IMMIGRATION AND EMPLOYMENT. The Pew Center goes looking for evidence that immigration costs native born Americans jobs and can't find any . --Matthew Yglesias
  • More "Entitlement" Nonsense at the Post

    Yet again the Post reports on the threat posed by �entitlement� spending, referring to Social Security, Medicare, and Medicaid. To quickly repeat myself, this is dishonest. There are modest and manageable increases in projected Social Security spending due to the aging of the population. There are unmanageable projected increases in Medicare and Medicaid expenditures due to a projected explosion in health care costs. If the projected explosion in health care costs proves accurate, then it will devastate the economy, and cause serious budget problems. Honest people respond to these projections by examining ways to prevent the explosion in health care costs. Less honest people talk about the need to cut entitlement spending, including Social Security. Next month we start a new fundraising vehicle for CEPR. We want people to pledge a certain amount (e.g. 5 cents, 50 cents, etc.) for every time the Post runs an article/column warning about entitlement spending (: -- Dean Baker
  • Wrong Experts on Inflation and Unemployment

    The Times had an article examining the prospects of the Fed being able to successfully bring down the inflation rate, without also inducing a recession. While it is a thoughtful piece, the two experts whose views dominate the article, Robert Gordon and Lawrence Meyer, have the distinction of having been proven completely wrong on this topic by the events of the nineties. Both were prominent inflation hawks in the mid/late nineties, arguing that low unemployment would trigger an outbreak of accelerating inflation. In fact, Meyer, who was a Fed governor at the time, led an unsuccessful campaign to force Greenspan to raise interest rates to slow the economy and raise the unemployment rate. Of course, the unemployment rate continued to fall through the late nineties, and there was no noticeable uptick in the inflation rate for most of the decade. This failure doesn�t mean that Gordon and Meyer�s views should be ignored, both have done extensive research on this topic. But, given the track...
  • Trade Deficits and Living Standards

    The modest drop reported in the trade deficit in June is good news, the current deficit is unsustainable. A declining trade deficit will also help to boost economic growth, as noted in a Times article this morning. However, the article missed an important part of the story. Growth due to a declining trade deficit does not directly translate into improving living standards in the United States. For example, if the economy grows 3 percent next year, but 2 percentage points of this growth is due to a falling trade deficit, then domestic demand (consumption, investment, and government spending) can only increase by 1 percent. If employment grows by 1 percent (a modest 1.4 million rate of job creation), this means that wages, on average, do not rise. In short, a declining trade deficit has the same effect on living standards as a tax increase; we will be able to see less of what we produce. This �tax increase� will come in the form of rising import prices, which will add to inflation, or...

    JOE AND THE STOCK OPTIONS. In between writing a bunch of frightening posts about the bursting housing bubble , Dean Baker took some time out yesterday to remind us of Joe Lieberman 's ignominious and highly consequential '90s-era role in getting the Financial Accounting Standards Board to back down from requiring that stock options be treated as expenses against profit. This story won't be news to a lot of readers, but Dean's pithy account offers a nice little reminder that the senator's domestic policy record isn't as uncheckered or unimpeachably liberal as his defenders have asserted. (It certainly offers a nice counterpoint to the emerging, crazy narratize pitting Lunch Pail Joe and the hearty blue collar base he embodies against a bunch of namby-pamby elite liberals.) Take a look. --Sam Rosenfeld

    IN HOUSE WANKING. I just thought I'd point out that the commenters seem to me to have the goods on Ben "TNR" Adler and the question of whether or not Israel has expansionist policies. --Matthew Yglesias

    ADDICTED TO FAILURE. Bush says today's plots serve as a "stark reminder that this nation is at war with Islamic fascists." If anything, it's a stark reminder of the reverse. A stark reminder that this isn't a "war" at all -- you don't foil a plot like this with armored personnel carriers and JDAMs. We're also not going to capture the capital city of "Islamic fascism" -- not Kabul, not Baghdad, not even Teheran and Damascus -- and force our adversaries to surrender. It's not at all difficult to kill or capture terrorists. Instead, what makes them dangerous is that they're hard to identify. What makes them doubly dangerous is that because they're hard to identify, the temptation is to target them very broadly. And as we saw in the administration's desperately failed strategies in the "Sunni triangle" when you tar huge numbers of not-yet-opponents in your effort to find the bad guys, you wind up generating a much larger number of adversaries. The great challenge is to identify strategies...

    JUST POSTED ON TAP ONLINE: SPILLS OF WAR. Christopher Moraff reports on an ongoing environmental disaster in Lebanon: a gigantic oil spill off the Mediterrenean coast caused by Israel's bombing of a power plant three weeks ago. The total spill could rival the Exxon Valdez catastrophe of 1989 -- and the continuing war is preventing government and international agencies from fully addressing the situation or containing the damage. Read the whole thing . --The Editors

    GRATUITOUS SHOT. You'd think, having just complained that The Nation and other lefty media outlets ought to be more focused on the increasing influence of rightwing Christian Zionism than on AIPAC, that I'd be delighted by this new piece by Max Blumenthal . And I am pleased to see Blumenthal's comprehensive reporting on the influential new group Christians United for Israel (CUFI), and the Armageddon-based philosophy of its founder, John Hagee . (Don't miss the extensive work done on Hagee by the Prospect 's own Sarah Posner .) But why does Blumenthal indulge in outdated Israel-baiting by saying CUFI believes "supporting Israel's expansionist policies is 'a biblical imperative'"? Expansionist policies? Didn't Israel withdraw from Gaza? Wouldn't that be precisely the opposite of expansionism? Indeed Blumenthal later mentions that when Christian Zionist Pat Robertson suggested Ariel Sharon's stroke was God's punishment for withdrawing, CUFI's spokesman defended Robertson. So wouldn't it...
  • TERROR PLOT: ...

    TERROR PLOT: NO OPPORTUNITY WASTED FOR POLITICAL GAIN. President George W. Bush could have moved to reassure the American people, in his statement from Green Bay, that their well-being is first and foremost in the minds of public officials -- that the government will leave no stone unturned in its quest to maintain the safety of American citizens. Instead, the president decided to play politics. The first public words out of the mouth of the president regarding a plot that his spokesman said was "a direct threat to the United States" was that the plot constituted a "stark reminder" that the nation is "at war with Islamic fascists." This, of course, is the rationale used by the administration for its invasion of Iraq. (Note Matt 's reference to the "fly paper" strategy.) It also comes the day after, as mentioned on MSNBC by Andrea Mitchell , a "well-coordinated" political attack by Vice President Dick Cheney on Democrats in the wake of the Lieberman defeat. From Reuters : Echoing a...