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5 Keys to Restoring America's Prosperity: John B. Taylor


In his new book, First Principles: Five Keys to Restoring America's Prosperity, Stanford University professor of economics John B. Taylor, details the not-so-secret ingredients to rebuilding American's economic future: predictable policy, rule of law, strong incentives, reliance on markets, and a clearly limited role for government. "America can be great again, economically speaking," Taylor explains, "it's just more recently where we've gone off track."

Taylor sat down with Reason Magazine Managing Editor Katherine Mangu-Ward to discuss his book, the principles that underlie America's economic supremacy and what's gone wrong over the past decade.

Taylor is the Raymond Professor of Economics at Stanford University and the George Shultz Senior Fellow at Stanford's Hoover Institution. He was Treasury Under Secretary for International Affairs from 2001 to 2005. His previous books include Getting Off Track: How Government Actions and Interventions Caused, Prolonged, and Worsened the Financial Crisis. You can watch a 2009 interview discussing the book with Taylor here.

Shot by Joshua Swain and Jim Epstein. Edited by Meredith Bragg

Approximately 5:30 minutes long.

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  1. #6 Quit minding everybody else’s business in the four corners of the planet.

    1. But…the world… round….

      (to be read in Denholm Elliott’s voice)

  2. Taylor looked like he was barely tolerating the questioning by Mangu-Ward.

    1. Katherine Banjo-Chord

  3. An interview with an old, rich white guy on how not to be poor. That will certainly fly with the lefties.

  4. Boilerplate Bullshit from Taylor.

    He wants “predictable tax rates” but under the Reagan and Clinton booms taxes were like a yo-yo.

    All five of his principles are in better shape now than any time since 1970.

    1. * Predictable policy framework

      Good thing we don’t have a giant health care law that affects the cost of every new hire hanging over the economy’s head until 2014. Lets wait until it is in effect to see how it works. And don’t forget the millions of pages of regulations that are yet to be written about the act.

      * Rule of law

      Good thing we don’t have a President who openly questions the legitimacy of the Supreme Court or anything.

      * Strong incentives

      Good thing we don’t have a President who spends all of his political capital stocking class resentment.

      * Reliance on markets


      * Clearly limited role for government

      Trillion + dollar deficit and some of our largest states headed for pension driven bankruptcy. LOLOLOL

      Retarded is too weak of a word for you shrike. Maybe criminally retarded is better.

      1. You’re an idiot. Companies don’t care about ObamaCare – they already comply (unless you’re a lawn service or shithole company).

        Incentives are great – look at all the recent and pending IPO’s – even overvalued companies like Groupon are cashing in.

        The markets are strong as death now – look at the averages. And Obama has the outrageous $1.3 trillion Bush deficit moving down.

        Interest rates low, exports high, Dollar is sound, Iraq War debacle behind us.

        The biggest investor in the world – Larry Fink says go 100% into equities and supports Obama.

        Another Bush will only fuck up this recovery.

        1. What color is the sky in your world dipshit? There is no recovery. This is 1990s Japan all over again.

          1. Bullshit. Bush left GDP at -8.9% and it topped +4.0 last quarter.

            1. No it didn’t


              I know you are retarded and psychotic. But you can’t just get on here and lie about shit. Try again you little fucking wierdo.

              1. 1.8%. Oops!

              2. He’s confused because pulling stuff out of your ass, as long as it supports The Narrative, always gets applause at HuffPo.

              3. Shrike apparently doesn’t know the difference between the words “real” and “nominal”.

                Remember, 100% equities guys! Can’t miss!

        2. So that 15 Trillion in debt we have has been magically washed away by President Obama? And we haven’t operated with a deficit in 3 years?

          Keep drinking that Team Blue KoolAid bro.

        3. What we had during our historic boom times were higher tax rates, lower spending, and smaller government debt.

          Then somebody figured out that America’s credit was so good you could simultaneously cut taxes, jack spending, and make up the difference with borrowing against the nation’s future, even in the trillions of dollars.

