Monday, December 17, 2018

Blog repair…and a request for questions. [feedly]

Blog repair…and a request for questions.
http://jaredbernsteinblog.com/blog-repair-and-a-request-for-questions/

I've been remiss in keeping up with this blog. While I still post here–especially stuff that's too technical to go elsewhere and my write-up of the monthly jobs numbers–I've taken to posting most weekly takes on this or that to my PostEverything WaPo column.

In the old days, however, I used to post a link here to those posts, often with an extra comment or two. Here's a brief attempt to update:

This one's more political than usual: I pushback on Frank Bruni's NYT oped arguing that my former boss VP Biden shouldn't run in 2020. To be clear, I don't know who should run, but neither does anybody else.

Here's some noodling about what I judge to be a highly interesting moment in macro-dynamics: the job market is fueling strong consumer spending, which is almost 70 percent of US GDP. But the other components of GDP are all shakier. It's C vs. I+G+NX!

In a related recent post, I get into what some other sources recent econo-angst: the flattening yield curve and the late 2019 fiscal fade.

Another entry into current economic events: The cause for a pause in the Fed's rate hike campaign.

–I recently interviewed the great Belle Sawhill on her new book, The Forgotten American.

–I've been putting together what I call a "reconnection agenda" set of pieces intended to help members of the new House majority and their staffs think through some of the key policy issues that have been ignored or abused for too long. Here's one on fiscal policy and one on jobs. Tomorrow, I'll post #3 in this series–on climate change.

I've also featured the occasional musical link to share with those who, like me, recognize the essential importance of great music to get us through these challenging times. We if you need to ingest the chill pill, I'll happily write you a prescription for the first cut here from the Gator: Willis Gator Tail Jackson.

Finally, I was asked to do a video answering questions folks have on anything I write about–economy, political economy, markets, fiscal policy…you know my methods. So, if you've got a question that might be usefully addressed in such a venue, please post it to comments.

Thanks, and seasonally-adjusted greetings (which I guess means no greetings at all!).


 -- via my feedly newsfeed

Saturday, December 15, 2018

Bonuses are up $0.02 since the GOP tax cuts passed [feedly]

Bonuses are up $0.02 since the GOP tax cuts passed
https://www.epi.org/blog/bonuses-are-up-0-02-since-the-gop-tax-cuts-passed/

Newly available data from the Bureau of Labor Statistics' Employer Costs for Employee Compensation data allows an update of the trends of worker bonuses through September 2018, to gauge the impact of the GOP's Tax Cuts and Jobs Act of 2017. The tax cutters claimed that their bill would raise the wages of rank-and-file workers, with congressional Republicans and members of the Trump administration promising raises of many thousands of dollars within ten years. The Trump administration's chair of the Council of Economic Advisers argued in April that we were already seeing the positive wage impact of the tax cuts:

A flurry of corporate announcements provide further evidence of tax reform's positive impact on wages. As of April 8, nearly 500 American employers have announced bonuses or pay increases, affecting more than 5.5 million American workers.

Following the bill's passage, a number of corporations made conveniently-timed announcements that their workers would be getting raises or bonuses (some of which were in the works well before the tax cuts passed). But as Josh Bivens and Hunter Blair have shown there are many reasons to be skeptical of the claim that the TCJA, particularly corporate tax cuts, will produce significant wage gains.

The new data allows us to examine nonproduction bonuses in the first three quarters of 2018 to assess the trends in bonuses in absolute dollars and as a share of compensation. The bottom line is that there has been very little increase in private sector compensation or W-2 wages since the end of 2017. The $0.02 per hour (inflation-adjusted) bump in bonuses between December 2017 and September 2018 is very small. Nonproduction bonuses as a share of total compensation grew from 2.73 percent in December 2017 to 2.78 percent in September 2018, an imperceptible growth. Moreover, whatever growth in bonuses has taken place is not necessarily attributable to the tax cuts, rather than employer efforts to recruit workers in a continued low unemployment environment.

As a June 2018 Wall Street Journal article noted:

Bonuses started taking off four years ago. Businesses have been electing to give workers short-term payouts for retention and morale, rather than longer-term wage increases the economy had experienced in previous decades. Anecdotally, the trend of bonuses rather than permanent wage increases continues. A recent report by the Federal Reserve showed employers in the Atlanta Fed district were "increasing the proportion of employee compensation that is not permanent and can be withdrawn, if needed."

