Dean Baker's Blog, page 116

Yes, Robert Samuelson Says It's Time to Cut Social Security and Medicare

Now that we seem on the edge of giving lots more tax dollars to Donald Trump and his rich friends, the deficit hawks feel newly empowered and have Social Security and Medicare clearly in their sights. Robert Samuelson is on the job, telling us that we haven't prepared for the aging of the population.

His primary weapon is a new report from the OECD on the aging problem. The report says that the ratio of the over 65 population to the 25 to 65 population is projected to rise from 0.124 in 2015...

"Universal" Doesn't Mean the Same Thing to Ross Douthat as the Rest of Us

Ross Douthat goes over what he sees as the good and the bad in the Republican tax plans in his column today. He notes the ending of the mandate that people buy health care insurance in the Senate version of the bill and then says:

"In the long run any universal health insurance system will be on a firmer political footing if it finds a way to work without requiring people to buy a product they don’t want."

A "universal" system does mean that everyone has to have health insurance even if they...

Having An Acting Director at the Consumer Financial Protection Bureau Was a Choice, Not an Accident

The NYT has an article discussing the ways in which Mick Mulvaney is changing the Consumer Financial Protection Bureau in his capacity as acting director. There is one item on which it is somewhat misleading. The piece indicates that Mulvaney's status as an acting director is an accident, telling readers that Trump could appoint a new director, but the confirmation process could take months.

While confirmation can be lengthy, depending on the quality of the nominee (Republicans do control the...

Donald Trump Puts Coal Mining Jobs in West Virginia at Risk by Downsizing National Monuments in West

That could have been the headline, at least if the New York Times article reporting on the action is accurate. The NYT told readers that when Clinton first created the Grand Staircase National Monument in 1996:

"When Mr. Clinton formed Grand Staircase, the move halted plans for a coal mining project there that would have brought desperately needed jobs to a poor county."

Since the demand for coal is not hugely elastic, if coal was being mined from the area that became the monument, it would...

Because Robert Samuelson Doesn't Understand Budget Deficits, He Thinks Others are Equally Confused

Robert Samuelson used his column today to say he doesn't understand budget deficits. This is hardly a surprise to regular readers of his column. But, he bizarrely argues that because he is confused, everyone else is also.

Samuelson tells readers:

"The truth is that we don’t fully understand the effects of budget deficits on the business cycle."

No, "we" do understand the effects of budget deficits. It really is pretty simple, deficits increase demand compared to a balanced budget or surplus...

Because Robert Samuelson Doesn't Understand Budget Deficits, He Thinks Other are Equally Confused

Robert Samuelson used his column today to say he doesn't understand budget deficits. This is hardly a surprise to regular readers of his column. But he bizarrely argues that because he is confused, everyone else is also.

Samuelson tells readers:

"The truth is that we don’t fully understand the effects of budget deficits on the business cycle."

No, "we" do understand the effects of budget deficits. It really is pretty simple, deficits increase demand compared to a balanced budget or surplus. O...

Is There Any Reason to Think Republicans Believe their Tax Plan Will Pay for Itself?

Sure Republicans say this, but did we think that they would say that they expect their tax plan to increase the debt by $1.5 trillion, but rich people need tax cuts? Given their endless tirades about deficits under President Obama, Republicans are pretty much required to say that their tax cuts will pay for themselves regardless of what they actually believe.

So why don't we recognize this very simple fact and stop telling people what Republicans believe, as this NYT article does.

"But the bi...

Can We Cut the Crap on the Debt from the Tax Bill Hurting Our Kids?

The Republican tax bill is an abomination. It gives hundreds of billions of dollars in tax breaks over the next decade to the country's richest people. The Trump family alone stands to pocket more than $1 billion from the reduction in the estate tax and other provisions in the bill.

Furthermore, instead of making the tax code simpler, it creates all sorts of new gaming opportunities. Corporations will have enormous incentive to have their profits show up in tax havens, where they will be able...

McKinsey Global Institute Agrees With Trump Administration on Growth

One of the issues that has been raised in the debate over tax cuts is how fast the economy can grow. The Congressional Budget Office (CBO) is projecting growth averaging just 1.9 percent annually over the next decade. This is based on the assumption that the labor force will grow on average by 0.5 percent annually and productivity will grow by 1.4 percent.

By contrast, the Trump administration is arguing that with its tax plan the economy can grow 3.0–4.0 percent annually. It appears that the...

Mind Reading on Tax Policy at the Washington Post

When the Washington Post advertises for reporters, do they include "mind reading skills" as a necessary qualification? They gave us yet another example of these skills in an article discussing Republican efforts to craft a tax bill that will be able to get the support of 50 senators.

The piece told readers:

"Many Republicans believe the economic growth that will be unleashed by the tax cuts will be worth it, potentially creating such an economic boom that new revenue will come in from job cr...