The following newsletter highlights CEPR’s latest research, publications, events, and much more
—CEPR Co-director Dean Baker wrote extensively on the Federal Reserve this past month, both before and after the Fed announced that it was raising interest rates. Dean wrote several op-eds prior to the Fed’s December meeting, including this one for Fortune, and he and he spoke about the impact of the expected rate hike on the Diane Rehm show. CEPR issued this statement on the Fed’s decision. Dean penned several op-eds after the announcement including this one for Al Jazeera. In this op-ed Dean reminded the presidential candidates that the Fed exists and In this piece for US News and World Report’s Debate Club he called the decision to raise rates a step in the wrong direction. Dean also teamed up with Josh Bivens of EPI and the folks at Fed Up to answer some frequently asked questions about the Fed. We were happy to see Senator Bernie Sanders pick up on this theme in a NYT column later in the month.
—Prior to the recent election in Spain CEPR released a paper by Co-director Mark Weisbrot and Economist David Rosnick that looked at Spain’s recent economic history, both before and after its recession. The paper, “Has Austerity Worked in Spain?”, notes that Spain has pursued a set of economic policies since 2011 based on internal currency devaluation, labor market reform, fiscal consolidation, and structural and deregulatory reforms aimed at boosting growth through increased efficiency. The authors find that the country’s recent economic recovery isn’t attributable to austerity policies and that current policies won’t rescue Spain from mass unemployment. Paul Krugman cited the paper in his blog, writing that that he and others have argued that “Spain’s recent growth reflects the combination of a leveling off of austerity and the slow effects of very painful internal devaluation”.
Mark appeared on American Public Media’s Markeplace following Spain’s election, which resulted in a strong showing for the anti-austerity Podemos party. "I think people were not actually convinced that the austerity worked, and I think there’s very good economic reasons for them not to believe that," said Mark. Mark was also interviewed for the radio program “Between the Lines”, and he wrote an op-ed titled “Spain votes ‘no’ on failed economic policies” for Al Jazeera that was picked up by the Huffington Post.
—CEPR also monitored the recent legislative election in Venezuela that saw the opposition coalition win a qualified majority of seats in the National Assembly. Prior to the election CEPR released a paper by David that looked at the possible outcomes of the election based on polling data and on the results of previous legislative elections. The paper also examined impact of an inherent rural/small state advantage for the governing party coalition, and realigned party coalitions.
Mark published several op-eds both before and after the election. His piece for Folha de Sao Paulo titled “Brazil Should Stand Firm Against U.S.-Led Campaign to Undermine Venezuelan Elections” was reprinted in the Huffington Post, Common Dreams, Truthout and Viomundo. He penned several additional op-eds prior to the elections including this one and this one for the Huffington Post. He also appeared on Newsmakers Talk (TRT World).
CEPR lived-blogged the December 6th election, and Mark’s post-election analysis for the Hill, “What’s Next for Venezuela?”, was reprinted in several other outlets including Common Dreams, the Huffington Post, Alternet, La Agencia Latinoamericana de Información (ALAI), Desde Abajo and Página/12,
—CEPR Senior Economist Eileen Appelbaum wrote this post for the CEPR Blog on the California public employees’ pension fund (CalPERS) investment in private equity. As Eileen noted in the post, she and Rosemary Batt published this op-ed in the Sacramento Bee on the same day as the recent CalPERS investment committee board meeting. As the op-ed explains, CalPERS’ return on investment in PE failed to meet the fund’s benchmark, once CalPERS’ risk factor for PE investing is taken into account. The op-ed was shared with members of CalPERS BOARD prior to their meeting, and later that same day the board defeated a staff proposal that would have deleted the requirement that CalPERS aim to maximize risk-adjusted returns on these risky investments. This would change the requirement for PE returns to a vague objective about enhancing PE's performance. This LA Times article on the decision includes a great quote from Eileen: "This is outrageous," Eileen Appelbaum, a senior economist at the Center for Economic and Policy Research, a Washington think tank, said before the meeting. "CalPERS can't get over the goal, now plans to do away with goal post.”
