Dean Baker's Blog, page 106

Universities Place a Higher Priority on Keeping Hedge Fund Managers Rich than Education

That is the implication of a NYT article reporting on the fact that the returns on university endowments trailed a simple index mix of either 60 percent stock and 40 percent bonds or 70 percent stock and 30 percent bonds. According to the article, university endowments had an average nominal return over the last decade of 4.6 percent. This compares to a return of 5.3 percent for a 60-40 stock/bond index mix and 5.4 percent for a 70-30 stock/bond index fund.

This means that universities were t...

David Brooks Radical Dishonesty

We would usually expect that a 12-year-old kid would be taller than a 6-year-old kid. However, if a 12-year-old had only grown one inch over their last six years, we would probably be somewhat worried.

David Brooks devotes his most recent column, "the virtue of radical honesty" to presenting data from Steven Pinker's new book, Enlightenment Now, which purports to show that things are better than ever. Most of the data has the character of boasting over our 12-year-old's one inch of growth ove...

Data Say Job Loss Is Due to Imports, Washington Post Says "It's the Robots"

When it comes to talking honestly about the impact of trade on the labor market few papers flunk the test as badly as the Washington Post. It is a consistent and unreflective supporter of the pro-business trade policy that has been pursued by administrations of both parties for the last four decades.

Regular Beat the Press readers know how in an editorial defending NAFTA the paper absurdly claimed that Mexico's GDP quadrupled between 1987 and 2007. According to the I.M.F., the actual gro...

Disney's Bonuses for Its Workers are Less than 10 Percent of Its Annual Tax Savings

That's a bit of background that might have been helpful for people reading this Washington Post article on Disney's threat to withhold a $1,000 bonus from union workers unless they accept a contract offer from the company. According to the article, the company will be paying out a total of $125 million in one-time bonuses.

Last year, the company paid $4,422 million in taxes on $13,788 million in pre-tax income for an effective tax rate of 31.9 percent. If the new tax law lowers Disney's...

The Bond Vigilantes Are Dead! Even With Soaring Budget Deficits Interest Rates Are Stable

In the last six months, Republicans gave up being a party that pretends to care about budget deficits as they happily pushed through large tax cuts (roughly 0.7 percent of GDP over the next decade) and big increases in spending (roughly 0.7 percent of GDP over the next two years). The deficit picture looks much worse today than it did a year ago.

While the few remaining deficit hawks at the Washington Post and the Peter Peterson–funded organizations are screaming, the question serious people...

It Wasn't the Market that Made Elites Incredibly Rich, It was Elites Rigging the Market to Make Themselves Incredibly Rich

It is amazing how frequently we hear people asserting that the massive inequality we are now seeing in the United States is the result of an unfettered market. I realize that this is a convenient view for those who are on the upside of things, but it also happens to be nonsense.

Today's highlighted nonsense pusher is Amy Chua, who warns in a NYT column about the destructive path the United States is now on where an disaffected white population takes out its wrath on economic elites and racial...

The Case Against Google

An NYT Magazine piece does a very nice job laying out the argument as to how platform monopolies like Google could be engaging in anti-competitive practices.

Contrary to What You Hear from Ivanka Trump, Most Women in Their Late Sixties Don't Want to Work

An NYT article discussed a plan being pushed by Ivanka Trump and several Republicans in the Senate which would allow for new mothers to take up to twelve weeks of paid family leave. This would be paid for by delaying their Social Security retirement benefits beyond age 67, which would be when they would now be able to collect full benefits.

The piece quotes Carrie Lucas, the President of the Independent Women's Forum saying:

"Sixty-seven is really late middle age, and many people are re...

How Does the Washington Post Know that Trump's Plan "Aims" to Pump $1.5 Trillion Into Infrastructure Projects?

This is an assertion in a major Post article on infrastructure, but it doesn't fit with the evidence. Trump is actually only proposing to put up $200 billion (0.09 percent of GDP) over the next decade towards his infrastructure initiative.

The rest is supposed to come from state and local governments and private investors. As the piece notes, many are dubious whether anything like this amount will be forthcoming. Also, Trump is proposing large cuts to Amtrack and a wide range of other areas o...

Robert Samuelson Is Worried About Inflation, Yet Again

As the saying goes, writing for Washington Post means never having to say you're sorry. Hence the paper never apologized for saying NAFTA had caused Mexico's GDP to quadruple when the true growth was just 84.2 percent. And Robert Samuelson needs never apologize for silly warnings about run away inflation.

The latest line is that we are supposed to be scared about the 0.5 percent inflation rate shown in the Consumer Price Index (CPI) for January. He begins his piece telling readers:

"Anyone lo...