The Mismatch Between Economic Consensus and What To Do About It
August 26, 2011
[Guest post by Matthew Zeitlin] When Congressional Budget Office head Douglas Elmendorf sat down with reporters on Tuesday to give the CBO’s update on the budget and economic outlook, he repeatedly shied away from one word: should. The CBO, Elmendorf said multiple times, does not make recommendations to policy makers about what policies they should pursue. They merely provide analysis on the state of the economy and the budget, as well as projections for the effects of proposed policies.
Think Progress: Leave Mitt Romney Alone!
August 16, 2011
[Guest post by Matthew Zeitlin] Last week, Think Progress caught Mitt Romney saying “corporations are people, my friend.” Jon Chait pointed out that Romney was clearly referring to the incidence of corporate taxes—which are ultimately borne by people—not the more-than-century old legal doctrine by which corporations have the some of the rights and protections as individuals. Romney committed a classic “Kinsley gaffe,” whereby a politician catches flack for saying something true.
Rick Perry and the Campaign That Never Happened
August 15, 2011
[Guest post by Matthew Zeitlin] While a big part of Rick Perry’s campaign pitch is comparing the job growth in Texas to that of the rest of the nation, it seems likely that another aspect will be implying that Rick Perry—a conservative, white Southerner from Texas—is more American than Barack Hussein Obama.
With all the chaos and rioting in the streets of London, it’s proven quite difficult for the media to parse out exactly who is participating in the unrest and what sort of grievances or agenda they might possess. Some have located the cause in the police shooting of Londoner Mark Duggan on Tuesday, August 4. Others have taken a more sociological approach, pointing to issues of race, class, and social alienation in the city’s poorest neighborhoods.
Look Who’s Profiting From the Debt Ceiling Crisis
July 30, 2011
The consequences of the current impasse over the debt ceiling are highly uncertain. What is certain is that, whether it’s a mild increase in interest rates that leads to an uptick in unemployment or an economic calamity caused by the debt default, the fallout from a failure to resolve the crisis is sure to be negative. But is anyone benefiting from the crisis? Turns out, yes.
Least Convincing Advocate Ever
July 18, 2011
[Guest post by Matthew Zeitlin] An under-remarked upon aspect of the debt ceiling debate is the so-called “carried interest” loophole. The way this works is that the managers of a private equity, hedge, venture capital, or private real estate fund pay the capital gains rate on the income they accrue from the profits of an investment, even from the money that other people or organizations or people put into the fund.
The Republican Theory of Our Current Economic Woes
July 18, 2011
[Guest post by Matthew Zeitlin] According to both Republican politicians and conservative opinion-writers, the problem with our economy is not a shortfall of demand. If they thought this was the problem, you would not see the calls for massive reductions in spending right now, you would not see Paul Ryan describing a payroll tax holiday as a “sugar high,” and you would not see Fred Barnes totally dismissing stimulus as a way to grow the economy. Problem being, as Jon has pointed out before, everyone from Ben Bernanke to Goldman Sachs thinks that large, immediate cuts would retard growth.
[Guest post by Matthew Zeitlin] In this exchange with Tim Pawlenty, conservative economist Larry Kudlow points out that failure to raise the debt ceiling means economic disaster, and that it will be impossible to get the Senate to pass an ambitious “cut, cap and balance” plan.
[Guest post by Matthew Zeitlin] Lawrence Kudlow, as pure a supply sider as there is, makes noises that sound like what a decent number of Republican congressmen describe as “alarmism”: Senator McConnell is determined to produce something from this grand-design package. He’s a smart guy. He may be saving the GOP from itself. McConnell believes that debt default must be completely taken off the table.
The Asymmetry in Tax Debates
July 12, 2011
[Guest post by Matthew Zeitlin] David Brooks in his column today argues that there is are almost symmetrical obsessions with “magic levers” policies that can always be counted to increase growth. One group thinks that the magic lever is marginal tax rates, some other group thinks it is deficit spending, and both of these groups are very bad: The spending they began must have done some good to cushion the recession, but either through a failure of theory or a failure of implementation, their lever was not as powerful as they promised.