- Nighttime Must-Read: John Aloysius Farrell: Yes, Nixon Scuttled the 1968 Vietnam Peace Talks | Washington Center for Equitable Growth
- Depreciation Rates on Wealth in Thomas Piketty's Database: Monday Focus: June 9, 2014 | Washington Center for Equitable Growth
- Evening Must-Read: Steve Randy Waldmann: Welfare Economics: an Introduction | Washington Center for Equitable Growth
- Evening Must-Read: Ben Wolcott: Austerity and the Employment Rate | Washington Center for Equitable Growth
- If Only Batiushka, the Little Father, the Czar Knew...: Tuesday Hoisted from the Archives from Ten Years Ago (Brad DeLong's Grasping Reality...)
- Ron Chernow on Alexander Hamilton: Live from La Farine CXCIII: June 10, 2014 (Brad DeLong's Grasping Reality...)
- Liveblogging World War II: June 10, 1944: 2nd SS Panzer Division: "Das Reich" (Brad DeLong's Grasping Reality...)
- Over at Equitable Growth: Depreciation Rates on Wealth in Thomas Piketty's Database: Monday Focus: June 9, 2014 (Brad DeLong's Grasping Reality...)
Larry Mishel: Raising America’s Pay: A summary of the initiative: "Raising America’s Pay will: Highlight our nation’s failure to provide broad-based wage growth.... Research and explain the role of labor market policies and practices in suppressing pay.... Identify policies that will generate substantial broad-based wage growth.... Connect with key networks of civic engagement and community organizing groups..."
Nick Bunker: Immigration reform is pro-growth and pro-equity: "Gianmarco Ottaviano of the Universita’ di Bologna and Giovanni Peri... found that the wages of U.S. citizens, even those with less than a high school education, actually increased because of immigrant labor... immigrants were complementary workers.... The benefits of productivity gains due to immigration aren’t limited to boosting U.S. wages. Immigrants can also increase the overall productivity of the economy and spur long-run economic growth.... Passing commonsense immigration reform in 2014 is certainly a long-shot. But members of the House of Representatives and the general public should be aware of this shrinking window of opportunity..."
Heather Boushey And Nick Bunker: The labor market is doing better, but not fully recovered: "Six-and-a-half years after the start of the Great Recession, in some ways, the U.S. labor market has recovered nicely.... The three-month average for job growth is 234,000 a month.... And the unemployment rate has dropped from its high of 10 percent in October 2009 to 6.3 percent in May. But... these improvements are not... enough to alleviate the pain the Great Recession inflicted on our economy.... The labor force participation rate... was 62.8 percent in May.... The year-on-year growth in nominal wages was 2.1 percent..."
Nick Bunker: Inequality and the future rate of savings: "[If] there is a positive relationship between growth and the saving rate... [that leads] to a declining savings rate as growth declines.... There’s also the issue of net savings versus gross savings... the rate of savings has to be higher than... depreciation.... As more and more income flows to those at top, the consumption and savings decisions of top earners would have a larger effect on the overall savings rate... [and] high-income individuals have a higher savings rate than the rest of the population..."
Lily Kuo: Beijing is having a hard time convincing officials they shouldn’t abandon China: "Chinese state media recently reported what was meant to be another coup for president Xi Jinping’s anti-corruption campaign: a crackdown on thousands of 'naked' officials—those who send their family, and often their wealth, abroad, and remain behind.... China’s battle against elite families moving abroad remains an uphill one, which reflects a much broader public relations crisis for the country’s ruling party. For the Chinese public, the fact that so many government officials—whose official salaries are low—can afford to send their families to live, and their children to study, in America, Canada, or Europe is yet more proof of corruption in the government. Some also use their emigrated relatives as a way to funnel wealth abroad, often through real estate.... 'These officials have lost confidence in the party and the country', Chinese economist Zhao Hai Jun wrote on his blog (link in Chinese) in response to the news..."
Should Be Aware of:
- Dean Baquet: "It was really painful... to get beat by your biggest overseas competitor and your biggest national competitor.... It was just painful.... I am much, much, much more skeptical of the government's entreaties not to publish today than I was ever before..."
- Ian Buruma: "Obama’s instincts are right... the limits of America’s power to impose a global order by force. His success as a president rests... on the stupid things he has avoided, like getting into more unnecessary wars..."
- Pierre-Daniel Huet: A Philosophical Treatise Concerning the Weakness of Human Understanding
- Jim Sleeper: Brooks, Wieseltier: Cries of American Weakness by the People Who Weakened America
- Bernard S. Black
- Dhara Ranasinghe: Japan's Q1 GDP revised sharply higher
- Jeet Heer: The Problems with Patterson’s Heinlein Biography
- Ryan Cooper: The case for optimism on climate change
- Marissa Lingen: Robert A. Heinlein In Dialogue With His Century: Vol. 2: The Man Who Learned Better, 1948-1988, by William H. Patterson, Jr. | Novel Gazing Redux
- Robert Farley: Asia's Greatest Fear: A U.S.-China War
- Bob Cesca: Politicians and Pundits Called For an Armed Revolution, So the Millers Tried to Deliver One
- Al Gore: "What [Snowden] revealed in the course of violating important laws included violations of the Constitution that were way more serious than the crimes he committed. In the course of violating important laws he also provided an important service because we did need to know how far this has gone..."
