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  • Author: Derek M. Scissors
  • Publication Date: 01-2014
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: New data published in the American Enterprise Institute-Heritage Foundation China Global Investment Tracker show that China continues to invest heavily around the world. Outward investment excluding bonds stood at $85 billion in 2013 and is likely to reach $100 billion annually by 2015. Energy, metals, and real estate are the prime targets. The United States in particular received a record of more than $14 billion in Chinese investment in 2013. Although China has shown a pattern of focusing on one region for a time then moving on to the next, the United States could prove to be a viable long-term investment location. The economic benefits of this investment flow are notable, but US policymakers (and those in other countries) should consider national security, the treatment of state-owned enterprises, and reciprocity when deciding to encourage or limit future Chinese investment.
  • Topic: Security, Foreign Policy, Development, Economics, Emerging Markets, International Trade and Finance, Foreign Direct Investment, Sovereign Wealth Funds
  • Political Geography: United States, China, Asia
  • Author: Bruce E. Bechtol
  • Publication Date: 11-2013
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: South Korea is in a unique position. It is an economic powerhouse and a thriving democracy that faces the most ­ominous and imminent threat on its borders of any democracy in the world. Moreover, this is a threat that continues to evolve, with increasing missile, cyber, special operations, and nuclear capabilities and a new leader who shows no signs that he will be any less ruthless or belligerent than his father. To meet this threat, Seoul has undertaken a number of efforts to better deter and defend against North Korean capabilities and provocations, including increasing the defense budget, upping training with US forces, creating new command elements, and establishing plans for preemptive strikes against imminent North Korean missile launches. However, in part because of administration changes in Seoul, the South Korean effort has been uneven. And decisions remain to be made in the areas of missile defense, tactical fighter aircraft, and command-and-control arrangements that will be significant for not only South Korea but all states that have an interest in Northeast Asia's peace and stability.
  • Topic: Conflict Resolution, Security, Democratization, Development, Emerging Markets, Nuclear Weapons, Bilateral Relations, Territorial Disputes
  • Political Geography: United States, East Asia, South Korea, North Korea
  • Author: Megan Davy
  • Publication Date: 05-2008
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Latin American and Caribbean (LAC) economies, usually susceptible to international financial turmoil, are especially vulnerable to even minor tremors in U.S. markets. Regional policymakers and entrepreneurs, therefore, have been closely watching the current U.S. subprime credit crisis. Here is the good news: all signs point to relatively minor symptoms in LAC countries—despite a rocky financial history during the 1980s and 1990s—thanks in large part to reforms undertaken in response to previous financial crises, as well as continued high commodity prices that will likely buoy export markets. Although the economic downturn in the United States and other global markets will likely expose lingering weaknesses in the region's economy, this latest crisis can provide an impetus to complete the unfinished business of building more modern, resilient economies.
  • Topic: Development, Economics, Emerging Markets
  • Political Geography: United States, South America, Latin America, Central America
  • Author: Roger F. Noriega
  • Publication Date: 01-2008
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: If Time magazine had wanted to recognize a true democrat and reformer as the 2007 Person of the Year, they would have chosen Brazil's president Luiz Inacio "Lula" da Silva over Russia's Vladimir Putin. Working within Brazil's free, pluralistic democratic system, Lula has focused on economic growth and social justice, getting tangible results with his new anti-hunger and poverty programs. Unlike Putin, Lula is also strengthening key institutions and the rule of law.
  • Topic: Democratization, Development
  • Political Geography: South America, Latin America
  • Author: Robert F. Noriega
  • Publication Date: 02-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: As Fidel Castro shuffles off the world stage, many non-Cubans are pondering the future of a nation that has spent nearly fifty years trapped under the rubble of the dictator's demented experiment. Too many outsiders, however, are disoriented by the myths that the regime has spun over the past five decades to make the island seem complicated, bedeviled, dangerous, and unapproachable. Castro realized that if the world came to comprehend Cuban reality, then even the intelligentsia might notice something wrong with the way he ran the place.
  • Topic: International Relations, Development, Politics
  • Political Geography: Cuba, Central America
  • Author: John H. Makin
  • Publication Date: 03-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: To the dismay and amazement of optimistic market players, not to mention Federal Reserve chairman Ben Bernanke, early in March former Fed chairman Alan Greenspan publicly assessed the probability of a recession this year to be one in three. This was a shock to those who had been carefully avoiding use of the “r word” while intensifying problems in the subprime mortgage market heralded the news that the housing correction, which had been declared “over” in January, was instead moving into a second, more intense, and unpleasant phase. Weaker investment (capital spending was actually a drag on fourth quarter growth) and an 8.7 percent drop in January durable goods orders further undercut hope for sustained general growth. The Fed's own economic outlook has looked to firmer capital spending as part of an economic recovery scenario.
