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

Is Economy nearing Natural Limit?

Unemployment dropped to 6.1% in June and down to 6.2% for the 2nd quarter. Unemployment is dropping faster than many economists expected. I would explain the fast drop as a reaction by firms to maintain their profit rates as labor share and productivity are both stationary now. The recent drops in unemployment are evidence that […]

Global Warming and the Which Way Is Up Problem in Economics Print

From Center for Economic and Policy Development comes this framing….Global Warming and the Which Way Is Up Problem in Economic Print It is painful to read Eduardo Porter’s column on the prospects for slowing global warming and China’s greenhouse gas emissions. It’s not that Porter got anything in particular wrong; he is presenting standard projections […]

Supply Creates Its Own Demon II: You Don’t, Say!

by Sandwichman at Econospeak  (reposted with permission from the author)   Supply Creates Its Own Demon II: You Don’t, Say! Karl Marx could hardly bring himself to utter the name of J. B. Say without affixing to it some contemptuous description or sarcastic remark: “Say’s earth-shaking discovery…” “…adopted by Ricardo from the tedious Say (and […]

Another side to the vaccine story and disease outbreaks

From the NYT comes this quick look at the vaccination issues you might have heard about in the news…Vaccine Costs Soaring and Paying till it hurts… Vaccination prices have gone from single digits to sometimes triple digits in the last two decades, creating dilemmas for doctors and their patients as well as straining public health […]

Hypocrisy ??? – Updated

Update to the Hobby Lobby decision comes as a result of a SCOTUS injunction the day before the 4th of July 2014 The nonprofit Wheaton College filed a petition to keep it from having to a file self-certification document certifying it is a religious organization and should be exempt from having to provide contraceptives. Sotomayer […]

The Other Kind of Austerity… Low labor share

Austerity by governments is a policy to reduce budget deficits by cutting spending and/or raising taxes. Basically governments withhold money from the economy. The result is that aggregate demand is reduced. Yet, there is another form of austerity where businesses lower pay to labor. In effect, businesses withhold money from the economy by reducing pay […]

Alito’s (really) weird lobbying hobby, and its chaotic results

As we will show, Congress provided protection for people like the Hahns and Greens by employing a familiar legal fiction: It included corporations within RFRA’s definition of “persons.” But it is important to keep in mind that the purpose of this fiction is to provide protection for human beings. A corporation is simply a form […]

1970s stagnation

I keep seeing references to the 1970’s stagnation that reflect a consensus belief that real GDP growth in the 1970s was significantly lower in the 1970s than in the 1980s.   But this is contrary to the data:   REAL GDP GROWTH( % )   1970…0.21……..1980…-0.04 1971….3.29……..1981….2.58 1972….5.25……..1982…-1.91 1973…..5,64…….1983….4.63 1974….-0.52…….1984….7.26 1975….-0.20…….1985…..4.24 1976….5.34………1986…..3.51 1977…..4.61………1987…..3.46 1978…..5.56………1988….4.20 1979……3.18………1979….3.68 […]

Confusion over low productivity continues… sigh

Laurence Ball wrote an article called The Great Recession’s Long-term Damage. He writes about how potential output has been reduced in many countries after the recession… “Through what mechanisms do recessions reduce potential output? This question is addressed in a number of recent papers (see Ball 2014). While the results vary, it appears that recessions […]