Slideshow: The People's Budget: Cutting the Deficit the Progressive Way

This slideshow examines the People's Budget from the Congressional Progressive Caucus. The plan makes major cuts to defense expenditures, increases infrastructure investment, and raises marginal tax rates.

Keywords: Budget deficit, national debt, marginal tax rates, tax reform.

Slideshow: What Can We Learn about the Ryan Medicare Plan from German Experience?

The recently approved Republican plan for reform of Medicare, conceived by Representative Paul Ryan, proposes to replace the current single-payer, government-run Medicare system with one under which seniors would choose from a list of approved private health care plans, with the cost to be paid partly by the government and partly by beneficiaries. This slideshow compares the Ryan plan with the German health care system, which uses a similar system of competing private insurance options with cost split between beneficiaries and the government.

Keywords: Health care economics, Republican Plan for Prosperity, Paul Ryan, Medicare.

Slideshow: Tax Reform as a Path to Growth-Friendly Fiscal Consolidation

Raising tax rates or cutting expenditures are policies that can help reduce deficits, but they can slow economic growth, especially if they are implemented during a cyclical downturn. This sideshow discusses how tax reform that broadens the tax base while reducing marginal tax rates represents a path to growth-friendly fiscal consolidation.

Keywords: Fiscal consolidation, deficit reduction, economic growth, tax reform.

Slideshow: Is Financial Reform Working or Will It Make Things Worse?

Recent financial reforms, including the Dodd-Frank act and the new Basel III capital standards, are encountering a backlash. Some observers, like former Fed Chairman Alan Greenspan, and some members of Congress, think they are making things worse. Others, like Representative Barney Frank himself, are sure they will work. This slideshow provides a simple graphical framework intended to clarify the issues.

Keywords: Financial reform, financial regulation, banking, Dodd-Frank, Basel III.

Slideshow: Econ 101, Hayek, and Why We are Losing the Drug War

Decades of efforts to reduce the supply of illegal drugs like cocaine and heroin have failed to stop widespread availability, and as an unintended consequence, have encouraged violence that has destabilized important US allies like Colombia and Mexico. This slideshow uses concepts from Econ 101 and the writings of Friedrich Hayek to explain why strategies used in the war against drugs create the conditions for their own failure.

Keywords: Supply and demand, elasticity, Friedrich Hayek

Slideshow: Monetary Accommodation of Oil Price Shocks: Some Simple Analytics

As oil prices spike in response to events in the Middle East, inflation has risen above its target level in the US, the UK, and the euro area. The three central banks face the choice of whether to resist the inflationary impact of the oil price shock, at the risk of slowing growth and rising unemployment, or to accommodate the shock, at the risk of inflation. This slideshow uses simple macroeconomic analysis to explain what happens when central banks accommodate oil price shocks or decide instead to resist oil price inflation.

Keywords: Monetary policy, oil price shocks, accommodation, aggregate supply and demand

Slideshow: Move Over Ethanol, Market Forces Favor CNG

The US government has spent billions in the elusive search for a "fuel of the future," that would be cheap, clean, and made in America. At the same time, it has given little attention to an off-the-shelf alternative, compressed natural gas (CNG), which is all of the above. This slideshow looks at the market forces that favor CNG and the barriers to its wider use.

Keywords: Energy, natural gas, CNG, elasticity, regulation.

Slideshow: What Can the US Learn from the French Health Care System?

The French health care system combines top-quality performance with broad freedom of choice for both patients and doctors. How does it do so at a per-capita cost that is half that of the United States? This slideshow gives some details of the French system.

Keywords: Health care economics, France

Slideshow: How A Price-Smoothing Oil Tax Could Help Make This the Last Oil Price Shock

Producing countries have learned to protect themselves from oil price volatility by using national wealth funds that build up when prices are high and run down when prices are low. This slideshow explains how a variable, price-smoothing oil tax could offer similar protection to consuming countries.

Keywords: Oil prices, taxes, oil price volatility, externalities, national security, environment

What Can the US Learn from Other Countries' Health Care Systems?

