Dean Baker's Blog, page 455

The Fiscal Cliff Is Not as Steep As It Seems

The Congressional Budget Office came out with its mid-year budget update. The update included a warning that if the Bush tax cut and the payroll tax cut are both allowed to expire and the cuts from last year's budget agreement take effect, the economy will sink into recession in 2013 and the unemployment rate will rise to 9.0 percent. The NYT immediately picked up on this warning in a news article on the new projections.

It is important to realize that this projection for a shrinking economy...

Globalization Doesn't Just Happen

David Leonhardt's latest blogpost on increasing inequality is a discussion of globalization. It's most reasonable except the underlying premise appears to be that globalization is something that just happened.

While this is a common theme in polite circles, it is ridiculous on its phase. Globalization has been by design. Ever hear of the WTO, NAFTA, CAFTA etc.? These are carefully hammered out deals that determine which sectors will exposed to more competition, which sectors will see increas...

Actual Analysis on Candidates' Medicare Positions from the NYT

The NYT did what newspapers are supposed to do, it analyzed the impact of the Medicare proposals of President Obama and Governor Romney. It charted out their differences and gave the opinions of some leading experts in the area.

This is important. Reporters should have the time to do this sort of investigation. The overwhelming majority of readers do not have time to evaluate the accuracy of competing claims, which is why the he said/she said reporting that has become standard is so offensive...

Still Getting the Housing Bubble Wrong

The collapse of the housing bubble led to the downturn. However that does not mean that housing is the road out, or at least not unless we expect to see another bubble. Ezra Klein presents this mistaken view in his column today.

The basic story is very simple. (Remember, the purpose of economics is to make simple things complicated so as to exclude most of the public from debates on the most important policy issues that affect their lives.) The economy in the bubble years was driven by the bu...

David Brooks Doesn't Have Access to the Medicare Trustees Report

David Brooks makes one of his usual balanced pitches for the Romney-Ryan ticket. As usual, just about everything of substance in the piece is wrong.

He begins by bemoaning the fact that: "Entitlement spending is crowding out spending on investments in our children and on infrastructure." (Btw, "entitlements" is pundit speak for Social Security, Medicare, and Medicaid.)

Brooks tells us:

"In 1962, 14 cents of every federal dollar not going to interest payments were spent on entitlement program...

Newsweek's Pinata of Errors: Niall Ferguson's Trashing of Obama

It's hard to believe that progressive bloggers didn't get together to pay Newsweek to run Niall Ferguson's piece on Obama. The thing is so shot full of easily identifiable errors no serious publication would ever allow it into print. It already has been picked to pieces by Paul Krugman, Ezra Klein and Mark Thoma, among others.

My personal favorite was this little item picked up by Josh Holland. It seems that Ferguson can't even get straight who he supported in 2008. In the latest piece he was...

David Leonhardt's List of Causes of Inequality is Too Short

Take the poll and add your two cents. Here's mine:

How about limited global competition? There are plenty of smart people in China and India who could train to U.S. standards and would be delighted to work as doctors or lawyers in the U.S. at $100k a year. That would reduce inequality.

How about a change in norms among corporate board members who essentially get paid off to let the CEOs pilfer the company. Its their job to restrain CEO pay. They don't do it.

How about stronger patent and cop...

NYT Couldn't Find the Missing $716 Billion in the Romney-Ryan Medicare Plan

The NYT did a classic he said/she said on the debate between the presidential candidates over Medicare. While such coverage is easy for reporters it is not very helpful to readers who generally have less time than reporters to determine the truth of specific claims.

For example, it might have been helpful to point out to readers that the Romney-Ryan budget assumes $716 billion in unspecified cuts to Medicare over the next decade. These mystery cuts are due to the fact that they have promised...

It's Monday and Robert Samuelson is Confused About Medicare, Again

Robert Samuelson devotes his column today to misrepresenting a new article in the Journal of the American Medical Association, claiming that it shows the Ryan-Romney Medicare plan would save money. In fact, the article compares costs of Medicare Advantage plans with the current traditional Medicare plan. It notes that in many cases the former are lower, however it does not attribute the savings to the more efficient delivery of care. It notes that lower costs may be due to healthier patients,...

AP Column Misleads Public About the Health of Social Security

AP has been running a series of widely distributed columns that have been trying to convince readers that the Social Security system is in crisis and is in desperate need of fixing. These pieces have contributed to the misinformation on the topic that has been widely disseminated by wealthy people like Peter Peterson and the Washington Post.

These pieces routinely try to scare the public by expressing the size of the projected Social Security shortfall in large numbers that lack any context....