- Jason Furman: Global Lessons for Inclusive Growth: "The first set is policies that directly expand both growth and opportunity... preschool, which has among the highest returns of any area of investment... ￼expanded access to college and improved demand-driven training.... The second set of policies are ones that increase growth... labor, capital, and what we can broadly call technology.... The third set of policies is aimed at ensuring that everyone shares in the benefits of growth. Currently, countries including Switzerland and the United States are focused on raising their minimum wages.... The EITC has been very successful in reducing poverty, rewarding work, and encouraging increased labor force participation. Part of ensuring that everyone shares in the benefits of growth is making sure that the process of enhancing medium- and long-term fiscal sustainability does not move in the opposite direction. One element of this is that deficit reduction be done in a balanced manner that in addition to entitlement reform include additional high-income revenue.... Ensuring everyone shares in the benefits of growth would be, from my perspective, a sufficient motivation for these policies. But as I discussed in the previous section, there is also the possibility that these policies could raise growth rates and increase the sustainability of economic expansions.... We have a lot of low-hanging fruit in terms of policies that can both reduce inequality and increase economic growth. And these policies would promote the type of inclusive growth that would manifest itself in higher median incomes, lower poverty rates, and broader, more inclusive growth. I can tell you that the Administration in the United States is very focused on all of these areas and I am hoping that we can work together to draw lessons from each other’s experiences and to cooperate on economic policies that would help advance these goals." ￼
Simon Wren-Lewis: mainly macro: What we do know: "There is much that we do not know in macro.... Noah [Smith] puts all this down to lack of data, rather than politics. When it comes to unconventional monetary policy this is also right. However there are some things where the data is pretty clear, and where any macroeconomist with an open mind should be able to come to a clear conclusion.... There is a huge elephant in the room: fiscal policy.... The theoretical framework used by monetary institutions almost everywhere says that fiscal contraction at the zero lower bound will do serious damage to output and unemployment (and therefore reduce core inflation). The evidence overwhelmingly confirms this proposition. While the reasons for the Great Recession may still be controversial, the major factor behind the second Eurozone recession is not: contractionary fiscal policy, in the core as well as the periphery.... Yet too many macroeconomists seem reluctant to acknowledge this. There are the anti-Keynesians who want to deny the monetary policy consensus; there are others, who want to deny the importance of the zero lower bound; and still more, who for some other reason want to deny the importance of fiscal policy. This allows policymakers to continue to press for fiscal consolidation in the Eurozone, largely ignoring those economists who do challenge this policy because they just represent 'one view' within the discipline..."
Liza Daly: 23 and Me: The Complete James Bond: "There’s a scene in which Goldfinger stages an elaborate Powerpoint presentation to a roomful of henchmen, and then immediately gasses them all to death. As someone who has to give a lot of public talks, I found this progression of events curiously appealing."
Ben Wolcott: Austerity and the Employment Rate: "In 2010, after an initial round of coordinated stimulus from both wealthy and developing countries, deficit hawks around the world regrouped. Pointing to growing deficits and debt, they demanded that countries reverse course and begin moving toward balanced budgets. The deficit hawks argued that deficit reduction could be accomplished without impairing growth because of the effect it would have in boosting confidence among businesses and consumers. Many economists argued against this drive towards austerity at the time. They noted and rigorously explained the fallacious logic in the idea that deficit reduction could be expansionary. They also pointed out how fiscal policy had already saved the economy from a second depression and that more stimulus would likely be necessary. However, now we have more than three years of data, so we no longer have to speculate. A simple picture can be worth a thousand words (or in this case, billions)..."
Steve Randy Waldmann: Welfare Economics: an Introduction: "Whenever a claim about 'welfare' is asserted assumptions regarding ethical value are necessarily invoked as well. If you believe otherwise, you have been swindled. If claims about welfare can’t be asserted in a value-neutral way, then neither can claims of 'efficiency'. Greg Mankiw teaches that '[under] free markets…[transactors] are together led by an invisible hand to an equilibrium that maximizes total benefit to buyers and sellers'. That assertion becomes completely insupportable. Even the narrow and technical notion of Pareto efficiency... is rendered problematic, as nonmarket allocations can also be Pareto efficient.... Market efficiency, deadweight loss, tax incidence, price discrimination, international trade--all of these topics are diagrammed and understood in terms of what happens to the area between supply and demand curves. If we cannot redeem those diagrams, all of that becomes little more than propaganda.... If the best 'scientific' economics can do is say nothing about interpersonal welfare comparison, that is neither evidence for nor evidence against policies which, like all nontrivial policies, benefit some and harm others, including policies of outright redistribution..."
John Aloysius Farrell: Yes, Nixon Scuttled the Vietnam Peace Talks: "Did Richard Nixon’s campaign conspire to scuttle the Vietnam War peace talks on the eve of the 1968 election to capture him the presidency? Absolutely, says Tom Charles Huston, the author of a comprehensive, still-secret report he prepared as a White House aide to Nixon. In one of 10 oral histories conducted by the National Archives and opened last week, Huston says 'there is no question' that Nixon campaign aides sent a message to the South Vietnamese government, promising better terms if it obstructed the talks, and helped Nixon get elected. Nixon’s campaign manager, John Mitchell, 'was directly involved', Huston tells interviewer Timothy Naftali. And while 'there is no evidence that I found' that Nixon participated, it is 'inconceivable to me', says Huston, that Mitchell 'acted on his own initiative'..."