Yeah, what else is new. After all, no one thinks that a conservative columnist writing for the country’s most important newspaper should have any clue about the topics they cover.
Brooks uses his column today to tell us that workers are getting their share of the economic pie and the real problem is productivity growth.
“The problem of the middle-class squeeze, in short, may not be with how the fruits of productivity are distributed, but the fact that there isn’t much productivity growth at all. It’s not that a rising tide doesn’t lift all boats; it’s that the tide is not rising fast enough.”
Sorry Mr. Brooks, but the numbers don’t agree with you. Here’s the story on average hourly earnings for production and non-supervisory workers since 2007. This is a good proxy for the median wage since it excludes high-end workers like doctors, Wall Street types, and CEOs.
Source: Bureau of Labor Statistics.
After rising by less than 2.0 percent between 2007 and 2013, real wages have started to grow at a respectable pace in the last four years. Still, they are just 8.0 percent above their 2007 level. By contrast, productivity has risen by 13.7 percent over this period. That’s a difference of 5.7 percentage points over the last decade.
For a person earning $40,000 a year, the loss due to the gap between productivity growth and wage growth is equivalent to a tax increase of $2,280 a year. Would Brooks try to tell readers that a tax increase of this magnitude is small change? If we go further back to 1980, when inequality first started to take off, the gap would be closer to 40 percentage points. Anyhow, it’s cute that Brooks wants to tell us not to think about all the money going to rich people and just concentrate on productivity growth, but this stuff is too silly even for children’s games.
There, however, is one point here worth noting. As unemployment has fallen, workers have been seeing their share of gains from productivity growth. This is a huge deal, which points to the importance of Federal Reserve Board policy.
There were many economists who wanted the Fed to take a tighter stance on monetary policy and keep the unemployment rate from falling as low as it has. The decision by the Fed to be relatively slow in raising interest rates has not only allowed millions of additional workers to get jobs, it has also meant higher pay for those who were already working. This makes an enormous difference to the country’s workers, but don’t expect to see anything about it in a David Brooks column.
Yeah, what else is new. After all, no one thinks that a conservative columnist writing for the country’s most important newspaper should have any clue about the topics they cover.
Brooks uses his column today to tell us that workers are getting their share of the economic pie and the real problem is productivity growth.
“The problem of the middle-class squeeze, in short, may not be with how the fruits of productivity are distributed, but the fact that there isn’t much productivity growth at all. It’s not that a rising tide doesn’t lift all boats; it’s that the tide is not rising fast enough.”
Sorry Mr. Brooks, but the numbers don’t agree with you. Here’s the story on average hourly earnings for production and non-supervisory workers since 2007. This is a good proxy for the median wage since it excludes high-end workers like doctors, Wall Street types, and CEOs.
Source: Bureau of Labor Statistics.
After rising by less than 2.0 percent between 2007 and 2013, real wages have started to grow at a respectable pace in the last four years. Still, they are just 8.0 percent above their 2007 level. By contrast, productivity has risen by 13.7 percent over this period. That’s a difference of 5.7 percentage points over the last decade.
For a person earning $40,000 a year, the loss due to the gap between productivity growth and wage growth is equivalent to a tax increase of $2,280 a year. Would Brooks try to tell readers that a tax increase of this magnitude is small change? If we go further back to 1980, when inequality first started to take off, the gap would be closer to 40 percentage points. Anyhow, it’s cute that Brooks wants to tell us not to think about all the money going to rich people and just concentrate on productivity growth, but this stuff is too silly even for children’s games.
There, however, is one point here worth noting. As unemployment has fallen, workers have been seeing their share of gains from productivity growth. This is a huge deal, which points to the importance of Federal Reserve Board policy.
There were many economists who wanted the Fed to take a tighter stance on monetary policy and keep the unemployment rate from falling as low as it has. The decision by the Fed to be relatively slow in raising interest rates has not only allowed millions of additional workers to get jobs, it has also meant higher pay for those who were already working. This makes an enormous difference to the country’s workers, but don’t expect to see anything about it in a David Brooks column.
