Dean Baker's Blog, page 499

David Brooks Is Confused Again

David Brooks devoted today's column to a plea to use a broad range of approaches to combating poverty in the hope that some will work. For this reason his focus on President Obama's decision to end a school voucher program in the District of Columbia is misplaced.

President Obama is not ending school voucher programs, in fact he is protecting the idea of local control that could lead to exactly the sort of diversity of approaches that Brooks is touting. The issue is that Congress has sought t...

Explaining the Housing Bubble to Robert Samuelson

Almost no one who wrote about the economy for a major news outlet was able to recognize the $8 trillion housing bubble that was driving the economy before it burst. Because people who write about the economy are not held responsible for the quality of their work, none of the people who missed this huge bubble were held accountable for this failure. Remarkably, many of them even now do not understand the bubble.

Robert Samuelson, the economic columnist for the Washington Post, is among this...

The Debt Splits the Left, Because the Media Do Such a Horrible Job of Reporting on Economic Issues

This column reports on the fact that people on the center and left of the political spectrum have a range of views in the debt/deficit, which the right seems fairly united in arguing for less government spending. It is worth noting that one reason why there may be divisions and confusions on this issue is that the media routinely allow politicians to say complete nonsense on this topic without correcting it.

For example, the piece tells readers:

 

"Mitt Romney takes up the same theme, with...

The Debt Splits the Left, Because the Media Does Such a Horrible Job of Reporting on Economic Issues

This column reports on the fact that people on the center and left of the political spectrum have a range of views in the debt/deficit, which the right seems fairly united in arguing for less government spending. It is worth noting that one reason why there may be divisions and confusions on this issue is that the media routinely allow politicians to say complete nonsense on this topic without correcting it.

For example, the piece tells readers:

 

"Mitt Romney takes up the same theme, with...

Bill Keller Does not Understand Free Speech, Copyright, and the Constitution

Bill Keller tells readers that Congress should pass laws that require intermediaries like Google and Wikipedia to take responsibility for helping to enforce copyrights. It is interesting to see how he thinks the wording of the Article 1, Section 8:

"To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries"

which gives Congress the power to grant copyright and patent monopolies...

It Is Brazil's Bloated Financial Sector, not Its Growth, that Attracts Immigrants

The Post ran a piece on the growing number of foreigners who are going to work in Brazil, especially in its finacial sector. It attributed this in part to Brazil's rapid growth, which reports as averaging 4.5 percent since 2004.

According to the IMF, Brazil's growth has averaged 4.1 percent over this period. That is not especially fast for a developing country. Chile averaged an almost identical 4.0 percent over this period while Venezuela grew at a 4.5 percent rate and Argentina grew at a...

Is the Obama Administration Really as Clueless About the Economy as the Post Claims?

In an article about Gene Sperling, the head of President Obama's National Economic Counsel, the Post claims that in mid August of last year:

"Sperling presented Obama and his top aides economic forecast after economic forecast showing that U.S. economic growth was rapidly slowing. Unemployment probably would be stuck around 9 percent. The government needed to pump hundreds of billions of dollars into the economy to create jobs — and fast."

It is difficult to believe that the White House...

Post Column Defending Europe Gets the Story Wrong

An opinion column in the Post defending Europe against charges of being a continent of broken down socialist states, by Martin Klingst, the Washington bureau chief of the German newspaper Die Zeit, got the basic story of its economic crisis wrong. It told readers that Europe's fiscal calamities, "stem in part from the unaffordable benefits for its citizens," later adding, "it is also true that a number of E.U. countries have irresponsibly expanded their welfare systems and can no longer...

Overstating the Decline in Wage Share

An NYT Economix blognote overstated the effective decline in the labor share of national income over the last three decades by using gross national income rather than net national income. The note shares the labor compensation share declining by 4-5 percentage points over this period. 

However, the depreciation share of gross domestic product rose by roughly 2 percentage points over this period. If we assume that this increase came proportionately from the capital and labor share of income...

The Post Hopes for Job Loss in San Francisco, May be Disappointed

A Washington Post editorial on indexing the minimum wage told readers:

"at the margins, minimum-wage increases probably destroy jobs in small restaurants, landscaping and janitorial firms."

It then added:

"as the city of San Francisco, which has just imposed a highest-in-the-nation $10.24 minimum, may soon find out."

Whether or not the first claim is accurate, the warning to San Francisco clearly is not. San Francisco first put its city-wide minimum wage in place in 2004. Since that time, it ...