Macro Foundations

The following links (Macroeconomics by Paul Krugman and Krugman and the New York Times) coincide well with our recent and upcoming classroom topics regarding the Classical/Keynesian debate, and also represents a nice conclusion to our course.

War on Welfare

It should come as no surprise that the latest macroeconomic policy issue seems to be the "War on Welfare".  Though the following quote was written during the 1960's "War on Poverty", in my opinion, it applies equally well in today's circumstances.

"The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a moral justification for selfishness."
                                                                -- John Kenneth Gaibraith

It's fascinating that the increase in transfer payments (e.g., on welfare, food stamps, unemployment compensation as well as student grants, farm subsidies, corporate bailouts, etc.) is a direct result of a poorly-functioning economy, though somehow the perception of the "deserving" vs. "undeserving" poor has always existed, and serves to differentiate the legitimacy of the transfer payment categories above.

Why?