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

Does Steady GDP Growth “Prove” that Market Monetarists Are Right About Ineffective Fiscal Policy and Foolish Keynesianism?

You’re seeing a lot of crowing these days from the likes of Scott Sumner, David Beckworth, Lars Christensen, et al., claiming that fiscal austerity has obviously had no effect on GDP growth. “Look!” they say: “Even with the sequester and all the other government spending cuts, growth in 2013 has been the same as 2012! […]

What Reinhart and Rogoff should do now

Carmen Reinhart and Kenneth Rogoff wrote an angry open letter about how Krugman has been uncivil to them. ¬†Krugman’s reply strikes me as being convincing even devastating. Update: My full fisking here. I want to focus on one sentence in the R&R letter   “politicians may float a citation to an academic paper if it […]

Four easy fixes for corporate taxation

Everyone “knows” that the corporate income tax is a mess. Ask any company. They pay too much in corporate income tax, face rates higher than in any other OECD country, and are just following the law when they use tax havens to keep profits eternally deferred from taxation and to perform general sleight-of-hand.   Don’t […]

How Wall Street Stole Main Street

This graph speaks volumes: Profits as a Percent of GDP: Financial Corporations vs. Nonfinancial Corporations We saw a big decline in real businesses’ profit share in the 40s, then a slower semi-steady decline through the 70s, as wages constituted a larger share of GDP. Financial corps doubled, expanding and increasing profits, but they remained small […]

Medicare Claim Costs Growth Under 1% in 2013??? Why?

“All nine of S&P Healthcare Economic Indices showed slower annual growth rates for February 2013 compared to January 2013. As measured by the S&P Healthcare Economic Commercial Index, healthcare costs covered by commercial insurance plans rose by 4.62% in February, down from +5.41% reported for January. Annual growth rates in Medicare claim costs increased by […]