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The mainstream reaction to the Bernard Madoff scandal was inevitable. Whenever a government regulatory agency proves itself to be incredibly incompetent or corrupt, the respectable media swoop in to declare that the “free market” has failed and the agency in question obviously needs more money and power. Whether it’s the Department of Education’s

Wily competitors have known for ages that if you can’t win the game, you can simply change the rules. Now, during normal economic times, if somebody recommended that the government borrow a trillion dollars and spend it on anything that moves, most economists (as well as common sense) would say, “That’s nuts.” So one would think that especially in

Although many free-market economists were aghast that Paul Krugman won the Nobel ( Memorial ) Prize in Economics, I have come to realize that he is every bit as brilliant as that august award indicates. For some time now, Krugman has said we are in “depression economics” mode , where the normal rules of scarcity and tradeoffs don’t apply . In this

Robert E. Lucas, Jr. Lately the Mises Daily may have given the impression that we just bash Paul Krugman . In the interest of balance, today I will cast aspersions on another Nobel laureate, the Chicago School economist Robert Lucas. As is typical among many “promarket” economists, the undeniably sharp Lucas inexplicably sees no problem with

A lot of people get annoyed with Austrian economists because they tend to be so dogmatic (we prefer the term consistent ) and because they cloak their strictly economic claims with self-righteousness (we prefer the term morality ). After a good Austrian bashing of the latest call to steal taxpayer money and waste it on something that will make a

In working on my forthcoming book dealing with the Great Depression, I noticed something intriguing about the discount rate of the Fed. Oh wait, I should first clarify — I’m talking about the New York Federal Reserve Bank, because the Fed banks had more autonomy in the beginning, and so you couldn’t talk of “the Fed’s” discount rate. What I

[An MP3 audio file of this article, read by Dr. Floy Lilley, is available for download .]   In their zeal to oppose the lunacy of the so-called “stimulus” plan, many radio talk show hosts and other pundits have fallen into the Keynesian trap. Rather than the politicians spending nearly a trillion dollars, they argue, it would provide much more

There’s an old joke where the first guy says, “What’s the difference between drapes and toilet paper?” The second guy says, “I don’t know, what?” Then the first guy responds, “You are not allowed in my house!” After watching the “expert” economists debate our financial crisis during the past year, I realize that we can modify the joke. Today I

For some reason, there are a lot of people out there who can’t stand the gold standard. Maybe their hostility is in reaction to the large (and growing) number of gold bugs who think the worst day in history was August 15, 1971 . But since I’m an economist, not a psychoanalyst, all I can really do is patiently explain how silly the antigold

In a recent debate, prominent Keynesian professor and blogger Brad DeLong claimed that the Austrian explanation of the business cycle “does not work as an intellectual enterprise.” DeLong quotes Paul Krugman who, back in December, apparently dealt the Austrian diagnosis a crushing defeat on both theoretical and empirical grounds. In the present