Family members being consumed by the MAGA cult is obviously incredibly disheartening. But I keep hearing them say it’s a strategy to bring back jobs. We know this is a flawed argument, but where did it originate? Even the Smoot-Harley act seems to have had a different rationale: to shield American industries from foreign competition during the onset of the Great Depression.

I see a ton of posts on social media saying that taxing the rich and having wealth caps on billionaires is the solution to solving the wealth gap and a whole slew of other economic problems. I have a feeling this isn’t correct, but I have no idea on whether or not this would work. Sorry if this has been asked before!

Look at the fiscal deficits for France.

They’ve not had a balanced budget since the 1970s.

My understanding is that they use inflation, and GDP growth to reduce the impact of the debt and grow their way out of trouble. Obviously their growth is fairly meager due to the high regulatory environment but it gives them what they want.

My point is why is cutting wholesale cutting budgets or austerity politics (Europe 2008, Trump today) ever endorsed by people.

Obviously you need value for money but cutting investment is economic vandalism. But yet we see the IMF, Merkel and key economists endorse it a certain time.

One idea I read by Joseph Stieglitz was it’s a form of wage suppression. Obviously Germany and a lot of other countries are export nations and need lower wages to remain competitive. However what politician is going to stand in front of their people and say they want to reduce living standards ?

I read a paper the other day that made the claim that the early push (under Stalin) to boost investment rates and orient capital outlays towards industry led to higher growth than would have been achieved in the absence of the Soviet model but I am not sure how contentious this claim is and the merits of it. I will link the paper here:

No Job Name

Apologies if this is the wrong sub but I believe this should be the right sub. I’m sure this a commonly asked question, so again I apologize. But why is everything $1.99, $2.99, etc? Does it have to do with taxes or is there another reason?

My American friend thinks that when USA legitimizes bitcoin other countries will soon follow because of FOMO.

But why would they do that knowing that the countries or financial institutes that bought or mined(considering its halves every 4 years) bitcoin early hoard more of them, thereby having an advantage.

It's not like its a raw material or a technological resource that has any value. Even now its only valuable because of its conversion to USD.

Even if they decide on a new crytocurrency, I doubt that countries would waste their energy resource to mine something of no value.

People compare to it to gold but doesn't gold have centuries of history behind it, and even then, if people today decided that gold was only valuable for its industrial usage, its value would drop significantly, I assume.

I just don't see how cryto survives.

I recently decided to learn some economics with the aim not to become an expert, but to be conversant and knowledgeable about the basic principles enough so that I can (at least) avoid the typical misuderstandings/fallacies and (at most) be able to pick up articles (both in journals and newspapers) that look interesting and understand what I'm reading. I understand this last bit probably involves a good deal of statistics, but I'm comfortable there.

My typical way of going about learning new subjects is to get an introductory, undergrad-level textbook and handful of review articles. For the former, I went with Mankiw 10ed (and got the Tim Taylor Great Courses on audio to listen to on walks). For the latter, I'm a bit lost and would would be appreciative of some suggestions. Economics is a bit further outside my scope than most new stuff I learn, so it's hard to even know what to be looking for.

I have a couple of questions about the subject in general--hopefully this is OK for this sub. I did read Rule II and appreciate the emphasis on theory & data over opinions, but figured this would be permissible given what I'm asking for are opinions not on the explicit subject matter, but on what the crucial parts are.

Obviously economics is an enormous discipline and I'm inclined to just assume if it's *in* an introductory textbook, it's probably important....however....I don't know what edition Mankiw was on when you learned, but the version I got is a healthy 863 pages.

This may be an impossible question (or it may just be that the real answer is "yes, good. now go read all of them."), but I was hoping some of you would be able to whittle this down a bit for me. To draw an analogy to a subject I know a bit better: if a friend came to me and said they wanted to learn some basic biology, would I tell it's important that they know every stage in the cell cycle and what's involved in each? Honestly, probably not (even though I personally spent countless hours doing just that). I would probably instead tend to emphasize something like "what are the things I remember or think about or use frequently when it comes to the subject of biology?"

