Dean Baker's Blog, page 266

Joe Nocera on Politicians and Trade

Joe Nocera used his NYT column this morning to beat up on a number of politicians who oppose President Obama's call for fast-track authority to facilitate passage of the Trans-Pacific Partnership (TPP) and the Trans-Atlantic Trade and Investment Pact (TTIP). He claims that they have the trade story badly wrong and that recent trade deals have actually been a big help to the country.

While Nocera may be correct in saying that many politicians have exaggerated the negative impact on NAFTA and o...

Ubernomics

In trying to push its case with the public, Uber decided to share its internal data with Alan Krueger, a prominent Princeton economist and former head of President Obama's Council of Economic Advisers. (Could this be part of Uber's dividend from hiring former Obama political adviser David Plouffe?) Anyhow, Kreuger finds that Uber drivers on average earn a gross premium of $6.00 an hour over the pay of drivers of traditional cabs. (He also had some rather unsurprising findings, for example tha...

George Will Thinks the Mortgage Interest Deduction Is Destroying the American Character

There may be some case here, but of course that is not what George Will is actually arguing. He is pulling numbers from outer space to tell a story of a run away welfare state. As he quotes that great welfare reformer of the past, Daniel Patrick Moynihan:

"the issue of welfare is not what it costs those who provide it but what it costs those who receive it."

Okay, none of us like to see healthy people in their prime working years scamming the rest of us rather than working. But in spite of Wi...

Betting Against Subprime Mortgages Was a Good Thing

Paul Krugman joined in ridiculing billionaire Jeff Greene, a person who richly deserves to be ridiculed. (He wants people to get used to lower living standards.) However people are wrongly attacking Greene when they complain about his betting against subprime mortgage backed securities.

Subprime mortgage backed securities were the fuel for the housing bubble that entrapped tens of millions of people, laid the basis for the economic collapse, and ruined millions of lives. The securities were i...

Denver Businessman Says That His Refusal to Raise Wages Shows the Structural Problems in the Economy Today

By almost every measure there continues to be a great deal of slack in the labor market. Unemployment rates remain high even for college graduates and even college graduates with degrees in the STEM fields have since little increase in wages in recent years.

Given this backdrop, it is not clear what information the NYT thinks it is giving readers when it reports :

"His company [a cable start-up based in Denver] has created about 60 jobs in the past year, but Mr. Binder said that vacancies oft...

Robert Samuelson Gets It Right on the Fed and Interest Rates

Robert Samuelson used his column on Monday to debate the need for the Fed to clamp down on wage growth and came down on the right side: hurry up and wait. This is good to see, but there are a few more data points that make the case even more strongly.

First, the quit rate -- the share of unemployment due to people voluntarily quitting their jobs -- is still at levels that we would expect in a recession. This is important because it is a relatively direct measure of workers' confidence in thei...

Wages Did Not Rise in November and Fall in December: #23,754

I thought that reporters had finally learned that monthly wage data are erratic and best ignored, but noooooooo, they apparently still believe that they give us real information about the rate of growth of wages. The immediate cause for complaint is a Morning Edition State of the Union fact check segment in which Scott Horsley told listeners that wages rose in November, but then fell in December.

As I tried to explain after the big wage jump in November was reported, the monthly changes are d...

Mind Reading from NPR

Other news sources just told us what the Republicans said in reaction to President Obama's State of the Union Address, National Public Radio told us what they really thought. It's top of the hours news summary on Morning Edition (sorry, no link) told listeners that Republicans "see it as more tax and spend."

The Doom and Gloom in Denmark and the Washington Post

Denmark has long cold rainy winters where the sun only shows up briefly. It is understandable that someone can get pretty sour living in these conditions. But that is no reason for the Washington Post to run scurrilous screeds from Scandinavia that inaccurately impugn the region.

That is a reasonable description of Michael Booth's Sunday Outlook piece, which managed to get most of the important points wrong in a piece titled, "Stop the Scandimania: Nordic nations are not the utopia they are...

Denmark "Defends" the Krone by Lowering Interest Rate: More Which Way Is Up Problems

Usually when a country takes steps to "defend" its currency, the problem is that the value of its currency is falling in world currency markets. This is most often due to higher inflation in the country in question, although the situation can be worsened by speculative attacks. Raising interest rates is a standard form of defense, since it makes it more desirable to hold assets denominated in that currency.

Against this normal pattern, the NYT told readers that Denmark was "defending" its cu...