  • Topic: Development, Economics, Government, Markets
  • Author: John H. Makin
  • Publication Date: 02-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The slowdown in the housing sector that began early in 2006 subtracted over a percentage point from GDP growth during the second half of last year. Now, in 2007, analysts have declared that the worst of the housing slowdown is over. However, early in February, more serious problems emerged in the subprime mortgage market, the rapid growth of which supported the later stages of the housing boom in 2005 and 2006. Subprime mortgages are risky loans to weak borrowers who usually have to borrow the down payment on a home purchase, leaving them with mortgage obligations equal to 100 percent of the purchase price.
  • Topic: Development, Economics, Markets
  • Author: Michael Rubin
  • Publication Date: 03-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The following article is the second of two installments by Michael Rubin in AEI's On the Issues series. The two articles originally appeared as a review essay in the Spring 2007 edition of Middle Eastern Quarterly.
  • Topic: Civil Society, Development, Education
  • Political Geography: Iraq, Middle East
  • Author: Michael Rubin
  • Publication Date: 03-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The following article is the first of two installments by Michael Rubin in AEI's On the Issues series. The two articles originally appeared as a review essay in the Spring 2007 edition of Middle Eastern Quarterly.
  • Topic: Civil Society, Development, Education
  • Political Geography: Iraq, Middle East
  • Author: Charles Murray
  • Publication Date: 02-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: In January, W. H. Brady Scholar Charles Murray stepped back from current education debates about reauthorization of the 2002 No Child Left Behind Act and education funding in the president's budget to ask more fundamental questions about the goals that should shape American education in the future. This On the Issues is adapted from essays published in the Wall Street Journal on January 16, 17, and 18, 2007.
  • Topic: Development, Education, Government
  • Political Geography: United States, America
  • Author: Frederick M. Hess
  • Publication Date: 01-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Race-based hiring practices are commonplace in today's colleges and universities. Not even our country's highest court has been able to put a stop to them. What is needed to end them are determined efforts by alumni and trustees, strong voices within universities, and an engaged public.
  • Topic: Demographics, Development, Economics, Education
  • Author: Frederick M. Hess
  • Publication Date: 01-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The No Child Left Behind Act (NCLB) is due for reauthorization in 2007. In the nick of time, a bipartisan conventional wisdom has emerged that conveniently excuses the shortcomings of this awkwardly assembled law.
  • Topic: Civil Society, Development, Education, Politics
  • Author: Samuel Thernstrom, Lee Lane
  • Publication Date: 01-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: President George W. Bush was widely expected to propose ambitious new initiatives to control greenhouse gas emissions in the State of the Union address on January 23. The week before the speech, his top environmental advisor told a Washington Post columnist that a carbon tax or cap-and-trade system would be “the most elegant” solution to climate change, raising expectations that a proposal along those lines might be forthcoming. In the end, however, the president proposed a remarkably modest (and poorly conceived) initiative to cut gasoline consumption by 20 percent in the next ten years. This was an important lost opportunity for leadership at a crucial juncture.
  • Topic: Development, Environment, Government, Politics
  • Political Geography: Washington
  • Author: Leon Aron
  • Publication Date: 01-2007
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The twentieth anniversary of the beginning of the Russian revolution (1987–91) is a fitting occasion to assess the true scale and the impact of the national spiritual liberation known as glasnost, and to put it into a broader context of the history of ideas and their role in revolutions. Such an examination is doubly useful today, when a steady stream of Kremlin-sponsored propaganda seeks to distort and minimize what glasnost has wrought.
  • Topic: Development, Government, Nationalism
  • Political Geography: Russia, Europe, Asia
  • Author: Robert F. Noreiga
  • Publication Date: 12-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: While the world's attention is focused on a struggling Iraq and a rising China, a battle for the heart and soul of the Americas is being waged closer to home. A simplistic account might describe this confrontation as a tug of war between U.S. president George W. Bush's vision and that of his self-appointed nemesis, Venezuelan president Hugo Chávez. Equally misleading are characterizations that describe the showdown as one between left and right, rich and poor, north and south. But this is not a battle between two powerful leaders or between ideologies of the left and right. The contest being waged in the Western Hemisphere is about democracy itself: can it deliver the goods for impatient publics? On one side are leaders from the left and right who see democratic institutions and the rule of law as indispensable to prosperity and liberty. On the other are those who treat democracy as an inconvenience and see free markets as a threat.
