Things to Read on the Morning of December 5, 2014
Must- and Shall-Reads:
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The Liquidity Trap, the Great Depression, and Unconventional Policy: Reading Keynes at the Zero Lower Bound - :
Fiscal Policy and Full Employment - :
Productivity and Potential Output Before, During, and After the Great Recession - :
A 1920-21 Recovery Myth
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Economist’s View: ‘What’s Causing the Increase in Long-Term Unemployment?’: “Salim Furth, who ‘is senior policy analyst in macroeconomics at the Heritage Foundation’s Center for Data Analysis’: ‘What’s Causing the Increase in Long-Term Unemployment?: Some economic indicators, including the short-term unemployment rate, have recovered to levels associated with ‘normal times.’ But long-term unemployment remains high…. Many economists, myself included, expected that the expiration of long-term unemployment benefits at the end of 2013 would sharply lower the long-term unemployment rate. Instead, the rate has continued its slow, steady decline…. Economists have not yet found convincing explanations…. The problem is worth studying.’ They will have to find another social insurance program to blame… instead of, say, lack of demand (a policy failure) combined with the stigma attached to the long-term unemployed.” -
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4 New Studies: Obamacare Working Incredibly Well:
“Four major new sources of information have come out this week, all of which have further demonstrated the law’s success. 1. Increasing access to the uninsured…. Conservatives widely denied that the law would even succeed at its basic goal of increasing access to health insurance. Obamacare ‘created more uninsured people than it gave insurance to. And it promises to create even more,’ argued National Review’s Jonah Goldberg. Fox News panelist Charles Krauthammer proclaimed the law would result in ‘essentially the same number of uninsured.’… 2. Reducing overall health-care costs…. 3. Hospital errors…. 4. Insurance competition. Obamacare is based on an old Republican plan, developed by the Heritage Foundation and first tried by Mitt Romney, whose central feature was market competition…. Liberals did not place much faith in this dynamic…. But the dynamic has turned out to work much better than expected…” -
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Are We Mismeasuring Productivity Growth?:
“Noah Smith… observed that the Fernald TFP data can be decomposed into TFP in investment production and TFP in consumption production. TFP in investment looks better than the overall…. TFP in consumption… has basically flatlined since the early 1970s and is what is driving the Great Stagnation…. The Great Flattening does not seem reasonable. Has productivity growth in consumption really been flat since the early 1970s?… This suggests there are big measurement problems in consumption production. And I suspect they can be traced to the service sector…” - :
Economist’s View: ‘Entrepreneurship, Down-Side Risks, and Social Insurance’:
“In 2009 I argued: A more extensive social safety net can reduce the risk of attempts at entrepreneurship. If there is an extensive social safety net to fall back upon if things don’t work out, you might be more willing to quit the job you hate (the one with health insurance for the kids) and sink everything you have into a small business that you’ve always wanted to run. But I’m not sure the data above support this interpretation, i.e. that there is an obvious positive association between the strength of social insurance and the prevalence of small business. But it is highly suggestive, and regressions that control for other cross-country differences could help to settle the issue. Nick Bunker discusses a paper that provides supporting evidence: ‘Entrepreneurship, down-side risks, and social insurance…. John Hombert… et al. looks at a reform in the French unemployment insurance system enacted in 2002. The reform allowed unemployed workers who start a new business to keep the right to their unemployment benefits for up to three years…. The rate at which firms were created increased by 25 percent after the 2002 reform…. ‘The evidence points toward these new entrepreneurs being capable businesspeople who just needed a safety net before starting a business. What’s more, these new firms had a positive impact on the overall economy….'”” - (2007):
No Exit Revisited: “Andrew Sullivan tries to answer my post from yesterday on No Exit, the [Betsy McCaughey] article he published attacking the Clinton health plan. He says that ‘I don’t think it’s fair to expose the internal editing of a piece but there was a struggle and it’s fair to say I didn’t win every skirmish,’ which is interesting, and he says that ‘I was aware of the piece’s flaws but nonetheless was comfortable running it as a provocation to debate.’ What he doesn’t say is that he believes the piece accurately described the Clinton health care plan. Which is what’s at issue. There were reasons to criticize the delivery structure the Clintons sought to implement, but No Exit simply lied…” -
