• Insecurity about Homeland Security Spending

    Jan 14 • Thinking Economically • 235 Views

    I recommend looking at the 2005 American Enterprise Institute paper on homeland security spending at:

    Providing insight about where, how, and why approximately $44 billion is being spent, the report expresses concern about homeland security spending decisions. In this excerpt from page six, they discuss how decisions are made.

    “Imagine that after September 11th, all the players involved in airline security were in a room trying to figure out what to do. Some members of the public are scared to fly, others aren

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  • A Financial NTSB

    Jan 13 • Thinking Economically • 192 Views

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  • Is the Market Ethical?

    Jan 12 • Demand, Supply, and Markets, Regulation • 262 Views

    Some people believe that government should control areas that we consider most valuable while others say precisely the opposite.
    The “war” between government believers and market believers was evident in Saturday’s Wall Street Journal. Wherever kidneys are paid for through the market, more are available for those who will die without one. In the United States, 83,000 people are on the official transplant list. 16,500 people received a kidney and 5,000 died because they did not. Nobel winning economist Gary Becker estimated that $15,000 to living donors would minimize our shortage.
    A government list or the market…Which solution is more ethical?

    The Economic Lesson
    The market: a system through which buyers create demand, sellers create supply, and an equilibrium price is established that optimizes benefits for buyers and sellers.

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  • Is More Security Too Expensive?

    Jan 11 • Thinking Economically • 201 Views

    Great cost benefit analysis in yesterday’s Wall Street Journal.
    How do we decide whether the cost of intensified airport security is worth the benefit?

    1. The TSA says that one life saved is worth $3 million spent. That means, though, that we have to prevent 1,150 fatalities per year to make the added expense valid.
    2. Instead, let’s consider expense to be time. The estimate is an extra 15 minutes per person. For the vaaction traveler, we could assume the cost is worth it. However, for millions of business travelers, do we want 15 minutes lost? 4 million hours? Will that impact GDP and jobs and recovery?

    economic idea:
    opportunity cost: the most desirable alternative that is sacrificed when a decision is made. Choosing is refusing.

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  • Comments On Today’s News

    Jan 10 • Thinking Economically • 245 Views

    A1 NY Times
    From a town clerk in Genesee, Wisconsin:

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