          Exactly when this scam will play itself out, if ever, is impossible to say. But that long-lost fiscal balance represented something larger: a bipartisan consensus on the need to actually govern the country. Arguments were won and lost at election time. Once the election was over, negotiations proceeded in rough approximation of the results. Using the filibuster, or the debt ceiling, or “government shutdowns” as doomsday weapons was not considered legitimate.

          Times change, and they don’t change back. Future prosperity will not involve “restoring” anything from our past, but adapting to the new, bloodier and more hate-driven political reality of the present.

          1. “…new, bloodier and more hate-driven political reality of the present.” citation needed. Also, the entirety of the 19th century and the first 2/3rds of the 20th century disagree with you.

            1. You want a citation? I refer you to the next seven months. You’ll get all the proof you need.

              As for the “first two thirds of the 20th Century,” the top rate was 70%, and 91% in the years before that.

              1. “As for the “first two thirds of the 20th Century,” the top rate was 70%, and 91% in the years before that.”

                Yeah, but thanks to all the loopholes, the effective top-rate was only in the mid-30s, not significantly higher than today.

                1. So, we’ve never actually tried to collect money with higher ‘effective’ rates, then?

                  In that case, we can’t say for certain that it won’t work.

              2. Oh, and why didn’t those higher taxes bring in more revenues?


                You have 2 choices. Deny one and you confirm the other:

                1. Tax rates were never significantly higher than they are today.

                2. The Laffer Curve is real and significant.

                Neither fit your narrative.

                1. Wiki link fail.

        4. Interest rates are down because of a weak economy clown. Kind of like Japan had for a long time.

          1. Interest is also low because the Fed is engaged in a policy of suppressing interest rates, via, among other mechanisms, manipulating the market for Treasury debt via “quantitative easing”, “twist”, and general monetization of the debt.

            I saw an estimate (sorry, no linkee) that the Fed bought over 60% of the Treasuries issued last year. Monetization is here.

            1. Of course. I love the Dollar Doves Obama has seated at the Fed.

              By July every Fed Gov will be an Obama appointee.

              1. Free liquidity and debt monetization is great. Well, for the leveraged, anyway.

                Until its not. And when its not, its very much not. For everybody.

        5. “Companies don’t care about ObamaCare”

          I work for a muti-billion dollar corporation that has 9,000 employees and you are full of shit.

          1. McDonalds or Burger King?

            1. So who do you work for ?

              1. My guess is unemployment or welfare, which constitutes “work” in shrike’s world. Those free checks don’t spend themselves ya know!

        6. Say what? No one knows what the Obama administration is going to do next WRT regulation. The EPA, for all practical purposes, just outlawed the construction of coal-fired power plants. What’s that going to do to the price of electricity? (A: It’s going up).

          No one knows what that hag Sebelius is up to with Obamacare regs, so there’s that. The dollar is bleeding value, though the Euro’s bleeding masks it (for now). Obama can’t propose new taxes fast or heavy enough, including Biden’s insane “global tax.”

          Your argument is insane.

          1. No, they will move to natural gas fired plants.

            Or nuclear (Obama has been approving nuclear for Southern Company/Georgia Power).

            Wake up, pal. Coal is not the only poison to make energy from.

            1. Is this another example of your fabled capitalist credentials ? Where you approve of very little government except for health care, house, education, money, banks, coal. Is coal no longer capitalist ?

              You are simply socialist slime, I know socialists that believe in more freedom that you do.

              1. Coal is filthy.

                When Bush 41 outlawed sulfur I don’t recall any of you rednecks yelling SOCIALLISM!

                1. So is nuclear, no doubt if your masters said nuclear is bad, you will change your support in a second.

                  Tell me can you think for yourself, or do you simply drone the mantras your masters feed you ?

