What went on at OTE during the lead-up to, and in the wake of, the fiscal cliff?
Pre-cliff:
- Highlighting a few irreverent cliff notes, including a photo of my very own “Come Together” latte; considering one of many big fiscal cliff meetings, which ended with no white smoke from the White House chimney; arguing that it’d be better to go over the cliff than to accept a bad deal; noting that not all tax threshold deals are created equal; and analyzing a potential deal taking shape.
- Pointing to an important piece by Ezra Klein on some issues with the recent budget debates.
- Explaining my views on spending cuts and entitlements.
- If you want to criticize deficit hysteria–and you should–then you aslo have to explain what’s wrong with CBO’s alternative baseline.
- Considering the tax impact of the Senate cliff compromise, courtesy of the number crunchers at the Tax Policy Center.
Post-cliff:
- On the other side of the deal, looking at what we’ve learned from this episode in reckless governing.
- Introducing some perspective on the deal: we have a clear fiscal target of $1.2 trillion, which should be achieved with a balance between new revenues and spending cuts.
- Summing up the December jobs numbers: the report shows steady employment growth, fast enough to keep the jobless rate from rising, but not fast enough to knock it down much.
- At the end of the day, why is our policy agenda is so biased towards fiscal policy as opposed to jobs?
Musical Interludes: a theater-themed interlude from My Fair Lady, and an outsourced, bluesy interlude featuring Buddy Guy and John Mayer.
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Views on entitlements: C-CPI-U “more accurate” than CPI-U
If you believe that, then, assuming for calculation purposes CPI-U annual rate of 2.5% over last 20 years, and, therefore, C-CPI-U annual rate of 2.2%, that means you believe that over the last 20 years the increase in the cost of living has been exaggerated cumulatively by over 15%. (63.9% increase for CPI-U vs. 54.5% increase for C-CPI-U.)
Does that make any sense at all? Of course not. The continually expanding exaggeration would have become obvious to everyone.
BLS is the official agency that determines the cost-of-living increase, and CPI-U is its official rate. C-CPI-U is little mlore than an afterthought that isn’t even final for a year. When BLS officially adopts C-CPI-U or its methodology as its primary measure, fine, then we can talk. Until then, it is silly to talk about that measure as being “more accurate” when there is utterly no empirical evidence for that. It is nothing more nor less than a method to reduce benefits, and the reduction will hit people in their 80s and 90s very hard.