Dean Baker's Blog, page 85

President Trump Proposes $20 Billion Tax on Consumers to Increase Profits for Boeing, Pfizer, and Microsoft

No one wants to pay higher taxes, but we all understand the need when there is a good cause. Therefore, consumers shouldn't have any issues paying an extra $20 billion a year ($200 billion over a 10-year budget horizon) to force China to pay Boeing, Pfizer, Microsoft and other major US corporations more money for their patent and copyright monopolies.

This is explicitly the story, as the Post reports:

"Administration officials said the tariff fight is aimed at forcing China to stop stealing...

How Developing Countries Can Deal with Automation

As we remain mired in the longest period of weak productivity growth in recorded U.S. history, the NYT ran yet another on coping with the problem of automation creating mass job displacement. This one is focused on the developing world and asks how developing countries could cope with massive displacement of workers in agriculture and manufacturing.

Incredibly (perhaps not incredibly) the possibility of ignoring the patent and copyright monopolies that rich countries demand does not app...

When It Comes to Higher Wages, Wall Street Journal Doesn't Believe in Capitalism

That's the implication of this piece warning that a tight labor might force companies to raise wages and this could be hard on many companies' profits. We know that profit shares are near record highs, especially after the Trump tax cut substantially reduced companies' tax liabilities.

This means that the vast majority of companies should be able to easily absorb higher wages without passing the cost on in prices. Undoubtedly some companies are not well-situated because they are less efficien...

NYT Does More Mind Reading on Donald Trump

Any newspaper can hire reporters, but The New York Times hires mind readers. Yes, they are at it again. In an article on Trump's demand that other NATO countries increase their military spending to 2.0 percent of GDP the NYT tells readers;

"Mr. Trump, who appears to have a special animus toward Germany, believes that Berlin has developed a vibrant social system and thriving export-driven economy unfairly and on the back of the United States, by not spending enough on defense."

It's so great...

The Washington Post Has Determined the Federal Bureaucracy Is Bloated and That Trump Is Trying to Streamline It

It's not clear how the paper made these determinations, but it does assert them to be true in the second paragraph of an article on the Trump administration's plans to reduce the rights of federal employees:

"The administration describes Trump’s new rules, issued in May, as an effort to streamline a bloated bureaucracy and improve accountability within the federal workforce of 2.1 million."

While it is certainly possible that the Trump administration is motivated by a desire to make governm...

Intellectual Property and China: No One Is Back

I sometimes go under the professional name of "No One" as in "no one saw the financial crisis coming." I apparently need to use this identification again when it comes to a trade war with China.

On Morning Edition today, Jeff Greene interviewed Jonah Goldberg, senior editor at National Review. Mr. Goldberg told Greene how conservatives are free traders so they generally are opposed to Trump's tariffs. He then suggested that a way out for Trump would be to focus on China's intellectual propert...

Doctors Earn More than $250,000 a Year, Nursing Assistants Get $13.23 An Hour

The second fact appeared in a NYT article reporting on how nursing homes are frequently understaffed, the first did not. As many doctors angrily told me after reading a column I did on the protections that inflate doctors' pay, nursing assistants save lives.

Yes, we pay lots of money for health care in this country, more than twice as much as the average for other wealthy countries. Unfortunately we don't have better outcomes to justify this spending. A big part of this story is how much we p...

Does the US Have a Lot of Leverage with China? Mr. Arithmetic is Skeptical

With Donald Trump's trade war with China heating up I thought I should bring in Mr. Arithmetic to clarify the situation. Trump apparently thinks that he holds all the cards in this one because the US imports much more than it exports to China.

As I pointed out previously, China has other weapons. For example, it can just stop respecting US patents and copyrights altogether, sending items all over the world that don't include any royalty payments or licensing fees. This could reduce the p...

Does the U.S. Have a Lot of Leverage with China? Mr. Arithmetic is Skeptical

With Donald Trump's trade war with China heating up I thought I should bring in Mr. Arithmetic to clarify the situation. Trump apparently thinks that he holds all the cards in this one because the U.S. imports much more than it exports to China.

As I pointed out previously, China has other weapons. For example, it can just stop respecting U.S. patents and copyrights altogether, sending items all over the world that don't include any royalty payments or licensing fees. This could reduce the pr...

The Fed Is Not a Church: The NYT Is Unhappy About President Trump Commenting on Fed Policy

Like the Supreme Court, the Fed has considerable independence from day to day politics. It has seven governors who are appointed by the president and approved by the senate. They can serve 14 year terms, although most do not stay for the full period.

The Open Market Committee that sets interest rate policy also includes the twelve district bank presidents. Five of these twelve bank presidents have a vote at any point in time, although all twelve take part in the discussion. The bank president...