The figure below shows the share of total compensation represented by nonproduction bonuses for private sector workers since 2008.

Figure A

There was a sharp jump up in the share of compensation going to bonuses between the second and third quarters of 2014, rising from 1.8 to 2.5 percent, but a fairly mild drift upwards since then. The increase from the fourth quarter of 2017 to the first quarter of 2018 was from 2.7 to 2.8 percent of compensation, an increase from $0.92 to $0.96 an hour. The third quarter, measured as of September 2018, shows the same share and level of nonproduction bonuses, $0.96 an hour and 2.8 percent of compensation. The inflation-adjusted increase (all inflation-adjusted data adjusted to September 2018 dollars) in bonuses was just $0.02 an hour between the fourth quarter 2017 and the third quarter of 2018.

An examination of overall wage and compensation growth does not provide much in the way of bragging rights for tax cutters, especially given the expectation of rising wages and compensation amidst low unemployment.

The $0.02 increase in inflation-adjusted bonuses per hour over the last three quarters came as W-2 wages (defined as direct wages plus wages for paid leave and supplementary pay) actually fell $0.07, a 0.3 percent decline.

The White House contention that corporate tax cut-inspired widespread provision of bonuses that led to greater paychecks through bonuses or wage increases for workers is not supported by the BLS Employer Costs for Employee Compensation data. This is not surprising. Press releases—"a flurry of corporate announcements"—by a small group of administration-supporting firms do not create widespread bonuses or wage growth for workers. Neither do tax cuts, at least within the first nine months.


 -- via my feedly newsfeed

Thursday, December 13, 2018

By Expanding Wealth Taxes, States Can Expand Opportunity [feedly]

By Expanding Wealth Taxes, States Can Expand Opportunity
https://www.cbpp.org/blog/by-expanding-wealth-taxes-states-can-expand-opportunity

The nation's wealth is concentrated in the hands of a few (see graphic), and state tax systems have contributed to that concentration as wealthy individuals and corporations used their power to shape state tax policies to benefit themselves. But better state tax policies could help build a more broadly shared prosperity.


 -- via my feedly newsfeed

Progress Radio:Pizza Night at the Progress Diner Radio Program

John Case has sent you a link to a blog:



Blog: Progress Radio
Post: Pizza Night at the Progress Diner Radio Program
Link: http://progress.enlightenradio.org/2018/12/pizza-night-at-progress-diner-radio.html

--
Powered by Blogger
https://www.blogger.com/

Wednesday, December 12, 2018

Dani Rodrik: China’s Boldest Experiment [feedly]

The estimable Rodrik on China

China's Boldest Experiment

Dani Rodrik

Paul Krugman: The G.O.P. Goes Full Authoritarian [feedly]




Some may think these args a bit shrill. But K is right on, IMO, to warn that the authoritarian power base is well heeled, and bigger than Trump by orders 
of magnitude.

The G.O.P. Goes Full Authoritarian
https://www.nytimes.com/2018/12/10/opinion/trump-gop-authoritarian-states-power-grab.html  

Paul Krugman


Donald Trump, it turns out, may have been the best thing that could have happened to American democracy.

No, I haven't lost my mind. Individual-1 is clearly a wannabe dictator who has contempt for the rule of law, not to mention being corrupt and probably in the pocket of foreign powers. But he's also lazy, undisciplined, self-absorbed and inept. And since the threat to democracy is much broader and deeper than one man, we're actually fortunate that the forces menacing America have such a ludicrous person as their public face.

Yet those forces may prevail all the same.

If you want to understand what's happening to our country, the book you really need to read is "How Democracies Die," by Steven Levitsky and Daniel Ziblatt. As the authors — professors of government at Harvard — point out, in recent decades a number of nominally democratic nations have become de facto authoritarian, one-party states. Yet none of them have had classic military coups, with tanks in the street.

What we've seen instead are coups of a subtler form: takeovers or intimidation of the news media, rigged elections that disenfranchise opposing voters, new rules of the game that give the ruling party overwhelming control even if it loses the popular vote, corrupted courts.

