Dean Baker's Blog, page 66

Arithmetic Help for Mitch McConnell on Voting Measure

We know that Republicans have trouble with arithmetic so I thought I would take a few minutes to help Mitch McConnell with some of the numbers in a column he wrote for the Washington Post complaining about a bill to protect voters' rights and limit the influence of money in elections.

The column complains

"the legislation dedicates hundreds of pages to federalizing the electoral process. It would make states mimic the practices that recently caused California to incorrectly register 23,000 in...

The NYT Is Worried that China Is Running Out of People

Seriously, this is a topic of a major article in the paper. The story is that low birth rates over the last four decades mean that fewer people will be entering the labor force and this is supposed to be really bad news.

"The declining population could create an even greater burden on China’s economy and its labor force. With fewer workers in the future, the government could struggle to pay for a population that is growing older and living longer.

"A decline in the working-age population co...

Does William Cohan's NYT Tirade Against Low Interest Rates Make Any Sense?

It doesn't as far as I can tell. Cohan has been on a rant for years about how high-risk corporate bonds are going to default in large numbers and then...something. It's not clear why most of us should care if some greedy investors get burned as a result of not properly evaluating the risk of corporate bonds. No, there is not a plausible story of a chain of defaults leading to a collapse of the financial system.

But even the basic proposition is largely incoherent. Cohan is upset that the Fed...

Washington Post Forgets to Mention, Scott Walker Misled Fifth Graders About Taxes

The Washington Post had an article about how Republicans and right-wingers have become obsessed with trying to attack Alexandria Ocasio-Cortez, the newly elected representative from New York. At one point it refers to former Wisconsin governor Scott Walker's attack on Ocasio-Cortez's position advocating a high marginal tax rate on high-income individuals.

"Former Wisconsin governor Scott Walker, a Republican who was defeated in November, on Tuesday mocked Ocasio-Cortez for her tax proposal a...

John Bogle, Vanguard Founder, Dies

I generally don't get teary-eyed over the passing of a finance guy (or woman), but I make an exception in the case of John Bogle. Bogle was the founder of Vanguard funds, which now has over $5.1 trillion in assets. That would be roughly $16,000 for every person in the country.

Bogle's great innovation was to minimize the cost of managing individual accounts. The key Vanguard asset is an index fund. It does minimal trading, it just tracks the market. Bogle argued, supported by much evidence, t...

Robert Samuelson Ignores Role of Hedge Fund Magnate Eddie Lampert in Sears Decline

By Eileen Appelbaum

In today’s column, Robert Samuelson attributes Sears bankruptcy and possible liquidation — the final chapter in a saga that has already cost 200,000 workers their jobs — to the department store chain’s inability to adapt to competition with big box stores and the Internet. Apparently, he has never heard of Eddie Lampert and his ESL hedge fund, which took over Sears and Kmart in 2006 and ran the company, now known as Sears Holdings as an ATM for himself and his investors. L...

Will Paying for Kidneys Reduce the Waitlist?

In a Washington Post column Megan McArdle suggests that we pay people to donate their kidneys as a way on increasing the number of donors and reducing the number of people who must rely on dialysis. Needless to say, to many folks it is attractive to get market relationships into ever more aspects of our lives. However, if we are interested in getting more kidneys, rather than just getting more money for the health care industry, this is likely a bad way to go.

There was a great study done a f...

Declining Birth Rates: Are We in Danger of Running Out of People?

There have been several pieces in recent weeks about the drop in birth rates in recent years. Birth rates declined in the recession and they have not recovered even as the economy has improved.

As these pieces point out, economics plays a big role in the drop in birth rates. Young adults often are having difficulty finding and keeping jobs that provide a decent wage. This was certainly true in the downturn, but it is still often the case even now with the unemployment rate at 50-year lows.

In...

Louisiana To End Monopoly Pricing for Hepatitis Drugs

The Washington Post had an article about plans by Louisiana to stop paying for Hepatitis C drugs for its Medicaid and prison populations by the dose. Instead, it will take bids from drug companies on how much they would charge for a year of unlimited use of their drugs.

While this will still allow the companies to make large profits on their sales to the state, it has the great benefit that eliminates the enormous gap between the price of the drug and the marginal cost of producing an additio...

NYT Says Big Donor Politics Are "Pragmatic"

In an article on Democratic presidential candidates pursuing a populist agenda in their 2020 campaigns, the NYT contrasted this approach with "the pragmatic politics and big-donor appeal of Hillary Clinton, the 2016 nominee." It's interesting that the NYT has decided that efforts to extend health care coverage, access to college, and stop global warming are not pragmatic. Maybe the paper could at some point publish its criteria for grading a policy proposal as pragmatic.