venezula-crisisWhat’s going on in Venezuela?

Because of high inflation and unemployment, Venezuela has the most miserable economy in the world. The country currently has an inflation rate of 180 percent, but that’s expected to increase 1,642 percent by next year. The current unemployment rate is 17 percent, and the IMF projects it will reach nearly 21 percent next year.

The country is also crippled by shortages of goods and services. A few weeks ago Venezuela’s President Nicolás Maduro instituted a two-day workweek for state employees because of power shortages. (Because most of the country’s energy is produced by a hydroelectric plant, critically low water levels are blamed for the energy crisis.)

President Maduro has declared a state of emergency, threatening to seize factories and jail business owners who have stopped production. 

Shortages of basic goods like food, toilet paper, and medicine has devastated a nation where more than 70 percent of the people already live in poverty.

What caused the crisis? 
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Blog author: jcarter
Friday, May 20, 2016
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Extreme global poverty is rapidly declining, but 84% of Americans don’t realize it
James Pethokoukis, AEI Ideas

Free trade and global investment aren’t just economic priorities, they’re moral ones. It’s an important aspect missing from the current American political debate on trade and globalization.

What Was the Greatest Era for Innovation? A Brief Guided Tour
Neil Irwin, New York Times

Which was a more important innovation: indoor plumbing, jet air travel or mobile phones?

How authoritarian socialism caused Venezuela’s collapse
Pascal-Emmanuel Gobry, The Week

Venezuela’s economy is in freefall. It’s probably the worst in the world — literally. T

US raises China steel taxes by 522%
BBC

The US has raised its import duties on Chinese steelmakers by more than fivefold after accusing them of selling their products below market prices.

Today at The Stream, I examine the dissonance between the goals of Vermont senator Bernie Sanders’ presidential campaign and his recommended means:

[W]hile Sanders’ goals may seem comparable to Scandinavia, there’s little Nordic about his means. It all reminds me of a quip from the Russian Orthodox philosopher S. L. Frank, a refugee from the brutality of actual, Soviet socialism. “The leaders of the French Revolution desired to attain liberty, equality, fraternity, and the kingdom of truth and reason, but they actually created a bourgeois order. And this is the way it usually is in history,” Frank wrote. Sanders wants Scandinavia, but his policies would put us on a track more in line with Argentina or Greece. Good intentions are not enough.

Sure, Sanders is nicer than Trump, for example, and there are real differences between them. Sanders rails against the evils of America’s “millionaires and billionaires.” Trump is one.

But Sanders’ brand of politics still amounts to populist demagoguery, still ultimately appealing to the worst in us. It is to our great shame that we now have no major candidate who consistently appeals to the best. In the meantime, we’d do well to resist such polarizing demagoguery in whatever form it takes.

Read my full article, “Sorry Bernie: Scandinavia Isn’t Socialist,” at The Stream here and see the rundown on why Sanders’ policies wouldn’t get us what Nordic countries have.

Following up on yesterday’s post “Samuel Gregg on David Bentley Hart and Murderous Markets,” Rev. Gregory Jensen, author of the Acton book The Cure for Consumerism, observes that “Hart’s assertion that ‘the New Testament treats such wealth not merely as a spiritual danger, and not merely as a blessing that should not be misused, but as an intrinsic evil’ is simply wrong.” Writing at his Palamas Institute site, Jensen, an Orthodox Christian priest, added that “it is a gross overstatement to assert the Scriptures treat wealth as such as morally evil.” More from Jensen:

Whatever might be the contemporary roots of Hart’s moral reasoning on economics, his argument that wealth is evil is more in keeping with the thought of the early Christian heretic Pelagius than with, such as, Ambrose, Augustine, Basil the Great and John Chrysostom. These fathers were all critical of wealth and the wealthy but avoided the extremes found in Pelagius.

While making this argument in any detail is more than I can do here, let me make a start by offering some observations from Peter Brown 2014 work, Through the Eye of a Needle: Wealth, the Fall of Rome, and the Making of Christianity in the West, 350-550 AD. I have removed the footnotes.

Go to “The Pelagian Criticism of Wealth” to read Jensen’s comments and the excerpt from Brown’s book.

overtime-on-clocks-KATHY-CAPRINOIn announcing the Obama administration’s new overtime rule (for more on this news, see this explainer), Vice President Joe Biden says companies will “face a choice” to either pay their workers for the overtime that they work, or cap the hours that their salaried workers making below $47,500 at 40 hours each work week.

“Either way, the worker wins,” Biden said.

Biden has held political office for more than four decades, and yet he has still not learned one of the most basic and important concept in economic and political policy: consider that which is unseen.

As Frederick Bastiat explained 125 years before Biden first took office,

In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause—it is seen. The others unfold in succession–they are not seen: it is well for us, if they are foreseen. Between a good and a bad economist this constitutes the whole difference—the one takes account of the visible effect; the other takes account both of the effects which are seen, and also of those which it is necessary to foresee.

If Biden, President Obama, and the others in the administration were better economists, they might have forseen the following five consequences of this disastrous policy:
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no-signWhat just happened?

On May 18, the Obama administration announced the publication of a new Department of Labor rule updating and expanding overtime regulations.

Why did the overtime rule change?

Since the 1930s some white collar jobs (i.e., those performed in an administrative setting) have been exempt from the overtime requirement. The white collar exemption salary level was adjusted in 2004 to $455 per week or $23,660 a year. The new rule will entitle most salaried white collar workers earning less than $913 a week ($47,476 a year) to overtime pay.

The rule also updates the total annual compensation level above which most white collar workers will be ineligible for overtime. The final rule raises this level to the 90th percentile of full-time salaried workers nationally, or from the current $100,000 to $134,004 a year

The salary threshold will also automatically be updated every three years, beginning January 1, 2020. Each update will raise the standard threshold to the 40th percentile of full-time salaried workers in the lowest-wage Census region, estimated to be $51,168 in 2020.

How is overtime pay determined?
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Blog author: jcarter
Thursday, May 19, 2016
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Researchers Just Solved One of the Biggest Problems for World Hunger
Ria Misra, io9

Biologists from Cold Spring Harbor Laboratory have come up with a new agricultural technique which they say increases their crop yields by an incredible 50 percent.

Going to church could help you live longer, study says
Carina Storrs, CNN

Many Americans say they attend church because it helps them stay grounded and gives them spiritual guidance. A new study suggests that regular attendance may also help increase their lifespan.

What’s the Church say on unemployment? A lot, actually
Father Leonardo Salutati, Crux

Beginning with the encyclical Rerum Novarum, whose 125th anniversary falls on May 15, the Church has offered society countless teachings and suggestions about work, expressly recalling the rights and duties of people, and many times taking up the defense of workers who are unjustly exploited or not adequately put at the heart of the economy.

Why We’re Falling Behind in World Trade
Tori Whiting, The Daily Signal

Despite the success claimed by the U.S. Department of Commerce, the United States actually lags behind the world in the use of trade.