Dean Baker's Blog, page 483

James B. Stewart Declares Himself Clueless About the Ryan Budget

I met Paul Ryan when I debated him over President Bush's Social Security privatization plan back in 2005. He seemed like a nice, reasonably intelligent guy.

However this has nothing to do with the time of day when we are talking about his budget; the budget that NYT columnist James B. Stewart assured us is a good starting point in his column on Saturday. What Stewart tells us is reasonable is that the budget calls for cuts in entitlements and tax reform. He then asks who could disagree with t...

Falling Coverage Rates: One Reason Government Surveys May Not Show a Rise in Poverty

In a NYT Economic blogpost Jason DeParle ponders the fact that government surveys are not showing much increase in poverty, even though we know there are many people experiencing long periods of unemployment and many forms of government assistance have been cut back. One possible explanation is that people in poverty and extreme poverty are less likely to be covered by the survey.

My colleague, John Schmitt, found clear evidence of a coverage problem in comparing employment rates as shown in ...

Falling Coverage Rates: One Reason Govenrment Surveys May Not Show a Rise in Poverty

In a NYT Economic blogpost Jason DeParle ponders the fact that government surveys are not showing much increase in poverty, even though we know there are many people experiencing long periods of unemployment and many forms of government assistance have been cut back. One possible explanation is that people in poverty and extreme poverty are less likely to be covered by the survey.

My colleague, John Schmitt, found clear evidence of a coverage problem in comparing employment rates as shown in ...

Economics Reporters Over-Discover the Weather

Back in February and March when we got reasonably strong employment numbers, some of us noted how unusually good weather likely inflated job growth (see last paragraphs). That is why we were not especially surprised that the March job numbers came in below the average for the prior three months and many economists' expectations.

However, the news stories today were filled with accounts from surprised economists who discovered the influence of the weather on economic data. This stuff really...

Economics Reporters Over Discover the Weather

Back in February and March when we got reasonably strong employment numbers, some of us noted how unusually good weather likely inflated job growth (see last paragraphs). That is why we not especially surprised that the March job numbers came in below the average for the prior three months and many economists' expectations.

However, the news stories today were filled with accounts from surprised economists who discovered the influence of the weather on economic data. This stuff really is not ...

WAPO Runs Editorial on the Budget in News Section

It is well-known that the Washington Post is obsessed with the budget deficit and that it feels little need to restrict this obsession to the opinion pages (hence its nickname, "Fox on 15th Street"). It once again ran an editorial in its news section as it told readers about the country's "rocketing debt."

The editorial then asked:

"Why can't America's leaders, at the helm of such a wealthy country, find a solution that both puts the nation on a long-term path to financial security and...

WAPO Thinks We Should Raise the Retirement Age to 75

At least it thinks that this is a reasonable position deserving some of the paper's scarce column space. The Post printed a column today by Michael W. Hodin warning about the "inexorable" aging of the population. At one point Hodin asks:

"What if we reimagined and redefined what it means to age? What if, in light of our longer lifespans, 'middle age' were 55 to 75?"

While the piece implies that aging poses some radically new problem for the world, the fact is that populations have been aging ...

Profits Are at a Near Record Share of Income

That would have been worth mentioning in a piece that reported that profit growth is expected to slow in the first quarter of 2012 and may stagnate for the year as a whole. With profits already near post-war highs as a share of income, they can't grow any more rapidly than GDP unless the profit share goes still higher. Since it unreasonable to expect the share of GDP going to profits to continue to rise indefinitely, a slowdown in profit growth was virtually inevitable.

Arithmetic Lessons for David Brooks

Many pundits have been telling us that the reason that workers are not getting jobs is that employers cannot find workers with the skills needed for the positions available. I have regularly ridiculed this position, since if it were true we would see sharply rising wages in some sectors as employers competed for the limited group of workers who have the necessary skills. Of course we don't see any major sector of the labor market with rapidly rising wages.

However, I must now reconsider this ...

More Public Pension Scare Stories at the Post

The Washington Post is always willing to accomodate those who want to make a big issue out of budget deficits. In that spirit it ran a column today by Robert Pozen and Theresa Hamacher warning readers about "public-pension pitfalls."

The piece begins by decrying the fact that almost 80 percent of state and local government employees are still covered by traditional defined benefit pensions even as these pensions are rapidly disappearing from the private sector. This may seem a bizarre...