• Thumbnail No one should be taking economic advice from folks who rate subprime mortgage backed securities AAA.The Washington Post has the answer. It devotes an article to Moody’s assessment of the financial situation of the U.S. government. Most people probably know of Moody’s as one of the credit rating agencies that were paid tens of millions of [...]

  • Thumbnail Theo Kocken: “The expected-return approach is a huge economic offense, hurting younger generations.”Economists usually think it is a good to try to make spending countercyclical. This means that we want more spending when the economy is weak and less when the economy is strong. Traditional defined benefit pensions in the United States at least partly [...]

  • Thumbnail The vast majority of the money going to seniors in the Urban Institute’s calculation refers to payments for Social Security and Medicare. These are benefits that seniors paid for during their working lifetimes with designated taxes. Actually he is not angry about how much money the government pays to Peter Peterson but if he were [...]

  • Dean Baker wrote a new diary post: Stress Test: The Indictment of Timothy Geithner

    2014-05-24 08:32:32View | Delete

    ThumbnailAt one point in his autobiography, Timothy Geithner proudly recounts responding to a question from Damon Silvers, a lawyer with the AFL-CIO who was at the time a member of the Congressional Oversight Panel for the Troubled Asset Relief Program (TARP). Silvers had referred to Geithner’s background in banking. As Geithner relates the story, he corrected [...]

  • Dean Baker wrote a new diary post: Paradise Lost: Fred Hiatt and Bowles-Simpson

    2014-04-22 05:43:55View | Delete

    Thumbnail “No one in Washington is more Serious than Fred Hiatt.” As many have noted, the Very Serious People in Washington have a peculiar love affair with the Bowles-Simpson commission, or more accurately the report produced by the two co-chairs of the commission. (The report is often referred to as a report of the commission. This [...]

  • Thumbnail It’s not the beneficiaries who are doing the stealing Catherine Rampell used her column today to defend an earlier column complaining that baby boomers are taking from young people through Social Security and Medicare. She acknowledges that most baby boomers will not come out ahead on Social Security (actually they come out someone behind in the source [...]

  • Dean Baker wrote a new diary post: NYT Does Hilarious April Fools Joke on Budget Reporting

    2014-04-02 01:39:38View | Delete

    Thumbnail The joke’s on your readers, Grey Lady … The NYT took advantage of April Fools Day to do budget reporting that provided no information to almost all of its readers. An article on the budget introduced by Paul Ryan, the Republican head of the House Budget Committee, told readers how much the budget proposes to cut over [...]

  • Dean Baker wrote a new diary post: Robert Samuelson’s Arithmetic Challenged Economics

    2014-02-23 19:13:07View | Delete

    ThumbnailYes, it’s Monday and Robert Samuelson is badly confused about economics again. Today he complains about the White House’s “fairy-tale economics.” Under Samuelson’s fantasy of Fairy Tale Economics, are dragons job creators? Robert Samuelson is upset because the Obama administration has been arguing that it is possible to raise the minimum wage without any job loss. [...]

  • Dean Baker commented on the diary post WaPo Tells Liberals That They Have No Political Power: The Case of Social Security by Dean Baker.

    2014-02-23 19:11:26View | Delete

    yes, you should question what people believe. And you should not be telling other people what a politician believes because you don’t know.

    btw, I really don’t give a damn whether you think I believe what I say about SS, when it comes to my income, your ignorance is showing bigtime.

  • Thumbnail “Liberals didn’t kill Obama’s Social Security cuts: Republicans did.”The WaPo gets infuriated at the thought that anyone who doesn’t have lots of money could affect political outcomes in the United States. Hence it was quick to run a piece with the headline: “Liberals didn’t kill Obama’s Social Security cuts: Republicans did.” The reference is to President [...]

