Dean Baker's Blog, page 432

Corporate Subsidies Go Wild in Texas

The NYT had an excellent piece detailing the process whereby corporate subsidies are dished out in Texas. It reports that the subsidies come to around $19 billion a year. This is approximately $2,200 per household. As the piece points out, the incentives have been handed out with little apparent regard to the number or quality of jobs created. As a result, there is little evidence that the incentives have had benefits for most Texans.

The piece is part of a series on state subsidies for corpo...

NYT Disappears the Euro Crisis in Discussing Youth Unemployment in Europe

Europe has an enormous problem of youth unemployment, this is not really disputable. The NYT ran a major article on the topic that focused on the situation in France. It told readers:

"This is a 'floating generation,' made worse by the euro crisis, and its plight is widely seen as a failure of the system: an elitist educational tradition that does not integrate graduates into the work force, a rigid labor market that is hard to enter, and a tax system that makes it expensive for companies to...

Robert Samuelson Is Upset that No One Other Than the Washington Serious People Want to Cut Social Security and Medicare

Robert Samuelson is angry that President Obama doesn't agree with him that Social Security and Medicare should be cut. Who does Obama think he is, disagreeing with Samuelson and the Serious People?

Just to be clear on the playing field here (Samuelson seems confused), not only does President Obama oppose cuts to these programs, his opponent Governor Romney also argued against cuts to Medicare. And polls consistently show that the vast majority of Republicans, conservatives and even self-ident...

Underwater Homeowners Can't Rescue the Economy

A NYT editorial today argued that helping out underwater homeowners is essential to the recovery. This does not make any sense as can be seen with simple arithmetic.

There are roughly 11 million underwater homeowners. Suppose that eliminatiing all of their underwater debt caused them to increase spending by an average of $10,000 per family per year. This would be a very substantial increase in spending for a group that has a median income of close to $70,000. Depending on the whether we use t...

Halloween Might Be Over, but the Deficit Hawks Are Still Trying to Scare People

It seems that many people have been bothered by a Wall Street Journal column co-authored by Chris Cox and Bill Archer, the former Chair of the House Ways and Means Committee. The column warns of an $86 trillion dollar deficit if we propoerly account for the liabilities of Social Security, Medicare and other government obligations. That's scary.

Fortunately, we have been around the block with this argument before. If we go to the CEPR's oldies section we find this 2003 classic on the $44 trill...

What's Holding the Economy Back? The Collapsed Housing Bubble, End of Story

The major media outlets did their best to ignore the housing bubble as it was growing to ever more dangerous levels. Incredibly, they still cannot recognize and understand the bubble even after its collapse sank the economy. Hence we get the Washington Post offering us 10 charts that explain "what is holding back the economy."

Of course the Washington Post is a large corporation so they can waste money on unnecessary and misleading charts. Since CEPR is a small not-for-profit, we explain it a...

More Affirmative Action for Mexico in Economic Reporting

NAFTA may not have done much to improve Mexico's growth rate, but its approval sure did wonders for U.S. reporting on Mexico's economy. The Washington Post in particular has run several pieces touting Mexico's booming economy and rising middle class (e.g here and here). In fact, a 2007 Post editorial even claimed that Mexico's GDP had quadrupled in the years from 1988 to 2007. (The actual growth figure was 83 percent.)

The NYT appears to be getting into the act with an article discussing Mex...

The Telephone/Internet Duopoly

David Cay Johnston has a nice column in the NYT discussing how a failure of antitrust regulation has effectively allowed the old ATT monopoly to recreate itself as a duopoly, although this time without regulation.

Nate Silver Comes Through on Taxes

Both the NYT and Washington Post reported on a tax proposal from Republicans which could lead to a large tax increase on the slightly rich, while leaving the very rich little affected. The proposal would have the lower tax brackets (e.g. the 10 percent rate on the first $20,000 of income and the 15 percent rate on income between $20,000 and $70,000) phased out for households with incomes above $250,000.

Remarkably, neither paper pointed out to readers that this proposal would imply a substan...

Washington Post Takes Another Shot at Reducing Social Security Benefits

It seems to really pain the Washington Post editors that retirees can collect Social Security checks that average just over $1,200 a month. The amount of ink that they have devoted in both their opinion and news pages to cutting benefits could probably fill the Great Lakes. They're at it again today pushing a cut in the annual cost of living adjustment by adopting a chained CPI as the measure of inflation.

As expected, the piece uses more than a bit of sleight of hand to make its case. For ex...