Hey, but why would anyone expect otherwise from the Washington Post. The piece gave the outlines of a budget deal between House Speaker Nancy Pelosi and the White House, which is intended to avoid hitting the debt ceiling.
According to the article:
“Agreeing on new spending levels also avoids onerous budget caps that would otherwise snap into place automatically under an Obama-era deal, and indiscriminately slash $126 billion from domestic and Pentagon budgets.”
Is this $126 billion over one year or two years? That is not entirely clear from the piece, but it looks like a two-year figure. So how big a deal would this be? My guess is almost none of the Post’s readers has any idea how much money the government is projected to spend in the effect categories (discretionary domestic and defense spending) over the next two fiscal years.
According to the Congressional Budget Office, if spending in these categories increased with inflation, it would come to a bit more than $2.7 trillion over the next two years. This means the cuts would have been a bit more than 4.5 percent of spending.
It would be helpful if the Post’s budget articles put numbers in a context that is meaningful to their readers.
Hey, but why would anyone expect otherwise from the Washington Post. The piece gave the outlines of a budget deal between House Speaker Nancy Pelosi and the White House, which is intended to avoid hitting the debt ceiling.
According to the article:
“Agreeing on new spending levels also avoids onerous budget caps that would otherwise snap into place automatically under an Obama-era deal, and indiscriminately slash $126 billion from domestic and Pentagon budgets.”
Is this $126 billion over one year or two years? That is not entirely clear from the piece, but it looks like a two-year figure. So how big a deal would this be? My guess is almost none of the Post’s readers has any idea how much money the government is projected to spend in the effect categories (discretionary domestic and defense spending) over the next two fiscal years.
According to the Congressional Budget Office, if spending in these categories increased with inflation, it would come to a bit more than $2.7 trillion over the next two years. This means the cuts would have been a bit more than 4.5 percent of spending.
It would be helpful if the Post’s budget articles put numbers in a context that is meaningful to their readers.
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The New York Times ran a piece warning retirees thinking of moving overseas that Medicare will not cover their medical expenses in other countries. This is true, but the NYT piece never once pointed out that this is conscious policy, not something that just happened.
Readers of the paper may recall that it reports on trade agreements all the time. These trade agreements cover a wide range of issues, including things like enforcing patent and copyright monopolies and rules on Internet commerce and privacy.
If anyone in the United States in a position of power cared, then it would be possible to include transferring Medicare payments to other countries, to allow people to buy into other nations’ health care system on the list of topics being negotiated. This doesn’t happen because, unlike access to cheap labor for manufactured goods, there is no one in power who wants to make it easier for people in the United States to take advantage of lower cost and more efficient health care systems elsewhere.
While such a policy could potentially save the U.S. government an enormous amount of money on Medicare (costs in other rich countries average less than half as much per person), the health care industry would scream bloody murder if any politician attempted to implement free trade in health care services. “Free trade,” as it is conventionally used in U.S. policy debates, just means removing barriers that protect less educated workers from foreign competition.
The New York Times, like other mainstream publications will not even allow free trade to be discussed in its pages in contexts where it might hurt the interests of the wealthy.
The New York Times ran a piece warning retirees thinking of moving overseas that Medicare will not cover their medical expenses in other countries. This is true, but the NYT piece never once pointed out that this is conscious policy, not something that just happened.
Readers of the paper may recall that it reports on trade agreements all the time. These trade agreements cover a wide range of issues, including things like enforcing patent and copyright monopolies and rules on Internet commerce and privacy.
If anyone in the United States in a position of power cared, then it would be possible to include transferring Medicare payments to other countries, to allow people to buy into other nations’ health care system on the list of topics being negotiated. This doesn’t happen because, unlike access to cheap labor for manufactured goods, there is no one in power who wants to make it easier for people in the United States to take advantage of lower cost and more efficient health care systems elsewhere.
While such a policy could potentially save the U.S. government an enormous amount of money on Medicare (costs in other rich countries average less than half as much per person), the health care industry would scream bloody murder if any politician attempted to implement free trade in health care services. “Free trade,” as it is conventionally used in U.S. policy debates, just means removing barriers that protect less educated workers from foreign competition.
The New York Times, like other mainstream publications will not even allow free trade to be discussed in its pages in contexts where it might hurt the interests of the wealthy.
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Austin Frakt had a peculiar piece in the NYT Upshot section, which told readers, “there is no single, best policy for drug prices.” The piece is peculiar because for some reason Frakt opts not to even consider the policy of direct public funding for research, which would then allow all new drugs to be sold at generic prices.
While there are problems with any system, direct funding, which could be done through various mechanisms, would permanently end the problem of high-priced drugs. With the research costs paid upfront, the price of the drugs would simply cover the manufacturing cost with normal profits. In nearly all cases, this would mean prices would be low, generally less than 10 percent of current prices for patent-protected drugs and in some cases less than 1 percent.
