Econ Quotes: By Lipsky, Palin, Forbes, Malpass, Meltzer, Ruff, Etc.

Posted: Jan 06, 2011 12:01 AM
Quotes on the economy as the new year begins.....

David Malpass, global economist: "In its first days, the new Congress has to act on the understanding that this is a takeover, an upheaval of the old spending culture....The people and financial markets want deep spending cuts starting with Washington's sacred cows. This means cutting Washington's commissions, idle Tarp funds, earmarks, unused stimulus, the costly Jones Act (which blocked oil clean-up), multi-billion-dollar ethanol subsidies, cars, staff, planes, vacations, salaries, unbuilt buildings, open purchase orders -- all the stuff members approve to help expand government and win re-election but isn't affordable during a financial crisis."

Sarah Palin, former Alaska governor and 2008 Republican vice-presidential nominee: "The weak dollar -- a direct result of the Fed's decision to dump more dollars onto the market -- is pushing oil (and other) prices upward. We want a stable dollar combined with real economic reform. It's the only way we can get our economy back on the right track."

Steve Forbes, editor-in-chief of Forbes magazine: "Imagine if the government decided to increase the number of minutes in an hour from 60 to 70. You can hear policy-makers congratulating themselves: 'People will work longer at the same pay. This will be a boon to productivity!' Or if Washington increased the number of inches in a foot from 12 to 15: 'Home buyers will thus get more house for the same price and that will stimulate home buying!' Preposterous? It's no more foolish than what we and other countries routinely do with our currencies."

Seth Lipsky -- author, most recently, of "The Citizen's Constitution: an Annotated Guide" (Basic Books, 2009): "Former Fed Chairman Alan Greenspan himself (has)...warned that 'fiat money has no place to go but gold.' Even the president of the World Bank, Robert Zoellick, has just called for restoring a role for gold in the monetary system."

John Cogan and John Taylor, both senior fellows at the Hoover Institution: "The implication of our empirical not that the stimulus of 2009 was too small, but rather that such counter-cyclical programs are inherently limited. The lesson is to beware of politicians proposing public works and other government purchases as a means to stimulate the economy. They did not work then and they are not working now."

Stephen Moore, senior economics writer for The Wall Street Journal editorial page, and Richard Vedder, economics professor at Ohio University: "The grand bargain so many in Washington yearn for -- tax increases coupled with spending cuts -- is a fool's errand. Our research confirms what the late (Nobel) economist Milton Friedman said of Congress many years ago: 'Politicians will always spend every penny of tax raised and whatever else they can get away with.'"

Patrice Hall, Washington Times reporter: "Fannie Mae and Freddie Mac are well on their way to becoming the biggest and most enduring black holes for taxpayers coming out of the 2008 financial crisis, with a new estimate of their bailout cost nearly doubling the tab to as high as $259 billion."

Sara Murray, Wall Street Journal reporter: "Nearly half of all Americans live in a household in which someone receives government benefits, more than at any time in history. At the same time, the fraction of American households not paying federal income taxes has also grown -- to an estimated 45 percent in 2010, from 39 percent five years ago, according to the Tax Policy Center, a nonpartisan research organization. A little more than half don't earn enough to be taxed; the rest take so many credits and deductions they don't owe anything."

Allan Meltzer, professor of political economy at Carnegie Mellon University: "The most important restriction on investment today is not tight monetary policy, but uncertainty about administration policy. Businesses cannot know what their taxes, health-care, energy, and regulatory costs will be, so they cannot know what return to expect on any new investment. They wait, hoping for a better day and an end to anti-business pronouncements from the White House."

The late Howard Ruff, long dismissed by all-knowing leftists as a gloom-and-doom economic kook, in 1979: "Much of American wealth is an illusion which is being secretly gnawed away and much of it will be completely wiped out in the near future....So what is the rest of your future? A grisly list of unpleasant events -- exploding inflation, price controls, erosion of your savings (eventually to nothing), a collapse of private as well as government pension programs, and eventually an international monetary holocaust which will sweep all paper currencies down the drain and turn the world upside down."

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