Dean Baker's Blog, page 64

Steve Rattner Warns that Government-Granted Patent and Copyright Monopolies Are Imposing a Burden on Our Children

Of course, he wouldn't do that. Steven Rattner isn't concerned about the hundreds of billions (perhaps more than $1 trillion) that the government redistributes upward each year in the form of patent and copyright rents. These rents, which come to close to $400 billion annually for prescription drug alone, are a direct and intended result of the monopolies that the government gives companies and individuals as a way of paying for innovation and creative work.

But Steven Rattner isn't conc...

The Robots Taking the Jobs Industry

There is an old saying that the economy is too simple for economists to understand. There is plenty of evidence of this all around. After all, almost no economists could see the $8 trillion housing bubble, the collapse of which gave us the great recession. Back in the stock bubble days of the late 1990s, leading economists in both political parties wanted to put Social Security money in the stock market based on assumptions of returns which were at the least incredibly implausible, if not alt...

Slower Health Care Cost Growth: It's a Worldwide Pattern

Catherine Rampell noted in her column today the sharp slowing in health care cost growth in the last decade. This is an important point, which has received remarkably little attention. The Medicare projections and the budget projections more generally look far better than would otherwise be the case because of lower than projected health care cost growth. (It is hard to understand why the Obama administration did not try to take more credit for the slower cost growth.)

Anyhow, there is an imp...

Farhad Manjoo Promotes Billionaire Ideology in Proposal to Get Rid of Billionaires

New York Times columnist Farhad Manjoo tells us that he likes to "explore maximalist policy visions" in his columns. He falls well short of this goal in a piece calling for abolishing billionaires, which actually helps legitimate their existence.

The piece repeatedly tells us that their wealth is driven by technology, a point that first appears in the subhead which refers to "tech-driven inequality." The problem with Manjoo's piece is that the inequality is not in fact driven by technology, i...

NYT Tells Us Russia's Reserves Are Too Large, What About China?

It really gets annoying when reporting in our nation's leading newspaper has a make it up as you go along character. A piece on a new infrastructure program to boost Russia's economy begins by telling readers:

"Russia has become a world-class saver. So much gold has piled up in its central bank that Russia surpassed China last year to become the world’s fifth-largest holder of gold.

"The International Monetary Fund often has to badger developing nations to bulk up foreign currency reserves....

The Export–Import Bank: The Government Subsidy "Free Traders" Love

I have long had fun with the folks who call themselves "free traders." Essentially, these are people who argue it is a high moral principle to eliminate any barrier to trade that might support the income of working class people, but suddenly get really stupid and defensive when we talk about barriers that support the income of professionals and the wealthy. 

This means that a 10 percent tariff on imported steel is an outrage against all that is good and decent in the world. But when it c...

Low Unemployment: The Recipe for Higher Wages

Back in 2013, Jared Bernstein and I wrote a book called Getting Back to Full Employment: A Better Bargain for Working People (free download). The main point of the book was that low unemployment rates disproportionately benefited those who are most disadvantaged in the labor market. For this reason, we argued for using macroeconomic policy to get the unemployment rate as low as possible, until inflation became a clear problem.

At that time the unemployment rate was still close to 7.0 percent....

No, Medicare for All Is Not "Expensive"

I was going to really tee off on this NYT article, calling Medicare for All an "ambituous and expensive left-wing" policy, but I think Paul Waldman did a nice job making the point in his Washington Post column.The basic point is that reporters should leave these sorts of adjectives out of their coverage of the debate over reforming the health care system.

Every other wealthy country has some sort of universal health care system, many with government run insurance that look a lot like Medicare...

Trump Is Confused Again, Thinks His Trade War Is Responsible for China's Economic Problems

The New York Times had an article on the status of Trump's trade war with China. While the piece pointed out Trump's claim that his trade war is responsible for China's economic problems, it didn't point out that this is almost certainly not true.

In spite of Trump's tariffs, China's exports to the United States were up by more than $30 billion in the first ten months of 2018 compared to 2017. While their exports may have grown even faster without the tariffs, it doesn't make sense that slowe...

David Leonhardt on the Fleecing of Millennials

David Leonhardt used his column to give us a story about how the millennials are the big losers and the oldsters are the big winners in today's economy. The piece shows trends in the growth of income and wealth which show the over 65 group doing very well and everyone else not. This is not a quite a simple granny-basher column, Leonhardt does come around at the end and tells readers:

"But the country’s biggest economic problems aren’t about hordes of greedy old people profiting off the young....