Irwin M. Stelzer Articles


The Fed's Continuing Conundrum

11:01 PM, Oct 30, 2015

Coming soon to a central bank near you, in time for the Christmas shopping season, an increase in interest rates, courtesy of Janet Yellen and her colleagues on the Federal Reserve Board’s monetary policy committee. Or perhaps not. Folks living in euroland can expect the gift that keeps on giving, unless it doesn’t, more monetary stimulus. China works on a different calendar, so its people have already unwrapped their gifts, a cut in interest rates and assorted credit-easing measures.

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An Unfair Battle in Colorado

11:38 PM, Oct 28, 2015

It probably isn’t true that CNBC asked the Republican candidates to wear a metal plate with a number around their necks and face the camera, no smiles allowed. But this was less a debate, with the otherwise able CNBC reporters and analysts teasing out the candidates’ views on economic issues, than it was an attempt to stimulate candidates to attack one another or, failing that, to embarrass them. “Appalling … obnoxious…” commented Charles Krauthammer.

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The UK's New Special Friend

7:21 AM, Oct 24, 2015

Jilted. That’s how policy makers here in America feel now that British Prime Minister David Cameron has dubbed his country’s relation with the People’s Republic of China as “a very special relationship”, trumping the merely “special relationship”, the term used by Winston Churchill in 1946 to describe Britain and America’s close security and cultural ties.

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Looks Like a Good Deal

Oct 19, 2015

There are times when economics is secondary to other policy considerations—not irrelevant, but secondary. Last week, when 12 nations on the Pacific Rim finally agreed to the Trans-Pacific Partnership after years of negotiations, was one such time. This gives President Obama a much-needed victory—if he can persuade enough of his Democratic colleagues to join a majority of Republicans in approving the deal when Congress gets to have its say in up or down votes early next year.

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The Presidency: An Unenviable Job

11:01 PM, Oct 16, 2015

The next president of the United States will likely wish he or she weren’t. 

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Dem Debate Winners and Losers

3:32 AM, Oct 14, 2015

Debates produce winners and losers. And CNN, known to some as the Clinton News Network, saw to it the biggest winner was the Democratic contenders as a group. Recall that when CNN staged a Republican debate, most of the questions were aimed at getting each candidate to attack the others, producing video clips for later use by Democrats in the general elections and a sense that these quarrelling Republican candidates can’t get along with each other, much less with the Democratic counterparts with whom they would have to work to end gridlock. This time around CNN’s Anderson Cooper directed sensible, often piercing policy questions to the five Democrats, producing some disagreement but rarely a personal attack.

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Huddled Masses, Then and Now

Immigrants are not all alike.
Oct 12, 2015

It is understandable that Donald Trump’s vulgar attack on immigrants has nicer people up in arms, and that pundits are leaping to their computers to chastise Ben Carson for saying he might not want a Muslim to be president of the United States. But it wouldn’t be a bad thing if these comments opened the question of American immigration policy to review.

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How Hillary Just Made Obama's Job a Lot Harder

11:00 PM, Oct 09, 2015

Strange as it may seem, Barack Obama has much in common with the storied matchmaker of Jewish legend. This Polish entrepreneur announced to the poverty-stricken rabbi of a poverty-stricken Polish town that she had found a match for his even more poverty stricken, unattractive son – no less than the queen of England. The Rabbi refused to consent to the match on the grounds that the queen was not Jewish.

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On Tax Reform, Remember Adam Smith

11:01 PM, Oct 02, 2015

The only word to describe Friday’s job report is ugly. The private sector created only 118,000 new jobs in September, early estimates of job creation in July and August were lowered, average hourly earnings dropped a tiny bit, the labor force participation rate dropped to its lowest level since October 1977. Nothing here to justify the Federal Reserve Board’s policy gurus in raising interest rates, and much to make them happy that they withstood pressure to raise rates in the past.

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Feel Safe: Your Governments Are Protecting You

Gleanings and observations.
11:41 AM, Sep 30, 2015

Worry not about the tens of thousands of Syrians that Barack Obama plans to invite to take up residence here. Secretary of State Kerry assures us that the vetting process to screen out the bad guys will be thorough. Alas, Michael Steinbach, assistant director of counterterrorism of the F.B.I. told a House committee that Syria lacked the systems that would provide us with the information we need to evaluate refugees. Kerry is unworried, for two reasons.

