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Article Artículo

The Public is Clueless About the Federal Budget and It's the New York Times' Fault

Paul Krugman criticized the Trump administration for its budget, which would cut or eliminate many programs that benefit low- and moderate-income people. In his piece, Krugman points out that the public is incredibly ignorant on the budget, with most people having virtually no idea of where most spending goes.

In particular, he referenced an analysis that found people on average believed we spend more than 30 percent of the budget on foreign aid. The actual figure is less than one percent.

This is the sort of item that inevitably leads people to deplore the ignorance of the masses. While ignorance is deplorable, instead of blaming the masses, we might more appropriately look at the elites.

The overwhelming majority of people are never going to look at a budget document. Insofar as they get any information on the budget, it is from reporters who tell them how much we spend in various areas of the budget. (They may get this information indirectly from their friends who read the newspaper or listen to news.)

When they hear about spending, they will invariably hear things like we spend $40 billion a year on foreign aid or $17.3 billion on Temporary Assistance for Needy Families (TANF). Most people will think these figures are large sums, since they dwarf the sums that people see in their daily lives. In fact, the former is less than one percent of the $4.1 trillion that we will spend in 2017, while the latter is just over 0.4 percent of total spending.

The media could do a much better job of informing the public about spending (i.e. by doing their job) if they made a point of putting these figures in context. As it is, giving people these really huge numbers without context is essentially telling them nothing. As an alternative, they could make a point of always referring to these numbers as a share of the budget and/or expressing them on a per person basis (e.g. the spending on TANF comes to a bit more than $50 per person per year from every person in the country).

CEPR / March 17, 2017

Article Artículo

United States

Workers

Declines in Employment by Demographic Group

Overall, January’s unemployment numbers show that the current unemployment rate is only 0.1 percent higher than the June 2007 unemployment rate. This is good news for many American workers, as it suggests that the labor market has fully recovered from the last recession; however a recent CEPR post on prime-age employment goes into more detail of why that might not be entirely true. But when just analyzing the unemployment rate through varying demographics, CEPR found that some workers have fared better than others.

Teen unemployment (workers 16 to 19 years), although still significantly higher than that of adult workers, has actually dropped below 2007 levels. Black teens in particular now have 3.3 percent lower unemployment. White teen unemployment rates have also decreased 0.8 percent. Both remain high, and the unemployment rate for black teen workers is nearly double that of white teen workers. Black teen workers also experienced a greater increase in unemployment from 2009 to 2011 than white teens, with their highest unemployment rate 46.1 percent in 2010.

CEPR and Sarah Rawlins / March 15, 2017