Monday items: Nisen on Mundell and the euro; Goldman on Europe; Kudlow on the Fed.

From Business Insider, Max Nisen suggests Robert Mundell’s “A Theory of Optimum Currency Areas” predicted the eurozone’s troubles.

On PJ Media, David Goldman explains the startling disjunction between Germany and the weaker eurozone nations.

In The WSJ, George Melloan analyzes the Fed’s current commitment to openness.

On The Kudlow Report, Larry discusses whether the Fed will pump dollars into Europe:



At The WSJ, Stephen Moore reports the signing of the largest tax cut in Kansas history.

Also in The Journal, Moore notes Oklahoma Republicans blocking the state’s tax cut.

At The Washington Times, Richard Rahn links economic weakness and higher spending.

From Bloomberg, Ramesh Ponnuru suggests the US lower its trade barriers unilaterally.

Thursday update: Woodhill on growth vs. fairness; Rickards on gold and the IMF; Kudlow on Geithner and Bernanke.

From Forbes, Louis Woodhill argues for economic growth rather than fairness.

In US News, Currency Wars author James Rickards explains the hidden role of gold at the IMF.

From The WSJ, George Melloan highlights US Rep. Kevin Brady’s Sound Dollar Act.

On CNBC, Larry Kudlow critiques Tim Geithner’s political rhetoric and Ben Bernanke's refusal to raise inflation:



In The WSJ, Cato’s Dan Mitchell applauds Switzerland’s fiscal restraint law.

From Bloomberg, Caroline Baum examines the 2013 fiscal cliff.

The WSJ urges Mitt Romney to explain what he will do differntly than Presidents Obama and GW Bush, including on the dollar.

From First Trust, Brian Wesbury highlights Wednesday’s Fed policy statement.

In The WSJ, Stephen Moore reports the Senate’s Postal Service bailout.

On his website, Dilbert creator Scott Adams defends the rich.

The Sound Money Project features a video on inflation:



From Project Syndicate, Keynesian Stephen Roach defends China on trade and the yuan.

At Bloomberg, Jared Diamond notes Japan’s tremendous demographic challenges.

Monday summary: Lehrman on debt & the dollar; Grant at the Fed; Kudlow on growth.

From TGSN, Lew Lehrman explains the debt consequences of the paper dollar standard.

Zerohedge features James Grant’s excellent speech to the NY Fed.

At PJMedia, David Goldman defends Mitt Romney’s focus on economic generalities.

On CNBC, Larry Kudlow rolls out his 10 Commandments for Growth:



At Forbes, Nathan Lewis argues the Great Depression was not caused by the gold standard.

On Seeking Alpha, Paul Nathan responds to Ben Bernanke on the gold standard.

In The WSJ, James Grant reviews "White House Burning: The Founding Fathers, Our National Debt, and Why It Matters to You."

At The American, James Pethokoukis interviews Mitt Romney.

In The WSJ, George Melloan worries about federal lending.

At COAL, Paul Krugman rebuts inflation claims, but overlooks the three-peak correlation between the personal consumption expenditures deflator and the euro/dollar exchange rate:

From The WSJ, Mary Anastasia O’Grady reports on Argentina’s political takeover of its national bank.

On Forbes, John Tamny opposes the Cato Institute’s takeover by the Koch brothers.

Weekend edition: Domitrovic defends Romney's supply-side tax plan; Kudlow bashes the Fed's sterilized bond purchases; Grant critiques the Fed.

From Forbes, Brian Domitrovic defends Mitt Romney’s supply-side rhetoric.

On NRO, Larry Kudlow pans the Fed’s sterilized bond purchase plan.

At Forbes, Nathan Lewis explains a gold/dollar link would match currency supply with demand.

From Alhambra Partners, John Chapman suggests a US consensus on progressive taxation.

On CNBC, James Grant discusses the global loose money binge:



In The WSJ, Allan Meltzer notes similar patterns of wealth accumulation among the top 1% in European social democracies as in the US.

On US News, Bruce Yandle suggests bringing back the Misery Index.

In The WSJ, Stephen Moore argues California learn economic lessons from North Dakota.

From MarketWatch, Prof. Michael Bordo worries the Fed may be in danger of overshooting on inflation.

In The WSJ, George Melloan reviews a book on escalating compliance costs in US companies.

From The Manhattan Institute, Diana Furchgott-Roth refutes income inequality claims.

On The Kudlow Report, James Pethokoukis debates the latest job creation numbers:



At American Breaking Point, Charles Goyette remembers Jude Wanniski.

In Fiscal Times, Bruce Bartlett examines who is really rich today.

Monday round up: Santorum's economic freedom agenda; Tamny on Romney's Asia policy; Luskin and Kelly on European supply-side reforms.

From The WSJ, Rick Santorum outlines a strong economic freedom agenda, but omits dollar stability.