  • Topic: Democratization, Development, Politics
  • Political Geography: China, Asia
  • Author: John H. Makin
  • Publication Date: 11-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The U.S. economy has slowed to a level below its trend growth rate during the second half of 2006. Trend growth, the rate that can be sustained over time without rising inflation, is probably about 3 percent, having been reduced by a quarter of a percentage point by weaker productivity data. As has often been the case over the past five years, the slowdown itself has set into motion market adjustments that may mitigate or even reverse it. Since August, interest rates on benchmark tenyear treasuries have dropped by about 60 basis points. That reduction, coupled with a stock market that is rising in part because of lower interest rates, has caused an easing of financial conditions equal to nearly 100 basis points since late June on the Goldman Sachs Financial Conditions Index. Meanwhile, since August, the price of oil has dropped by about $18 per barrel—which, if sustained, would be enough to add about 0.7 percentage points to U.S. growth over the next year.
  • Topic: Development, Economics, Markets
  • Political Geography: United States, America
  • Author: John H. Makin
  • Publication Date: 05-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: In their April 21 press release following their spring meeting in Washington, D.C., the G7 finance ministers and central bank governors added an important sentence to their usual bland statement that exchange rates should reflect economic fundamentals: Greater exchange rate flexibility is desirable in emerging economies with large current account surpluses, especially China, for necessary adjustments to occur. In their April 21 press release following their spring meeting in Washington, D.C., the G7 finance ministers and central bank governors added an important sentence to their usual bland statement that exchange rates should reflect economic fundamentals: Greater exchange rate flexibility is desirable in emerging economies with large current account surpluses, especially China, for necessary adjustments to occur. The G7, significantly, also called for an increased role for the International Monetary Fund (IMF) to help countries, including those in the G7 but also China and others in emerging Asia, meet the macroeconomic and financial policy challenge of globalization. Specifically, the G7 supported the strengthening of IMF surveillance, including through increased emphasis on the consistency of exchange rate policies with domestic policies and a market-based international monetary system and on the spillover effects of domestic policies on other countries. The G7s endorsement of greater exchange-rate flexibility and of an enhanced IMF role in implementing it is important. The IMF, having been founded after World War II to maintain stable exchange rates among major economies, has become an advocate on behalf of the major economies of global exchange-rate flexibility. The lesson regarding the need for G7 currency flexibility was learned after Americas August 1971 abandonment of fixed exchange rates, which was followed by a decade of adjustments to higher oil prices that would have wreaked havoc under fixed exchange rates. The lesson for needed currency flexibility in emerging markets was learned after the disastrous attempt, fostered in part by the IMF, to impose fixed exchange rates during the Asian and Russian crises of 1997 and 1998, which prolonged and exacerbated the market gyrations caused by the crises. Sadly, China response to the G7-IMF call for greater currency flexibility has been both negative and misguided. China's foolishly insouciant attitude, captured in a comment by Zhou Xiao-chuan, governor of the Peoples Bank of China, carries with it serious risks both for China and for the world economy. Zhous remark was quoted on April 24 in the Wall Street Journal: [T]he speed of moving forward (on yuan appreciation) is OK. Its good for China and welcomed by many other countries. China's currency has appreciated only 1.2 percent since its initial 2.1 percent revaluation last July 21. That is less than OK. The total 3.3 percent revaluation against the dollar really represents no adjustment at all in view of the 1 to 2 percent inflation differential (lower in China) that has persisted between the United States and China over the past two years. If China had allowed prices to rise instead of mandating caps on prices of important commodities like gasoline, there would be less pressure for the yuan to rise in value. Both the intervention to cap the yuans appreciation and the capping of domestic prices are building up potentially disruptive inflation pressure inside China, as we shall see below. The most dangerous aspect of China's increased efforts to prevent yuan appreciation, as measured by accelerating reserve accumulation over the past year, is the rising pool of liquidity inside China that has resulted. The level of excess reserves in Chinese banks is now larger, relative to GDP, than the level of excess reserves built up in Japan from 2001 to 2005 during the years of a prolonged, desperate struggle against deflation. China's currency undervaluation, coupled with the massive liquidity buildup in its banking system, has resulted in excessive investment in China's state enterprises that have close traditional ties with the liquidity-sodden banks. The usual Chinese response to excess reserves has been to boost reserve requirements for its banks. But to absorb the huge pool of excess reserves now in place, reserve requirements would have to be boosted by 5 percentage points to 12.5 per-cent, going far beyond previous moves of 0.5 to 1 percentage point, and far beyond what China's shaky, insolvent banks could endure. When the Peoples Bank of China boosted its one-year benchmark lending rate on April 26 by 27 basis points (to 5.85 percent), it took a tiny step that will do little to tighten China's monetary stance.
