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America Strives to Exceed  French Capital Gains Tax Rates

A new report by the non-partisan Tax Foundation shows that America has higher capital gains tax rates than other industrialized countries. Nevertheless, President Obama is pushing Congress to raise taxes on capital gains still further. America’s tax treatment of capital gains already raises the cost of capital and reduces investment, and raising rates would create more disincentives to business investment and growth. 

A Better Pathway for the Fed

The economy is growing, labor markets have improved dramatically, and inflation is forecast to return to two percent over the intermediate term. However, the Fed still expresses extreme caution about normalizing monetary policy, citing myriad concerns, ranging from sluggish wage growth and low inflation to foreign economic and political risks, which might delay the date at which interest rates finally lift off their zero lower bound. This creates the potential for an erosion of the FOMC’s credibility and suggests the Fed lacks a clear strategy for getting monetary policy back on track.

Rules for the Fed to Live By

Should the Federal Reserve conduct monetary policy using a monetary policy rule? This question, a classic one in economics, was raised again during Chair Janet Yellen’s recent Congressional testimony and has become the subject of intense debate since then.

Jobs, Jobs, Jobs—and Nothing to Show for Them?

If Federal Reserve policy makers were to look solely at headline labor market indicators, they might be tempted to conclude that the U.S. economy had finally reached cruising altitude. Yet nothing else has that '90s feel: not the pace of economic growth, not capital investment, not productivity growth, not even Nasdaq 5000. The juxtaposition of solid job growth and tepid economic growth describes what the current expansion lacks: dynamism and innovation. 

Independence, Accountability, and Transparency: Three Keywords for the Fed

Monetary policymakers always face tradeoffs, and today provides no exception.  By holding interest rates lower, for longer, Federal Reserve officials might temporarily strengthen the economy, but only at the cost of risking higher inflation down the road.

Government’s Choke Hold on Law-Abiding Businesses

A disturbing Department of Justice program allows unelected bureaucrats to target law-abiding individuals and industries. Entitled Operation Choke Point, it has been in operation since 2013 with the intention of combatting fraud and money laundering. But its powers are being abused.

Dysfunctional Congress Takes Aim at the Fed

Anyone expecting the mild-mannered Federal Reserve Chairman to be treated with kid gloves at her semi-annual congressional testimony last week was mistaken. 


On the Senate side, Massachusetts Senator Elizabeth Warren drilled Janet Yellen on regulatory issues, interrupting her several times to ask if she agreed with Fed general counsel Scott Alvarez's public opposition to two Dodd-Frank rules.

Avoiding Optimism Might Be the Medicine the Fed Needs

Federal Reserve Vice–Chairman Stanley Fischer’s speech at the 2015 U.S. Monetary Policy Forum in New York centered on the Fed’s asset purchase program and future policy normalization based on the rate of interest paid on excess reserves. But the optimism he expressed in his remarks may be unwarranted.

Don’t Audit the Fed, Restructure It

An active -- and often colorful -- debate surrounds recent legislative proposals to “audit” the Federal Reserve.  While participants on both sides of this debate have not always been careful to explain exactly what such an “audit” would entail, all of these proposals emphasize that the central bank requires closer monitoring.  

Falling Oil Prices Yield a Barrel of Nonsense

The conventional wisdom holds that oil prices collapsed because of a positive supply shock. As technological innovation enabled energy companies to extract previously untapped shale oil and gas, producers were willing to supply more at any given price than they were before. That storyline has some glaring gaps. For example, domestic crude oil production has been steadily increasing for six years, practically doubling in that time period to a record 9.2 million barrels a day.


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