• Unemployment Rate Drops Another 0.4 Percentage Points, Despite Weak Job Growth

    For the second consecutive month, the unemployment rate fell by 0.4 percentage points, despite the weak job growth reported in the establishment survey.  The establishment survey showed a gain of just 36,000 jobs in January, following a revised gain of 121,000 jobs in December.  The big gainers in January were white men, who saw their […]

  • Plunging Imports Lead to Sharp Boost in 4th Quarter GDP

    Imports fell at a 13.6 percent annual rate in the fourth quarter, contributing 2.4 percentage points to the 3.2 percent growth rate for the quarter.  The replacement of foreign-produced goods by domestically produced goods was the largest factor propelling growth in the quarter.  Consumption of durable goods, led by a surge in new car purchases, […]

  • House Prices Fall Sharply in November, Led by Bottom Tier of Market

    The Case-Shiller 20-City index showed a sharp decline in prices again in November, dropping by a full percentage point.  Nineteen of the twenty cities showed a decline in prices.  San Diego was the only city where prices rose, albeit by only 0.1 percent.  The 20-city index has fallen at an annual rate of 11.9 percent […]

  • The Tidal Wave of Nonsense on Demography

    The debate over the demographic trends in the United States and other wealthy countries can be described a debate between those who care about our children and those who want more of them.  This is apparent once a little bit of logic is applied to the tales of demographic disaster being hawked by those concerned […]

  • Why Take an Ax to the Safety Net?

    Comments made at the Brookings Institution Forum titled “Should the Disadvantaged Be Spared From the Budget Axe? A Look at the President’s Budget Commission Findings and How They Could Impact the Poor,” December 16, 2010 I am about to make comments that will likely place me seriously at odds with the other members of this […]

  • Paul Krugman on the Euro Crisis

    Paul Krugman does a very good job laying out the issues behind the euro zone crisis in his NYT Magazine piece.  There are two additional points that would have been worth noting. First, there are powerful forces who are working hard to prevent the partial or full Argentinification (partial default or a departure from the […]

  • The Social Security Benefits of Sitting Senators

    In November, Colorado Senator Michael Bennet was interviewed on National Public Radio’s Morning Edition by Renee Montagne.1  In the course of the interview, Senator Bennet told Ms. Montagne that, as a 45-year old, he would get no Social Security benefit if the program is not fixed. This is not true.  According to the most recent […]

  • Employment Growth Concentrated among Workers over Age 55

    The Labor Department reported that the unemployment rate fell to 9.4 percent in December.  However, much of the reason for the decline was a drop of 260,000 in the size of the labor force.  The employment-to-population (EPOP) ratio inched up by 0.1 percentage points to 58.3 percent, but it is still 0.2 percentage points below […]

  • Contrary to the New York Times’ Assertion, Japan Does Not “Face a Looming Demographic Squeeze”

    Note that the labor force participation rate of women in Japan is a mere 48.5 percent, much lower than the 72.0 percent rate for men, a fact disregarded by both the New York Times and Dean Baker. — Ed. For some reason the New York Times wants to scare its readers about Japan’s economic situation, […]

  • Weak Job Growth Pushes Employment Rate Back to Downturn Low Point

    The establishment survey showed the economy adding just 39,000 jobs in November.  As a result of slow job growth, the unemployment rate rose to 9.8 percent.  The employment-to-population ratio (EPOP) fell to 58.2 percent, the low hit in December of last year.  The EPOP for white men and white women both dropped below their prior […]

  • If China Wants to Pay for Our Vacations, Should We Let Them?

    Trade disputes with China have been heating up lately, but there really is no reason for the hostility.  Essentially the dispute boils down to the fact that China wants to subsidize the consumption of people in the United States and elsewhere, by propping up the value of the dollar. This is raising objections from the […]

  • New Home Prices Plunge in October

    The Census Bureau reported last week that the median price for a new home fell from $226,300 in September to $194,900 in October, a one-month decline of 13.9 percent.  While new home sales prices are always erratic and the October data were pushed downward in part by a relative increase in sales in the low-cost […]

  • Ireland Should Study the Lessons of Argentina

    When a firefighter or medical team make a rescue, the person is usually better off as a result.  This is less clear when the rescuer is the European Central Bank (ECB) or the IMF. Ireland is currently experiencing a 14.1 percent unemployment rate.  As a result of bailout conditions that will require more cuts in […]

  • David Brooks’ Apocalypse

    “Elections come and go, but the United States is still careening toward bankruptcy.  By 2020, the U.S. will be spending $1 trillion a year just to pay the interest on the national debt.  Sometime between now and then the catastrophe will come.  It will come with amazing swiftness.  The bond markets are with you until […]

  • Are Public Sector Workers Overpaid?  The Story of Underfunded Pensions

    There has been a serious effort by many on the right to claim that public sector workers are overpaid.  The typical way that critics make this argument is to simply compare the average wage of workers in the public sector and the private sector.  This comparison does indeed show that public sector workers are paid […]

  • On Deficit Commission Proposals

    November 10, 2010 Senator Alan Simpson and Erskine Bowles appeared to have largely ignored economic reality in developing the proposals they presented to the public today. The country is suffering from 9.6 percent unemployment with more than 25 million people unemployed, underemployed, or who have given up looking for work altogether.  Tens of millions of […]

  • Dear Senator Michael Bennet

    November 9, 2010 The Honorable Michael Bennet 702 Hart Senate Office Building Washington, DC 20510 Dear Senator Bennet: I heard you say during your interview on National Public Radio this morning that if nothing is done, there will be no Social Security for people your age.  This is badly mistaken.  You should know, both for […]

  • Action on Social Security: The Urgent Need for Delay

    Introduction Many policymakers and analysts are arguing that there is an urgent need to make changes to Social Security.  They point out that the projections from the Congressional Budget Office and the Social Security Trustees show the program to be out of balance in the long-term, therefore we would be best advised to make changes […]

  • How Many Jobs Does It Take to Hold the Unemployment Rate Constant?

    This one should not be all that hard but the papers have numbers all over the place.  Let’s turn to our old friend, arithmetic, to shed some light on the topic.  The Congressional Budget Office tells us that the labor force is growing at the rate of 0.7 percent a year.  The current size of […]

  • Economy Adds 151,000 Jobs In October, But Employment Rate Falls

    Nominal wages have risen at a 2.2 percent annual rate over the last quarter. The establishment survey showed the economy adding 151,000 jobs in October, the biggest rise since May.  The 159,000 increase in private sector employment was the second-largest monthly rise of the recovery.  Although the rate of job growth is about 50,000 more […]