  • Topic: Development, Economics, International Trade and Finance
  • Political Geography: United States, China, Washington
  • Author: John H. Makin
  • Publication Date: 02-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: In August 2000, with the Japanese growth rate holding above 2 percent, the Bank of Japan decided to initiate an end to the zero interest rate policy that it had initiated in March 1999. This step was taken despite the existence of modest deflation, indicated by readings of minus 0.2 to minus 0.5 percent on various measures of inflation. At that time, no central bank had thought seriously about deflation as a threat since the depression of the 1930s.
  • Topic: Development, Economics, International Trade and Finance
  • Political Geography: Japan, Israel, East Asia
  • Author: Charles Murray
  • Publication Date: 12-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The twenty-fifth anniversary of the Atlas Foundation provided Charles Murray with an occasion to consider the influence of classical liberal ideas on policy and also to speculate on what lies ahead.
  • Topic: Development, Economics, Government
  • Author: Allan H. Meltzer
  • Publication Date: 11-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: On November 16, eminent economist Milton Friedman passed away. Friedman made unparalleled contributions to free-market economics, demonstrating in Capitalism and Freedom the close relationship of free enterprise to political liberty. His philosophy has been extraordinarily influential regarding social and economic policies in governments around the world.
  • Topic: Development, Economics, Markets, Politics
  • Author: Douglas J. Besharov
  • Publication Date: 08-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: It has been nearly ten years since President Bill Clinton signed the landmark 1996 welfare reform law. The anniversary has been the occasion for various news stories and opinion pieces, most of them praising the law's success in reducing welfare dependency. And it is true: welfare caseloads have fallen an astounding 60 percent since reform efforts began. But even as a strong supporter of welfare reform, I find it difficult to muster unqualified enthusiasm for the law and how it has been implemented.
  • Topic: Civil Society, Development, Economics, Human Welfare
  • Author: Steven F. Hayward
  • Publication Date: 10-2006
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: A close reading of Al Gore's views on the linkages between environmental issues and broader social and philosophical currents reveals their problematic political and policy implications. Gore derives our environmental problems from deeper metaphysical and psychosocial currents, a path that will foreclose a number of productive policy approaches to the problem of climate change.
  • Topic: Civil Society, Development, Environment, Politics
  • Author: John H. Makin
  • Publication Date: 11-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Let's begin with a riddle: Why is the dollar like a Republican president? Answer: Because the dollar faces incessant predictions of imminent collapse, but in the end it wins out over weaker alternatives.
  • Topic: Development, Economics, Government, International Trade and Finance
  • Author: John H. Makin
  • Publication Date: 10-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Japan's stock market, one of the world's strongest this year, is up about 20 percent since spring. It is doing remarkably well for a country whose nominal GDP is still below its 1997 level. By contrast, the U.S. stock market has been drifting lower all year. The S 500 Index is down about 4 percent in the last five months, even more when the highflying energy sector is excluded. This is the case despite U.S. nominal GDP having grown by a cumulative 46 percent since 1997. Clearly, stock markets are looking ahead and seeing a brighter future for Japan than for the United States.
  • Topic: International Relations, Development, Economics
  • Political Geography: United States, Japan, Israel, East Asia
  • Author: John H. Makin
  • Publication Date: 10-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The U.S. economy was in recession when the 9/11 terrorist attacks struck New York and Washington, D.C. Yet within a few months, despite fears of a collapse in confidence, consumption growth surged to a fourth-quarter annualized rate of nearly 5 percent, up sharply from a 1 percent rate during the third quarter. That consumption surge was enough to drag the economy out of what turned out to be a mild recession. By the first quarter of 2002, overall growth reached a booming 5 percent rate.
  • Topic: Development, Economics, Environment, Terrorism
  • Political Geography: United States, New York, Washington
  • Author: John H. Makin
  • Publication Date: 08-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Among the more remarkable features of the U.S. economy over the past five years—through a tech-stock collapse (from which we have still not recovered), the 9/11 disaster, and numerous chastening corporate scandals —has been the extraordinary resilience of American consumers. To paraphrase H. L. Mencken, no one has ever gone broke (at least not recently) by overestimating the willingness of Americans to spend money.
