Back-up evidence for WaPo piece on most important econ lessons of the decade

December 23rd, 2019 at 7:36 am

Here are the companion figures to my WaPo piece today on econ lessons of the decade.

1) The unemployment rate can fall a lot lower than most economists thought without triggering inflationary pressures.

2) Budget deficits cannot be assumed to place upward pressure on interest rates.

3) Weak worker bargaining power has long been a factor driving inequality. In the last decade, the increasing clout of certain employers has joined the mix.

Source: NY Times

4) Progressive health care reform, wherein the government plays a larger role in coverage and cost control, works.

Source: Paul Van de Water, CBPP

5) [Lesson re-learned] Trickle-down tax cuts don’t work.

Source: Goldman Sachs

6) Antipoverty programs don’t just reduce poverty today; they improve the outcomes of their beneficiaries many years hence.

Source: CBPP

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3 comments in reply to "Back-up evidence for WaPo piece on most important econ lessons of the decade"

  1. Kevin says:

    I don’t get Figure 5. It shows two similar series and recession shading. It doesn’t explain what is on the vertical axis.

    I suspect that the circled area is intended to show that investment wasn’t “crowded-in” by the tax cuts. Fair conclusion, but you have to connect the dots. You also need to make allowances for a sharp downturn in new fracking activity due to persistently lower oil and gas prices, limited transport options for new production, and increased capital efficiency. But it’s still hard to make the Norquist case that the tax cuts crowded in or incentivized additional short-term investment.

  2. Gerald Scorse says:

    Regarding the graphs on 1) Health care costs growing more slowly than expected, 2) Children with access to SNAP faring better in later years: Now and always, the Trump Administration is working overtime to minimize those trends.

  3. Gerald Scorse says:

    Unfortunately the Trump Administration is actively working to alter Graph 4 (lower health care costs) and Graph 6 (the effects of SNAP on children). So it goes as we close out 2019.