I was very disappointed that the Harvard Law Student Government endorsed divesting in Israel. This following on what the Harvard Graduate Student Union did some time ago illustrates that there is a pervasive prejudice problem on the Harvard campus. I continue to believe that BDS advocacy, if heeded, would represent anti-semitism in effect, if not intent.

In new NBER paper with @MA_Bolhuis, @juddcramer and Oskar Shulz, we argue that the unprecedented increase in borrowing costs is crucial to explaining the low consumer sentiment of the last two years. 1/N
nber.org/papers/w32163 With higher rates, mortgage payments, car payments, and other credit payments required to finance everyday purchases have risen as well. It is not surprising that this would affect how consumers feel about the economy. 2/N

In nearly 50 years of @Harvard affiliation, I have never been as disillusioned and alienated as I am today. The silence from Harvard’s leadership, so far, coupled with a vocal and widely reported student groups' statement blaming Israel solely, has allowed Harvard to appear at best neutral towards acts of terror against the Jewish state of Israel.

Listen here to 20VC podcast where I talk with @HarryStebbings about how to manage inflation, why we need to change the US tax system and more.

thetwentyminutevc.com/larry-summers/ @HarryStebbings asked me: What is the path out of US indebtedness?

First of all, we need to put it in perspective. A growing company can have a permanently growing debt. A growing economy can have a permanently growing government debt.

While I am glad to see that the “debt limit crisis” is in the rearview mirror, CBO projects budget deficits will exceed 7 percent of GDP and be on an upwards trajectory a decade from now.

Watch my @PIIE talk here:

youtube.com/live/2jcW_YomN… via @YouTube For all of the post financial crisis/ pre-pandemic period I feared secular stagnation and opposed fiscal alarmism. But now I am alarmed because we are in new and dangerous territory.

Very good @WSJ interview with the very wise Bob Rubin on his new book, The Yellow Pad: Making Better Decisions in an Uncertain World, and the challenges facing the United States.

wsj.com/articles/rober… via @WSJ The fact that the US is the only country where a career like Bob Rubin’s is possible makes me--for all our problems--more optimistic about our prospects than those of any other country.

@JakeSullivan46 is a very thoughtful leader and it's probably the most carefully intellectually developed exposition of the administration's philosophy that we have had to date.

Biden Administration's Industrial Policy
bloomberg.com/news/videos/20… Certainly, he's right that the world has changed. He's right that China represents a new kind of challenge. He's right to emphasize after what we've seen in Europe with oil, other things, the importance of resilience.

Today marks the 75th Anniversary of President Truman’s signing of the Marshall Plan into law. It might well be the greatest act of American foreign policy since World War II. Interesting to reflect on it today. Could Congress imaginably today commit 2 percent of GDP, or about $500 billion, to a 4-year foreign assistance venture? Would the Marshall Plan have passed in 1948 if it had been focus grouped?

Transferring frozen Russian reserves would be morally right, strategically wise and politically expedient — particularly with a restive U.S. Congress.

Read our @PostOpinions column with Philip Zelikow and Robert Zoellick #Ukraine️ #Russia

washingtonpost.com/opinions/2023/… There is elegant justice in using Russia's state funds, now lying idle, to counter the cost of Moscow's destruction.

I am not surprised that the group of big banks deposit in #FirstRepublicBank has done little for confidence. The banks committed for only 120 days whereas government money is in for a year, so there is not obvious economic substance. There is no transparency on what understanding there are, or are not, with the @USTreasury. And it projects more than a whiff of alarm. Policymakers can do better.

There is much fog of war surrounding the #SVB situation. Impossible to assess or prescribe with confidence, based on public information. 1/ I hope and trust that the authorities are on a path to doing what is necessary to restore confidence. Acting decisively and rapidly is both the cheapest for taxpayers and the best for the economy. Failure to act strongly enough would be a Lehman-like error. 2/

New analysis with @asdomash of Phillips curve models first put forward a year ago confirms very substantial grounds for concern that inflation is not yet on a path back to 2 percent
cepr.org/voxeu/columns/… Contrary to what others have claimed, standard models of labor market slack are not overly pessimistic as predictors of inflation, and can readily explain observed ECI wage disinflation in recent months

I told @FareedZakaria @CNN: This has evolved towards a war of attrition. That is going to make what happens to the Russian economy, and even more importantly what happens to the Ukrainian economy, central to how this plays out.

https://twitter.com/FareedZakaria/status/1629836177816842245

Russian economic sanctions haven’t really bitten that hard because less than half the world has been involved as part of the sanctions. A large part of the worlds' GDP --China, India, Turkey-- have not been part of the sanctions.

Friday’s PCE figures, with both core and headline inflation running at 7 percent last month and big upward revisions for the 4th quarter, are very troubling. They suggest that the @FederalReserve may have made much less progress in containing underlying inflation than has been generally supposed and make a soft landing look less likely.

1/The Fed's been trying to put the brakes on and it doesn't look like the brakes are getting much traction. And when your brakes don't get much traction, two things happen. You can be moving too fast, that's the inflation pressure.

via @YouTube 2/And you can be setting yourself up for some kind of collision or a crash down the road.

And both of those things, I think, are real risks in this environment.

Watch my interview last night with @DavidWestin @BloombergTV where we discuss three reasons the debt trajectory could be worse than CBO is saying.

youtube.com/playlist?list=… via @YouTube First, the @USCBO projection for the @federalreserve rate to settle for the long term at 2.5%, without there having been a recession, leaves much more room to be too low than to be too high.

The ECI # showed encouraging signs of disinflation even in a labor shortage economy, which raises possibility that inflation can decline w less slack than standard models suggest. Private wages ex incentive paid grew by 4.3% over last quarter, consistent w inflation near 4% But historically tight labor markets & seasonal factors mean there are still some risks of a false disinflationary dawn. Many contracts reset in Jan which may introduce catch-up raises. Estimates show that min wage hikes over last month increased wages for more than 8M workers

How the global Pandemic Fund can live up to its great potential.

Read my op-ed in today's @PostOpinions

washingtonpost.com/opinions/2023/… In response to the covid-19 pandemic, world leaders in November launched a new global Pandemic Fund housed at the @WorldBank to break the historic pattern of “panic and neglect” regarding global disease outbreaks.

. @paulkrugman is right that measuring inflation is difficult. But he continues his pattern of choosing to emphasize issues that could lower rather than raise expected inflation. He ignored the housing issues when I and others were pointing them out last year. The same point about new transactions vs. past transactions present wrt housing applies to the labor market but Paul fails to note that new hire wages are still way up and reservation wages continue to climb. He doesn’t consider that effort may be down for those working at home.

(1)The Republicans don’t want to fix the IRS. Here’s how to do it anyway.
My latest column in @PostOpinions with @NatashaRSarin

washingtonpost.com/opinions/2023/… 2) This will be remembered as the most important moment for tax administration since birth of income tax more than a century ago.

As past practitioners and analysts of tax administration, we offer five observations to guide in the years ahead.

.@60Minutes and @CBSNews should be embarrassed by their highlighting of doom-monger Paul Ehrlich's apocalyptic views in an interview on Sunday night. Ehrlich is as far from reputable scientific predictions as climate change denial scientists. His past and unrepentant support for coercive fertility control, predictions that a billion people would starve to death and acceptance of triaging whole nations by cutting off food aid mark him as a dangerous extremist.