Education and Wealth
You want my advice, you should pour a tall cup-a-Joe and settle in to read this essay by Sean Reardon in this AMs NYT on education and wealth. He covers a lot of ground, but the theme that resonated most with me is one I’ve stressed often in these parts regarding the growing evidence of [...]
This FAA Sequester Vote Doesn’t Smell Right
Well, well. It appears that both the Senate and House have voted to end sequester-imposed furloughs of air traffic controllers, just in time for the weekend. You choose: is this bipartisan support to mitigate one of the noxious effects of sequestration, which I and others have been tracking? Or is it papering over the high-visibility [...]
R&R Shoot Back…with a Popgun
There’s no question that Reinhart and Rogoff have been excessively pilloried for the mistakes in their influential paper on how high debt/GDP ratios allegedly slow growth. Very few economists get the “honor” of the Colbert treatment (may I never, ever be so honored…). It’s fair to say that they and their benighted paper have become [...]
The Four Noble Truths of Full Employment
[From a talk I just gave…] This wonderful setting has led me to meditate on the four noble truths of Buddhism: 1) suffering exists; 2) the causes of suffering can be known; 3) suffering can cease 4) the path to end suffering exists. It is the way. So it is with full employment: unemployment exists; [...]
GDP Up 2.5%, But Underlying Weakness Evident
As expected, the economy grew more quickly at the beginning of this year than at the end of 2012, according to this morning’s GDP release. Real GDP was up at a yearly rate of 2.5% over the first quarter, compared to a mere 0.4% in the prior three months. But only slightly beneath the surface, [...]
The Unbearable Brilliance of Colbert: Reinhart/Rogoff Takedown
OMG–this is an absolute master at the top of his game, explaining the Reinhart/Rogoff mistake, and in the next clip, interviewing the very cool young grad student who discovered it. As someone who spends his life trying to explain this stuff, I stand in slack-jawed awe at Colbert’s mastery of doing so in ways that [...]
The US Gov’t as Venture Capitalist: Why Go There?
Had a rousing debate on Kudlow tonight about the Fisker story that’s got a lot of folks like Larry K crying “Solyndra squared!” Not so fast, dude. Brad Plumer covers the details here, but Fisker Automotive is a small company that has been trying to break into the electric car market but now teeters on the [...]
Charting the Way Back to Factville: Fiscal Version
One of the stated goals of OTE is to help us find our way back to Factville, but man, it’s not gettin’ any easier. Here’s a US Senator (Tom Coburn) from yesterday: “the fact is, our country is headed toward bankruptcy” (from CQ News, no link). In fact, the fact is that this is factually [...]
Airport Sequester Watch: Live!
Heading out to the left coast, in the air with what looks like a pretty good wifi connection. Re sequester, definitely saw some delays at DC National—spoke to the folks sending flights to NYC and they said that backups were already starting, driven by the furloughs of 1,500 air-traffic controllers that commenced yesterday. (Though, truth [...]
The Preferences of the Wealthy and Their Role in Our Politics
A critical concern of our time is not simply our high levels of income inequality and their negative impact on opportunity and mobility. It’s how inequality and immobility become entrenched in the system—how they replicate. In a nation like ours, where the flow of money into politics keeps getting stronger, one way this occurs is [...]
Sequester Watch
Like I said, we at OTE plan to keep tabs on the effects of the automatic budget cuts now solidly in place for at least the rest of this fiscal year. I’m running off and don’t have to time to do more than post some links, but check these out and feel free to add [...]
Hey, What’d I Miss? OTE Summary, 4/16 – 4/22
On the Reinhart & Rogoff dustup: giving an initial reaction, explaining the roles of context and political economy in the debt debate, raising a question of economic epistemology, and asking if more peer reviewing is the answer. Arguing that getting back to full employment — not debt, deficits, sequester, debt ceilings — is what we [...]
The Papers: Weirdness at the WaPo
Two strange, revisionist pieces in this AM’s WaPo. First, on the oped page, a confusing, ahistorical editorial riffing off of the Rogoff-Reinhart (R&R) debacle. The piece starts off spot-on, making a point I’ve been stressing in recent days: the austerity movement is not built off of this one R&R paper, and absent their paper, the [...]
