Dean Baker's Blog, page 57

All New York Times Readers Know How Important 167,000 Jobs Are to Australia

That apparently is the assumption of the paper's editors. An article that discussed the impact of the debate on global warming on this weekend's election told readers of a study pushed by proponents of inaction which:

"estimated that the 45 percent reduction in carbon emissions proposed by the opposition Labor Party would cost the economy 167,000 jobs and 264 billion Australian dollars, or $181 million."

In case readers did not know how important 167,000 jobs are to Australia, it is equal to...

Ady Barken, the Fed, and the Liberal Funder Industry

(This post first appeared on my Patreon page.) Earlier this month, New York Times reporter Binyamin Appelbaum wrote a moving piece on Ady Barkan. Ady is a lifelong activist who is now dying from A.L.S., often known as Lou Gehrig’s disease.

It is an incredibly sad story, Ady is just 35 years old. He is married with a young son. While I’m sure he would like to spend the time he has left with his loved ones, he is determined to use whatever energy he can to push for universal Medicare.

I was sit...

The "We're Overstating Inflation!" Story is Back!!!!!!!!

The Wall Street Journal's opinion page has never been a place where reality is a binding constraint. Andy Kessler demonstrates this fact in a column that tells us that the Consumer Price Index (CPI) overstates the true rate of inflation by at least 2.0 percentage points annually and possibly as much as 5.0 percentage points.

The immediate basis for this observation is an interview Alan Greenspan gave in which he said:

"Because products are continuously changing, ..... when new products go on...

The "We're Overstating Inflation!" Story is Back!!!!!!!!"

The Wall Street Journal's opinion page has never been a place where reality is a binding constraint. Andy Kessler demonstrates this fact in a column that tells us that the Consumer Price Index (CPI) overstates the true rate of inflation by at least 2.0 percentage points annually and possibly as much as 5.0 percentage points.

The immediate basis for this observation is an interview Alan Greenspan gave in which he said:

"Because products are continuously changing, ..... when new products go on...

Will Higher Pay for Uber Drivers Increase Productivity Growth?

That's what Sarah Jeong says in a New York Times column. The piece argues that if Uber drivers got a living wage then Uber would just turn to using driverless cars.

It is an interesting possibility. The argument is that higher pay is a major driver of productivity growth, as it forces companies to use workers more efficiently and to invest in labor saving equipment. Many progressive economists have long made this argument, although it is rejected within the mainstream of the economics profess...

Washington Post Tells Readers that a 17.5 Percent Tariff Can Lead to 85 Percent Price Increases

I'm not kidding. The first sentence of an article on the Trump administration's plans to impose a 17.5 percent tariff on Mexican tomatoes told readers:

"The United States will impose a 17.5 percent tariff on Mexican tomato imports starting Tuesday, and economists say that could lead to shortages and price increases of up to 85 percent as soon as this winter."

The idea that more than 400 percent of a tariff could be passed on to U.S. consumers should strike readers as a bit bizarre. After all,...

NYT Says New Tech IPOs Like Uber Have Longer to Develop Sustainable Business Model, but Haven't

The NYT had a piece today on the Initial Public Offering (IPO) of Uber and other recent start-ups. It notes that this generation of tech start-ups has waited much longer than the start-ups of the dot-com era to go public. The piece tells readers that this longer period gives:

"start-ups have had more runway to figure out sustainable business models while avoiding the public eye."

The problem with this assertion is that start-ups like Uber and Lyft don't seem to have developed a sustainable bu...

Getting to Medicare for All

(This post first appeared on my Patreon page.)

I had the opportunity to testify last week before the House Rules committee on Medicare for All. Incredibly, this was apparently the first time the topic had been explicitly addressed in a congressional hearing. In my testimony, I argued that a Medicare for All program would be affordable, but the key factor was reducing the cost of input prices, like prescription drugs, medical equipment, and doctors’ pay. I also briefly laid out what I consider...

Washington Post Gets Study Wrong, Uber Drivers Do Not Get $21 an Hour

A Washington Post article on Uber's IPO told readers that Uber drivers earned $21 an hour and linked to a study that came out of Stanford as the source. The study actually reports that $21 is the gross pay before deducting driving expenses such as gas and depreciation. This is very clear in the study.

It notes (page 42) the difference where it suggests a net measure might be more appropriate for the issue it is assessing (gender differences in earnings):

"Suppose drivers average 25 cents per...

USITC Says All Gains from New NAFTA from Reduced Uncertainty, What Is the Impact of Trump's Tariff Threats?

The United States International Trade Commission's (USITC) analysis of Trump's new NAFTA projected modest gains, entirely due to a reduction of uncertainty associated with its rules on digital commerce. (It makes it harder to regulate Facebook and Google.) The gains the USITC attributed to reduced uncertainty from this fairly limited segment of the economy were extraordinary, but they raise the obvious question about the cost of uncertainty in other areas.

For example, Donald Trump is now twe...