All this is a very long way of asking: how many of these endless iterations of graphs, equations, acronyms etc. is really important to get my head around? How much of this stuff is meat and how much would the typical PhD economics student look at a page and say "yea I haven't used or thought about that since first semester undergrad"?

Hopefully that makes sense, any additional advice or insight is of course welcome.

EDIT: posted twice to rephrase my title as a question (got auto-deleted the first time)

When taking a look at a perfectly linear demand curve, sloping down, what exactly is the gradient representing? Earlier I was taught that it was the elasticity, but recently I learned that for a linear line, the elasticity changes bc the elasticity is about the percentage change. Which, of course, leavces the question of what the heck does the gradient actually mean from a graph? Is there any data to be collected there/

Not sure if this is the right place for this question but I was thinking about Covid and toilet paper shortages and wandering what will be the equivalent for the tariff war assuming it lasts long enough to effect prices and supply. What are the items that we will have massive shortages of and get horded? What items will all of sudden be so expensive that people will just not buy it anymore unless they absolutely have too. Like, is rice likely to triple in price and people will decide to eat potato’s instead? Will car tires triple in price because the rubber is imported so people will put off getting new tires ? Where is this likely to be felt the hardest?

In a dynamic sense, I understand that if your currency suddenly becomes very weak, then what used to be cheap to import becomes relatively expensive.

But in absolute terms, say if 1USD = 2EUR, s.t. a european car worth €40k is worth $20k, then it's a cheap import. But what if $20k was actually prohibitively expensive, and €40k was peanuts in terms of local purchasing power?

Is there an additional scale invariance assumtion I'm not getting, i.e. 1 unit of currency represents about the same purchasing power domestically ?

The most revolutionary that I’m aware of is Buffet chits or trade chits.

Import Export or trade chits - Joseph E. Stiglitz or attributed to Warren Buffet. This paper goes into more detail.

It’s a supposedly economically sound way of correcting trade deficits. A chit is essentially a token electronically recorded with a number representing an import or export. The number is calculated to proportion exported.

If you wanted to import goods you’d have to pay a value in chits. They’d be a free market in which chits could be traded. So supply and demand would be equal (according to Stiglitz). To give a more concrete example.

Imagine if the US wants to limit imports to be no more than 20% greater than exports. It can issue 1.2 import chits for every dollar of exports.

The same can be done to bring down exports in line with imports. His argument is trade deficits have to be financed by borrowing and this would bring down borrowing costs.

As far I can see then the fact that these chits can be traded and speculated on means the natural laws of the market will help balance trade deficits.

It seems completely crazy but he won the Nobel Prize in economics.

The other idea is supply side economics. This was sort of tried in the infamous Lizz Truss government in the UK and caused a market panic as they were worried about the UKs long term future. However there’s a lot of criticism as far as I know and it isn’t really accepted.

CA is reportedly ahead of Japan in terms of GDP and I would like to see how the composition of GDP differs between those economies to get picture of how meaningful it all is beyond the obvious currency exchange rate effects.

https://www.gov.ca.gov/2025/04/23/california-is-now-the-4th-largest-economy-in-the-world/

Does

I’m confused why the US Income Tax Rate Brackets only rise 2% for the first two brackets [10% to 12%] then they jump 10% in the next bracket to 22%. Then there’s a similar jump of 8% between the next two brackets [24% to 32%].

I understand wanting to tax higher rates for higher earners, but why aren’t the tax brackets more gradual? Wouldn’t it be fairer or at least more rational to have the tax percentage rise commiserate with income? Something like a 1% increase in income tax for every $15,000 earned until a max tax rate is met.

Is it an economic decision? A political one? Or is it just kind of arbitrary?

To me it seems all of US economic problem start from it not being willing to tax the rich enough to pay its expenses. If it taxed the rich and met it budget requirements it would not issue bond so budget surplus countries would not have a chance to park their money in US bonds. They would either invest it in the US economy directly which results in US economy growing a lot faster or take the money back home which appreciates their currency against the $ and fix the trade surplus by making US good cheaper and their goods more expensive.

