"It is easy to blame the large trade deficit on foreign governments that block the sale of US products in their markets, which hurts American businesses and lowers their employees’ standard of living. It’s also easy to blame foreign governments that subsidize their exports to the US, which hurts the businesses and employees that lose sales to foreign suppliers (though US households as a whole benefit when foreign governments subsidize what American consumers buy)."

The US has experienced a decade of excessively low interest rates, which have caused investors and lenders to seek higher yields by bidding up the prices of all types of assets and making risky loans. The danger is that overpriced assets and high-risk loans could lose value and cause an economic downturn.

Border-adjustment tax would not hurt American consumers or businesses. But it would raise $1 trillion over the next decade from foreign exporters. 

Democrats are traditionally the main US advocates of legislation to reduce CO₂ emissions. With Republicans now in control of both houses of Congress and the presidency, the time is right to enact a plan that will command bipartisan support.

During his eight years in office, President Obama regularly warned of the very real dangers of global warming, but he did not sign any meaningful domestic legislation to address the problem, largely because he and Congress did not see eye to eye. Instead, Mr. Obama left us with a grab bag of regulations aimed at reducing carbon emissions, o en established by executive order. 

The Republican-controlled US House of Representatives has been preparing for years for an overhaul of how corporate profits and personal income are taxed. Now, with a Republican majority in the Senate and a Republican president in the White House, those detailed plans can provide the basis for legislative action.

The National Security Strategy released by the White House earlier this month differs from the previous congressionally mandated strategies that have been prepared every four years. The 2017 NSS is different because it emphasizes the role of the economy: “Economic security is national security,” the new NSS avers.

Argentina’s experience with inflation holds crucial lessons for other countries in the years to come. 

Tax reform will be the major domestic policy issue of 2017. Although the public debate will no doubt focus on the cuts in personal taxes, overhauling the corporate tax code is economically more important.

Ever since Donald Trump won the US presidential election, the press and financial markets have focused on his proposal to cut taxes and to spend $1 trillion on infrastructure over the next decade. The expectation that these policies will increase aggregate demand has pushed up long-term interest rates by 50 basis points.