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So Long, And Thanks For All The Shit):
“[The New Republic] does publish people I like these days, but there is this weird worship of it as An Institution, as An Important Part Of The Discourse. Yah, thanks for Marty Peretz, Andrew Sullivan, The Bell Curve, Betsy McCaughey, Mickey Kaus, the Iraq War… oh God, I forgot Chuck Lane, who often manages to make Richard Cohen look good…” - :
Even the liberal New Republic needs to change: “The eulogy that needs to be written isn’t for The New Republic. It’s for the role once played by Washington’s small fleet of ambitious policy magazines. The internet is now thick with outlets that pride themselves on covering… policymaking apparatus. Vox… The New Republic… Wonkblog, the Upshot, Mother Jones, Storyline, FiveThirtyEight, and Politico, to name just a few. And that doesn’t even include the individual bloggers who are must-reads… Kevin Drum, and Tyler Cowen, and Brad DeLong, and Paul Krugman, and Ross Douthat, and Ramesh Ponnuru, and Jonathan Chait, and Scott Sumner, and Megan McArdle, and Jonathan Bernstein, and, again, the list goes on. This sprawling conversation over Washington policymaking used to be centered in a handful of elite-focused policy magazines, of which The New Republic was perhaps the best known and most ambitious…”
Should Be Aware of:
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217-60-1-5 - :
A new study estimates surface temperature cooling from volcanoes at 0.05–0.12°C since 2000 - :
Taking Stock: Health Insurance Coverage under the ACA as of September 2014 - :
Hands Up, Don’t Choke: Eric Garner Was Killed By Police For No Reason
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The capitalists sold the mills and bought all our futures:
“If you want to measure the capital possessed by a nation, there are two ways of doing it. One is to travel the length and breadth of the country counting the houses, the bridges, the factories, shops and offices, and adding up their total value. The other is to knock on doors and ask people how rich they are…. The totals are not… the same…. The wealth of Carlos Slim, Bill Gates or Warren Buffett is largely outside [physical capital] data because the market value of América Móvil, Microsoft and Berkshire Hathaway far exceeds the tangible assets of these companies…. If ‘capital is back’, as Prof Piketty contends, it is in a very different sense from the 19th-century view, in which the ownership of capital confers authority over the means of production. Messrs Slim, Gates and Buffett… did not acquire control of the means of production by virtue of their ownership of capital; rather they acquired capital from their control of the means of production, which they gained through political influence and success in the market…” - :
The German club of Putin understanders:
“Most German Putin understanders were embarrassed into silence after the July downing of Malaysia Airlines Flight MH17, and the separatists’ treatment of the bodies and the crash site. That was when public opinion swung decisively behind Ms Merkel’s tough line against Mr Putin…. Putin critics in Berlin worry that the understanders are rearing their heads again. They expect them to begin agitating for an easing of sanctions against Moscow in response to the Ukraine crisis. The most famous understander is Gerhard Schröder, the former chancellor, who counts Mr Putin among his friends… said Moscow had justifiable fears about being encircled…. celebrate[ed] his 70th birthday with the president in St Petersburg, and was pictured warmly embracing him…. Matthias Platzeck, chairman of the German-Russian business forum and former chief of the Social Democratic party (SPD)… suggest[ed] the west should accept the annexation of Crimea to ease tensions with Moscow…. A measure of understanding of Russian policy inevitably creeps in when you want to do business with Moscow. The Eastern Committee… is critical of Russian actions in Ukraine and supportive of Ms Merkel but strongly opposed to sanctions. A delegation was in Moscow last month and met Sergei Lavrov, Russian foreign minister. The visit was low key. “‘It goes without saying that no one wants to see pictures of anyone hugging Lavrov”, says a committee official.'” - :
Even The “Liberal” New Republic » Balloon Juice:
“Me? The number of damns I give about TNR as a going concern at this point equals approximately the number of black voices writing for the magazine, which is to say zero, but YMMV. The thing survived two world wars, the Great Depression, Watergate, the fall of the Soviet Union, 9/11, New Coke, and 74,927 episodes of Law and Order, but couldn’t handle one Silicon Valley douchebag with a giant checkbook…”