  • Thumbnail Thomas Friedman ReturnsThomas Friedman is loose in Silicon Valley , the economic hub best known for colluding to rip off its workers . He can’t contain his enthusiasm for “start-up America,” telling readers;

    What they all have in common is they wake up every day and ask: ‘What are the biggest trends in the world, and how do I [...]

  • ThumbnailCharles Lane is wrong, as usual, in arguing that the Trans-Pacific Partnership (TPP), like its predecessor NAFTA, is good for U.S. workers. However, the piece is useful in providing an opportunity to explain some basic economics. The Washington Post mobilizes its best(?) in support of bad trade deals. Most of the piece is dedicated to saying that [...]

  • Thanks all for a great discussion. I would just add that we always have to keep pressing on every possible front. In this book and in all my work I have argued for using whatever channel we can to book employment. If we can do it by government stimulus, that’s great. If that channel is blocked then we should press the Fed to do everything it can. And we should also try to push for a lower valued dollar to get the trade deficit down. And we should promote work sharing, which is a great policy that can be done at the state level.

    There are reasons why one policy may be better than the other, but all are better than doing nothing. And it is not acceptable to do nothing. Tens of millions of people are suffering because of bad policy decisions. That should not be happening.

  • Just to emphasize a point that Jared and i consider really central in the book, we argued that the wages of large segments of the workforce are affected to a great extent by unemployment. This means that not only do we see millions of people needlessly unemployed or underemployed, but tens of millions of workers re getting lower wages than they would in a fully employed economy.

  • I’m glad you were able to get another job. The somewhat good news is that I don’t see another collapse on the horizon. we get downturns either when the Fed raises interest rates because it is concerned about inflation or because we have a bubble that bursts (this only happened in 2001 and 2008). I don’t see any problems with inflation any time soon and there are no notable bubbles at the moment, so i would say the horizon is cloud-free for now.

  • I think the effort for $15 is great. Just to be clear, this is not a demand for a minimum wage of $15, which i think would cause unemployment, it is a demand for a collective bargaining agreement that would give workers considerably higher wages.

    What has been so neat about this effort is that it has drawn considerable public support. this is why so few of the workers involved have been fired. These companies usually are not shy about firing workers for trying to organize, even though it is against the law.

    One other point to keep in mind. From 1938 to 1968 the minimum wage kept pace with productivity growth. if it had continued to keep pace with productivity over the last 45 years it would be $17 an hour today. that would be a very different world.

  • I don’t see them concerned about the economy as a whole. In terms of future bubbles, we had a real risk of the reappearance of the housing bubble last year. Prices nationally were rising at a double-digit rate and in several markets were rising at 30 or even 40 percent rates. Bernanke’s taper talk press conference in June sent interest rates soaring and appears to have stemmed this bubble, but I would still keep my eye on it. House prices are above trend, but not obviously out of line with fundamentals. THe UK and Canada both have serious housing bubbles.

  • I worry very much about Fisher. He had been a serious voice of neo-liberalism. he was at the center of the botched IMF bailout from the East Asian financial crisis. Being someone with enormous stature in the profession, if he and Yellen were to take opposing views he is exactly the sort of person who could effectively organize opposition to the chair.

  • yes, we are doing almost nothing to stop global warming.We are treating it as though it is an optional problem. In many ways the crash should have provided a great opportunity to get serious about retrofitting buildings to save energy and pushing our wind and solar power everywhere. Obama did some of this, but on a small scale. It would have been great to see these programs multiplied by a factor of ten — we had the money, remember the problem was a lack of demand.

    It would also be good to see a bit of creativity in trying to address the problem. What’s the downside of making bus fare free? Are we worried that the bill Gates of the world will take advantage of it? people who could afford to pay for their bus fare won’t?

    How about encouraging 4-day workweeks to cut down on the number of commuting trips? We should also find a way to pay China to use cleaner fuels. (It’s in our interest and it is the cheapest way to bring about emission reductions.)

    Anyhow, we are almost nowhere in combatting global warming and our kids will pay a huge price for it.

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