Today, Elizabeth Economy writes of China’s reluctance to fill in any gaps created by foreign policy shifts under way in Washington during the second Trump administration. John Cochrane recaps a new Hoover book drawn from work discussed at the annual monetary policy conference. And Orin Kerr explores a new ruling on the admissibility of evidence at Luigi Mangione’s state murder trial, that conflicts with a ruling made at his federal trial.
The Trump-Xi Summit
In the Financial Times, Senior Fellow Elizabeth Economy writes about her main takeaway from the Trump-Xi Summit: the Chinese Communist Party doesn’t actually want to fill any of the perceived gaps generated by President Trump’s withdrawal from multilateralism and America’s tussles with many of its traditional allies. The hawkish view of policy regarding China continues to have bipartisan support in Washington, yet China isn’t moving to increase its foreign aid budget or assume any costs of global leadership after Washington cut aid and backed away from global responsibilities. “The world is confronted now with two superpowers that want the rights of global leadership without any of the responsibilities,” Economy writes. “Faced with this choice, the response of most other countries appears to be ‘none of the above.’ ”
The Economy
In this special Grumpy Economist Weekly Rant, Senior Fellow John Cochrane highlights Finishing the Inflation Job and New Challenges for Monetary Policy, a new Hoover Institution Press volume drawn from Hoover’s annual monetary policy conference. The volume brings together leading voices from central banking, financial regulation, and economic policy, including Kevin Warsh, Chris Waller, Loretta Mester, Charles Plosser, Augustine Carstens, Isabel Schnabel, and others. Cochrane previews the volume’s major themes, the unfinished fight against inflation, digital assets, private credit, international risks, fiscal pressures, and the increasingly difficult relationship between monetary policy and fiscal policy in a government facing rising debt burdens. With inflation still elevated and new risks emerging across the financial system, the central message is clear: finishing the inflation job will require confronting the next generation of monetary policy challenges.
Revitalizing History
Catherine Ostler joins Distinguished Visiting Fellow Andrew Roberts to discuss her new book The Renoir Girls, which unravels the extraordinary true story behind Pierre-Auguste Renoir’s famous portraits of the Cahen d’Anvers sisters—a tale that stretches from the glittering salons of Belle Époque Paris and the fury of the Dreyfus Affair to Nazi-occupied France and to Auschwitz. Blending art, aristocracy, scandal, betrayal, and survival, Ostler reveals how one wealthy Jewish family became caught in the violent currents of French anti-Semitism, while the paintings themselves survived war, looting, and exile to become silent witnesses to one of Europe’s darkest centuries.
Revitalizing American Institutions
At the Volokh Conspiracy, Senior Fellow Orin Kerr writes about a New York state trial court’s decision to suppress some of the contents of a backpack seized from Luigi Mangione, who stands accused of murdering UnitedHealthcare CEO Brian Thompson, in contrast with a federal judge who ruled all contents of the bag are admissible. Kerr, who admits he found the new opinion “a little odd,” writes that the court based its decision on New York state constitutional law, even though police seized the bag in Pennsylvania. “The heightened restrictions of New York law apply to the Pennsylvania officers, even though they presumably didn't know (and maybe couldn't know) they would be governed by New York state search and seizure law,” Kerr writes of the ruling.
California
The proposed California state budget stands on the shoulders of a very small number of giants: the high earners with taxable incomes tied to equities. Not only are income tax windfalls from this source a gamble, writes Senior Fellow Lee E. Ohanian, but those taxpayers are the ones most equipped to abandon California for states that don’t treat them as cash cows. Stock-market gains predicted in Governor Newsom’s budget are far from a sure thing, he notes: revenue swings in recent years have veered from a 55 percent increase (2021) to a nearly 35 percent drop (2023). And now, proposals for wealth taxes to fund bloated state projects are posing a threat to California’s business creation and productivity. “As a Californian,” Ohanian asks, “can you feel any benefits of a state budget that has increased about 40 percent (after adjusting for inflation) over the past eight years?”
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