Quotes of the day

So while the Austrian puzzle observers nod approvingly as the dismantling and reconstruction continues slowly but effective onward as puzzle makers learn from the beeps, along comes their friend the Keynesian. The Keynesian bemoans the fact that there are so many puzzle pieces sitting “in waiting.” He says “wouldn’t things be better if we just starting putting those pieces into the puzzle in any old way? Even if we don’t get a meaningful pattern, at least we’d use up all the pieces. After all, isn’t that how you know you’ve reached the goal of a finished puzzle?” The Austrians respond by saying “No, the point isn’t to just use all the pieces. That’s easy to do, but it’s not the challenge of this kind of jigsaw puzzle. The challenge here is to produce a meaningful pattern without having a picture on the box, and which might not require all of the pieces to be used, because the meaningfulness of that pattern derives from the way in which the organization of the pieces matches what puzzle demanders want in a picture even though they cannot articulate it ahead of time.”--Steven Horwitz

Many people predicted that the Reagan deficits would produce soaring interest rates. The deficits appeared, but the 10-year interest rate peaked before the Reagan tax cuts took effect and plummeted in the latter half of 1982, in spite of then-record deficits. (see graph) Would [Paul] Krugman say that this proves that we were in a liquidity trap in 1982? I assume he would say "No, of course not," but he has become such a Johnny one-note on the subject of liquidity traps that I really cannot be sure.--Arnold Kling

Obamacare is “a problem,” as are many of the policies from 1963-73. In the long run they may be more important than the business cycle. But let’s not confuse policies that reduce the efficiency of the economy, with those that create business cycles.--Scott Sumner

The only way to achieve true fiscal discipline: Learn arithmetic.--Jeff Frankel

Congressional Republicans appear remarkably unified, reinforced by a surprising show of House-Senate unity in yesterday’s Senate floor votes. I cannot remember a time in the past sixteen years when House and Senate Republican leaders worked as well together as they have over the past few months. This is led by Speaker Boehner and Leader McConnell, but applied to both leadership teams. In contrast, Democrats are all over the map. Minority Leader Pelosi voted against the short-term CR while Minority Whip Hoyer voted for it. Nine Senate Democrats have loudly positioned themselves to the right of the President and their party leaders, voting against their party’s proposal yesterday. Senate Majority Leader Reid gave an impassioned defense of the National Cowboy Poetry Gathering in Elko, Nevada as an example of an important federally-funded priority that should not be cut. Team Obama overreached last week when they tried and failed to anchor negotiations at the President’s request spending level with their bogus “We’ve come halfway” claim. When CBS News calls the President’s budget message “the White House’s fuzzy math” and the Washington Post gives the Administration “three Pinocchios,” you know this tactic has failed.--Keith Hennessey

Republicans have so far largely ignored the Schumer Maneuver. I suggest they publicly address his suggestion by saying, “Senator Schumer is right – we need to reduce entitlement spending. We should not, however, cut one part of the budget so that we can spend more in another. We need to cut spending throughout the budget. We’re going to continue cutting appropriations now. We’ll get to entitlements next.” And then they need to follow through.--Keith Hennessey

Students are dubious or indifferent about most things. Because of our digitized world, they are predisposed to think that documents are faked (think of Dan Rather's manufactured Texas Air National Guard memos), pictures are Photoshopped, memories are unreliable, testimony is coerced, and so on.--David Clemens

More and more I understand why my mother would hide from my brothers and me, lock herself in the bathroom, and quietly eat a candy bar.--Tony Woodlief

Great men are almost always bad men.--Lord Acton

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