John Cochrane on Free Markets & Economic Growth and the Fiscal Theory of the Price Level - EP214

11/14/23 • 69 min

Professor John Cochrane of the Hoover Institution discusses the importance of free markets for economic growth and highlights stagnating growth as the biggest economic issue of our time. John talks about what may be his next book, "Free to Grow," which aims to update Milton and Rose Friedman's "Free to Choose" for today's world. After John speaks, show host Gene Tunny interviews him about his views on growth and his controversial Fiscal Theory of the Price Level. This is a recording of a live event at the Centre for Independent Studies in Sydney on 26 September 2023.

Please get in touch with any questions, comments and suggestions by emailing us at [email protected] or sending a voice message via https://www.speakpipe.com/economicsexplored.

About Professor John Cochrane

John H. Cochrane is the Rose-Marie and Jack Anderson Senior Fellow at the Hoover Institution. He is also a research associate of the National Bureau of Economic Research and an adjunct scholar of the CATO Institute.

Before joining Hoover, Cochrane was a Professor of Finance at the University of Chicago’s Booth School of Business, and earlier at its Economics Department. Cochrane earned a bachelor’s degree in physics at MIT and his PhD in economics at the University of California at Berkeley. He was a junior staff economist on the Council of Economic Advisers (1982–83).

For more on John, check out his bio here:

https://www.hoover.org/profiles/john-h-cochrane

What’s covered in EP214

00:03:36 Importance of economic growth.
00:16:06 Incentives drive productivity and growth.
00:17:12 Regulation hinders economic growth.
00:22:59 Fixing problems requires better solutions.
00:28:53 Fixing social programs by embracing free markets.
00:39:28 Regulatory state causing innovation slowdown.
00:46:24 Free market healthcare benefits the poor in John’s view.
00:48:47 Fiscal Theory of the Price Level: Inflation caused by government debt.
00:53:56 Avoid old left-right division.
01:05:21 Government debt may lead to a sovereign debt crisis.

Links relevant to the conversation

Video of the Free to Grow event on YouTube:

https://youtu.be/tmZh43Fc6Zo?si=wwWRfBW3zsbYmCRV

CIS web post about the Free to Grow event:

https://www.cis.org.au/event/free-to-grow-unlocking-economic-prosperity/

Please get in touch with any questions, comments and suggestions by emailing us at [email protected] or sending a voice message via https://www.speakpipe.com/economicsexplored.

About Professor John Cochrane

For more on John, check out his bio here:

https://www.hoover.org/profiles/john-h-cochrane

What’s covered in EP214

00:03:36 Importance of economic growth.
00:16:06 Incentives drive productivity and growth.
00:17:12 Regulation hinders economic growth.
00:22:59 Fixing problems requires better solutions.
00:28:53 Fixing social programs by embracing free markets.
00:39:28 Regulatory state causing innovation slowdown.
00:46:24 Free market healthcare benefits the poor in John’s view.
00:48:47 Fiscal Theory of the Price Level: Inflation caused by government debt.
00:53:56 Avoid old left-right division.
01:05:21 Government debt may lead to a sovereign debt crisis.

Links relevant to the conversation

Video of the Free to Grow event on YouTube:

https://youtu.be/tmZh43Fc6Zo?si=wwWRfBW3zsbYmCRV

CIS web post about the Free to Grow event:

https://www.cis.org.au/event/free-to-grow-unlocking-economic-prosperity/

Previous Episode

Is the American Dream a Broken Promise for Latinos? w/ Dr Paul Rivera - EP213

Dr Paul Rivera provides insights into the $3 trillion Latino economy in the United States and asks whether the American dream is a broken promise for Latinos. Dr. Paul Rivera is co-founder of BeActChange, a former senior economist at USAID, and lecturer at California State University Channel Islands. Dr Rivera and show host Gene Tunny also discuss the challenges of delivering foreign aid and the importance of understanding local communities. Rivera shares a compelling example to illustrate this point.

Please get in touch with any questions, comments and suggestions by emailing us at [email protected] or sending a voice message via https://www.speakpipe.com/economicsexplored.

What’s covered in EP213

The American Dream and Latino economy with Paul Rivera. (0:03)
International development, strategic planning, and community engagement. (4:41)
Inadequate consultation in international development projects. (10:23)
Latino population's role in US economy and American dream. (14:07)
Latino mental health and the American Dream. (20:13)
The economic power of the Latino community in the US. (25:45)
Latino homeownership, education, and mental health. (29:12)
The American Dream and its accessibility. (34:46)
Immigrant experiences and the American dream. (40:06)
Latino population growth in the US and its impact. (43:48)
Marketing to the Latino community in the US. (47:26)

Links relevant to the conversation

About Dr Paul Rivera on his BeActChange website:

https://beactchange.com/about-paul/

Paul’s LinkedIn page:

https://www.linkedin.com/in/drpaulrivera/

Paul’s book Creating Your Limitless Life co-authored with Dr. Esther Zeledón:

https://www.amazon.com.au/CREATING-YOUR-LIMITLESS-LIFE-Terms-ebook/dp/B0CFZN3FCS

Latino GDP report 2023:

https://lattitude.net/wp-content/uploads/2023/09/LDC%20GDP%20REPORT%202023.pdf

Next Episode

Iceland's Secret: The Untold Story of the World's Biggest Con w/ Jared Bibler - EP215

Show host Gene Tunny interviews Jared Bibler, author of the book "Iceland's Secret: The Untold Story of the World's Biggest Con." Jared discusses his firsthand experience during the brutal 2008 financial crisis in Iceland, where he worked at a collapsed bank and later at the financial markets regulator. He sheds light on the dodgy behaviour of bankers leading up to the crisis and the severe consequences that followed. Stay tuned to the end of the episode for Gene's interpretation of Iceland's secret and its relevance to economies worldwide.

Please get in touch with any questions, comments and suggestions by emailing us at [email protected] or sending a voice message via https://www.speakpipe.com/economicsexplored.

About Jared Bibler

Jared started his career as a consultant for a Wall Street giant in Boston and New York until moving to Iceland to support the Icelandic pension funds’ foreign investments. He resigned from his job at a leading Icelandic bank a weekend before the 2008 Icelandic financial crisis.

He was subsequently hired to lead a special investigation team, which referred more than 30 criminal cases to the Special Prosecutor of Iceland, including the largest stock market manipulation cases to be prosecuted globally.

Jared’s insider knowledge and unwavering persistence helped Iceland to famously become the only country to jail its bank CEOs. But the real story, deeply complex and sinister, has direct relevance today as banks once again begin to tumble.

What’s covered in EP215

00:02:56 Iceland's financial crisis was fueled by the growth of banks that became Enron-sized and collapsed, causing significant damage to the economy.
00:05:49 Financial industry corruption and collapse.
00:11:30 Iceland's banking system collapsed.
00:19:33 Icelandic banks manipulated stock prices.
00:27:26 The financial system is vulnerable.
00:34:58 Banking fraud and economic collapse.
00:35:58 Currency crisis in Iceland.
00:47:19 Iceland faced an economic crisis and unemployment.
00:50:54 Iceland's recovery transformed into something ugly.
00:57:38 Lessons from Iceland's banking collapse.
01:00:16 Incentives and regulation in finance.