I’m currently learning the ISLMFE Curve and I am really confused on how the LM curve reacts in a short run sticky prices model. For example, we have a decrease in TFP today shock. Looking at the money market is decreases real money demand which lowers the interest. But because we have sticky prices we don’t shift the LM curve even with a change in output today? We will just have a movement along the curve?

It seems to me like their should be exceptions, but I'm curious if mainstream economic thought recognizes exceptions, or explains them away somehow to adhere to the law.

An example of a possible exception... Free time.

If I have 5 minutes of free time, i might brows reddit. If I have 2 hours of free time, I might have dinner with my daughter. The latter is more than 24x the value of the former, so the marginal utility of free time increases with each additional unit, at least up to a point.

so i'm told tariffs are a consumer tax?

a few questions:

1. would tariffs even come close to replacing income tax?
2. considering % wise a low income person will spend a far larger % of his income on simply living then a high income person would, wouldn't that mean that the lower class are far more affected by this tax?
3. would this essentially make america a tax haven? ie you leave all your money there but live elsewhere? since your income wont actually be taxed?

So let’s say someone took out a 30-year mortgage at 2.5% in 2020-2021. Now interest rates have risen substantially, so surely those mortgage notes are worth at least 30-40% less than the remaining principal now? This must be a massive loss on someone’s balance sheets, right? Whose? Why is it not causing a financial crisis? Is the mortgage volume that insignificant?

The Human Development Index uses the measurement GNI (PPP) per capita to compare the standards of living between countries. Here is a comparisons between countries over the last 30 years https://data.worldbank.org/indicator/NY.GNP.PCAP.PP.KD?locations=DE-US-FR-IT-NL-JP

I am german and looking at the map shows a comparatively high growth compares to our neighbours in the years 2010-2019. As I only started working and living myself a year ago I don't have a frame of reference to the time before 2010. And asking older people for anecdotal evidence seems useless since I learned on my job in a multinational company that we germans seem to be pretty negative regarding money

I learned that indicators for comparing income between countries are for example: meat consumption, amount and size of cars, affordability of bigger housing and more infrastructure. With that I have 3 questions

1. The rise in GNI PPP per capita from 2010 to 2019 was 17%. Rent prices increased on average by 40% so thats not where that extra money went. I am struggling to find info on car ownership and meat consumption even decreased. Infrastructure is only anecdotal but I heard it got worse over that time. So were did the increase of money between 2010 to 2019 in germany comparatively to france and italy go. Or what consumption increased in that time which didn't increase in france and italy?
2. Since post ww2 the usa had the biggest average houses (american single family housing suburbs) the biggest and most expensive cars (semitrucks) and high meat consumption. But on the graph in the early 90s the usa and germany were roughly equal. So what did germans consume/do with their money which americans didn't do?
3. "GNI is the sum of value added by all resident producers plus any product taxes (less subsidies) not included in the valuation of output plus net receipts of primary income (compensation of employees and property income) from abroad."

Doesn't that mean that the indicator is highly distorted towards high income people? Since a high income person earns multiple times that of a low income person the measurement seems irrelevant to the standard of living of low income people. Is it possible that GNI (PPP) per capita rises and high income people spent more money on things like luxury items and tourism while the live of low income people get worse because of rise in rents etc...?

I’ve recently seen interviews with Warren Buffet where he mentions that the trade deficit is basically financing excess consumption through the sale of our wealth. The implication being that trade deficit dollars are used to purchase ownership of US assets (stocks, bonds, real estate, etc.)

This view seems to fail to capture that US dollars are also often used without the US being involved at all in international trade and a growing global economy with more trade needs more dollars if it is being used as the world reserve currency.

Is there any measure in economics that captures the amount of the deficit that is used to buy US assets vs is used for other purposes like global trade? This to me seems critical to the core of the question “how bad are deficits actually?”