United Liberty

Tyler Cowen and Alex Tabarrok of the popular Marginal Revolution economics blog have launched a free, online university. 11,000 potential students, including myself, signed up for updates about Marginal University. As of today, registration is open!

The first course in development economics will provide the equivalent of a 45-hour university-level course in a series of narrated videos broken into short segments (most no longer than 5 minutes) that can be taken as a complete syllabus or in separate lessons. The site is also designed to provide the opportunity for interactive questions, quizzes, and other related materials, including user-submitted content. As the site evolves, registered users will be able to submit multiple types of content, including questions and answers, documents, PowerPoint presentations, and their own videos. Later on in the syllabus, Tyler and Alex will add “country sections” to the basic core of material. They plan to start with India, followed by Mexico.

George Mason University has a top notch economics department, and this is a chance for anyone interested in economics to improve their understanding of this dismal science. I’ll report back when I complete the first series of classes.

Dr. Matthew Mitchell is a senior research fellow at the Mercatus Center at George Mason University. His primary research interests include economic freedom and economic growth, government spending, state and local fiscal policy, public choice, and institutional economics.

When he’s not researching, Dr. Mitchell blogs for Neighborhood Effects, a blog which touches on state, local, and global economic policy, often in a conversational way. You can follow his freedom-loving Tweets @MattMitchell80.

Matt Naugle: How did you become a libertarian?

Matt Mitchell: I credit my brother and the Institute for Humane Studies (IHS). Since I was 13 or 14, my brother and I have been debating politics and ideas. We agree on 95 percent of issues but like to focus on the 5 percent where we disagree. Through those discussions—and the reading I had to do to inform them—the edges of my worldview were gradually shaped.

When I was in college, I attended a weeklong IHS seminar and came to the realization that I could debate like this for a living. Basically from that point on, I set my sights on studying public choice economics at Mason, followed by a career discussing ideas. (My brother became a physician; as our friend puts it, I became “a doctor of silly diagrams”).

MN: As a member of the Joint Advisory Board of Economists for Virginia, does the state follow your advice?

Over the last couple of days, we’ve explained why President Barack Obama’s latest tax hike proposal is a campaign ploy, not a serious policy proposal. But Veronique de Rugy, an economist at George Mason University, notes that what’s getting lost in the shuffle from conservatives and libertarians in the debate is that government has grown out of control and that has served as an impediment to economic:

Former president Bill Clinton hit the morning shows on Sunday and Monday. The purpose was mainly to highlight his Clinton Global Initiative meeting in New York this week, but he also used the opportunity to remind people that the economy won’t suffer from letting marginal tax rates creep back up to the pre-Bush-tax-cut levels. His evidence: The economy was doing well during his presidency in spite of the 39.6 percent top marginal rate on income.

To be sure, the economy was doing well in the nineties, even with higher marginal rates. However, the burden of taxation isn’t the only factor in the health of an economy. A factor consistently overlooked by those calling for higher marginal tax rates is the size of government as measured by its spending.

According to OMB’s historical tables, when Clinton left office, government spending as a share of the economy was 18.2 percent. In FY 2005, the government spent $2 trillion. This year, government spending as a share of the economy is 25.3 percent, and real spending has reached $3.3 trillion. That’s significantly larger than when Clinton left office.

This chart from the Mercatus Center at George Mason University shows that spending at all levels of government (local, state and federal) is now at levels we haven’t seen since World War II.

Matthew Mitchell, an economist at Mercatus, notes that this level of spending isn’t likely to go away anytime soon because the “bulk of current and future government spending is on entitlement programs like Social Security and Medicare. This variety of spending is nearly impossible to reduce in the near term.”

Over at the Mercatus Center, Veronique de Rugy shows what makes up the more than $66 trillion in commitments the federal government has made for the next 75 years, which includes Social Security and Medicare.

The Mercatus Center does some projections on the future of Social Security:

Over at the Mercatus Center, Veronique de Rugy shows that debt owned by foreign investors is steadily growing. She notes, “While the ownership of our debt may be theoretically neutral, there is a case to be made that this debt reliance gives significant bargaining power to individual foreign governments.”

Too many people feel like China “owns” us considering the amount of our debt they hold and they are just waiting to use it against us. People forget that they have a vested interest in our economy returning to stability.

Take a look at this graph from the folks at the Mercatus Center. You can read more about the graph here

H/T: Reason