ADVERTISEMENT

The classic example is Hungary, where Fidesz, the white nationalist governing party, has effectively taken over the bulk of the media; destroyed the independence of the judiciary; rigged voting to enfranchise supporters and disenfranchise opponents; gerrymandered electoral districts in its favor; and altered the rules so that a minority in the popular vote translates into a supermajority in the legislature.

As Hungary's prime minister, Viktor Orban has worked against democratic norms.CreditRoni Rekomaa/Bloomberg, via Getty Images
Image
As Hungary's prime minister, Viktor Orban has worked against democratic norms.CreditRoni Rekomaa/Bloomberg, via Getty Images

Does a lot of this sound familiar? It should. You see, Republicans have been adopting similar tactics — not at the federal level (yet), but in states they control.

As Levitsky and Ziblatt say, the states, which Justice Louis Brandeis famously pronounced the laboratories of democracy, "are in danger of becoming laboratories of authoritarianism as those in power rewrite electoral rules, redraw constituencies and even rescind voting rights to ensure that they do not lose."

Thus, voter purges and deliberate restriction of minority access to the polls have become standard practice in much of America. Would Brian Kemp, the governor-elect of Georgia — who oversaw his own election as secretary of state — have won without these tactics? Almost certainly not.

Get our weekly newsletter and never miss an Op-Doc

Watch Oscar-nominated short documentaries from around the world made for you.

SIGN UP

ADVERTISEMENT

And the G.O.P. has engaged in extreme gerrymandering. Some people have been reassured by the fact that the Democratic landslide in the popular vote for the House did, in fact, translate into a comparable majority in seats held. But you get a lot less reassured if you look at what happened at the state level, where votes often weren't reflected in terms of control of state legislatures.

Let's talk, in particular, about what's happening in Wisconsin.

There has been a fair amount of reporting on the power grabcurrently underway in Madison. Having lost every statewide office in Wisconsin last month, Republicans are using the lame-duck legislative session to drastically curtail these offices' power, effectively keeping rule over the state in the hands of the G.O.P.-controlled Legislature.

What has gotten less emphasis is the fact that G.O.P. legislative control is also undemocratic. Last month Democratic candidates received 54 percent of the votes in State Assembly elections — but they ended up with only 37 percent of the seats.

In other words, Wisconsin is turning into Hungary on the Great Lakes, a state that may hold elections, but where elections don't matter, because the ruling party retains control no matter what voters do.

And here's the thing: As far as I can tell, not a single prominent Republican in Washington has condemned the power grab in Wisconsin, the similar grab in Michigan, or even what looks like outright electoral fraud in North Carolina. Elected Republicansdon't just increasingly share the values of white nationalist parties like Fidesz or Poland's Law and Justice; they also share those parties' contempt for democracy. The G.O.P. is an authoritarian party in waiting.

Which is why we should be grateful for Trump. If he weren't so flamboyantly awful, Democrats might have won the House popular vote by only 4 or 5 points, not 8.6 points. And in that case, Republicans might have maintained control — and we'd be well along the path to permanent one-party rule. Instead, we're heading for a period of divided government, in which the opposition party has both the power to block legislation and, perhaps even more important, the ability to conduct investigations backed by subpoena power into Trump administration malfeasance.

But this may be no more than a respite. For whatever may happen to Donald Trump, his party has turned its back on democracy. And that should terrify you.

The fact is that the G.O.P., as currently constituted, is willing to do whatever it takes to seize and hold power. And as long as that remains true, and Republicans remain politically competitive, we will be one election away from losing democracy in America.

Follow The New York Times Opinion section on Facebook, Twitter (@NYTopinion)and Instagram, and sign up for the Opinion Today newsletter.

Editors' Picks

Dorm Living for Professionals Comes to San Francisco

Justin Trudeau's Official Home: Unfit for a Leader or Anyone Else

How a Liberal Couple Became Two of N.Y.'s Biggest Trump Supporters

Paul Krugman has been an Opinion columnist since 2000 and is also a Distinguished Professor at the City University of New York Graduate Center. He won the 2008 Nobel Memorial Prize in Economic Sciences for his work on international trade and economic geography. @PaulKrugman

A version of this article appears in print on Dec. 11, 2018, on Page A26 of the New York edition with the headline: The G.O.P. Goes Full Authoritarian. Order Reprints | Today's Paper | Subscribe

 -- via my feedly newsfeed