This is also not a far-out idea. It has long been pushed by several prominent economists, most notably Joe Stiglitz. The idea of delinking drug prices from research costs has also been pushed in international forums by China, India, and many other developing countries. In fact, if Trump were pursuing his trade war with China in the interest of working people, instead of the rich, such a shift in funding for drug research could well be an outcome.
In any case, it is bizarre that a piece that purports to be an overview of ways to lower drug prices would not even mention this issue.
Austin Frakt had a peculiar piece in the NYT Upshot section, which told readers, “there is no single, best policy for drug prices.” The piece is peculiar because for some reason Frakt opts not to even consider the policy of direct public funding for research, which would then allow all new drugs to be sold at generic prices.
While there are problems with any system, direct funding, which could be done through various mechanisms, would permanently end the problem of high-priced drugs. With the research costs paid upfront, the price of the drugs would simply cover the manufacturing cost with normal profits. In nearly all cases, this would mean prices would be low, generally less than 10 percent of current prices for patent-protected drugs and in some cases less than 1 percent.
This is also not a far-out idea. It has long been pushed by several prominent economists, most notably Joe Stiglitz. The idea of delinking drug prices from research costs has also been pushed in international forums by China, India, and many other developing countries. In fact, if Trump were pursuing his trade war with China in the interest of working people, instead of the rich, such a shift in funding for drug research could well be an outcome.
In any case, it is bizarre that a piece that purports to be an overview of ways to lower drug prices would not even mention this issue.
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The NYT had a column by Eliza Griswold talking about the prospect of job loss in coal mining areas due to efforts to restrict greenhouse gas emissions. While it is often traumatic for workers to lose jobs, especially long-held jobs, it is important to realize that relatively few jobs are at stake in the coal mining industry.
For example, in Pennsylvania, one of the states mentioned in the piece, the Bureau of Labor Statistics reports that there are now 5,000 coal mining jobs in the state. The state has over 6 million workers, which means that coal mining accounts for roughly 0.08 percent of employment in the state. Kentucky has 5,800 jobs in coal mining, with total employment of 1,950,000. That comes to a bit more than 0.3 percent of total employment. Even in West Virginia, the heart of coal country, there are only 23,000 jobs in coal mining out of a total of 740,000 jobs. This comes to a bit more than 3.0 percent of total employment.
In all three states, there were sharp drops in employment in the industry in the past, which drastically reduced the importance of coal mining employment. It is a bit peculiar that the earlier declines in coal mining employment, which were primarily due to productivity growth (specifically, replacing underground mining with strip mining — a policy often opposed by environmentalists), received relatively little attention in the media or from politicians. By contrast, the prospect of considerably smaller future declines due to efforts to reduce greenhouse gas emissions is drawing extensive attention.
The NYT had a column by Eliza Griswold talking about the prospect of job loss in coal mining areas due to efforts to restrict greenhouse gas emissions. While it is often traumatic for workers to lose jobs, especially long-held jobs, it is important to realize that relatively few jobs are at stake in the coal mining industry.
For example, in Pennsylvania, one of the states mentioned in the piece, the Bureau of Labor Statistics reports that there are now 5,000 coal mining jobs in the state. The state has over 6 million workers, which means that coal mining accounts for roughly 0.08 percent of employment in the state. Kentucky has 5,800 jobs in coal mining, with total employment of 1,950,000. That comes to a bit more than 0.3 percent of total employment. Even in West Virginia, the heart of coal country, there are only 23,000 jobs in coal mining out of a total of 740,000 jobs. This comes to a bit more than 3.0 percent of total employment.
In all three states, there were sharp drops in employment in the industry in the past, which drastically reduced the importance of coal mining employment. It is a bit peculiar that the earlier declines in coal mining employment, which were primarily due to productivity growth (specifically, replacing underground mining with strip mining — a policy often opposed by environmentalists), received relatively little attention in the media or from politicians. By contrast, the prospect of considerably smaller future declines due to efforts to reduce greenhouse gas emissions is drawing extensive attention.
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I am not anxious to defend Donald Trump’s economic performance, but a complaint by Steven Rattner in his New York Times column caught my attention. The column features a graph showing that the ratio of the median wage for blacks has fallen relative to the median wage for white workers since 2016.
This bothered me, because in general the situation for blacks, and other groups who face discrimination, improves in a tight labor market. While it is possible that the plight of blacks has deteriorated due to Trump’s open racism, there is another plausible explanation.