—CEPR released a working paper by Dean titled: “The Upward Redistribution of Income: Are Rents the Story?” The paper outlines ways in which rents in various areas can explain the upward redistribution of income that has occurred over the past several decades, as opposed to the sort of argument advanced by Thomas Piketty that it is some natural process that is inherent to capitalism. Brad DeLong posted a short note commenting on the paper, which Dean discussed in this Beat the Press post.
—CEPR Director of International Programs Deborah James was in Nairobi, Kenya for the 10th Ministerial meeting of the WTO that took place from December 15-18. She wrote several op-eds on the issues addressed in the ministerial. In this piece for Alternet she discussed a letter to members of the WTO signed by an unprecedented 453 civil society groups including trade unions, farmers, environmentalists, public interest groups and development advocates from over 150 countries. The signers expressed “extreme alarm about the current situation of the negotiations in the WTO.” Deborah wrote several pieces for the Huffington Post, including this one on the WTO and global food security and this one on the proposed Trade in Services Agreement or TiSA. Deborah penned this summary of the recent ministerial, writing that “fortunately the effort by some developed countries to impose new pro-corporate issues on the agenda was defeated. However, the 162 WTO members also failed to affirm the importance and focus of having a true ‘development round,’ a promise made in 2001 in Doha and the core mandate of the Doha Round.”
—CEPR’s Haiti: Relief and Reconstruction Blog featured a post that compared two editorials on the Haitian elections. The editorial boards of both the New York Times and the Washington Post both wrote about the current electoral crisis in Haiti, though the recommended solutions differ greatly. Unlike the Times, which backed calls from Haitian civil society and political parties for further verification of the vote, the Post editorial pushed a line decidedly in tune with the U.S. State Department.
The Haiti blog also featured a post on Haitian President Michel Martely’s call for a commission to evaluate the October 2015 election results as well as one on a survey of the official results by the Brazilian Igarape Institute.
—CEPR released a paper on the incidence of financial transactions taxes. The paper, by Dean and CEPR Director of Domestic Policy Nicole Woo, looks at the effects of the FTT on various groups and points out that the generally accepted measures of elasticity of trading to transaction costs imply that the financial industry will bear the full burden of the tax.
CEPR also released a paper looking at various measures of the unemployment rate and labor market slack by CEPR Research Assistant Nicholas Buffie. The paper shows that standard U-3 measure which is usually, cited is out of sync with every other measure, all of which indicate there is still a considerable amount of labor market slack.
—CEPR Senior Associate for International Policy Alexander Main wrote this post for CEPR’s Americas Blog on calls by Honduran civil society and members of the US Congress for the creation of a United Nations-backed International Commission Against Impunity in Honduras (or CICIH).
—CEPR Domestic Program Assistant Kevin Cashman penned this FedWatch piece on black unemployment for the CEPR Blog that was picked up by the Huffington Post.
—A Bloomberg article that appeared in several publications including the Chicago Tribune cited CEPR’s work showing that the US is the only advanced nation that doesn't mandate paid leave. Dean made the National Center for Business Journalism’s list of economists to follow on twitter.
—Dean wrote this op-ed on Amazon’s Jeff Bezos, noting that he has received in the neighborhood of $4 billion in subsidies from taxpayers over the last two decades to help his business grow.
—In a recent Beat the Press post, Dean remarked on the news that columnist Harold Meyerson of the Washington Post has gotten the boot: “His columns showed a concern for the ordinary workers who make up the overwhelming majority of the country's population. Apparently this is a liability at the Post.” Dean also critiqued the Post’s Catherine Rampell, for devoting her column “to a popular Washington pastime: trying to get young people angry at their parents and grandparents so that they are not bothered by the enormous upward redistribution of income taking place in this country.” Here Dean fact checks “The Big Short”, while here he takes on BTP fave Robert Samuelson.
From all of us here at CEPR, our best wishes for a happy and healthy 2016!