  • Topic: Development, Economics, Government
  • Political Geography: United States, America
  • Author: John H. Makin
  • Publication Date: 08-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The persistence of annualized economic growth of about 3.5 percent—despite crude oil prices between $50 and $60 per barrel—has led many analysts to claim that the U.S. economy has already "absorbed" the shock of $2.35-plus-pergallon prices for self-serve regular gasoline along with a rise in heating oil costs of more than 30 percent over the last year. As if to underscore their insouciance over energy costs, American consumers accelerated the volume of vehicle purchases in June, especially those of light trucks that get only twelve or thirteen miles per gallon.
  • Topic: Development, Economics, Government
  • Political Geography: United States, America
  • Author: John H. Makin
  • Publication Date: 06-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Paul Samuelson once quipped elegantly that (falling) stock prices had predicted seven out of the last three recessions. There is indeed wisdom in the suggestion to ignore wiggles in the financial markets as indicators of the behavior of the real economy that produces goods and services.
  • Topic: Development, Economics, Government
  • Political Geography: United States
  • Author: John H. Makin
  • Publication Date: 05-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The Federal Reserve's measured move toward a "neutral" federal funds rate, the short-term rate that keeps the economy growing at about 3.5 percent, is a tricky process. No one knows with certainty what the neutral fed funds rate is, and it changes over time. As long as the Fed keeps raising rates and the economy keeps growing at or above trend, it is reasonable to infer that the neutral fed funds rate is higher than the current rate. The corollary to that proposition is that rates have to be boosted above the neutral rate, inducing an asset market collapse, a real economy slowdown, or both to infer that the neutral rate has been exceeded. It is beginning to appear as though the current rate of 2.75 percent is at or above neutral. If so, that would be about a full percentage point below what many were guessing.
  • Topic: Development, Economics, Government
  • Political Geography: United States
  • Author: Douglas Besharov
  • Publication Date: 10-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: For forty years, Head Start has sought to improve the life prospects of low-income children. Since 1965, about 20 million children have gone through the program at a total cost of more than $100 billion. Head Start was supposed to be reauthorized in 2003, but for two years Congress was immobilized as the Bush administration and its Republican allies pushed for what they saw as needed improvements in the program—while Democrats and the Head Start establishment argued that the proposals would hurt poor children. The impasse was broken earlier this year when key Republicans gave up their efforts to change the program. Committees in both Houses have now voted unanimously to expand eligibility for Head Start. The Senate bill would raise the income-eligibility cap from the poverty line to 130 percent of poverty (a roughly 35 percent increase in the number of children eligible for the program), and the House bill would allow programs to enroll more one-and two-year-olds, rather than their traditional target group of three- and four-year-olds (ultimately doubling the number of eligible children).
  • Topic: Development, Economics, Education, Government
  • Author: Adam Lerrick
  • Publication Date: 11-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: World Bank money is building schools in China's impoverished western provinces, but the bill for interest charges is being mailed to the United Kingdom, attention Chancellor of Exchequer Gordon Brown. Mexico, Chile, and Brazil will soon be lining up for the same deal. This is but the latest scheme designed to preserve the World Bank's lending role at a time when the need and demand for its services are falling. Major middle-income countries, the cream of the bank's lending portfolio and where more than 80 percent of Latin Americans live, are curbing their borrowing and paying down their balances, setting off alarms at the bank. Net loan flows have shifted from a positive $10 billion in 1999–2001, to a negative $15 billion in 2002–2004.
  • Topic: Debt, Development, Economics, Third World
  • Political Geography: China, United Kingdom, Brazil, Latin America, Mexico, Chile
  • Author: John E. Calfee
  • Publication Date: 09-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: If we know anything about the American tort liability system, we know that it works badly when it gets infected by junk science. The recent Vioxx verdict in Angleton, Texas, is a case in point. The jury awarded $253 million to the widow of a man who died after taking the now-infamous pain reliever. The award will almost certainly be reduced to something like $5 million or $10 million because it ignored statutory limits on punitive damages, and it may eventually get thrown out because of mistakes by the judge. But even at “only” $10 million a case, a string of adverse Vioxx decisions would prove an expensive example of the triumph of the junk lawsuit over science. Most press accounts portray the jury's decision as simply a reflection of medical science, which supposedly has indicted and convicted Vioxx of causing excess heart attacks. This view prevailed in the four months after September 30, 2004, when Merck voluntarily pulled Vioxx from the market. Those months saw vituperous debate and criticism of both Merck and the Food and Drug Administration in leading medical journals. A renegade FDA staffer testified at congressional hearings along with other critics.