The improvement in the labor market has had a considerably larger impact on employment rates for blacks than for whites. If we compare averages for the first six months of 2019 with the 2016 average, the employment to population ratio for blacks has risen from 56.4 percent to 58.3 percent, a rise of 3.3 percent. For whites, the increase has been from 60.2 percent to 60.8 percent, a rise of 1.0 percent.
The increase in black employment has been a very important gain for hundreds of thousands of black families, but it also means that the composition of black workers has changed somewhat. Let’s assume that the new workers have less education and experience than most of the people working in 2016.
In the extreme case, that they all fell near the bottom of the wage ladder, the increase in employment by 3.3 percent will mean that the median black worker in 2016 is now the 53.3 percentile worker, whereas the 46.7 percentile worker in 2016 is now the median worker.
When we compare medians from 2019 with 2016, we are looking at workers that were considerably further down the income ladder in 2016. This effect would be much smaller with white workers since their employment rates changed by less.
One piece of evidence supporting this story is that Rattner’s graph shows that drop in the ratio of medians under Trump essentially continues a trend that had been in place since 2012 when the labor market began to tighten substantially. To get the fuller picture, we really need to control for factors like education and experience or use longitudinal data sets that track the pay of individual workers through time, but it’s fair to say that Rattner’s graph really is not telling us much.
I am not anxious to defend Donald Trump’s economic performance, but a complaint by Steven Rattner in his New York Times column caught my attention. The column features a graph showing that the ratio of the median wage for blacks has fallen relative to the median wage for white workers since 2016.
This bothered me, because in general the situation for blacks, and other groups who face discrimination, improves in a tight labor market. While it is possible that the plight of blacks has deteriorated due to Trump’s open racism, there is another plausible explanation.
The improvement in the labor market has had a considerably larger impact on employment rates for blacks than for whites. If we compare averages for the first six months of 2019 with the 2016 average, the employment to population ratio for blacks has risen from 56.4 percent to 58.3 percent, a rise of 3.3 percent. For whites, the increase has been from 60.2 percent to 60.8 percent, a rise of 1.0 percent.
The increase in black employment has been a very important gain for hundreds of thousands of black families, but it also means that the composition of black workers has changed somewhat. Let’s assume that the new workers have less education and experience than most of the people working in 2016.
In the extreme case, that they all fell near the bottom of the wage ladder, the increase in employment by 3.3 percent will mean that the median black worker in 2016 is now the 53.3 percentile worker, whereas the 46.7 percentile worker in 2016 is now the median worker.
When we compare medians from 2019 with 2016, we are looking at workers that were considerably further down the income ladder in 2016. This effect would be much smaller with white workers since their employment rates changed by less.
One piece of evidence supporting this story is that Rattner’s graph shows that drop in the ratio of medians under Trump essentially continues a trend that had been in place since 2012 when the labor market began to tighten substantially. To get the fuller picture, we really need to control for factors like education and experience or use longitudinal data sets that track the pay of individual workers through time, but it’s fair to say that Rattner’s graph really is not telling us much.
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Sorry to pick on a NYT editorial with which I mostly agree, but the assertion that plans by Democratic presidential candidates to increase homeownership, “if successful, could ease the demand for rental units,” really needs to be called out.
Let’s say these plans are successful. Where do the additional units come from that the new homeowners now occupy? Some may come from existing homeowners who decide to sell at the higher prices resulting from these plans and then become renters.
Some of the units may come from the stock of rental units. Contrary to what the piece implies, god did not designate housing units as either ownership or rental units. Apartment buildings frequently switch from being rental to condominiums, if the sale price justifies the expense of the conversion. Furthermore, roughly one-third of all rental units are single-family homes. These can be converted very easily to ownership units if the price justifies it.
Long and short, policies to increase homeownership should be evaluated based on their impact of the affected population. It is not always the path to secure wealth, as people alive during the housing bubble years know. But as a way to reduce the cost of rental housing, it is just foolish.
Sorry to pick on a NYT editorial with which I mostly agree, but the assertion that plans by Democratic presidential candidates to increase homeownership, “if successful, could ease the demand for rental units,” really needs to be called out.
Let’s say these plans are successful. Where do the additional units come from that the new homeowners now occupy? Some may come from existing homeowners who decide to sell at the higher prices resulting from these plans and then become renters.
Some of the units may come from the stock of rental units. Contrary to what the piece implies, god did not designate housing units as either ownership or rental units. Apartment buildings frequently switch from being rental to condominiums, if the sale price justifies the expense of the conversion. Furthermore, roughly one-third of all rental units are single-family homes. These can be converted very easily to ownership units if the price justifies it.
Long and short, policies to increase homeownership should be evaluated based on their impact of the affected population. It is not always the path to secure wealth, as people alive during the housing bubble years know. But as a way to reduce the cost of rental housing, it is just foolish.
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