Dean Baker's Blog, page 372

The Employment Rate of Women Is Higher In Japan Than in the United States

Laura Tyson has a NYT Economix blogpost that highlights the success of Japan's policy of running large budget deficits. While Japan has a gross debt of almost 250 percent of GDP (more than twice the ratio in the U.S.), the government has embarked on an ambituous stimulus plan to boost its economy. In the two quarters this plan has been in place Japan's economy has grown at 3.0 percent annual rate (3.1 percent per capita). By comparison, in the United States, where deficit reduction has been t...

Is the Pay of Washington Post Reporters Expensive?

I just thought I'd ask since the paper apparently decided to tell readers that the government's health and retirement programs are expensive. This information is given in the context of an article on a plan by House Speaker John Boehner to offer a short-term continuing resolution that will maintain funding for the government into the new fiscal year that begins on October 1.

The article told readers:

"Obama and other Democrats are eager to turn off the sequester and have offered a plan to rep...

Many Workers Will Not Qualify for Unemployment Benefits

Wonkblog had an interesting piece noting the fact that the number of people collecting unemployment benefits is falling faster than the number of new unemployment insurance claims. It attributed this fact to the growing number of unemployed workers who have exhausted their benefits. The reduction in the duration of benefits has also increased this number.

There is is a third reason that the percentage of unemployed workers collecting benefits may decline. Many workers who lose their jobs now...

Obamacare Gives Children Cavities

Sorry, we're trying out some catchy lines to help the Republicans in their effort to stop Obamacare. They keep pressing the one about how it is causing businesses to shift to part-time workers to avoid the employer sanctions. The basis for these sanction was originally supposed to be the number of workers employed for an average of more than 30 hours a week in 2013, however in early June the Obama administration announced that it would put off the sanctions for a year.

Nonetheless, we still h...

Going Off the Deep End With David Walker

Yesterday the Associated Press fielded its entry in the classics in bad reporting on economic policy contest: a profile it did of David Walker, the former head of the Government Accountability Office and also former president of the Peter G. Peterson Foundation. The piece presented everything that Walker said at face value, making no effort to put his scare story in any context nor to verify his assertions.

The AP entry starts out strong with the third paragraph telling readers:

"Next month,...

NPR Overly Optimistic on Housing Rebound

Morning Edition had a segment on the housing recovery which substantially overstated its likely contribution to the recovery. The expert analyst the piece relied upon suggested that housing construction could add 1.0 percentage point to GDP growth over the next three years. This would imply a near doubling of its contribution over the last year.

According to data from the Bureau of Economic Analysis, housing has added an average of just less than 0.4 percentage points to growth over the last...

NYT Falls for Bad Numbers on Household Income

It's good to see the NYT taking a serious interest in the wages and income of typical families. Unfortunately, they have picked a bad measure to highlight in relying on the reports of Sentier Research.

The Sentier measure is moved to a large extent by erratic patterns in income reported by respondents to the Current Population Survey fielded by the Census Bureau. Because the sample size in this survey is relatively small (the overall survey has 60,000 households, with only one quarter answeri...

Washington Post Discovers Efforts to Supplement Retirement Savings

The Washington Post may not be the best place to get breaking news, but that doesn't mean they never get the news. Today it ran a piece discussing a proposal by the Center for American Progress (CAP) to create state-run savings systems that workers could contribute to on an opt-out basis. In other words, they would be contributing to the system unless they explicitly asked not to contribute. The plan is intended to supplement Social Security, recognizing that the vast majority of workers have...

Larry Summers Thought the Stock Bubble Was Cool and Missed the Housing Bubble

A Washington Post article on the battle over replacing Bernanke as Fed chair forget to mention these qualifications of Larry Summers.

When Loans Go Bad: Markets and Cartels

Phillip Swagel used an Economix post to discuss the ramifications of debtors not paying their debts. While his basic point is valid, that reducing payments to creditors will affect their willingness to lend in the future, some of the specifics are questionable.

His first example is the case of the auto bailouts, where the terms of the bailout put some commitments to the workers (most notably retiree health care benefits) ahead of bondholders, reversing the normal ordering of creditors in a ba...