RealClearMarkets Articles

Tariffs dominated headlines last week after a New York court ruled that the Trump administration illegally imposed trade barriers using emergency economic powers. Trump’s officials quickly appealed, meaning the tariffs remain in place for now. Meanwhile, the president threatened the EU with 50% tariffs over stalled trade talks and has now implemented 50% steel and aluminum tariffs as of this week. One of the main goals of these tariffs, repeated many times by President Trump, is to bring jobs back to the US by building factories here. But don’t be...

The rain was heavy for parts of last weekend in the Washington, D.C. area. Seeing it coming down in sheets, it got me thinking about how people used to live. How awful it must have been in the days of primitive construction. Everything must have always been damp, moldy, buggy, and surely worse than that. Surely is operative here, and was confirmed in The Triumph of Economic Freedom: Debunking the Seven Great Myths of Capitalism, a new book co-authored by former U.S. Senator Phil Gramm (R-TX) and George Mason University economics professor Donald Boudreaux. Gramm and Boudreaux brought harsh...

I’m opposed to President Trump’s idea of taking $3 billion in federal grant money from Harvard and giving it to trade schools; however, I’m very much in favor of taking $3 billion from Harvard. I’m against giving money to trade schools for the same reason I’m against giving money to Harvard. Both assume a nanny-state philosophy: that learning useful information is dependent on government funding. It’s not—and in many cases, the reverse is true. Read books and discuss them with smart people, and you are likely to have a reservoir of well-rounded...

The net interest on the U.S. Federal Debt is roughly 3 percent of Gross Domestic Product (GDP), amounting to $882 billion. What does this percentage and the absolute number mean?  If they were to increase, does it mean that the U.S. is becoming weaker? That its ability to borrow necessarily diminishes? That the debt must be cut? The 3 percent number does not offer insights into these questions. It shifts the debate from assessing the output Americans get from the federal government spending to a meaningless comparison between interest payments on the accumulated borrowing and the...

America’s antitrust enforcers say they want to protect innovation. But their current cases against Big Tech are only punishing it. The Department of Justice (DOJ) and Federal Trade Commission (FTC) have launched aggressive antitrust cases against companies like Alphabet, Amazon, and Meta, arguing that these firms are too dominant and that their success undermines competition. The government’s solution: break them up or force them to share the innovations and resources they created and that made them successful—like data and infrastructure—with rivals. Or...

Social Security is not going insolvent. Not now, and not in ten years. Write it down and do so confidently.  The surest sign insolvency in no way looms in Social Security’s present or future can be found in the certainty that there’s no “lock box” and there never was one. The paradoxical truth is that the lack of funds stashed away for future retirees is the surest sign that their Social Security payments are secure now and forever. Please read on.  What’s apparent from an “empty” lock box is that any excess Social Security collections from...

The Federal Trade Commission (FTC) withdrew the agency’s lawsuit against Pepsi Cola for allegedly violating the Robinson-Patman Act (RPA). The withdrawal was supported by all three members of the FTC’s board, which currently has two vacant seats since President Trump removed the board’s two Democrats. The RPA outlaws price discrimination—which is when a distributor offers a retailer a discount unavailable to other stores. The suit against Pepsi was the second suit brought by the FTC during the Biden years. The last suit from the federal...

The American Dream is at risk because homeownership – the primary method for wealth accumulation in the country – is simply out of reach for millions of Americans. And it’s a crisis of our own making by making it increasingly challenging to build new homes. The supply shortage is years in the making and is mainly the result of a welter of zoning restrictions in many populous communities and rising construction costs. Estimates show the country has a shortage of housing between 3.8 to 4.9 million units. The lack of supply has created intense competition in...

This week the Senate will vote on the GENIUS Act, which will enable banks to issue stablecoins. A similar bill on the House side, the STABLE Act, is also slowly moving towards passage. It seems the crypto industry will receive some combination of these bills – call it “A Very STABLE GENIUS” – but amendments to impose price controls on credit cards threaten to derail this necessary legislation.  Stablecoins are cryptocurrencies that are pegged to another commodity or currency, such as gold or the U.S. Dollar. They help expand access to dollar reserves or...

Remember those bold statements by the incoming Trump Administration about making the U.S. “the crypto capital of the planet”? Remember how President Trump’s “crypto czar” David Sacks promised to usher in “a golden age in digital assets”? Remember when President Trump named cryptocurrency advocate Paul Atkins as the new chair of the Securities and Exchange Commission (SEC), replacing stridently anti-crypto Gary Gensler, who never found a crypto pioneer he did not want to destroy?  President Trump himself promised that Chairman Atkins...