  • Topic: Development, Government, Human Welfare, Science and Technology
  • Political Geography: America
  • Author: Richard Vedder
  • Publication Date: 09-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: As college students begin a new academic year, many parents are reeling from tuition charges. This fall's estimated 8 percent average increase at public universities, added onto double-digit hikes in the two previous years, means tuition at a typical state university is up 36 percent over 2002—at a time when consumer prices in general have risen less than 9 percent. In inflation-adjusted terms, tuition today is roughly triple what it was when parents of today's college students attended school in the 1970s. Tuition charges are rising faster than family incomes, an unsustainable trend in the long run. This holds true even when scholarships and financial aid are considered. One consequence of rising costs is that college enrollments are no longer increasing as much as before. Price-sensitive groups such as low-income students and minorities are missing out. A smaller proportion of Hispanics between eighteen and twenty-four attends college today than in 1976. The United States is beginning to fall below some other industrial nations in population-adjusted college attendance.
  • Topic: Development, Economics, Education, Government
  • Political Geography: United States
  • Author: Scott Gottlieb
  • Publication Date: 07-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: There are seldom eureka moments in health care. Few new drugs or medical devices save scores of lives or cure diseases when they first hit the market. New technologies rarely translate into immediate life expectancy gains, and it is uncommon that results of a single study will transform how medicine is practiced. Medical progress is not magic, and sudden discoveries do not lead to dramatic cures, although a new book by Marcia Angell, a former editor of The New England Journal of Medicine, would lead you to think all of our gains in health have been achieved from just a handful of the most potent new medicines. Instead, medical breakthroughs unfold over time, and gains in life expectancy and health are realized only after a series of small technological advances are collected into new ways of practicing medicine or attacking a disease. The practice of medicine unfolds not in a series of certainties, but in a series of doubts.
  • Topic: Civil Society, Development, Human Welfare, Science and Technology
  • Political Geography: England
  • Author: John R. Lott Jr.
  • Publication Date: 06-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Statistical evidence indicates that qualifications, experience, and potential influence are far greater factors in delaying or rejecting judicial nominees than perceptions of extremism.
  • Topic: Development, Government, Politics
  • Political Geography: United States
  • Author: James K. Glassman
  • Publication Date: 06-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: Entry-level positions long criticized as "dead-end jobs" deserve respect as stepping-stones to greater success, as these jobs teach the basics of business to new workers.
  • Topic: Civil Society, Development, Economics, Education
  • Author: Steven F. Hayward
  • Publication Date: 10-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: The New Orleans flood is shaping up to take its place alongside the Cuyahoga River fire and the Santa Barbara and Exxon Valdez oil spills as one of the major environmental catastrophes of modern times. The issue of hurricanes and climate change—a linkage not established in current climate science—distracts from the most significant environmental lessons of the Katrina disaster. The rebuilding of New Orleans offers an opportunity to begin reversing the long-term Gulf Coast erosion that contributed to the magnitude of the disaster.
  • Topic: Development, Environment, Human Welfare, Politics
  • Author: Ted Gayer
  • Publication Date: 04-2005
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: After failing to make it out of Senate committee in March, the future of the president's Clear Skies bill is uncertain. While the bill contains some flaws, most of its opponents criticized the virtues of Clear Skies, thus making it more difficult to fix the real problems and to strike a compromise. There is still some hope that the bill will pass later this congressional session. In lieu of Clear Skies, the Environmental Protection Agency recently promulgated two administrative rules to tighten regulations on power plant air pollution. These rules are certain to be litigated and thus delayed. With Clear Skies, we get a greater guarantee that the air quality goals will be met, and we get greater regulatory certainty that leads to lower costs.
  • Topic: Development, Environment, Government, Politics
  • Author: Steven F. Hayward
  • Publication Date: 11-2004
  • Content Type: Policy Brief
  • Institution: American Enterprise Institute for Public Policy Research
  • Abstract: A slew of new and highly regarded environmental books in 2004 is testimony to the persistence of environmental apocalyticism, despite growing signs of environmental progress in the United States and the developing world. The persistence of doomsaying is an indicator of the staleness of popular environmental thought, which is increasingly removed from political reality and closed-minded toward innovative thinking about real environmental problems and their solutions.
  • Topic: Development, Energy Policy, Environment
  • Political Geography: United States