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Morning Edition had a segment on efforts to counter the Trump administration’s proposal to cut foreign aid, including money going to the Global Fund to Fight AIDS, Tuberculosis, and Malaria. The segment featured a comment from Bill Gates, whose foundation also supports this fund.
Gates noted the lack of support for foreign aid and attributed it to the media’s tendency to highlight failures, where money is poorly spent or stolen, as opposed to the success stories. While there is undoubtedly some truth to this argument, the more likely problem is the fratboy reporting on budget issues that gives the audience zero context.
In the case of the Global Fund, when people hear about it they are likely to hear that the U.S. will spend up to $4.3 billion this year. This might lead people to think that we are devoting a substantial share of the budget to this fund, at the expense of other programs and/or raising people’s taxes.
In fact, this sum is roughly to 0.1 percent of the budget, it comes to roughly $13 per person for everyone in the country. For another comparison, it is roughly 36 times the excess cost (the amount paid beyond what it cost to protect a normal president) of Donald Trump’s secret service protection. In other words, it would not be the reason that people are paying taxes they consider high.
Polls consistently show the public grossly overestimates the share of the budget going to foreign aid, with median estimates in the range of 25 to 30 percent of the budget, when the total is less than 1.0 percent, even when being very generous about what counts as aid. This is likely due at least in part to the fratboy reporting on aid, which gives people no information whatsoever.
It is amazing that National Public Radio, the New York Times, and other leading news outlets continue the bizarre practice of reporting large numbers without context, even when everyone knows it is not providing information to the vast majority of their audience. It is a very simple matter to express a budget number as a share of the total budget or to use some other comparison that would give it meaning to listeners and readers. However, news outlets refuse to do this.
They instead engage in mindless fratboy reporting where they carry through the ritual of giving a large number that means absolutely nothing to the people who see it, and then pretend they have done their job. This is a major reason people are hostile to programs like foreign aid, TANF, food stamps and other programs that benefit the poor here and elsewhere.
Yes, I know many people are racist and hate these programs for that reason. But many people who are not especially racist (i.e. they vote for people like Hillary Clinton) also believe that 30 percent of our budget goes to foreign aid or TANF. If these programs actually did cost that much much money, there would be good reasons for not supporting them, since they don’t have that much to show.
Morning Edition had a segment on efforts to counter the Trump administration’s proposal to cut foreign aid, including money going to the Global Fund to Fight AIDS, Tuberculosis, and Malaria. The segment featured a comment from Bill Gates, whose foundation also supports this fund.
Gates noted the lack of support for foreign aid and attributed it to the media’s tendency to highlight failures, where money is poorly spent or stolen, as opposed to the success stories. While there is undoubtedly some truth to this argument, the more likely problem is the fratboy reporting on budget issues that gives the audience zero context.
In the case of the Global Fund, when people hear about it they are likely to hear that the U.S. will spend up to $4.3 billion this year. This might lead people to think that we are devoting a substantial share of the budget to this fund, at the expense of other programs and/or raising people’s taxes.
In fact, this sum is roughly to 0.1 percent of the budget, it comes to roughly $13 per person for everyone in the country. For another comparison, it is roughly 36 times the excess cost (the amount paid beyond what it cost to protect a normal president) of Donald Trump’s secret service protection. In other words, it would not be the reason that people are paying taxes they consider high.
Polls consistently show the public grossly overestimates the share of the budget going to foreign aid, with median estimates in the range of 25 to 30 percent of the budget, when the total is less than 1.0 percent, even when being very generous about what counts as aid. This is likely due at least in part to the fratboy reporting on aid, which gives people no information whatsoever.
It is amazing that National Public Radio, the New York Times, and other leading news outlets continue the bizarre practice of reporting large numbers without context, even when everyone knows it is not providing information to the vast majority of their audience. It is a very simple matter to express a budget number as a share of the total budget or to use some other comparison that would give it meaning to listeners and readers. However, news outlets refuse to do this.