Last week, the Federal Trade Commission’s antitrust authority barely escaped intact from the House Judiciary Committee’s attempt to close it down and send all pending matters over to the Justice Department. The idea was sponsored by Judiciary Committee Chairman, Jim Jordan. It was in keeping with the DOGE effort to shrink the size of the federal government and eliminate agencies the administration considers superfluous.  Chairman Jordan pulled the proposal at the last minute out of a procedural concern that it was not tied closely enough to revenue and expenditures to...

New York Times reporters Ben Casselman and Colby Smith wrote on A1 yesterday that “There is a basic rule of thumb when it comes to the federal budget. The government should spend heavily during times of crisis – recessions, wars, pandemics – and then get its fiscal house in order when the crisis passes.” Casselman and Smith will be excused for getting the “rule of thumb” exactly backwards. They got their information from economists who near monolithically believe to be true what isn't. Governments don’t get their spending money from Pluto, rather they...

When it comes to corporate DEI agendas, we’ve seen a lot of apparent hypocrisy lately. One example is Verizon, the subject of a May 17 headline that announced “Verizon shuts down DEI policies for its 105,000 workers,” purportedly in exchange for the FCC’s approval of Verizon’s acquisition of Frontier, while a board member had made comments on May 14 suggesting Verizon was simply playing games with the FCC. Specifically, Axios quoted Oscar Health CEO Mark Bertolini on talking with the Trump administration: "You don't use certain words, like DEI, bad...

Government spending saps economic growth, which is no insight. Instead, it’s just a comment that the centralized and politicized allocation of goods, services and labor in sub-optimal fashion by politicians lays a wet blanket on economic growth.   What makes the economically enervating nature of government spending worth mentioning is the ongoing debate about state and local taxes, also known as SALT. Governors in high-tax blue states would like to return to the old state of tax play whereby state and local taxes paid could be 100 percent deducted against federal tax bills. Red...

Last month, the RealClearMarkets/TIPP survey was the first to offer a grounded reading: Consumer confidence softened, but panic was absent. In the weeks that followed, other surveys caught up to what we had already reported. This month, consumer sentiment showed meaningful improvement, edging closer to the neutral 50.0 threshold. The RealClearMarkets/TIPP Economic Optimism Index, a key gauge of consumer sentiment, climbed from 47.9 in May to 49.2 in June, representing a 2.7% increase. After hitting a 40-month high of 54.0 in December, the index eased to 51.9 in January and 52.0 in February...

The NFL has introduced numerous measures to improve player safety, including reforming concussion protocols, employing spotters, ejecting players for helmet-to-helmet hits, and reforming its kickoff rules in response to the ongoing problem. One of the most popular initiatives has been the league’s push for the use of guardian caps.  Guardian caps are soft-shell pads that are attached to the outside of helmets to decrease the impact of head contact and reduce the number of concussions football players suffer. Since their...

As the Senate prepares to begin consideration of the House-passed tax bill, the media and congressional Democrats are suddenly worried about budget deficits.  After cheering on the Biden spending spree the last four years, they are now warning of a fiscal disaster if the tax cuts are extended.Yes, the Senate should look for more spending cuts. But they should also be skeptical of any CBO deficit projection. CBO has not released an official cost estimate of the entire bill, and when it does, it will almost certainly be wrong. CBO has been issuing cost estimates for fifty years, and the...

When Bill Owens, longtime producer of the popular news show 60 Minutes, resigned in April it was natural that correspondent Scott Pelley would pay tribute to him. What was unexpected was that Pelley not only discussed why Owens was leaving—he openly sided with Owens against CBS’s management—but also explained that Owens left because Paramount (which owns CBS) “had began to supervise our content in new ways” and as as result Owens “felt he had lost the independence that honest journalism requires.” Pelley blamed the increased supervision of 60...

The Federal Communications Commission has opened two dockets to consider petitions to reduce the property rights of EchoStar in wireless licenses.  One docket examines whether EchoStar has met “buildout” requirements under its licenses.  The other docket examines whether, as a result of purported lack of intensive usage of certain licenses, EchoStar should share those licenses with other businesses. Under the wise leadership of Chairman Brendan Carr who does not want to undermine the wireless sector and the national economy, the FCC will...