Dean Baker's Blog, page 559

Can Somone Explain to the NYT the Difference Between Counterfeits and Unauthorized Copies?

This is really getting painful. The NYT has an article reporting that many Chinese consumers were outraged when they discovered that the expensive DaVinci furniture they had purchased was actually produced at "a ramshackle factory in southern China."

It then tells readers:

"Maybe more significant, the scandal indicates that even in China — where consumers have long been willing to turn a blind eye to pirated DVDs and Gucci knockoffs — there are boundaries that no counterfeiter should...

Do an Increasing Number of Greeks Really Regard Workers Getting $2,000 a Month as a "Special Caste?"

That's what the NYT tells us. It has a piece this morning on the union representing the workers at Greece's public electric utility. At one point it reports that:

"an increasing number of Greeks regard the power company workers in particular as an overpaid, overprotected caste. According to Mr. Fotopoulos, Genop's 21,000 members are paid an average net salary of $1,980 a month and its 35,000 retirees an average net pension of $2,122 a month — much higher than the Greek average."

The...

The NYT Misrepresents Public Attitudes Toward Social Security and Medicare

The NYT seriously misrepresented public attitudes toward Social Security and Medicare. It referred to Social Security and Medicare as:

"entitlement programs that represent core values to many liberal voters."

Actually polls routinely show that overwhelming majorities of voters across the political spectrum support Social Security and Medicare. It is not just liberals who care about this program. This is why politicians who want to cut these programs need cover from their political opponents. ...

Brooks Left Himself Off the List of Budget Deal Villians

Surely it was an oversight. In his column today, David Brooks lists all the various groups on the Republican side who made it difficult, if not impossible, to work out a deal with President Obama for large cuts to Social Security, Medicare, and other government programs. For some reason he forgot to include people like himself, ostensible moderates who routinely mislead the public about the budget.

As every budget expert knows, the large budget deficits we currently face are not the result...

NYT Runs Confused Editorial on China and U.S. Debt in Its News Section

The NYT decided that it did not like the efforts of the government to sustain demand and used a news story to describe this policy as "America's own fiscally dubious habits." While one can argue with the NYT's view that it would be better for the United States to have slower growth and higher unemployment than run a deficit, the more fundamental issue is that such comments are usually reserved for editorial pages.

This is not the only peculiar item in this piece. The article tells readers...

Robert Samuelson Wants Us to Follow the Example of a Country With 7 Years of Double-Digit Unemployment

Yes, I am serious. In his column today Samuelson holds up Latvia as the model for the United States to follow. The unemployment rate in Latvia is currently close to 20 percent. According to the latest projections from the IMF, it is still projected to be double-digits by 2016, the end of its projection period. Its 2016 GDP is projected to be 1.5 percent below its 2007 level. If this is a model for success, it's interesting to think of what Samuelson would view as a failure.

Tell Larry Summers, We Can Keep Banks Alive With Conditions

Larry Summers wants Post readers to believe that the policy choices are either letting banks fail like Lehman, and setting off a financial earthquake, or keeping them alive through government bailouts. Actually, there is a third option. Governments can keep the banks alive but tell them that their world will end.

The principle here is so simple that even one of the world's top economists should be able to understand it. Insolvent banks are kept alive by government welfare. Just as the...

Budget Reporting at the Post: Trees Die for Nothing

Pointless death is always tragic. The Post's budget reporting is a great tragedy for trees everywhere. Today it tells readers about plans to consider a balanced budget amendment to the constitution in Congress. It would have been useful to tell readers something about this amendment, which does not just require a balanced budget. It also restricts spending to 18 percent of GDP, requiring a super-majority of both houses of Congress to exceed this level of spending. This implies a reduction in ...

Should We Raise Taxes or Cut Spending: It's All So Complicated

That was the NYT's line in a piece on how best to deal with the deficit. While the piece briefly refers to some of the key research papers on the issue, it would have been worth noting that the U.S. already ranks at the bottom among wealthy countries in the tax share of GDP. Since other countries do manage to sustain healthy economies, with several enjoying comparable or better levels of productivity, it might suggest that raising taxes would not derail the U.S. economy. This fact would have ...

Krugman Also Thinks That an Increase in the Supply of Housing Lowers Its Price

I was glad to see Paul Krugman's piece this morning in which he reminded readers of the basics of supply and demand. If we slow the foreclosure process, we reduce the supply of housing, thereby raising the price of housing. This is important because there are a lot of people running around this town, with pretensions of being serious, who have been saying that slowing the foreclosure process would lower house prices and hurt the market. 

Maybe I'm idealizing the past, I would like to think...