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The Pope Prayed, Xi Promised, Putin Pleaded

11:01 PM, Sep 25, 2015

Two distinguished politicians, one with a constituency of over one billion souls, the other a constituency of over one billion subjects, visited us this week. The pope’s souls, of course, are voluntary adherents to his cause, with the price of disobedience deferred until the disobedient enter another world; the subjects of the president of China find deviation punished more immediately.

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Better To Be Xi Than Bibi

7:20 AM, Sep 23, 2015

En route to Friday’s state dinner in his honor, Chinese President Xi Jinping stopped off in Seattle to meet with the heads of America’s great technology firms, from which China denies regularly stealing $300 billion annually in intellectual property, according to the Wall Street Journal.

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Of Baguettes, Taxis, and Refugees

3:01 PM, Sep 22, 2015

Moody’s must have it in for France. Sure, its economy is moribund. Sure, its trade unions are among the most intransigent in the world. But surely the socialist government deserves some credit for one of the most significant reforms in 200 years.

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If You Are Insufficiently Aware of Depressing News, Please Consider...

Gleanings and observations.
8:36 AM, Sep 21, 2015

The opposition British Labour Party, now led by a leftist who favors Hamas, wants Britain to withdraw from NATO because its expansion has antagonized Vladimir Putin, give up its nuclear deterrent, and declare an arms embargo against Israel, has appointed as his shadow chancellor, one John McDonnell.

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Still Chaste, and Likely to Remain So

Yellen's Augustinian monetary policy.
11:01 PM, Sep 18, 2015

The U.S. economy is chugging along. Not at high speed, but at a steady 2.25 percent annual rate, with retailers stocking up in anticipation of a very merry holiday season. The unemployment rate is down to 5.1 percent, according to the Federal Reserve Board headed lower to its “long-run normal” rate, and employers in many sectors are scrambling to find workers with the skills they need.

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Francis in the Land of Savage Capitalism

11:01 PM, Sep 11, 2015

In eleven days the much-travelled Pope Francis will set foot on American soil for the first time: Unlike his two immediate predecessors, he did not visit this country before rising to the papacy. His baggage will include the mind-set typical of Latin American anti-U.S. populists, in his case the Argentine variety, numerous vitriolic attacks on our economic system, and support for many of the positions being taken by the Democrats’ left wing.

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Growth and Inequality

Sep 07, 2015

The economic recovery is barely worthy of the name, and there is evidence that inequality in America is increasing. Ignoring the first rule of statistics—correlation is not causation—progressives see this as a new reason to expand government. Reduce inequality and the growth rate will increase. 

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Eleven Days to Fed’s Decision Day

11:00 PM, Sep 04, 2015

“A fact can be a beautiful thing,” sings one of the characters in the award-winning musical, “Promises, Promises.” True. Unfortunately, a gaggle of facts can be somewhere between confusing and a curse, especially if you are a central banker who has specialized in promises, promises that a process of normalization will begin after seven years of zero interest rates. Now, faced with its next meeting less than two weeks hence, the Federal Reserve Board’s monetary policy committee has to decide whether to replace promises with action.

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The Fading Chinese Model

11:01 PM, Aug 28, 2015

Warren Buffett had it right, “Only when the tide goes out do you discover who’s been swimming naked.” Peer through the fog of commentary on recent share price gyrations and you can see the unclothed figures of Chinese president Xi Jinping and his fellow managers of the Chinese economy, the very one that in recent years has been providing about half of global economic growth even though it accounts for only about 15% of world output.

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Studies in Arrogance and Incomprehension

Gleanings and observations.
8:12 AM, Aug 26, 2015

We can always count on the New York Times to remind us how complete has been conservatives’ loss in the culture wars. Elisabetta Povoledo reports from Venice that Mayor Luigi Brugnaro had to retreat from his proposed ban on books headed for the magical city’s preschool library about (1) a male dog that aspired to be a ballerina; (2) a little boy who wanted to be a princess; (3) a penguin egg hatched and adopted by two male penguins.

