Kamala Harris has proposed a 25% “Kamala Tax” on unrealized capital gains, applicable to all those with more than $100 million net worth, while removing the differential between income tax and capital gains tax rates for the rest of us. Since the inflation her policies will inevitably cause would push us all into the $100 million net worth bracket in 4-5 years, I thought it worth examining the economic effects of her new policy, yet another attack on capitalism by a party that no longer believes in it, which will not yield significant net revenue. Continue reading →

Democracy is an imperfect form of government – no question. As the 1784-1830 Tories successfully demonstrated, a property franchise with a low qualification is a much better way of selecting representatives, but since that is not one-man-one-vote, it is not technically a democracy. Yet genuine democracy, while it often leads to sub-optimal economic policy, nevertheless contains intrinsic safeguards that prevent property and other rights from being too egregiously violated. Those rights are now in severe danger worldwide in several states that are still nominally democracies; I would like to explore where the line should properly be drawn. Continue reading →

The Tokugawa shogunate which ruled Japan from 1603 to 1868 is popularly thought of as a period of extreme national introversion, during which Japan closed itself off from the outside world in a feudal state for 250 years and stagnated economically. This is inaccurate. The period of shogun rule was one of sustained economic advance for the Japanese people, albeit at a modest pre-industrial pace. By the time the U.S. Navy’s Commodore Matthew Perry arrived in 1853, Japan was fully comparable to mid-18th century Britain in both technology and living standards, albeit with different capabilities. The greatest credit for that success should go to the innovative reforming shogun Tokugawa Yoshimune (1684-1751) who during his rule from 1716 to 1745 reoriented the Japanese economy in a way that has lessons for us today. Continue reading →

Government debts have spiraled in the Covid-19 period and in many cases are the highest since World War II, while annual budget deficits show no sign of reducing. Meanwhile, the movement of the ultra-rich to tax havens and corporate juggling are sucking out tax capacity from the world’s fiscal systems. Global protectionism is increasing, reducing the trade on which tariffs can be paid. Overall, rating the debt of any government above Standard and Poor’s BBB or equivalent is over-optimistic. Universal catastrophic government default may not be imminent but will death-spiral rapidly when it occurs. Continue reading →

The last week’s market turbulence may or may not persist and should not directly be blamed on Kamala Harris’ selection as Democrat candidate for the Presidency and her modest bounce in the polls. Instead, the focus should be on the last two decades’ economic policies, for which Harris, while not responsible, is generally an enthusiast. Huge value has been destroyed in the economy through failing to follow basic truths; markets have been ignoring this destruction, but in the end bubbles burst. Continue reading →

Francis Fukuyama’s 1992 book “The End of History” propounded a Utopian vision in which the fall of Communism had left liberal democracy as the universal global ideology, ending conflict and producing an era of universal prosperity. Thirty years later, we can see the reality more clearly: the intellectual mainsprings of Communism never fell, “liberal democracy” was a myth and the society towards which we are heading is a dystopia, not a Utopia. Continue reading →

The selection of J.D. Vance as Republican Vice-Presidential candidate to Donald Trump raises the question of what economic agenda a successful Trump/Vance ticket might implement. The two have different backgrounds and intellectual histories, yet there are themes common to both men that suggest an economically sound agenda as set out below might play to both men’s strengths and fulfil their goal of Making America Economically Great Again. Continue reading →

The new Keir Starmer Labour government’s energy secretary Ed Miliband, former leader of the party (2010-15) has overruled his officials to ban offshore North Sea energy drilling, sued to stop a coal mine project to which the Tories had given the go-ahead, announced the resumption of new onshore solar and wind projects and promised greater investment in Britain’s attempt to reach Net Zero carbon emissions by 2050. By pushing Britain’s climate change mania so vigorously, he will ensure that the disasters to which it will lead will hit Britain first. Continue reading →

France’s cuisine is probably civilization’s finest creation, and its art, music and fashion aren’t bad, either. Yet the French people fall for every leftist scam that is pulled on them, notably in the second round of elections last week, and are far too prone to revere intellectuals who would best be placed in solitary confinement. Economically, this has caused the country to underperform even worse than Britain. It is perhaps worth examining this pathology in more detail. Continue reading →

For 200 years, leftist political economists and low-wage sweatshops have lobbied governments to put in taxes and regulations that lower wage rates, supposedly to “create jobs.” Such interference with the market, by making labor artificially cheap prevents the “creative destruction” that alone produces productivity gains and better living standards. The policy mix that produces high wages and good living standards is often termed “populist” but it is simply aimed against regulation freaks and monopolistic corporate rent-seekers. In every country, governments should work to raise wages and improve their people’s lives through deregulation and proper economic management. Continue reading →