Robert Higgs

Employment Losses in the Recession

Many commentators have noted in recent years that Americans have been leaving the labor force. Their departure has made interpretation of unemployment statistics more difficult, and because the Bureau of Labor Statistics (BLS) publishes six variants of the unemployment rate,

Private Employment Has Recouped Only Three-Eighths of Its Recent Loss

As the most widely reported rate of unemployment (U-3) has fallen in recent months, people with a political agenda served by painting a rosy picture of the recovery have made considerable noise about this decrease. Their political opponents have responded

U.S. Unemployment Woes Persist

After the headline rate of unemployment (U-3) reached 8.5 percent in December 2011 ( the most recent month reported), some commentators began to talk as if the employment situation is now improving rapidly. Some have gone on to suggest that

The Government Is Expropriating Private Wealth at a Rapid Rate

About a month ago, I posted in regard to what I called “the euthanasia of the saver.” This comment had to do with the fact that nominal interest rates in the United States for financial investments such as bank certificates

Important New Evidence on 'Regime Uncertainty' and Government Failure

When I introduced the concept of regime uncertainty in 1997, attempting to improve our understanding of the Great Depression’s extraordinary duration, I anticipated that many people—especially my fellow economists—would not welcome this contribution. Their primary objection, I ventured, would be

One More Time: Consumption Spending HAS Already Recovered

Commentators and pundits, some of whom ought to know better, continue to harp on the idea that the recession persists because consumers are not spending. Every Keynesian seems to believe that because consumers are in a dreadful funk, only government

Government Stimulus: Polishing the Rotten Apples

Once upon a time in a land far, far away, there was a country famous for its apples. In fact, it produced nothing but apples and so was called Appleonia. The people ate many apples in many different ways: raw

World War II Was Not the Quintessential Keynesian Miracle

Someone must have imagined that my hopes for improved economic understanding might be excessively optimistic and thus needed to be curbed to restore my normal emotional balance, because that person undertook to smash any such hopes to dust by e-mailing

Looming Treasury 'Default': Theater of the Absurd

For weeks, we have been treated to comic opera in D.C.’s theater of the politically and economically absurd. On the stage, the actors–President Obama, the Secretary of the Treasury, congressional leaders–hop about, shouting moronic lines about the national “default” that

Bernanke's Macroeconomic Errors

Despite the astonishing flood of more than a trillion dollars in new commercial-bank reserves that the Fed created in late 2008 and early 2009, when it undertook to rescue the big banks and other institutions from the consequences of their

Private Business Net Investment Remains in a Deep Ditch

If any one thing estimated in the Commerce Department’s National Income and Product Accounts may be described as the engine of economic growth, private domestic business net investment is that thing. This variable has such tremendous importance because, if accurately

Debating the Great Depression: The Failure of Keynesian Economics

The Great Depression has been a deeply contested subject from the very beginning. After John Maynard Keynes’s General Theory became sacred writ for most mainstream economists, Keynesian interpretations generally prevailed, notwithstanding pockets of resistance among older economists, in general, and

Macroeconomic Booms and Busts: Déjà Vu Once Again

Consider the following commentary on the economic situation: Foolhardy procedures which are divorced from economic realities, or whose economic implications are not understood by their promoters, do not perforce become sanctified and wise merely by designating them as “action”; tilting

Shovel-Ready Stimulus Sightings

A funny thing happened on the way to the voting booth: Americans discovered that most federal “stimulus” funds were being used to stimulate government, not the economy. I was on the road recently, driving from my home in southeast Louisiana

New Survey Confirms that Regime Uncertainty Is Spooking Investors

Writing for CNBC’s “Behind the Money,” John Melloy describes the findings of a recent survey of investors: Institutional investors fear a government policy mistake far more than inflation, terrorism, a housing double dip, a weak dollar, poor earnings or any

Why 'Stimulus' Doesn't Stimulate

President Obama has asked Congress for an additional $50 billion in “stimulus” money to finance infrastructure projects. The theory is that the additional spending will cause businesses to boost production to meet this demand. Producers will add jobs, triggering increases

Regime Uncertainty: Behind the Reports of Economic Doom

Each summer, Wall Street strategist Byron Wien convenes a meeting of high rollers to discuss the outlook for investment. This year’s meeting brought together fifty individuals, including more than ten billionaires. Their expectations, as reported by CNBC, are gloomy: “They

More Government 'Stimulus' Will Ensure Protracted Economic Stagnation

It must be a condition of employment that a journalist who writes about the current recession include in his article the statement, “consumption makes up more than two-thirds of the economy” or “consumption spending accounts for 70 percent of GDP.”

The Recession and 'Regime Uncertainty'

Regime uncertainty has gained increasing recognition as the current economic troubles have persisted with little or no improvement since the economy reached a cyclical trough early in 2009. As described in my 1997 paper, regime uncertainty pertains to the likelihood

Can Capitalism Be Restored?

I pose this question seriously, not as a physiologist, but as an economic historian. I am provoked to raise the question by an advertisement that Amazon sent me recently, calling my attention a book titled Can Capitalism Survive? Creative Destruction

The Two Great Classes in Contemporary America

Angelo M. Codevilla, professor emeritus of international relations at Boston University, has written an extraordinary essay for the July/August issue of The American Spectator. It’s called “America’s Ruling Class – And the Perils of Revolution,” but it deals much more

Will Oil Drilling Become a Pipe Dream?

If President Obama’s Oval Office speech made one thing clear, it is that his administration and the activists who back it view the Gulf oil spill as simply an opportunity to advance their pre-existing agenda–which has nothing to do with

Doom and Gloom: Which End, if Any, Is Near?

Some people have always occupied themselves in crying out that the end is near. This sort of thing has been going on for millennia. But lately, it seems to me, the volume of such doom-saying has risen markedly. Websites that

Crisis and Leviathan: Current Observations on the Rise of Big Government

Since the early twentieth century, periods of real or perceived national emergency have been “critical episodes” in the growth of government’s size, scope, and power in the United States and in many other countries. Hence, the concise conceptualization: Crisis and

Billionaire Entrepreneur Complains of Regime Uncertainty

Speaking to CNBC in Las Vegas recently, Steve Wynn, the billionaire developer and operator of entertainment properties, said: “Washington is unpredictable these days. No one has any idea what’s next . . . the uncertainty of the business climate in

Economic Troubles and the Growth of Government

The current recession and, especially, the related financial panic in the fall of 2008 have given rise to an extraordinary surge in the U.S. government’s size, scope, and power. As I write, the financial panic has subsided, but the recession,

Nothing Outside the State

The health care legislation recently bulldozed through Congress is only the tip of the iceberg. With some 2,400 pages of dense legalese–with thousands of additional pages of regulations implementing the legislation still to be written–this huge statute puts government in