Dean Baker's Blog, page 540

Can We Talk About Drug Patents Please?

The Washington Post ran a fascinating article (researched by ProPublica). The article examined 15 instances in which pharmaceutical or medical supply companies reached settlements in connection with kickback schemes where they paid doctors to use their drugs or medical equipment. The study found that none of the 75 doctors paid any fine or suffered any professional sanction.

While this is an amazing situation, since it implies that these doctors suffered no consequence even after being...

The Less Than Prophetic Martin Feldstein

The Washington Post business section ran a piece today titled, "a fiscal prophet shapes debt debate." The prophet being referred to in the headline is Harvard economics professor Martin Feldstein, who served at one time as President Reagan's chief economist.

Some of us know Mr. Feldstein for some less than prophetic work. For example, in the spring of 1993, when Congress was debating the Clinton tax increase, he wrote a column in the Wall Street Journal that claimed the Clinton tax increases ...

George Will Comes Out for Stimulus, At Least When It Is Military Spending

George Will has been a harsh critic of President Obama's stimulus package, claiming that it did little to boost the economy and create jobs. He would rather see him reduce the deficit. However in today's column he firmly expresses the view that government spending does create jobs, at least when it is tied to the military.

In this piece he warns readers that:

"The 1.5 million active-duty members of the armed services and 700,000 civilian employees of the Defense Department depend on an...

The NYT Fails to Tell Readers About UK Inflation

The NYT has an interesting piece discussing Adam Posen, a U.S. citizen who sits on the Bank of England's monetary policy committee. It reports Posen's view that the Bank of England and other central banks should taje aggressive actions to boost the money supply in order to support growth. It contrasts this view with the concerns of inflation raised by others, noting that inflation in the U.K. has been 4.5 percent over the last 12 months.

The piece then presents Posen's assertion that...

If Frank Bruni Knew Arithmetic He Wouldn't Write Columns Like This One

Frank Bruni, one of the NYT's new columnists, ran a column today complaining about government corruption in Italy and the impact that an aging population in both Italy and the U.S. will have on reducing the living standards of our kids. This is one of those columns which could have been so easily prevented if the NYT just required a remedial 3rd grade arithmetic course for columnists that intend to write on economic issues.

For example, Bruni complains that seniors and older workers want to p...

NYT: Germany's Unemployment Rate is 7.0 Percent or 6.2 Percent

In the NYT, Germany's unemployment rate seems to vary depending on which article you read. We can look at the chart accompanying a piece on Geithner lecturing the European Union on how to deal with debt and see that the German unemployment rate is 6.2 percent. Or we can read in a piece discussing Berlin's economic and social prospects that the city's 13.3 percent unemployment rate is far above the national average of 7.0 percent.

The 6.2 percent number in the chart is right. This is the...

How Did the NYT Determine that the President Can't Do Much About the Economy?

In an article reporting the results of a new public opinion about President Obama and Congress, the NYT told readers:

"Two-thirds of the public say Mr. Obama has not made progress in fixing the economy, even though a majority of people concede the condition of the national economy is not something a president can do a lot about."

The public can only "concede" that the president cannot do much about the economy if it is in fact true that the president cannot do much about the economy. Of...

August Industrial Production: Double Dippers Get Dunked

The Federal Reserve Board released data on industrial production in August yesterday, and it was reasonably good. Manufacturing production rose by 0.5 percent following a 0.6 percent rise in July.

This is not earth shattering growth, and certainly not very good compared to the growth rates following severe downturns in the 70s and 80s, but it is clearly positive. The growth rate over the last 2 months is more than than 6.0 percent at an annual rate. Even adding in the zero figure for June...

The NYT Says Denmark and Bill Gates are Both Like Greece

The NYT has lost any connection to reality in its deficit/debt discussions. In an article discussing the victory of the left parties in Denmark it told readers:

"For Denmark, a nation of 5.5 million people, the election turned on the issue that has also divided many other Western nations struggling with low growth, large government deficits and historic levels of national debt: what mix of government spending and tax policies to adopt in order to restore economic health and avoid...

David Brooks Wants Us All to Just Accept That the Unemployed Have to Suffer

David Brooks piece today is titled the "the planning fallacy." The gist of it is that because of the financial crisis the gods have dictated that the United States simply must experience a prolonged period of high unemployment.

In Brooks view, the only problem is that the Democrats are stupid enough to rely on the actual history of the New Deal, and mountains of other evidence. They therefore believe that we can actually do something to bring down the rate of unemployment to more acceptable l...