On Forbes, John Tamny critiques Mitt Romney’s Asia policy, including his high yuan/low dollar policy.

At Big Government, Dr. Susan Berry reports supply-siders favor Newt Gingrich’s tax plan.

On The Kudlow Report, a panel discusses Romney vs. Santorum tax plans:



At The WSJ last week, Don Luskin and Lorcan Roche Kelly highlight European supply-side reforms (h/t: Bretton Woods Research).

In The WSJ, George Melloan explains the Fed’s dilemma if borrowing costs rise.

From The NY Sun, Ira Stoll rebuts a Republican call for higher capital gains taxes.

At International Liberty, Dan Mitchell highlights a poll that indicates 75% of likely voters believe the wealthy should pay lower taxes.

On Kudlow, Sen. Ron Johnson (WI) debates tax rates on the rich:



PJ Media reports economist Laurence Kotlikoff is running for President from the Americans Elect party.

At TGSN, Ralph Benko recounts legendary Treasury Secretary Albert Gallatin’s support for gold-linked money.

From earlier this month on Forbes, Brian Domitrovic notes the role of tariffs on the Civil War.

Tuesday round up: Klein compares Obama and Romney tax plans; Kudlow and Forbes on the President's budget; Melloan on the gold standard.

In The Washington Post, Ezra Klein compares tax rates under Obama vs. Romney. One smart observer writes, “Obama got to the right of Romney for the first 60 percent of income levels. Brilliant. And again shows how Romney's timidity and weakness on taxes is provocative.”



The Daily Beast reports anti-tax advocate Grover Norquist arguing that Mitt Romney is acceptable because he will sign conservative legislation.

In Forbes, Ralph Benko likens US Rep. Ron Paul (TX) to Thomas Jefferson.

From First Trust, Brian Wesbury argues the economic recovery is real.

At NRO, Larry Kudlow highlights the many tax increases in the President’s budget proposal.

On The Kudlow Report, Steve Forbes discusses the President’s tax plan:



In The American Spectator, George Melloan advocates the gold standard.

At United Liberty, Jeremy Kolassa assesses CPAC’s gold standard panel.

In The Economist, a confused columnist suggests gold is too volatile to serve as a monetary standard.

The NYT quizzically reports the rise of interest in gold-linked currency.

From US Rep. Walter Jones (NC), a chart on assets held by the US Federal Reserve:

At Salon, David Wolman cites Benn Steil making Robert Mundell’s case for a single world currency.

At RCM, John Tamny explains that on housing, the prudent bailout out the imprudent.

The WSJ roots Greece’s problems in its failure to go for economic growth.

On Kudlow, US Rep. Paul Ryan (WI) offers the Republican alternative to the President’s budget:




From Politico, Scott Paul of the Alliance for American Manufacturing calls for tough action to force China to appreciate its currency (as the US did to Japan in the late 1980s, resulting in long-term deflation and stagnation).

In The NYT, Bruce Bartlett analyzes income’s definition in tax policy.

Weekend edition: Lehrman calls for GOP unity on gold; The Wash Post reports Newt's link to supply-siders; The NY Sun notes Romney's resistance to gold.

From The NY Sun, Lewis Lehrman encourages Mitt Romney and Rick Santorum to join the sound dollar alliance.

The Washington Post reports the role of leading supply-siders in the Gingrich campaign.

The NY Sun notes Mitt Romney’s resistance to gold in monetary policy.

In Forbes, Ken Repoza quotes Paul Hoffmeister on Ron Paul and monetary policy.

On The Kudlow Report, Stephen Moore discusses rising government benefits:



In The Washington Times, James Bacon analyzes Fed policy and finds himself in agreement with Ron Paul.

From The Cayman Financial Review, former El Salvadoran Minister of Finance Manuel Hinds argues for a return to gold.

On TGSN, Ralph Benko reports the FDR cabinet debate over devaluing the dollar.

At Asia Times, David Goldman notes Egypt is down to $10 billion in reserves.

From TGSN, Benko counters The Washington Post’s Ezra Klein on gold-linked money.

On Kudlow, James Pethokoukis discusses the economy’s weak recovery:



On International Liberty, Dan Mitchell responds to the State of the Union’s tax analysis.

In National Journal, Grover Norquist predicts a crisis if President Obama is re-elected and doesn’t extend the Bush tax cuts.

MarketWatch notes weak dollar advocate C. Fred Bergsten of the Peterson Institute for International Economics will step down as director at year’s end.

At The American, James Pethokoukis explains that US economic growth is way off.

On CNBC, Bruce Bartlett advocates revenue-neutral tax reform with a focus on corporate tax reform:



At The WSJ, Niall Ferguson argues the euro has been flawed since its inception.

The WSJ notes the Fed’s recommitment to loose money.