They instead engage in mindless fratboy reporting where they carry through the ritual of giving a large number that means absolutely nothing to the people who see it, and then pretend they have done their job. This is a major reason people are hostile to programs like foreign aid, TANF, food stamps and other programs that benefit the poor here and elsewhere.
Yes, I know many people are racist and hate these programs for that reason. But many people who are not especially racist (i.e. they vote for people like Hillary Clinton) also believe that 30 percent of our budget goes to foreign aid or TANF. If these programs actually did cost that much much money, there would be good reasons for not supporting them, since they don’t have that much to show.
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The NYT had a piece on prices being charged by drug companies for new types of treatment for cancer, which can run as high as $1 million a year. While the piece noted the argument of one industry critic, Dr. Aaron Kesselheim, that we don’t pay firefighters when they show up at a fire or based on how many lives they save, it didn’t carry through the logic of this point.
The alternative implied by Dr. Kesselheim’s remark is that we could pay for the research upfront, as we already do to some extent with funding for the National Institutes of Health and the Orphan Drug Tax Credit. If the government paid for research upfront, then in nearly all cases the price of treatment would be trivial, since the cost of manufacturing and delivering the drug is rarely very high. It would have been worth presenting this alternative more clearly in the piece.
The NYT had a piece on prices being charged by drug companies for new types of treatment for cancer, which can run as high as $1 million a year. While the piece noted the argument of one industry critic, Dr. Aaron Kesselheim, that we don’t pay firefighters when they show up at a fire or based on how many lives they save, it didn’t carry through the logic of this point.
The alternative implied by Dr. Kesselheim’s remark is that we could pay for the research upfront, as we already do to some extent with funding for the National Institutes of Health and the Orphan Drug Tax Credit. If the government paid for research upfront, then in nearly all cases the price of treatment would be trivial, since the cost of manufacturing and delivering the drug is rarely very high. It would have been worth presenting this alternative more clearly in the piece.
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Readers may have missed this fact, but this is what the NYT said in an article on the prospect for tax reform when it told readers:
“Democrats have also been deeply skeptical of the Trump administration’s plans to repeal the estate tax, which it has said has been harmful to family farmers.”
If the Trump administration has been saying the estate tax has been harmful to family farmers it is lying since virtually no family farmers will owe a penny as a result of the estate tax. This would be known to NYT since the paper ran a piece 16 years ago which noted that the American Farm Bureau Federation, a strong opponent of the estate tax, could not identify a single person who had lost a family farm as a result of the estate tax.
Readers may have missed this fact, but this is what the NYT said in an article on the prospect for tax reform when it told readers:
“Democrats have also been deeply skeptical of the Trump administration’s plans to repeal the estate tax, which it has said has been harmful to family farmers.”
If the Trump administration has been saying the estate tax has been harmful to family farmers it is lying since virtually no family farmers will owe a penny as a result of the estate tax. This would be known to NYT since the paper ran a piece 16 years ago which noted that the American Farm Bureau Federation, a strong opponent of the estate tax, could not identify a single person who had lost a family farm as a result of the estate tax.
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According to an article in Sunday’s paper, employers are now able to find the workers they need by going to cities with large amounts of unemployment or underemployment.
According to an article in Sunday’s paper, employers are now able to find the workers they need by going to cities with large amounts of unemployment or underemployment.
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The Census Bureau reported that the percentage of people without health insurance fell by 0.3 percentage points in 2016 to 8.8 percent. This puts the cumulative gain in coverage since 2013, when the main Affordable Care Act provisions took effect, at 4.5 percentage points.
By state, the largest drop in the percent of the population that is uninsured was in California, which had a decline of 9.8 percentage points to 7.3 percent. Next was New Mexico with a decline of 9.5 percentage points, giving it an uninsurance rate of 9.2 percent, and Nevada with a drop of 9.3 percentage points to 11.4 percent.