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Obama’s Energy Debacle

And what the next president can do about it.
Aug 24, 2015

The late great comedian Milton Berle, when introduced to an enthusiastically applauding audience, would hold up his left hand in a modest gesture as if to say thank you but that’s enough, and with his right hand held at waist level encouraged the audience to even wilder applause. President Obama has just accomplished a similar feat. With one hand he has delivered his Clean Power Plan, designed to reduce the use of our own resources of fossil fuels.

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The Way We Live Now

11:01 PM, Aug 21, 2015

There are times when excessive attention to monthly data reporting what’s up, what’s down, can be allowed to obscure underlying structural changes in an economy. With the game of what-will-Yellen-do-next in full flow, this is one of those times. No, the proverbial tectonic plates are not shifting, whatever that phrase might mean when applied to an economy other than one in the throes of an irreversible Margaret Thatcher-style revolution.

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Keep Church and State Separate, Some of the Time

Gleanings and Observations.
6:30 AM, Aug 20, 2015

Liberals and progressives go to great lengths to keep church and state separate. Just try to have religious schools share in a voucher or other government program that provides relief to students trapped by the teachers’ unions into failing schools. No can do. It violates the separation of church and state.

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The Hunt for the 2% Solution

11:01 PM, Aug 14, 2015

Google wants a management structure more like Berkshire Hathaway’s. Berkshire Hathaway wants growth more like Google’s. Monsanto and Terex want to be more like Apple and other companies that minimize their tax burdens. And China wants to be more like the U.S., or at least its central bank wants to follow the Yellen brick road of devaluation to prosperity. All are seeking the 2 percent solution.

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The Gig Is Up

11:01 PM, Aug 07, 2015

On Friday, the government reported that the economy added 215,000 jobs last month, and that the  unemployment rate remained a low 5 percent. That could support a decision by the Federal Reserve Board to raise its key interest rate in September.

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It Depends On What the Meaning of Charity Is

Gleanings and observations.
3:00 PM, Aug 03, 2015

The New York Times notes that the Clintons have decided to contribute between $5 million and $10 million to the Clinton Foundation. “That may reflect their enhanced wherewithal” – they earned more than $30 million in the past year and a half, and, it would seem, want to share the wealth. Actually, as the Times later points out, “They did not write personal checks, however: the money was transferred from a smaller charity, the Clinton Family Foundation, to the larger entity.” Oh.

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Libertarians for Bigger Government

Gleanings and observations.
11:36 AM, Aug 03, 2015

Libertarians in Colorado are flying high after their success in getting marijuana legalized in the state. In our little town of Aspen, there are now seven stores in which eager consumers – I perhaps should say addicts because one user recently held up a store, threatening staff with a hammer, because he absolutely positively had to have the $11,000 worth of weed – can satisfy their desire for the stuff. Score one for libertarians.

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The Next Greece?

Unsustainable public debt closer to home
Aug 03, 2015

Is America, or Illinois, or Chicago the next Greece? The answers are “Yes, if .  .  . ,” “No, but .  .  . ,” and “Perhaps.” Greece joined what was then the European Economic Community even though it had no business applying for admission, and the existing members had no business allowing it entry, as the community’s finance ministers concluded, only to be overruled by France and Germany, whose leaders were hoping to construct an institution that would make another continental conflagration impossible: Full speed ahead, economics be damned.

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2,417 Days and Counting...

11:01 PM, Jul 31, 2015

Hurry up and wait. Hurry to the announcement by the Federal Reserve Board’s monetary policy committee, and then wait for the next one. After 2,417 days of keeping its key interest rate at zero, on Wednesday of last week the Fed policy team decided that a few more weeks or months at that level might be a good idea. The Fed knows that zero is not a sustainable level for interest rates, but also wants to be certain it doesn’t abort the none-too-robust recovery.

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Safer Banks, Fewer Loans

9:10 PM, Jul 25, 2015

All bad things must come to end has been the hope of the banking industry for these past eight years. Now it seems that time has come. In the past week or so just about everything has been coming up roses for America’s banks. JPMorgan Chase delivered second quarter earnings that “beat the Street”, as Wall Street jargon would have it.

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