From First Trust, Brian Wesbury suggests monetary policy remains too loose.

In The WSJ, George Melloan analyzes the recent Japanese trade deficit.

At Business Insider, Dean Baker argues supply-side economics doesn’t work.

From Op-ed News, journalist Robert Parry critiques supply-side economics.

Wednesday update: Mundell calls for a US/EU common currency; Chapman on gold; Huntsman wants sound money.

Klassa (Bulgaria) reports Robert Mundell advocating a common currency between the US and EU.

On Coffee and Markets, Brian Domitrovic discusses his Laffer Center paper on the Federal Reserve’s financing of the federal debt.

At The Freeman, John Chapman and John Allison argue for a return to gold-linked money.

On The Kudlow Report, Dan Mitchell discusses a US bailout of Europe:

 

On his website, Jon Huntsman advocates sound money:

Jon Huntsman supports a strong and stable dollar. As president, he will appoint Federal Reserve Board Governors and a Chairman who believe in sound money. The United States cannot devalue our way to prosperity and efforts to do so risk a “beggar thy neighbor” round of devaluations, which will ultimately harm American exporters and risk the dollar’s privileged position as the primary global reserve currency.

On NRO, Larry Kudlow doubts the Fed’s cheapening of dollars to Europe will change anything.

From Cato, Steve Hanke suggests Europe is suffering from monetary contraction.

At The WSJ, George Melloan notes Europe’s move toward fiscal consolidation:

The possible direction of the negotiations was tipped by a leaked German memo proposing a "European Monetary Fund" that would be the core of a "stability union" paving the way for "political union." As a quid pro quo for financial aid, this fund would demand policy reforms in distressed nations to facilitate a work-off of excessive debt. Ms. Merkel, French President Nicolas Sarkozy and the new Italian premier, Mario Monti, are promising that a plan for closer economic and political integration will be submitted at the Dec. 9 European Union summit. If approved, this could be a very big deal.

From The Council on Foreign Relations, Benn Steil explains the ECB is restrained, unlike the US Fed, because it lacks the backing of a national treasury.

Cato’s recent monetary conference is now online (panel 1; panel 2; panel 3; panel 4; closing remarks):



At Forbes, Jim Powell recounts the history of debt and devaluation among wealthy nations.

From Bloomberg, National Review’s Ramesh Ponnuru argues the Fed should adopt Nominal Gross Domestic Product.

Monday items: McIntosh's Shadow Super Committee; Tamny and Pethokoukis on Romney; Benko on pro-growth policies.

Rumor Mill: A knowledgeable source reports former-US Rep. (and now candidate) David McIntosh (IN) is chairing a Shadow Super Committee that will release a pro-growth alternative plan focused on capping – not cutting – spending, combined with reforms – including monetary – designed to raise growth to 4%.

In Forbes, John Tamny critiques Mitt Romney’s economic plan.

At The American, James Pethokoukis applauds Romney’s greater focus on growth, entitlement reform, and budget discipline.

In Forbes, Ralph Benko advocates growth with monetary reform.

Bring on the American Economic Miracle! How? One “miracle” was engineered in Germany, in 1948, by Ludwig Erhard; another, in 1958 France, by Jacques Rueff. The miraculous growth of the Reagan era (continuing through and ending with the Clinton administration) was founded in part on strengthening, rather than rubbishing, the dollar.

At NRO, Larry Kudlow notes weak job growth.

In The WSJ, Stephen Moore reports from inside the congressional Super Committee.

Also in The WSJ, Moore worries Speaker Boehner will open the door to higher taxes.

On The Kudlow Report, Moore debates the Super Committee:

 
On Fox News, Art Laffer argues a flat tax would give us China-style growth rates.

At Forbes, Peter Ferrara advocates raising worker wages by removing barriers to production.

In The WSJ, George Melloan notes Japan’s support for an Asia free-trade zone.

On Kudlow, Davids Malpass and Goldman discuss Europe:

 
In The NYT, Catherine Rampell notes the relative wealth of America’s poor versus the rich in other nations.

From The Heritage Insider, Alex Adrianson explains the shifting demographics of the wealthy.

In The FT, Edward Chancellor discusses Europe’s Mundellian trilemma.

Wednesday round up: Melloan on the Fed; Woodhill on the GOP Medicare plan; Kudlow on QE3.

From The WSJ, George Melloan explains the Federal Reserve can’t handle higher interest rates:

But the Fed is running a big interest-rate risk. Over the past few years, the Fed has borrowed about $1 trillion in excess reserves from member banks. The banks can call in those loans to the Fed on demand, which is about as short-term as you can get. Should the economy pick up and banks need that money to make private loans, the Fed would have to offer a higher rate to try to hold those reserves. But when interest rates go up, the value of bonds goes down—and so too would the market value of the Fed's $2 trillion-plus portfolio of Treasurys and mortgage-backed securities.

