Dean Baker's Blog, page 254

13 Former Democratic Governors Don't Know That Replacing Domestic Production with Imports Cost Jobs

That probably should have been the headline of a Politico article on a letter signed by 13 former Democratic governors urging Congress to approve fast-track trade authority to facilitate the passage of the Trans-Pacific Partnership (TPP) and the Trans-Atlantic Trade and Investment Pact (TTIP). The most newsworthy aspect of the letter is that the governors apparently do not understand the basic economics of trade.

In the letter the governors tell members of Congress:

"We've seen firsthand the...

Washington Post's Ageist Rant for the Trans-Pacific Partnership

The Washington Post again pushed for approval of the Trans-Pacific Partnership (TPP) in an editorial urging Congress to pass fast track trade authority. Now wanting to waste time with arguments, it jumps straight to ad hominems:

"To the measure’s far more numerous critics on the left, the TPP is yet another corporation-friendly bargain that will destroy American jobs, as the North American Free Trade Agreement, also passed pursuant to fast-track authority, allegedly did.

"These are old anti-t...

Michael Gerson Comes Out Against the Wheel

Although he didn't single it out, readers may conclude that it is on his list of outmoded innovations that his "reform conservatives" intend to overcome. He begins his piece by noting Hilary Clinton's campaign announcement then comments inaccurately about progressive Democratic leaders:

"Joe Biden? Jerry Brown? Elizabeth Warren? All fight for Social Security while qualifying for their full checks." (Warren does not turn age 66, and therefore qualify for full benefits, until June.)

The piece c...

Contrary to What The NYT Tells You, President Obama Did Not Nearly Cut the Unemployment Rate in Half

I hate to get picky on the numbers, but the unemployment rate was 7.8 percent in January of 2009 when President Obama took office. The Labor Department reported that it was 5.5 percent in March. Since 5.5 percent is more than two-thirds of 7.8 percent, the NYT was seriously exaggerating in its article on Hilary Clinton's announcement of her candidacy when it gave President Obama credit for:

"getting the country out of the worst financial crisis since the Great Depression and cutting the unemp...

WaPo Column Asks: "Should Mitt Romney Be Able to Use Fund Managers' Tax Break to Buy Filet Mignon?"

No, that actually is not what the column asked. The question was instead whether people on TANF or food stamps should be able to buy steak or spend their money in other ways that politicians consider lavish.

It seems that if we think the government has a right to dictate people's spending habits based on giving them $1,600 a year in food stamps (the average benefit per recipient), there should also be a case for dictating their spending habits if we give them thousands of times as much in tax...

The Social Security Trust Fund, One More Time

I see that Bloomberg has apparently decided to give Megan McArdle infinite space to tell its readers that she doesn't like the Social Security trust fund. Well, they have to fill their website with something.

Just to keep things short and simple, there are two ways to think about the trust fund. First, we can follow the law as written. Under the law, designated Social Security taxes and only designated Social Security taxes can be used to pay Social Security benefits. Money from the taxes tha...

National Journal Discovers Social Security Paid Out 0.000008 Percent of Benefits to Sexual Predators

The National Journal reported that roughly 0.000008 percent of Social Security benefits over the years 2006-2008 were paid to people who had been committed to institutions as sexual predators. Under the law, these people (18 were uncovered, in total) are ineligible for Social Security benefits.

The National Journal and its reporters are now waiting for the Pulitzer Prize.

The Government Needs to Find the Money to Pay Peterson the Interest on His Bonds and Also to Pay the Interest on Social Security's Bonds

That's what I learned from reading Megan McArdle's rejoinder to my comment on her piece claiming that the bonds held by the Social Security trust fund are irrelevant. I'm not sure what else I can get from her most recent post.

We do get the line:

"They [Social Security beneficiaries] are legally entitled to the benefits that are duly laid out in our current law." This means that they are legally entitled to all the benefits that can be paid with money from designated Social Security taxes and...

Trying to Explain the Jobless Recovery That Does Not Exist

That seems to be endless demand for economic policy analysis that finds ways to blame workers for the bad economy rather than the folks in Washington with their hands on the policy wheel. The Wall Street financed group Third Way and the Wall Street Journal gave us more proof for this proposition yesterday with a new explanation for the "jobless recovery." Their basic story is that economy lost routine relatively low-skilled jobs, but it now needs workers with high-skills for the new jobs that...

Correcting Samuelson: The Non-Problem of Investment

Robert Samuelson cites an I.M.F. report this morning to tell us that the problem with the recovery is the lack of investment. Following the I.M.F. he attributes this to a lack of demand. However he disagrees with the I.M.F. that a dose of stimulus could increase investment by increasing demand, since he claims short-term stimulus won't be sufficient to change firms investment plans, since they know the demand will go away.

Okay, let's check the story starting with the original claim on invest...