrast, even the state's Democrats—such as Sen. Kent Conrad and former Sen. Byron Dorgan—tend to be pro-oil. The industry services the old-fashioned liberal goal of making middle-class constituents wealthier.

On Lew Rockwell, Andrey Dashkov notes rising interest in gold-backed money.

At AEI’s The American, Jay Weiser critiques gold-backed money:

Bullion-based systems have two major problems. First, supply is ordinarily fixed in the short term, creating deflationary pressure when economic activity expands: there is not enough coin to go around. As far back as the Middle Ages, bullion stocks were insufficient for commerce, not to mention costly to transport and safeguard. Before central banking, this led to currency debasement. As Carmen Reinhart and Kenneth Rogoff have documented, over centuries, the proportion of silver (the original European monetary base) in coinage inexorably dropped to a small fraction; by the 19th century it was quasi-fiat money….

Bullion production was uneven, creating a second major problem: huge swings in the monetary base unrelated to the rate of economic growth and the size of economies. Large discoveries triggered massive expansion and inflation, but when mines played out, sudden production drop-offs caused contractions—the opposite of Milton Friedman's prescription for a constant rate of monetary base growth. Early modern Spain is the poster boy: after its conquest of South America, the giant Potosí silver mountain fuelled inflation and imperial overstretch in a series of Reformation-era wars, followed by multiple bankruptcies when production decelerated around 1590, then declined in the 17th century. Similarly, the silver supply surge created by the mid-19th century discovery of Nevada's Comstock Lode generated Japanese inflation that helped topple the Tokugawa Shogunate.

On US News, Robert Schlesinger reports that Republican budget cuts would impact tsunami warning.

At The Washington Times, Richard Rahn advises the GOP to avoid the Washington Monument Ploy when reducing spending.

From House Republicans, a JEC report argues lower spending will help the economy.

Weekend items: Rose roundtable on gold, Benko on the dollar standard, Kudlow on Utah's gold bill.

From December, Charlie Rose hosts an excellent roundtable on gold and the dollar.
(h/t: Ralph Benko)

At TGSN, Ralph Benko lists nine weaknesses that accompany a dollar standard, including necessitating a perpetual trade deficit while enabling a chronic budget deficit.

On Asia Times, David Goldman notes the recovery remains weak and lopsided.

At The Kudlow Report, Larry discusses Utah’s bill recognizing gold and silver as legal tender:



The NY Sun analyzes the latest exchange between House Monetary Policy Subcommittee Chairman Ron Paul (TX) and Fed Chairman Ben Bernanke.

From Forbes, Bill Flax explains that inflation is never a good policy.

Also on Kudlow, John Tamny debates unions, budgets, and Social Security reform:



At Huffington Post, Nathan Lewis explains the conservative critique of unions.

On Forbes, Reuven Brenner advocates putting public union compensation to a vote.

ABC promotes “buy America” as the solution to U.S. unemployment:



On NRO, Larry Kudlow notes that so far high oil hasn’t derailed the stock market.

From New World Economics, Nathan Lewis discusses bank reserves.

At COAL, Paul Krugman argues that British budget cuts haven’t increased business confidence:


On Time, David Von Drehle suggests claims of rising inequality are overblown.

At Lew Rockwell, Robert Wenzel blasts Karl Rove and supply-side economics.

Thursday round up.

At Forbes, Jerry Bowyer highlights China’s weaknesses.

On Cafe Hayek, Don Boudreaux rebuts China currency manipulation charges.

The XtraNormal bears argue China manipulates its currency which steals American jobs.



The WSJ clarifies that China has many problems and that a burst of Reaganite growth would restore American confidence.

China remains an underdeveloped country, its economy barely one-third the size of America's. Its leaders live in fear of peasant revolts, ethnic separatists, underground religious movements, political dissidents and the free flow of information. Its economy remains profoundly hobbled by corruption, inefficient state-owned enterprises and an immature banking system.

There is no genuine rule of law and its regulatory environment has become increasingly unpredictable for foreign investors and local entrepreneurs. It suffers from an aging population and environmental damage Americans wouldn't tolerate. Its greatest comparative advantage—cheap labor—is under strain from rising domestic wages and competition from places like Vietnam and Bangladesh.

Above all, China suffers from an absence of self-correcting mechanisms, beginning at the top with its authoritarian political system. And while it can trumpet achievements like a stealth fighter or bullet trains—some based on pilfered designs—it has a harder time adjusting to failure, much less admitting to it.

