Government quality is not randomly distributed, but leptokurtic – good and bad trends tend to perpetuate themselves. In so doing, they resemble stock market and real estate malinvestment, as Austrian economists put it. It can probably be agreed by both political sides that since January 2001, the United States has endured more than two decades of very poor leadership, an ailment that seems unlikely to be alleviated this side of 2025. However, this is by no means the longest run of bad leadership in a country’s history; both democracies and the various forms of autocracy have produced longer periods of unrelieved ineptitude. To cheer ourselves up, it is thus worth looking at how these other examples escaped their malaise – while passing over hurriedly those that did not. Continue reading →

We are constantly subjected to propaganda from media journalists living in tiny apartments in crime-ridden major cities about how wonderful those cities are. That is partly a matter of taste, of course. However, the technological and organizational changes brought by the COVID-19 pandemic may finally end city life for those for whom that pathological taste is not politically and psychologically ingrained. For those without the mania, it will be a joyous release. Continue reading →

This column has written fairly frequently about the blight of regulation, but it is always difficult to find concrete examples, while proving economic damage requires considering the counterfactual where the regulation did not exist. However, in my researches for “Forging Modernity,” a study of Britain’s Industrial Revolution, I have come across a modest-sized regulation whose damage is pretty clear, huge, and extending over three centuries. I refer to the Woollens etc. Manufactures Act, 1720. Continue reading →

“We have the means to impose the state of the world” said World Economic Forum chairman Klaus Schwab, sounding ever more like Ernst Stavro Blofeld, at the Davos forum this week. In that remark, he summed up precisely what is wrong with globalization – it leads inexorably to an unending global monopoly. Even the totalitarian Oceania, Eurasia and Eastasia of George Orwell’s “1984” are more libertarian and economically efficient. Continue reading →

Pundits all over the media are proclaiming gloomily that we are in for a re-run of the 1970s. They are far too optimistic. If you look at the world with an unprejudiced eye, we currently have aggressive power blocs, rapidly escalating protectionism, overpriced stock and real estate markets and a huge mass of malinvestment from the last decade that will need to be written off. Guys and girls: that is not the 1970s, it is the 1930s, albeit with rather more inflation. Continue reading →

The Financial Times last week gave an account of the new “pencil” tower at 111 West 57th Street that made me glad I am not a billionaire. For one thing, if by inordinate wealth I were compelled to purchase an apartment on the upper floors of that building, the weight of my book collection – all 291 volumes of “Punch” magazine and some remarkably heavy 17th Century “bokes” –would fully counteract the dampening weight in the basement, that protects the tower from swaying too much in high winds. If my library were so resident, in a typical New York storm the entire structure would become unstable, swaying wildly from side to side and perhaps in a New York rush hour showering immensely heavy volumes from a height of 1,100 feet on the heads of passers-by on 57th Street, killing hundreds. A true tragedy, and an epitome of the folly of modern life. Continue reading →

The well-respected political journalist Matthew Continetti has just published a book “The Right: The Hundred Year War for American Conservatism,” one of many such, which takes the meaning of “Conservatism” as varying from decade to decade, according to the winds of events and popular culture. This seems to me a silly way to go about defining the term “Conservatism,” as is the concurrent attempt to write lengthy philosophical tomes attempting to do so from first principles. Instead, I suggest would-be “Conservatives” should identify a regime which in their view ran its country well, and then measure ideological deviations from that regime. Trust me: it’s much simpler and more coherent! Continue reading →

There are many factors that make rational economic decision-making difficult. One of them is that the media and educated opinion, mostly wholly ignorant of the laws of economics (or preferring to ignore them) often has violently misguided views on a subject, which it uses its intellectual power and marketplace megaphone to impose. William F. Buckley declared in 1963 that he would rather be governed by the first 2,000 names in the Boston telephone book than by the Harvard faculty; the problem with that solution is that even without appointing the faculty to govern, it still has an excessive influence on the views of the telephone book’s “Aardvark to Adamson” contingent. Continue reading →

The United States and the world as a whole have fallen into a difficult period in the last year, with war in Ukraine, rising inflation and almost certainly a coming recession as interest rates soar. Many blame President Joe Biden for this, but I thought it worth carrying out a thought experiment: what if Donald Trump had won the 2020 election that he narrowly lost? To what extent would today’s outcomes be different? Continue reading →

The U.S. Consumer Price Index ticked up again this week, to 1.2% in the latest month (15.4% annualized) or 8.5% in the last 12 months, making the 10-year Treasury bond rate at 2.7% even more inadequate to restrain it. As the negative real rate of interest gets more severe, it pushes inflation up further, causing a death spiral that is eventually solved by a sharp surge in bond rates and an economic crash. However, that is not the only death spiral visible today; their prevalence makes this column even more pessimistic than usual. Continue reading →