2017/04/24: Economists are very worried about the decline in labor’s share of U.S. national income. One reason they’re concerned is because when less of an economy’s wealth flows to workers, it exacerbates inequality and increases the risk of social instability. But another reason is that this trend throws a wrench in economists’ models. For decades, macroeconomic models assumed that labor and capital took home roughly constant portions of output -- labor got just a bit less than two-thirds of the pie, capital slightly more than one-third. Nowadays it’s more like 60-40.
There are four main theories, each of which falls apart under scrutiny.
2015/05/18: on Irak and WMD
We are creating a permanent class of unemployed Americans.
I don't know how we go forward from here. Is America a failed state and society? It looks truly possible.
New technologies offer important tools for empowerment - yet democracy is stagnating. What's up?
Il premier britannico David Cameron è gongolante per un risultato che nemmeno lui sperava potesse realizzarsi. Tuttavia, l'esito sorprendente di questa competizione elettorale, benché dia apparentemente credito a Cameron di poter condurre una legislatura priva di gravi problemi grazie alla maggioranza che gli consente di governare senza ricorrere ad alleanze, potrebbe invece dargli problemi molto seri
2015/04/29: The case for cuts was a lie. Why does Britain still believe it?
The austerian ideology that dominated elite discourse five years ago has collapsed, to the point where hardly anyone still believes it. Hardly anyone, that is, except the coalition that still rules Britain – and most of the British media.
I don’t know how many Britons realise the extent to which their economic debate has diverged from the rest of the western world – the extent to which the UK seems stuck on obsessions that have been mainly laughed out of the discourse elsewhere. George Osborne and David Cameron boast that their policies saved Britain from a Greek-style crisis of soaring interest rates, apparently oblivious to the fact that interest rates are at historic lows all across the western world. The press seizes on Ed Miliband’s failure to mention the budget deficit in a speech as a huge gaffe, a supposed revelation of irresponsibility; meanwhile, Hillary Clinton is talking, seriously, not about budget deficits but about the “fun deficit” facing America’s children.
Is there some good reason why deficit obsession should still rule in Britain, even as it fades away everywhere else? No. This country is not different. The economics of austerity are the same – and the intellectual case as bankrupt – in Britain as everywhere else.
Herring, the secret to world domination.
The critics prove too much.
It's inequality, not social collapse.
Se il mondo nel quale stiamo vivendo da cinque anni a questa parte fosse la nuova normalità? La crisi finanziaria che ha avuto inizio con la Grande Recessione è ormai acqua passata. Nonostante ciò, la nostra economia continua a essera depressa di PAUL KRUGMAN Se
2013/11/21: a funny thing has happened in the past year or so. Suddenly, we’re hearing
open discussion of the idea that Social Security should be expanded, not cut.
Talk of Social Security expansion has even reached the Senate, with Tom Harkin
introducing legislation that would increase benefits. A few days ago Senator
Elizabeth Warren gave a stirring floor speech making the case for expanded
Where is this coming from? One answer is that the fiscal scolds driving the
cut-Social-Security orthodoxy have, deservedly, lost a lot of credibility over
the past few years. (Giving the ludicrous Paul Ryan an award for fiscal
responsibility? And where’s my debt crisis?) Beyond that, America’s overall
retirement system is in big trouble. There’s just one part of that system
that’s working well: Social Security. And this suggests that we should make
that program stronger, not weaker.
Before I get there, however, let me briefly take on two bad arguments for
cutting Social Security that you still hear a lot.
One is that we should raise the retirement age — currently 66, and scheduled to
rise to 67 — because people are living longer. This sounds plausible until you
look at exactly who is living longer. The rise in life expectancy, it turns
out, is overwhelmingly a story about affluent, well-educated Americans. Those
with lower incomes and less education have, at best, seen hardly any rise in
life expectancy at age 65; in fact, those with less education have seen their
life expectancy decline.
So this common argument amounts, in effect, to the notion that we can’t let
janitors retire because lawyers are living longer. And lower-income Americans,
in case you haven’t noticed, are the people who need Social Security most.
The other argument is that seniors are doing just fine. Hey, their poverty rate
is only 9 percent.
There are two big problems here. First, there are well-known flaws with the
official poverty measure, and these flaws almost surely lead to serious
understatement of elderly poverty. Furthermore, the elderly poverty rate is highly likely to rise sharply in the future, as the failure of America’s private pension system takes its toll.
Adjustment in a low-inflation eurozone: mission impossible?
Don't blame unemployment insurance.
What happens when good jobs disappear? It's a question that's been asked for centuries.
Paul Krugman has no concept of money as something that can be designed, but his argument on the social aspect of money can't be ignored: "The similarity to goldbug rhetoric isn't a coincidence, since goldbugs and bitcoin enthusiasts - bitbugs? - tend to share both libertarian politics and the belief that governments are vastly abusing... Continue reading ...
Words ought to be a little wild.
1997/03/20: an op-ed piece I had written for the New York Times, in which I had pointed out that while wages and working conditions in the new export industries of the Third World are appalling, they are a big improvement over the "previous, less visible rural poverty." I guess I should have expected that this comment would generate letters along the lines of, "Well, if you lose your comfortable position as an American professor you can always find another job--as long as you are 12 years old and willing to work for 40 cents an hour."
Such moral outrage is common among the opponents of globalization--of the transfer of technology and capital from high-wage to low-wage countries and the resulting growth of labor-intensive Third World exports. These critics take it as a given that anyone with a good word for this process is naive or corrupt and, in either case, a de facto agent of global capital in its oppression of workers here and abroad.
But matters are not that simple, and the moral lines are not that clear. In fact, let me make a counter-accusation: The lofty moral tone of the opponents of globalization is possible only because they have chosen not to think their position through. While fat-cat capitalists might benefit from globalization, the biggest beneficiaries are, yes, Third World workers.