Jason Furman Profile picture
Aug 15, 2021 6 tweets 3 min read Read on X
I am beyond thrilled the President Biden is taking the long overdue step to adjust the Thrift Food Plan to be in line with the increased cost of healthy food. This is a large advance for poverty reduction, nutrition and opportunity for children.

nytimes.com/2021/08/15/us/…
In a 2015 CEA report we explained why the long-standing practice of updating the Thrifty Food Plan, the basis for the SNAP benefits, by inflation was an inadequate reflection of the increased cost of a nutritious meal. I'll list the reasons in this thread. obamawhitehouse.archives.gov/sites/whitehou…
1. VARIETY & PALATABILITY. The TFP departs sharply from avg food consumption. The TFP assumes consumption of foods like beans, whole wheat pasta, etc. 20X the average American consumption, while assuming near-zero consumption of some healthful foods that Americans eat regularly.
2. PREP TIME. The TFP assumes greater meal prep time than families typically spend preparing meals, btwn 1-2 hours of prep time per day, excluding shopping, but studies of low-income women found that they do not spend as much time on food prep as the TFP assumes
3. VARIATIONS IN COST. The cost of the TFP is not regionally adjusted though food costs vary substantially by location. In addition, low-income households are less likely to have access to large grocery stores that offer lower prices.
4. LAG IN INFLATION ADJUSTMENT. Every year, the TFP is adjusted for inflation. But there is a lag in the inflation adjustment of as much as 16 months by the following September. If food prices are rising over that 16 month period, the value of SNAP benefits are eroding.

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More from @jasonfurman

Jul 8
Senator's Cassidy and Kaine outline a plan to "rescue" Social Security. Both Senators are very thoughtful, bipartisanship on this issue is essential, but unfortunately I'm mostly skeptical on this proposal.

This 🧵 outlines some of the major considerations: Image
They propose the government borrowing $1.5 trillion to invest in stocks..

Simultaneously general revenue would cover full Social Security full benefits.

After 75 years, they argue, the premium on stock investments could repay that initial borrowing. washingtonpost.com/opinions/2025/…
GOVERNMENT ACCOUNTING

The way the government, or at least the Social Security acturies, does its accounting their plan works. Eg assume a 5% borrowing cost & 9% stock return then after 75 yrs govt hedge fund has net ~$640T, or ~$25T NPV--same as Social Security shortfall.
Read 14 tweets
Jul 3
The extraordinary U.S. economy continues to be extraordinary. 147K jobs added in June with upward revisions to April and May. Unemployment rate ticks down to 4.1%. Some contrary signs: participation rate down and hours down + weak wage growth. Image
Note all of this while the Federal government continues to shed jobs--although the job reductions (averaging 11k per month this year) are still small compared to underlying private sector job trends. (And in June state and local education increases overwhelmed federal cuts.) Image
And here is private job growth. Image
Read 9 tweets
Jun 27
Core PCE inflation came in just as expected. It has been very tame for the last three months--but shouldn't think of them in isolation but as part of a noisy process where inflation was much higher before.

Annual rates:
1 month: 2.2%
3 months: 1.7%
6 months: 2.9%
12 months: 2.7% Image
Here are the full set of numbers. Most of the measures lined up at this point. Image
Market-based core may be more useful. Image
Read 6 tweets
Jun 11
And in big inflation news, the CPI-based Ecumenical Underlying Inflation measure was exactly 2.0% in May, consistent with the Fed's target. This is the first time it has been there since I started this concept during the inflationary episode. Image
The ecumenical measure takes the median of 21 different measures: 7 different concepts (e.g., with and without housing) over 3, 6 and 12 months--all re-meaned to match the PCE inflation that the Fed targets.

In practice it is very similar to 6-month core CPI (re-meaned). Image
I didn't share the basic data earlier. Here is core CPI, came in well below expectations in May. Image
Read 8 tweets
Jun 6
A boring jobs report, in a good way. 139K jobs added (140K private). Unemployment rate unchanged at 4.2%. Hours unchanged. Only notable deviations from steady state were participation down and unusual wage growth up. Image
Note, Federal employment continued to decline. But state and local added almost as much. Image
Here is earnings. Image
Read 6 tweets
May 2
Strong jobs report. 177K jobs added. Unemployment rate steady at 4.2% but participation rate up and U-6 down. Hours steady. A slowdown in hourly wage growth. Image
Federal employment was down a bit but state and local more than made up for it. The trend in private jobs is basically the same as total. Image
Unemployment rate very slowly drifted up for the last year and a half. Image
Read 6 tweets

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