                2. When Bush 41 outlawed sulfur I don’t recall any of you rednecks yelling SOCIALLISM!

                  Sulphur has been outlawed? Tell us more, cockbreath.

            2. No, they will move to natural gas fired plants.

              Sure they will. And when fracking is banned by the EPA, guess what happens to the price of gas (and therefore electricity)?

              1. It “Necessarily skyrockets,” of course.

                1. IOW, foreseen consequences are not unforeseen.

          2. There is no “global tax” being proposed you idiot.

            Quit reading Free Republic. It is a white trash site.

            1. It took me 5 seconds to find this:

              1. It’s a sockpuppet. IGNORE IT.

            2. “”We want to create what’s called a global minimum tax,” said Vice President Joseph R. Biden Jr. at a fundraiser in Iowa Wednesday.”

            3. It’s not a ‘global tax’, it’s worse.

              It’s a global minimum tax.

              1. It’s a global minimum tax.

                I just don’t understand it doctor, we’ve doubled the number of leeches, and the patient isn’t any better.

        7. “The biggest investor in the world – Larry Fink says go 100% into equities and supports Obama.”

          Nevermind that Larry Fink is in-line to be the next treasury secretary. I bet he does support Obama!

          Oh, and the 100% equities bullshit? He started pushing that in June last year…


          Wanna know what else happened right after that? Take a look…


          Nevermind all that. Shrike, whom nobody can touch on markets, says with a straight face we should listen to the guy saying go 100% (!?!) into equities. 100-fucking-percent. Really.

          Shrike, you are a colossal dumbfuck.

    2. “He wants “predictable tax rates” but under the Reagan and Clinton booms taxes were like a yo-yo.”

      No, you asshole.

      Taxes were PREDICTABLE during the Reagan and Clinton years. Under Reagan, you knew they were going down. Under Clinton, you knew they were going up.

      Under Obama, you don’t know until the last minute whether the Bush tax cuts are going to be re-upped or not.

      I’m sure if taxes were as predictable as you, though, Taylor would be thrilled.

  5. Stay safe all you Dallas Reasonites, even if your city sucks.

    1. Hey! And thanks.

  6. I thought I heard an insane Texan whore screaming my name, but it must have been the wind.

    1. There you go, DANCING again.

    2. But…but…she makes the puppets dance!


      How’s registration, Mary?



    4. She really hates you and me.

      1. I’m moderately curious about who in her personal life your Internet identity she is using as a substitute. Apparently she is heavily fixated on you and heller.

        It’s like one of those bad movies that ends without wrapping up all the plot lines. You’re kind of disappointed that you didn’t get answers, but not disappointed enough to really give too much of a shit about.

        1. It is a bad movie alright. There is no judging insanity.

  7. Shit-disturbing!!!!

  8. The “strong incentives” bit makes me a little queasy.

    We don’t need “incentives” set by diktat. That kind of kleptocorpocrat central planning bullshit is big part of the ball and chain on our economy right now.

    1. To me, the strongest incentives out there are those that let you reap the rewards from doing things people like and make you bear the costs of things they don’t. All you need for that to work is the State to get the fuck out of the way.

      Brutus, aka “Jeffersonian”

  9. John B. Taylor does a damn fine Mika Brzezinski impression.

  10. He has management hair.

  11. Shrike is such a financial genius, strange that despite all that money he makes, he somehow cannot gather enough cash to escape the shit hole he complains about all the time.

    1. shriek is a sockpuppet. It is designed to wind people up. Ignore it.

      1. Odhinn knows I do. With the mighty Gungnir of reasonable filtration the Allfather did smite shrike.

    2. So Notsure is P Brooks.

      The only two so hapless they cannot find the ‘reply’ button.

  12. You need to do a follow up interview now with Scott Sumner or George Selgin. Do it. Do it!!!

    1. How about just Selgin and call it a day.

    2. Throw in Larry White, and have them debate NGDP targeting, productivity norms, and how many times last decade the Fed was either too loose or too tight.

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