The Washington Post has been running a multi-part series on the country's disability programs. The premise, as stated in the most recent installment, is that we are seeing:

"...decades-long surge in the nation’s disability rolls."

The formula then involves profiling one or more families who depend on disability payments from the government instead of work for their primary source of income. Usually, the profiles show family members to be reluctant to work and to have drug problems and other unhealthy habits.

While this situation undoubtedly describes a substantial number of people in the United States, the idea that the number of people getting disability payments is exploding is a Washington Post invention, not a fact in the real world. The graph below shows disability payments as a share of GDP from 1980 to 2013.

Source: OECD.

While the share of GDP going to disability payments did rise over this 33 year period, the increase was just over 0.3 percentage points, a rise of 30 percent. Furthermore, Social Security disability payments, the largest component of this spending, has fallen by 0.07 percentage points of GDP over the years from 2013 to 2016, leaving an increase of less than 25 percent measured as a share of GDP over 46 years. (The Social Security Trustees project payments as a share of GDP will fall somewhat more this year.)

Eileen AppelbaumHuffPost, July 21, 2017

With the release of the annual Social Security and Medicare trustees’ report, President Trump’s appointees endorsed sharp improvements in Medicare’s financing that occurred under former President Obama. Medicare had a projected shortfall of 3.54 percent o

Mark WeisbrotThe Sacramento Bee, July 20, 2017

Dean Baker
The Hill, July 19, 2017

July 19, 2017

Back in the 1990s stock bubble it was common for analysts to say things like price-to-earnings ratios (PE) no longer mattered. They were right, at least for a while, as the stock valuations of companies like AOL and Priceline soared way beyond anything that could conceivably be justified by current or future earnings.

Of course after a while, price-to-earnings did come to matter, as the stock market lost half its value from its peak in March of 2000 to its trough in the summer of 2002. The tech heavy Nasdaq lost close to 80 percent of its value. Many of the big tech enthusiasts were wiped out in this crash. While it might seem old-fashioned, people presumably value stock based on how much earnings a share commands, not the beauty of the stock certificate or how cool the company is.

With this in mind, it is interesting to think about what the Amazon future might look like given that it now has a market capitalization of roughly $480 billion with current profits of roughly $2.6 billion. This gives it a price-to-earnings ratio of 184 to 1.

Jake Johnston
World Politics Review, July 18, 2017

July 2017, Lara Merling, Kevin Cashman, Jake Johnston, and Mark Weisbrot

Dean Baker
Truthout, July 17, 2017

July 2017, Eileen Appelbaum and Rosemary Batt

The "Democracy Dies in Darkness" folks at the Washington Post somehow feel they have an obligation to print lies from the White House on their opinion page. How else can one explain the decision to run a column from Marc Short and Brian Blase that calls the Congressional Budget Office's (CBO) estimates of the impact of the Republican health care plans "fake news." (The authors are respectively, assistant to the president for White House legislative affairs and special assistant to the president for the National Economic Council.)

The column is chock full of lies. (Sorry, with this crew there is no point in trying to be polite. They are liars, let's not pretend anything else.) It starts by trying to generically discredit CBO's analysis of health care plans.

"When Obamacare passed in 2010, the CBO projected a healthy individual market with 23?million people enrolled in exchange plans by this year. The CBO predicted that by 2017, exchange plans would be profitable and annual premium increases low."

....

"But this never happened. Today, there are only 10 million people enrolled in exchange plans — about 60 percent fewer than expected. (Contrary to some claims, this is not because more people have maintained employer plans than the CBO expected; the reduction in employer coverage has been greater than the CBO projected, and overall about 9 million more people are uninsured now than projected.) Absent the projected bounty of young, healthy consumers, health insurers are abandoning the exchanges, leaving a third of American counties with only one insurer to choose from. As insurers continue to flee the exchanges, consumers will face even fewer options next year."

CBO was not overly optimistic about Obamacare, it was actually overly pessimistic. As I wrote a couple of months back:

"Actually, CBO was overly pessimistic about Obamacare. If we look to CBO's last report on the Affordable Care Act, before the exchanges began operation in 2014, it projected that there would be 29 million people uninsured as of 2017 (Table 3). In its most recent analysis, it puts the number of uninsured in 2017 at 26 million (Table 4). In other words, the number of people who are uninsured under the ACA is 3 million fewer than CBO had predicted back in 2012.

"In what world is overestimating the number of uninsured 'overly optimistic?' It is true that fewer people are in the exchanges than CBO expected. This is due to the fact that more people have qualified for Medicaid and also more people are receiving employer-provided insurance, as fewer companies than expected dropped coverage."

The premiums have risen more in the last few years than projected because they were originally lower than projected. Premiums for 2017 are pretty much right where CBO had projected. And in states run by Democratic governors who are trying to make the Affordable Care Act work, the exchanges are doing just fine.

In short CBO gets an A- for its record on forecasting Obamacare, the White House crew gets a big fat "L" for lying.

The NYT shows us that the skills shortage is real in an interview with Sarah M. Smith, the owner of a roofing company in Nebraska. In the interview, Ms. Smith explains why she needs foreign workers, on H2-B visas, since she is unable to get native born workers or greencard holders for the $17 an hour she is offering.

Ms. Smith explains:

"We have offered the $17-an-hour wage because it is the prevailing wage determination for this type of work, according to the United States Department of Labor. We do offer incentives and bonuses above that. And just to note, Nebraska’s minimum wage is $9 an hour."

She is then asked why, if she can't find enough workers, she doesn't offer a higher wage. Ms. Smith responds:

"In response to the article, I got an email that said if we were to offer $35 an hour with health care benefits, we would definitely get people to apply; it said people who were highly qualified applicants with years of experience would probably line up at our door.

"My response is: We would love to be able to offer $35 an hour as starting pay, but are you in turn willing to pay premium prices for your next roof replacement? A lot of customers we get through online lead services like Thumbtack are people looking for the best deal. They want to collect proposals from four to five businesses and most of the time choose the cheapest one.

"We want to compensate our employees fairly for the work they do and the risk they take, but we wouldn’t be able to stay in business if we doubled the hourly rate. It’s not just their hourly wage that becomes a factor. Insurance in the roofing industry is extremely expensive. Not only are we required to carry expensive general liability insurance, we also have to have workers’ compensation insurance for employees on the roof. That comes to 40 percent of their wage. And on top of that, there’s payroll tax.

"We also do a lot of insurance restoration work like hail damage claims, and in those cases the insurance provider determines what they pay for labor and we work with it. If we come back saying it’s going to cost us way more on labor to do the job, the homeowner isn’t likely to want to cover the extra cost, especially not above their out-of-pocket deductible."

Okay, let's for the moment ignore the idea that Ms. Smith would pay $35 an hour as starting pay. Let's imagine that she offered $20 an hour, roughly an 18 percent increase over her current pay and presumably substantially more than her competitors.