Mitch McConnell Is Directionally Challenged
December 22, 2010
[Guest post by Noam Scheiber:] My favorite paragraph in the McConnell op-ed Chait mentioned earlier: Some Democrats have responded to the election by reaffirming their belief in government’s ability to solve our problems. But many others have acknowledged with their votes on the tax bill that the policies of the last two years have fallen short, and that it’s time to move in a different direction.
So Is Roger Altman Replacing Larry Summers or Not?
December 14, 2010
[Guest post by Noam Scheiber:] Anyone interested in this question has no doubt read about Altman's multiple White House visits to discuss relieving Larry Summers as head of the National Economic Council (NEC). And yet, here we stand, just days from Summers's planned departure--NEC staffers have been busy writing exit memos, as I understand it--without an announcement about his replacement.
December 08, 2010
Geoffrey Wheatcroft on the mirage of Irish independence.
Obama’s Hold on Big Business
December 02, 2010
Two weeks after a mid-term election in which the U.S. Chamber of Commerce helped thwart Barack Obama and the Democrats, the group’s CEO, Tom Donohue, gave a speech that read like a doubling down of sorts. “We cannot allow this nation to move from a government of the people to a government of the regulators,”he said.
Extend the Bush Tax Cuts Below $1 Million? I'm Intrigued...
November 19, 2010
[Guest post by Noam Scheiber:] The idea's been bouncing around for a while, but Politico suggests some Senate Dems are now seriously considering it, even if many of their colleagues aren't wild about it: Senate Democrats struggled Thursday to figure out what that next step would be.
Fighting the Fed
November 17, 2010
Last week, in between leading a graduate seminar on Proust and delivering a long-scheduled lecture on mass spectrometry, former Alaska Governor Sarah Palin ventured a few ticks beyond her acknowledged area of expertise and reflected on monetary policy at a convention in Phoenix. The occasion for her unexpected soliloquy—I’m actually serious about the economics speech—was the Fed’s decision to buy some $600 billion in long-term government securities, a practice known as quantitative easing. “We shouldn’t be playing around with inflation,” Palin said, in a typically Delphic pronouncement.
Is the Mortgage-Interest Deduction Really A Middle-Class Tax Break?
November 16, 2010
Over in the comments section for our editorial about the deficit commission, several readers have taken umbrage with our claim that the mortgage-interest deduction overwhelmingly favors the wealthy. One makes his case by citing this paragraph from a recent Paul Krugman column: Actually, though, what the co-chairmen are proposing is a mixture of tax cuts and tax increases — tax cuts for the wealthy, tax increases for the middle class.
Way Too Big To Fail
November 07, 2010
There were many factors that led us to the financial crisis of 2008—dangerous derivatives, irresponsible ratings agencies, negligent regulators—but one was more important than the rest. We now know it as the “too big to fail” problem. What brought the economy to the edge of disaster wasn’t only that financial institutions had made rash bets on lousy investments, but that those institutions were so massive that when their bets went bad, they threatened to take the rest of the economy down with them.
Where David Brooks Goes Wrong
November 05, 2010
[Guest post by Noam Scheiber:] David Brooks thinks voters are rejecting Obama because he’s too liberal. I think voters are mainly (if not entirely) pissed off because unemployment is really high, and that Brooks’s argument, which he’s been making for a while now, leans on some pretty implausible assumptions. I don’t think either side of this debate is going to convince the other any time soon. But maybe it’s at least worth pointing out two places where today's Brooks column comes up a bit short. 1.) Brooks writes: Some Democrats believe their policies have nothing to do with the debacle.
October 29, 2010
With Republicans poised to sweep into office and obstruct Obama's agenda, is there anything he can do to revive the economy over the next two years? Last week I wrote about the possibility that we’re in a Japan-style recession—a rare form of economic disease that’s largely unresponsive to conventional remedies, like lower interest rates. This type of malady—the fashionable term is “balance-sheet recession”—tends to follow a collapse in the price of housing or stocks, at which point people become so preoccupied with paying down debt that they refuse to borrow even on super-attractive terms.