Solving a Problem Like Puerto Rico

puerto rico

Editor’s Note: The following is Alex Pollock’s testimony to the Senate Judiciary Committee on the subject of Puerto Rico’s fiscal problems, delivered December 1, 2015.

Mr. Chairman, Ranking Member Leahy, and Members of the Committee, thank you for the opportunity to be here today.  I am Alex Pollock, a resident fellow at the American Enterprise Institute, and these are my personal views.  Immediately before joining AEI, I was President and CEO of the Federal Home Loan Bank of Chicago from 1991 to 2004.  I have published numerous articles on financial systems and credit crises, including municipal debt crises.

The government of Puerto Rico, having run a long series of constant budget deficits, has accumulated a very large debt which according to its own statements, it cannot pay.

Read More

Friday Roundup, July 19th

The current Liberty Law Talk is with Vern McKinley on a century of bailouts. Free markets in water: In the Books section this week Jonathan Adler reviews Lewis Solomon's America's Water and Wastewater Crisis. Kent Greenfield in The American Prospect on the road to polygamy and incest. David Bernstein: ACLU abandons its former opposition to state and federal double jeopardy prosecutions and urges the DOJ to proceed forthwith against Zimmerman. I guess the appointment of Big Sis won't help with this problem. Jerry Bowyer: Demographics and Middle East Revolutions. On this point, David Goldman's How Civilizations Die: (And Why Islam is Dying Too) is a…

Read More

Financing Failure: A Century of Bailouts

Financing Failure

So we were told with the passage of the Dodd-Frank Act that too big to fail was now behind us. Except it isn't. In fact, the conditions supporting bank bailouts have only gotten worse with the nation's largest banks actually increasing in size and scope since 2008. TBTF, however, goes back farther than you might think. This podcast with Vern McKinley on his book, Financing Failure, discusses the regulatory history of bank bailouts rather than winding down insolvent institutions. Contrary to the Hank Paulson and Ben Bernanke narrative of the 2008 crisis, although the scope of the problem was new,…

Read More

Friday Roundup, May 24th

What to Expect When No One's Expecting: Jonathan Last comes to Liberty Law Talk to talk babies, the extent of the market, welfare entitlements, and the pre-liberal foundations of a free society. And on that day the markets will freeze, businesses will shutter, homelessness will skyrocket, and we will plunge into a Great Depression 2.0. But what was the evidence relied upon by the government smart-set at the regulating agencies in those fateful days of September 2008? Answering this question is Vern McKinley's Financing Failure which Todd Zywicki reviews this week @ Law and Liberty. McKinley's book is the product of…

Read More

The Moral Corruption of Fiat Money

Never having read a textbook of economics in my life, I am at the mercy of newspapers for my knowledge of the dismal science. And by means of the intellectual equivalent of the Chinese water torture, I have come to the conclusion over many years that fiat money brings with it enormous psychological problems, not to say moral corruption. My conclusions are unoriginal, of course; I could have reached them in a few hours if only I had read a few texts. No doubt re-inventing the wheel is wasteful of time and effort, but it brings with it a certain pleasure not to be had from merely reading what others have invented before.

Read More