The smallest decline over this period was in Massachusetts, where the percent uninsured fell by just 1.2 percentage points, but this is due to the fact that it had an uninsured rate of just 3.7 percent in 2013. Wyoming had the second smallest decline, with the rate falling by 1.3 percentage points to 11.5 percent.
Texas, Alaska, and Oklahoma had the highest uninsured rate in 2016, at 16.6 percent, 14.0 percent, and 13.8 percent, respectively. The lowest rates were in Massachusetts, 2.5 percent, Hawaii, 3.5 percent, and Vermont, 3.7 percent.
By employment, the biggest increase in coverage was among those working part-time. The percentage uninsured among this group fell by 9.0 percentage points to 14.8 percent. For those who did not work at all, the percent of uninsured fell by 7.4 percentage points to 15.0 percent. For full-time, full-year, workers the drop was 4.1 percentage points to 9.8 percent.
On the whole, these newest numbers indicate that Obamacare has succeeded somewhat more than expected in extending coverage. The biggest beneficiaries have been people who choose to work part-time (80 percent of part-time employment is voluntary), who no longer need to get coverage through an employer as a result of the exchanges and the expansion of Medicaid.
Note: Percent of uninsured for Wyoming has been corrected; thanks, Charles Angevine.
The Census Bureau reported that the percentage of people without health insurance fell by 0.3 percentage points in 2016 to 8.8 percent. This puts the cumulative gain in coverage since 2013, when the main Affordable Care Act provisions took effect, at 4.5 percentage points.
By state, the largest drop in the percent of the population that is uninsured was in California, which had a decline of 9.8 percentage points to 7.3 percent. Next was New Mexico with a decline of 9.5 percentage points, giving it an uninsurance rate of 9.2 percent, and Nevada with a drop of 9.3 percentage points to 11.4 percent.
The smallest decline over this period was in Massachusetts, where the percent uninsured fell by just 1.2 percentage points, but this is due to the fact that it had an uninsured rate of just 3.7 percent in 2013. Wyoming had the second smallest decline, with the rate falling by 1.3 percentage points to 11.5 percent.
Texas, Alaska, and Oklahoma had the highest uninsured rate in 2016, at 16.6 percent, 14.0 percent, and 13.8 percent, respectively. The lowest rates were in Massachusetts, 2.5 percent, Hawaii, 3.5 percent, and Vermont, 3.7 percent.
By employment, the biggest increase in coverage was among those working part-time. The percentage uninsured among this group fell by 9.0 percentage points to 14.8 percent. For those who did not work at all, the percent of uninsured fell by 7.4 percentage points to 15.0 percent. For full-time, full-year, workers the drop was 4.1 percentage points to 9.8 percent.
On the whole, these newest numbers indicate that Obamacare has succeeded somewhat more than expected in extending coverage. The biggest beneficiaries have been people who choose to work part-time (80 percent of part-time employment is voluntary), who no longer need to get coverage through an employer as a result of the exchanges and the expansion of Medicaid.
Note: Percent of uninsured for Wyoming has been corrected; thanks, Charles Angevine.
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If you thought the pharmaceutical industry couldn’t possibly sink any lower in its pursuit of profits, Allergan just proved you wrong. The geniuses at Allergan came up with the brilliant idea of turning over one of its patents on the dry-eye drug Restasis to the Mohawk tribe. The tribe will then lease the patent back to the Allergan.
The reason for this silly trick is that the Mohawk tribe, based on its sovereign status, is disputing the right of generic competitors to pursue a case before the Patent Trial and Appeal Board. This board is supposed to determine whether a patent was appropriately granted in the first place.
The article may have left readers confused about the issues involved when it reported without comment a statement by Allergan’s lawyer, which claimed that they were trying to avoid double jeopardy since the company also faces a case in federal court. The additional background here is that there is an enormous asymmetry in legal cases involving patents. The patent holder is fighting for the right to sell a drug in a monopoly market, which means monopoly profits. The challenger(s) is fighting for the right to be able to sell the drug in a competitive market, which means normal profits.