Is More Peer Reviewing the Answer?
In the midst of the Reinhart-Rogoff meltdown, a commenter was aghast to learn that their paper was not peer reviewed.* She asked, reasonably, how could the newspapers report findings that had not gone through that process? It’s a fair question, and I should expand on the too glib remarks from my post: So the answer [...]
Musical Interlude: King Albert Inducted into Hall of Fame and Other Goodies
I heard that Albert King was just inducted into the Rock & Roll Hall of Fame, which I visited just a few weeks ago. So in honor of this great bluesman, here’s his biggest hit, Born Under a Bad Sign. If it wasn’t for bad luck, the man wouldn’t have no luck at all… BTW, [...]
Getting Back to Full Employment
Getting back to full employment—not debt, deficits, sequester, debt ceilings—is what we ought to be talking about (along with R&R, of course). I’m happy to say, in fact, that in my travels outside this benighted town (DC), it’s the question I get asked most often (“why isn’t Washington doing anything about jobs!!??”). What do I [...]
The Reinhart/Rogoff Mistake and Economic Epistemology
By now, it is well known, at least in wonkish circles, that the economists Reinhart&Rogoff (R&R) made a number of errors in deriving their highly influential finding that debt-to-GDP ratios above 90% lead to slower growth. Kudos to the various academics and bloggers who dug into this—particularly Herndan et al, who most recently found and [...]
A Few Thoughts on Immigration Reform
Here are a few observations on the new immigration reform proposal, with an emphasis on a part that I think is particularly important and largely overlooked given the emphasis on citizenship: the consideration of labor market impacts and the introduction of mechanisms to control them. Before getting into some policy analysis, let’s consider why the reform [...]
The Political Economy of Reinhart/Rogoff and the Austerity Debate
Allow me to quickly try to tie together some current events (zipping up to NYC to give this talk). First, you’ve got the Reinhart/Rogoff (R&R) dustup which is generating lots of ink in the AMs papers—more on that in a moment. Second, indicators once again show that the ongoing expansion in American economy continues to [...]
At Least the Big Banks Are Kickin’ It…
I just read that Goldman Sachs posted a profit of $2.2 billion in the first quarter, “…driven by strength in its investment banking business as well as its investing and lending unit.” And they’re mere pikers compared to their banking brethren: Across Wall Street, banks are showing signs of strength. Last week, JPMorgan posted a [...]
Not to Pile On, But…Correcting Reinhart and Rogoff
I’m late to this and many excellent posts have already gone up citing a new paper that corrects what appear to be fundamental mistakes in Reinhart and Rogoff’s (R&R) influential finding that high debt levels lead to slower growth. Specifically, they argued that when a country’s debt-to-GDP level gets above 90%, real GDP growth takes [...]
The President is Right About Faster Growth Shrinking the Deficit
As I noted here, and despite the current dominance of austerity budgeting, President Obama made an important point when he released his budget last week when he asserted that “…nothing shrinks deficits faster than a growing economy.” Just a one percentage-point increase in real GDP at a time like this–when we’re still below potential and the [...]
Hey, What’d I Miss? OTE Summary, 4/9 – 4/15
Tax day commentary, with a link to a highly progressive video game! Previewing the President’s budget and highlighting some important snippets from the proposal. Looking at my Center on Budget and Policy Priorities colleague Bob Greenstein’s important warning about how the President’s entry in the current budget negotiations risks rightward drift. Delving into a bit [...]
Tax Day!
And thus an opportune time for a moment of reflection on the spectrum of emotions this day, and this topic, evokes. First though, everyone should do what’s required on them on April 15th. No, I’m not talking solely about getting the check in the mail. I’m talking about the traditional OTE tax day visit to the [...]
Jared Bernstein’s areas of expertise include federal and state economic and fiscal policies, income inequality and mobility, trends in employment and earnings, international comparisons, and the analysis of financial and housing markets.
