Have you ever heard of Wynne Godley? Those who read the front page of the Business section of the NY Times on Wednesday, September 11, might have seen the picture and noted the name. For others, he will be an unknown.
Six years ago I noted in a commentary that there was a very simple solution to the foreclosure crisis that followed the bursting of the housing bubble. The solution is to force any financial institution that foreclosed on a property to permit the current homeowners to stay in the house as renters with the rent fixed at a current market rate. A version of this idea was introduced in Congress in 2010.
Members of my family live in New York’s 18th Congressional District. Previously, I have criticized the former representative from this district, Republican Nan Hayworth. Today I want to strongly criticize the Democrat who beat her, Sean Patrick Maloney. Recently, he voted in support of building the last section of the Keystone Pipeline – a terrible vote in my opinion.
Back in 1990, a Congressman from South Carolina (Stephen Neal) introduced a bill that would require the Fed (our Central Bank) to make a zero rate of inflation its primary goal. I was able to publish my response in the economic journal Challenge under the title, “Zero Inflation: prescription for recession.” (Challenge 1990) At the time I noted that Fed Chairman Alan Greenspan had expressed support for that goal. What I did not know was that later in the decade, Chairman Greenspan would attempt to persuade the entire Federal Reserve Board of his view. IN 1996, he engaged in a spirited Debate with Economist Janet Yellen, then a member of the Fed Board of Governers.
By all rights, President Barack Obama should have been beaten handily by Mitt Romney. Usually, an incumbent President wins if the economy is doing well --- think of 1996 when Bill Clinton was re-elected, think of 1972 when Richard Nixon was re-elected. If the economy is not doing well, an incumbent President loses: Think of Jimmy Carter in 1980 and George H, W. Bush in 1992. There are “close calls” in this analysis – the two that come to mind are the successful re-election campaigns of Ronald Reagan in 1984 (which resulted in a landslide victory) and George W.
My wife, Ann and I have fond memories of the time we lived in Wisconsin. I got my Ph D from the University of Wisconsin in Madison. Ann, taught in the public schools and our son was born in Milwaukee. We have always had a great deal of respect for the great progressive traditions of the State of Wisconsin.
Thus, when Governor Scott Walker introduced a budget bill into the State Legislature that would not merely cut pensions of government workers but strip them of all collective bargaining rights, I was heartened by the outpouring of opposition within the state.