In this context, the patent holder has an enormous incentive to delay and run up the cost of litigation, which may quickly prove unprofitable to the generic competitor. The Patent Trial and Appeal Board was created to allow a quicker lower cost process to challenge invalid patents. It is also worth noting that Allergan’s revenue on this drug (more than $1.3 billion annually, according to the article) can be thought of as a tax on the American public. Without this patent, the drug would likely sell for 20 percent or less of its patent-protected price.
If you thought the pharmaceutical industry couldn’t possibly sink any lower in its pursuit of profits, Allergan just proved you wrong. The geniuses at Allergan came up with the brilliant idea of turning over one of its patents on the dry-eye drug Restasis to the Mohawk tribe. The tribe will then lease the patent back to the Allergan.
The reason for this silly trick is that the Mohawk tribe, based on its sovereign status, is disputing the right of generic competitors to pursue a case before the Patent Trial and Appeal Board. This board is supposed to determine whether a patent was appropriately granted in the first place.
The article may have left readers confused about the issues involved when it reported without comment a statement by Allergan’s lawyer, which claimed that they were trying to avoid double jeopardy since the company also faces a case in federal court. The additional background here is that there is an enormous asymmetry in legal cases involving patents. The patent holder is fighting for the right to sell a drug in a monopoly market, which means monopoly profits. The challenger(s) is fighting for the right to be able to sell the drug in a competitive market, which means normal profits.
In this context, the patent holder has an enormous incentive to delay and run up the cost of litigation, which may quickly prove unprofitable to the generic competitor. The Patent Trial and Appeal Board was created to allow a quicker lower cost process to challenge invalid patents. It is also worth noting that Allergan’s revenue on this drug (more than $1.3 billion annually, according to the article) can be thought of as a tax on the American public. Without this patent, the drug would likely sell for 20 percent or less of its patent-protected price.
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Okay, they haven’t written anything about too many iPhones that I know of, but the paper continually displays its irrational fear of too much government borrowing. It did so yet again in a discussion of plans to temporarily raise the debt ceiling and possibly to get rid of it altogether. The piece presents the views of the Peter Peterson-funded Committee for a Responsible Federal Budget that the country faces a serious debt and deficit problem.
The evidence of a problem with debt and deficits would be high interest rates and/or inflation. In fact, interest rates remain extraordinarily low, as does the inflation rate, which has been persistently below the Federal Reserve Board’s target of a 2.0 percent average inflation rate. The debt is not even a serious measure of generational balance as it is often used. The austerity that has resulted from concerns over the debt has cost us tens of trillions of dollars of future output, making our children and grandchildren far poorer than if we had pursued sound macroeconomic policies in the years following the Great Recession.
It would be helpful if the Washington Post had economics-based discussions of debts and deficits rather than hyping the irrational fears promoted by a Wall Street billionaire.
Okay, they haven’t written anything about too many iPhones that I know of, but the paper continually displays its irrational fear of too much government borrowing. It did so yet again in a discussion of plans to temporarily raise the debt ceiling and possibly to get rid of it altogether. The piece presents the views of the Peter Peterson-funded Committee for a Responsible Federal Budget that the country faces a serious debt and deficit problem.
The evidence of a problem with debt and deficits would be high interest rates and/or inflation. In fact, interest rates remain extraordinarily low, as does the inflation rate, which has been persistently below the Federal Reserve Board’s target of a 2.0 percent average inflation rate. The debt is not even a serious measure of generational balance as it is often used. The austerity that has resulted from concerns over the debt has cost us tens of trillions of dollars of future output, making our children and grandchildren far poorer than if we had pursued sound macroeconomic policies in the years following the Great Recession.
It would be helpful if the Washington Post had economics-based discussions of debts and deficits rather than hyping the irrational fears promoted by a Wall Street billionaire.
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