Writing in Forbes.com on May 6, William F. Ford (a former Atlanta Fed president) and Walker F. Todd (who did stints with both the Cleveland and New York Feds as a lawyer and economist) note that a one percentage point rise in long-term interest rates would lower the market value of the Fed's current bond portfolio by $100 billion. That would more than wipe out the $81.7 billion in earnings the Fed reported for 2010.

In Forbes, Louis Woodhill advises Republicans to reconsider their Medicare proposal and focus on growth.

At NRO, Larry Kudlow opposes a new round of quantitative easing.

On The Kudlow Report, David Goldman discusses the likelihood of QE3 in response to the softening economy:




Reuters reports 150 economists, including supply-side guru Robert Mundell, support Republican efforts to cut spending.

From Reason, Jerry Brito discusses a new attempt at private money.

IBD notes the weak economic recovery.

In The WSJ, David Malpass proposes an alternative strategy to bring down spending:

The way to do it is legislation linking debt or spending to GDP and forcing the government to cut spending when it exceeds a set ratio. For example, if the debt-to-GDP ratio is over 65% in fiscal years 2012-2014 (as it surely will be), or over 60% in 2015-2018, or over 50% thereafter, the president could be required to submit budgets that are no greater than the previous year's nominal spending.

At NRO, Cato’s Michael Tanner suggests the GOP presidential candidates haven’t proposed enough spending cuts.

From COAL, Paul Krugman pushes back on Benn Steil and Manuel Hinds.

On the John Batchelor Show, I discuss Robert Mundell’s euro/dollar argument.

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.

Wednesday update.

On TGSN, Ralph Benko explains the gold-standard works best because it relies on the wisdom of crowds rather than a small group of bankers.

At RCM, John Tamny argues letting banks fail will correct bad behavior more effectively than new regulations.

On The Kudlow Report, Dan Mitchell suggests a government shutdown might be a victory for spending restraint:



In The WSJ, Alan Reynolds challenges the claim that business is hoarding $2 trillion (reprinted by The Cato Institute).

At Alhambra Investments, Joe Calhoun worries about the long run unless there is budget and tax reform and a stabilized dollar.

From The WSJ, George Melloan links the low dollar to world inflation and unrest.

About the only one failing to acknowledge a problem seems to be the man most responsible, Federal Reserve Chairman Ben Bernanke. In a recent question-and-answer session at the National Press Club in Washington, the chairman said it was "unfair" to accuse the Fed of exporting inflation. Other nations, he said, have the same tools the Fed has for controlling inflation.

Well, not quite. Consider, for example, that much of world trade, particularly in basic commodities like food grains and oil, is denominated in U.S. dollars. When the Fed floods the world with dollars, the dollar price of commodities goes up, and this affects market prices generally, particularly in poor countries that are heavily import-dependent. Export-dependent nations like China try to maintain exchange-rate stability by inflating their own currencies to buy up dollars.

Mr. Bernanke has made it clear that his policy is to inflate the money supply. His second round of quantitative easing—the controversial QE2 policy to systematically purchase $600 billion in Treasury securities with newly created money—serves that aim. But even for the U.S. it is uncertain that Mr. Bernanke can hold to his 2% inflation target. Oil is going up. Foodstuffs are going up. And when the Fed sneezes money, the weak economies of the world, and the poor masses who are highly vulnerable to price rises in the necessities of life, catch pneumonia.

At The NYT, David Leonhardt argues Keynesian spending has made the U.S. recession lighter than in austerity-focused nations.

On Capital Gains and Games, Bruce Bartlett recounts the taxes Ronald Reagan raised as governor and president.

From the archives, Bartlett revels in the success of supply-side economics.

Tuesday round up.

Tino at Super-Economy offers a great post on optimum tax rates, the Laffer Curve, and European vs U.S. per capita tax revenue and rates. (H/T: The American)

In The NYT, Joseph A. Massey and Lee M. Sands explain that raising a currency's exchange rate won't fundamentally change the terms of trade.

At The WSJ's Real Time Economics blog, Bob Davis says China's failure to raise the yuan may stimulate protectionist sentiment.

At Cafe Hayek, Don Boudreaux argues increased trade with China is best for world peace.

In The WSJ, George Melloan suggests Federal Reserve policy is damaging market confidence.

At The Kudlow Report, Stephen Moore discusses the federal deficit:

In First Things, The Anchoress provides a good budget chart and a great NYT link.

At RCM, John Tamny warns against more housing subsidies.

At The American, Scott Shane explains why small businesses aren't hiring.

At Alhambra Investments, Joseph Y. Calhoun, III wonders if the bond market is a bubble.

Newsweek's Andrew Romano claims fiscal deficits will force Republicans to raise taxes.