Relevant and even prescient commentary on news, politics and the economy.

Why No Social Security Posts on Angry Bear?

Because we won. Or more precisely I won. Because we are not that much closer to the adoption of the Coberly inspired Northwest Plan than before, despite the fact that similar plans poll spectacularly positive. But mostly all the ‘Reform’ plans for an ‘unsustainable’ Social Security system are running scared from the Senator Warren and Sanders ‘enhance’ approach. Lots of things contributed to this, including the demise of R-R. But in today’s climate the Plutocrats are deploying their billions on defense against the dreaded words ‘income inequality’. And the prospect of a $10.10 minimum wage frightens them much more than having to pony up some bucks to ‘bail out’ Social Security in the 2030s.

I have been relentlessly promoting a Social Security reform plan of ‘Nothing’ since 2005 and since 2010 here at Angry Bear. Now it was never the perfect plan and in collaboration with Dale and Arne I was willing to push another more pro-active plan. On the other hand ‘Nothing’ is a far better more proven plan than 99% of the ‘Other’ plans out there. And since the only hopes of GOP/Conservative survival going forward depend on not pissing off their base of older white folk I am thinking the target has been taken off the back of Social Security. For now. So ‘Nothing’ is looking pretty good right now.

So you can redub me ‘Social Security Lurker’ from ‘Social Security Defender’. Because the Bad Guys are in retreat. For now.

On the other hand the salvation of Social Security still rests in a policy that would advance the entirety of the progressive agenda overall:

‘More Jobs. At Better Wages.’ And I will be happy to join you all at that set of barricades. But this particular run at SS has seemingly run out of steam. TTFN.

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Climate Change Denialism from Fox News (and CNN) in One Picture

Man there is a lot of snow!

Australia Smaustralia, California Drought! Heck we had record cold in Buffalo. And ice in ATLANTA!!! So anthropogenic climate change is obviously a myth!

(And since Clarence Thomas never saw racism in the 60’s South when he was a boy that is an obvious Lie-Beral myth too)

Shorter FAUX News. To save you ‘al the bandwidth.

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Economists look foolish by not seeing what Central Bankers see… small output gap

Antonio Fatas writes that the central bankers are estimating smaller output gaps in Europe, the UK and the US. I have been saying for a year that potential GDP is far less than the CBO estimate. But other economists have been sticking to the claim that the output gap is still quite large.  Economists do not understand effective demand yet. We see this reflected in what Mr. Fatas writes…

“Measuring potential output or the slack in the economy has always been challenging. One can rely on models that capture the factors that drive potential output (such as the capital stock or productivity or demographics) or one can look at more specific indicators of idle capacity, such as capacity utilization or unemployment rate.”

Do you  see any demand factors for determining potential output in his quote? No. So if productive capacity stays the same, so should potential output, right? Well, wrong… if demand is undermined, for example by a 6% fall in labor share of national income/output, the economy will not be able to sell its potential output. There is a demand constraint.

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The Global Labor Glut

Ryan Avent’s excellent post at The Economist finally provides me the impetus to respond to Josh Mason’s comments on my recent post.

I suggested:

 What we have instead of a Global Savings Glut is:

1. A Global Labor Glut: more human effort and ability available than is needed to provide goods that provide high aggregate marginal utility, and,

2. A global financial and political system that — despite the reality of #1 — fails to transform that abundance into maximum aggregate human utility via reasonable distribution of that abundance.

Josh sed:

I think your conclusion that unemployment must be a glut of labor is both wrong and politically destructive. By turning this into a labor-market problem, you are implicitly accepting Say’s law and rejecting the principle of aggregate demand. And you are wrong factually. All factors of production are in excess supply in a recession, not just labor.

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Been There, Done That

by Joseph Joyce

Been There, Done That    

President Barak Obama has nominated Stanley Fischer to the Board of Governors of the Federal Reserve Board, where he will succeed Janet Yellen as Vice-Chair of the Board. Fisher’s accomplishments are well-known. But he also brings an interesting set of credentials to the Board at a time when it has been criticized for ignoring the impact of its policies on other countries.

Fischer received his doctoral degree from MIT, and returned there after a stint on the faculty at the University of Chicago. During the 1970s and 1980s he taught or advised such future luminaries as Ben Bernanke, Greg Mankiw and Mario Draghi. He served as Vice President and Chief Economist of the World Bank from 1988 to 1990. He was the First Deputy Managing Director of the IMF from 1994 through 2001, a period when financial crises recurred on a regular basis in the emerging market countries.

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I like this Ed Kilgore post

by Robert Waldmann

I like this Ed Kilgore post

Ed Kilgore wrote (among other things) “accept the validity of other religions”, ” Erick Erickson’s denials that I’m a Christian at all”, “the confusion of belief with fundamentally secular efforts to advance laissez-faire capitalism, American nationalism (and sometimes militarism), partriarchal family structures, and what God-hater Ayn Rand called “the virtue of selfishness.” ” and “the very old but much-forgotten historical fact that secularism has been very good for religion in America.” I meant to write an approving comment to make up for yesterday but the interested reader (if any) can read what I actually wrote. There is something about Kilgore that sets me off. In other words, I find him extremely intellectually stimulating. I don’t know what it is. My comment

I think this is a brilliant essay. It is very beautiful. I also think you are fundamentally right.

Some thoughts

1)Your belief that Christianity implies social solidarity and help for the least among us is different from their belief that Ayn Rand was a Christian.

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