Dean Baker's Blog, page 119

CEOs and the One Percent

After having a horde of angry doctors attack me (and my wife) for suggesting that they face market competition, I was happy to see Jonathan Rothwell make the same point in a NYT Upshot piece. However, when running through the causes of runaway income at the top, he gives short shrift to the excessive pay of CEOs and other top executives.

Rothwell comments:

"Most top earners in the United States are neither executives nor even managers. People in those occupations make up just over one-third...

The Republican Tax Bill and Cuts to Social Security

Reductions in Social Security benefits are extremely unpopular across the political spectrum. The program enjoys enormous support among both Democrats and Republicans and people are far more likely to say that benefits should be raised than cut. For this reason, the public should be paying attention to a little noticed provision in the tax bill passed by the House today and which also appears in the bills under consideration in the Senate.

In both cases, the basis for indexing tax brackets wo...

NYT Tells Readers Republicans Backed Trade Deals Believing Corporate Beneficiaries Would Shower Them with Campaign Contributions

Okay, that's not quite what the article said. Instead it told readers:

"Republicans have long championed free trade, believing that by allowing markets to operate unhindered, nations can boost domestic industries, lift their wages and improve living standards."

Wow, so Republicans are motivated by a concern over workers' living standards. It's good we have the NYT to tell us this because we certainly wouldn't know about Republicans' concern for workers based on their behavior. (Yes, Democra...

Are Doctors "Thirsty" for Payments from Patients? NYT Flacks for Amazon

Everyone knows that Amazon founder Jeff Bezos is a genius. After all, he made himself one of the richest people in the world by avoiding the requirement that retailers collect state sales taxes. Yes, Amazon now collects these taxes, but the savings on tax collections in the years it didn't collect taxes almost certainly exceed Amazon's cumulative profits since it's been in business.

While Amazon's tax avoidance may have been legal, it was 100 percent brain-dead as public policy. In effect, st...

Peter Morici Gets the Mortgage Interest Deduction Wrong on NPR

University of Maryland economics professor Peter Morici misrepresented the Republican's proposed change in the mortgage interest deduction in a debate with my friend Jared Bernstein on Morning Edition. Morici said that the proposed cap would only hit people paying more than $500,000 in interest on their mortgage. In fact, it would cap the amount of principal on which interest could be deducted at $500,000.

Morici is correct that this would hit very few people, since it means having an outstan...

The Trump Administration Assumes that More than 100 Percent of a Corporate Tax Cut Goes to Workers

The Washington Post may have misled readers on the Trump administration's claims about the impact of its proposed cut in the corporate income tax. It noted the claim that "that more than 70 percent of the corporate tax burden is passed on to U.S. workers." In fact, it is assuming an amount of growth that would vastly exceed the size of the tax cut. If workers get their share of this growth, well over 100 percent of the tax cut would be passed on in higher wages.

That is how it gets the figure...

The United States Is Not as Low Tax As It Seems

Eduardo Porter had a good piece noting that the United States is an outlier among rich countries in that it takes in far less tax revenue each year than other wealthy countries. As a result, it provides less in public services like health care and higher education. However, this is an incomplete story.

Tax collections are only one way in which the government pays for goods and services. There are three other important mechanisms:

1) patent and copyright monopolies;

2) tax expenditures, and;

3...

If Trucking Companies Can't Get Drivers Maybe They Should Try Raising Pay

The NYT gave us yet another account of an industry that apparently can't get enough workers:

"Trucking is a brutal job. Drivers endure long, tedious stretches where they are inactive but have to stay focused, and they spend weeks at a time away from home. For those and other reasons, the industry’s biggest problem has been the scarcity and turnover of drivers, making it hard to keep up with shipping demand."

According to the Bureau of Labor Statistics, the average hourly wage for production...

NYT Knows What Tom Price Really Believed About Plans to Restructure Doctors' Payment System

The NYT had a lengthy article reporting on the Trump administration's efforts to reverse the movement away from fee for service payments to doctors initiated by the Obama administration. Tom Price, who had been head of the the Department of Health and Human Services, was a central figure in this effort.

At one point the piece tells readers that Price:

"...had fought against what he saw as unnecessary government intervention since his days as a surgeon in the suburbs north of Atlanta."

While...

OMG, Trump's Trade Policy May Be Costing Some Lobster Trappers Sales In Europe

Yep, that seems to be the point of a major NYT article highlighting increased sales of Canadian lobsters in Europe. The point is that a trade deal between the European Union and Canada eliminated a 7 percent tariff on Canadian lobsters, which remains in place on U.S. lobsters.

To put in some of the perspective that is altogether lacking in this piece, the lobster industry in the United States is a bit under $500 million annually. Or, to put this in some context that might make sense to most N...