From Foreign Policy, Daniel W. Drezner explains that China isn’t beating the U.S.

On The Kudlow Report, Gov. Mitch Daniels (IN) shows sound policy instincts regarding China and pro-growth policies, but omits the dollar from his analysis:



At Conscience of a Liberal, Paul Krugman praises the Bush era’s dollar decline.

On his blog, Brad DeLong quotes Krugman citing Milton Friedman in favor of currency devaluation.

In The WSJ, Joseph Sternberg suggests China won’t "rebalance" toward consumption anytime soon.

China needs to reallocate capital and labor on a massive scale to orient itself toward producing goods and services that Chinese consumers want to consume. This will require major banking changes, especially improving access to credit for the small and medium-sized enterprises that make a modern consumption-driven economy tick. Both regulation and habit will get in the way.

The regulation involves interest rates: Government manages both deposit and lending rates in a way that guarantees banks a wide spread. This was intended to help banks earn themselves out of an earlier generation of nonperforming loans at the expense of households, which earn lower rates on savings deposits. And the policy could prove especially necessary if 2009's credit binge results in huge piles of bad debts.

On Lew Rockwell, "Norm" claims Bill Kristol’s recent support for monetary reform is “another neocon trick, like supply-side economics.”

Wednesday items.

On Forbes, Ralph Benko skewers Fed Chairman Ben Bernanke’s quantitative easing plan.

At The WSJ, Michael Boskin explains the data that support tax rate cuts over spending stimulus.

On The Kudlow Report, Jerry Bowyer defends the eurozone and calls for sound money and lower taxes:




The WSJ editorial board notes the harm higher top tax rates do to job creators.

On NRO’s Corner, Cato’s Mark Calabria rebuts David Beckworth’s “conservative case for QE2.”

The WSJ reports U.S. Rep. Mike Pence’s (IN) superb recent Detroit Economic Club speech calling for a supply-side reform agenda.

After criticizing the excessive money creation under Federal Reserve Chairman Ben Bernanke, Mr. Pence called for eliminating the Fed's dual mandate to pursue both price stability and full employment. He wants the Fed to focus exclusively on price stability and thinks the U.S. should consider returning to gold in setting the value of the dollar. President Reagan understood that inflation is the thief of the middle class and that investor confidence is destroyed when governments debase the value of their currencies. Mr. Pence apparently understands this, too.

A brief video clip is here.

In The Washington Times, Richard Rahn examines insider trading.

In City Journal, Nicole Gelinas advocates tax reform:

Moreover, cutting tax breaks would be in the best supply-side tradition. Supply-side economists, after all, have long counseled lower tax rates for a reason: they figured that regular people could spend and invest their money more wisely than the government could. But rate reductions can’t work if the government continues to run people’s lives through the rest of the tax code.

Right now, we may have supply-side tax rates, but thanks to tax breaks, we’ve got a thoroughly demand-side tax code. That’s a toxic combination, considering that we need healthy economic growth to help us confront our national debt. The economy can’t grow optimally if Washington encourages Americans to pour more borrowed money into their houses at the expense of more productive investments. Nor can the economy fight its way out of stagnation if state and local governments keep pushing up their own taxes, with an assist from Capitol Hill and the White House.

At Lew Rockwell, Gary North obsesses over deficits and omits economic growth from his critique of the Laffer Curve.

Thursday round up.

John Tamny argues the dollar is inflationary not deflationary.

The Business Roundtable cites the high corporate tax rate at the top of its list of growth inhibitors.

The WSJ's Steve Moore discusses the report on Kudlow.

The Cato Institute's Dan Mitchell criticizes the Business Roundtable for having supported the stimulus.

WSJ editorialists consider coming tax increases.

As Congress debates derivative regulation, here’s a Joseph Calhoun item from April that explains that dollar volatility is the main reason for derivatives.

David Goldman confirms his thesis on central banks buying gold.

Don Luskin recommends buying bonds.

Austrian economics advocate Peter Schiff wants a gold standard.

Robert Higgs of the Independent Institute suggests lower government spending would improve the economy.

Shawn Tully of Fortune quotes monetarist Allan Meltzer's view that spending cuts led to the British boom under Margaret Thatcher.

Dan Mitchell laments England's tax increases.

From 1999, Lew Rockwell provides an interesting overview of Robert Mundell’s economic contributions.