Although a plurality of Americans believe that their country has the world's best health care systems, international rankings provide little support for that claim. This slideshow examines data from several international comparisons, and discusses the problems they reveal. This is the first in an occasional series; future posts will look at what can be learned from the experience of individual countries.

Keywords: Health care, international rankings

Slideshow: How Chronic Budget Optimism Helped Dig the Hole We're In

Each year's federal budget is based on assumptions about economic growth, unemployment, and other variables in the year being budgeted and those beyond. This slideshow examines the realism of the assumptions made in past budgets, and the consequences of chronic budget optimism.

Keywords: Budget, deficit, fiscal policy, economic growth, unemployment.

Slideshow: A Policy Dilemma: Budget Deficit vs. Infrastructure Deficit

As the budget season moves into full swing, infrastructure is not only on the table, but in the center of the table. Does the US government spend too much, or too little, on infrastructure? This slideshow addresses the issue of how we can tell.

Keywords: Budget deficit, infrastructure

Slideshow: The Case Against the Mortgage Interest Deduction

This slideshow outlines the case against the US federal tax deduction for mortgage interest expense. It concludes that the deduction encourages speculation and price instability, crowds out more productive forms of investment, and contributes substantially to the federal deficit, while providing benefits primarily to high-income households.

Keywords: Housing, tax policy, mortgage interest, imputed rent, deficit.

Slideshow: Could An Obscure Loophole Send the Euro the Way of the Ruble?

Could an obscure provision of European monetary policy known as emergency liquidity assistance undermine the European Central Bank's control of monetary policy and allow monetary free riders to subvert the euro, as happened two decades ago in the 15-nation post-Soviet ruble area? This slideshow explains why it is extremely unlikely.

Keywords: Monetary policy, emergency liquidity assistance, euro, ruble

Slideshow: Demographics and Politics, as Much as Floods and Security, Undermine Pakistan's Economy

This slideshow examines the development prospects of Pakistan, a country with which the United States has declared an especially important relationship. Pakistan's economy was doing well as recently as a few years ago, but has since faltered. Well publicized natural disasters and security issues are part of the problem, but there are underlying demographic and political difficulties that make matters worse.

Keywords: Pakistan, economy, demographics, politics, development, energy subsidies, tax reform.

Slideshow: The Impossible Trinity, or, Why Latin America Hates QE2

This slideshow examines the effects on Latin American economies of the Fed's program of quantitative easing (QE2). The problems created by QE2, and steps taken in Brazil, Chile, and elsewhere to mitigate these problems, are discussed in terms of the impossible trinity.

Key words: Exchange rates, monetary policy, quantitative easing, QE2, impossible trinity, capital account, financial flows, sterilization, Brazil, Chile

Slideshow: Could Federal Spending Be Capped at 20 Percent of GDP? Should it Be?

This slideshow discusses proposals to resolve U.S. budget problems by capping U.S. federal government spending at 20 percent of GDP. Charts present historical and projected data, and show why a 20% cap would be likely to entail a reduction in the real level of public services and entitlement payments.

Keywords: Fiscal policy, budget, deficit, debt, spending cap, entitlements, discretionary spending.

Slideshow: Hidden Pitfalls of Increasing U.S. Dependence on Canadian Oil Sands

This slide show explores environmental and national security impacts of increasing U.S. dependence on imports of oil from Canadian oil sands, and discusses some pitfalls for policy makers and investors.

Key words: Oil imports, oil sands, tar sands, bitumen, Canada, environment, national security, energy policy

Slideshow: If a Stronger Yuan is Good, Can a Weaker Dollar be Bad?

This slideshow looks at two of the big currency stories to 2010. A gradual appreciation of the Chinese yuan was generally seen as good news in the United States, but the broader decline of the dollar to new lows against other trading partners was often treated as bad news. Does this make sense?

Keywords: Exchange rates, yuan, China, dollar, real effective exchange rates

Slideshow: What is Price-Level Targeting? Has Its Time Come?

This slide show describes the monetary policy known as price-level targeting and compares it with the alternative, inflation targeting. It discusses the views of both supporters and critics, and explains why support for price-level targeting may grow in 2011.

Key words: Fed, FOMC, central banking, monetary policy, inflation targeting, price-level targeting