Many of the headlines on the new administration offer get it wrong by emphasizing the headline cost, which makes it sound serious. The key thing is the refusal to extend unemployment benefits, which is cruel and stupid 1/ huffpost.com/entry/covid19-…
THIS IS NOT ABOUT STIMULUS. As some of us emphasized all along, when a pandemic is raging the goal shouldn't be to goose the economy but to provide disaster relief to those who can't work because their usual jobs spread the virus 2/
And it's true now, as our negligence has created a wave of infections and deaths bigger than we suffered in the spring 4/
Sending everyone a $600 check totally misses the point. Most people don't need it; meanwhile it's utterly inadequate for those who do need help. Why would anyone propose swapping out unemployment aid for this? 5/
I actually don't know where this is coming from. One possibility is that Trump, still deluded in the belief that he can steal the election, wants another round of checks with his name on them 6/
Another is that Mnuchin is just stupid, that after all this time he still doesn't understand the basics of pandemic economics. OK, I guess these aren't mutually exclusive 7/
Somehow this makes me even angrier than McConnell's stonewalling. MM is at least evil in an understandable way. What we're seeing here, in the final economic act of the Trump admin, is a special mix of cruelty and cluelessness 8/
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The GOP spent most of 2020 rejecting science in the face of a deadly pandemic; now it's rejecting democracy in the face of a clear election loss. How did we get to this point? One step at a time, of course. But I'd argue that the wrong turn began under Reagan 1/
Republicans have, of course, done their best to beatify Reagan — mainly on the basis of an economic recovery that he didn't cause and the collapse of Communism, which he also didn't cause. What actually happened on his watch? 2/
Well, for one thing it was the beginning of the great mortality divergence. America used to have about the same life expectancy as other rich countries; since 1980, however, we've fallen far behind 3/
The paradox of the Trump economy: the economy did pretty well even though his two main policy initiatives — cutting taxes on corporations to encourage investment and tariffs to reduce trade deficits — were busts. Here's business investment: 1/
And here's trade: 2/
So what did go right? As I've been saying, inadvertent and unadmitted Keynesianism: big increase in cyclically adjusted deficits, driving demand 3/
So, I was too busy to comment on the jobs numbers this AM. But let's step back: you should see where we are in the context of Trump's decision, back in April, to stop fighting the virus and in fact bully states into relaxing restrictions 1/
This was supposed to lead to rapid economic recovery; in fact, after a few months the recovery slowed and has now effectively stalled, with the US still ~10 million jobs down 2/
Meanwhile, the virus was supposed to go away; instead, 200,000 more people have died, with high likelihood that another 100,000 or more will die before Trump leaves office 3/
Now, many people will surely start waving around frightening-looking projections, like those of the CBO 2/ cbo.gov/publication/56…
But while I respect CBO's integrity, those long-run debt projections are much more questionable than people probably realize. Realistic projections, I (and many sensible economists) argue, are much less alarming 3/
More on fiscal issues: once Biden is in office, expect Rs to wave around a lot of charts purporting to show a dangerous long-run debt trajectory. And to be fair, long-term CBO projections show a big rise in debt 1/
But what's driving those projections? Mainly it's rising interest costs — which in turn are driven largely by the assumption that rates will rise a lot 2/
But as Furman and Summers point out, CBO has consistently projected big rate increases that haven't happened 3/ piie.com/system/files/d…
This is going to be a very dark and tragic winter — especially tragic because so many Americans are going to die unnecessarily 1/ nytimes.com/2020/11/27/hea…
We've known since the early days of the pandemic that it was crucial to flatten the curve to avoid overloading the health care system 2/ nytimes.com/article/flatte…
And the case for flattening the curve is especially strong now that we know that a vaccine is on the way: at this point an infection postponed for a few months may well be an infection avoided 3/