Will Protectionism Be Our Downfall?

Mr. Obama talks about not rewarding companies who ship jobs overseas... 

I suggest he look up comparative advantage. 

I know that I have sufficiently argued my point against protectionism, why self-sufficiency undoubtedly hinders more than it helps, and why comparative advantage truly helps the entirety of our populace in the long run.

Here's my extremely simple example to really get my point across... Imagine there are two people working on the same project and allowed to work together, but are getting two separate grades. Let's say the project has two components, one being mathematical, the other being writing-based. Person A is exceptional at math, but only has average writing skills, while Person B has outstanding verbal prowess, yet lacks such a status at math. Each person can make the best project if Person A does their own math, and greatly helps Person B with their math, while Person B would do the writing portion by themself, concurrently substantially aiding Person A with their writing portion. 

By each person doing what each is most adroit at, both parties get the best grade, and both parties win.

Now, the people are countries, math and writing are two different goods, and the project is GDP. 

It speaks for itself... Protectionism will only kill us. 

The End of Incentives

It looks as if the upper class will have their incentive to work decreased... Exactly what we need when GDP is already under it's potential. This article talks about Obama's healthcare plan, proposed tax cuts to the middle and lower classes, and the tax increase for the richest Americans. 

While some of Obama's reforms include the government actually saving money, it seems as if the new taxes are a start to lowering our Gini coefficient, and increasing income "equality" in the United States, while increasing healthcare coverage provided by Washington. 

While this isn't necessarily socialism, it sure is a page out of Europe's book...

And the World Watches Washington

In Thomas Friedman's op-ed, he talks about how the world watches Washington, and how many are scrambling to the dollar, with the overall prominence of the U.S. in the global economic arena. 

He's unquestionably, right. I mean, it seems as if every new development in Washington is so closely examined, not only by the US media, but by all. 

I'd also like to say that his book on globalization, The World is Flat. If you question the value of globalization to America, or would like to reinforce your belief in its merits, it's undoubtedly a must-read either way. 

Greg Mankiw's Favorite Children's Books

Here

More than a Harvard Economist...

Best Purchase...

Yesterday I made two great purchases.... At least as economics goes...

1. Principles of Economics by N. Gregory Mankiw. The man is a genius, and I could use a more in depth textbook for learning the basics. I also plan on using it as a nice reference material.

2. Capitalism and Freedom by Milton Friedman. Invented Monetarism... I don't need to say more.

Obama's Dream Come true

While it was a prolonged struggle to pass a stimulus bill which included provisions for investment in "green" energy, it looks as if ex-gang members are being trained to install solar panels. Check it out.

Maybe some more of that stimulus should go to Homeboy Industries, the non-profit supporting this effort...

EXTREMELY NERDY! ECON JUNKIES ONLY!

Now that you've all been forewarned of the exceedingly nerdy nature of this post... I will not accept any asinines on the basis that this post was too nerdy... On the Freakanomics blog, I found this recent post about how at the University of Michigan, the band has started to play over inappropriate chants that are shouted by students when an opposing team's player gets a penalty... Naturally, it's examined in an economic light of what the students should do to attain a desired equilibrium.