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Why the Trade Arithmetic Favors China

11/18/2019

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Kaushik Basu, PhD.
Former Chief Economist of the World Bank and former Chief Economic Adviser to the Government of India

Picture B.Zhou / Shutterstock.com
The biggest risks facing the world economy today stem from the escalating trade war between the United States and China. In the past few weeks, the threat has gained greater salience: As negotiations have stalled and tariffs have risen, markets around the world have registered tremors of concern. Yet most commentators fail to recognize the kind of effect an all-out clash would have on the U.S. economy, and on the world.


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Social Security Does Much More for Disadvantaged Children than Temporary Assistance

11/4/2019

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Shawn Fremstad
Senior Policy Fellow at the Center for Economic Policy and Research

Picture
If you listen to Social Security’s critics, it’s easy to come away thinking that Social Security is a system of generational theft in which Boomer parents and grandparents steal from their children and grandchildren. At the same time, many of these same critics point to the Temporary Assistance for Needy Families (TANF) block grant as a model social program for families.​​

Yet, Social Security does much more to help kids today than TANF. Although Social Security is typically thought of as a retirement program, minor children are eligible for direct benefits if one of their parents is an insured worker who has retired, become disabled, or died. In 2018, nearly 3 million children under age 18 received $20.9 billion in Social Security benefits. The number of children receiving Social Security has been relatively stable in recent decades. For example, in 2000, roughly 3 million children received benefits.


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The Solution to the Country’s Debt and Deficit Problem

10/14/2019

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Dean Baker
Senior Economist at The Center for Economic and Policy Research (CEPR)

PictureEditorial Credit: Chinese 100 Renminbi and 100 U.S. dollar bills: Dan Hanscom Photography / Shutterstock.com
For most people, the country’s national debt and annual deficit are not major concerns. However, for a substantial portion of the policy types who make, write, and talk about economic and budget policy, debt and deficits are really big deals. And, the fact that our budget deficit and debt are both large by historic standards, and growing rapidly, is an especially big deal.

The list of people in this category is lengthy. It starts with the Peter J. Peterson Foundation (which displays the debt in big numbers right on its home page) and the many groups funded by them. The most important is the Committee for a Responsible Federal Budget, which is virtually guaranteed prominent placement in stories on the budget by major news outlets.


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Medicare for All 64-Year-Olds

6/20/2019

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Dean Baker
Senior Economist at The Center for Economic and Policy Research (CEPR)
PictureJanuary 19, 2019 San Francisco / CA / USA - Participant to the Women's March event holds "Medicare for all" sign while marching on Market street in downtown San Francisco. Editorial credit: Sundry Photography / Shutterstock.com
 The push for universal Medicare was given new momentum by Bernie Sanders campaign for the 2016 Democratic nomination. While it is still quite far from becoming law in even an optimistic scenario, it is certainly now treated as a serious political position. This is probably best demonstrated by the fact that the Medicare for All (M4A) bill put forward by Washington representative Pramila Jayapal has 107 co-sponsors, nearly half of the Democratic caucus in the House.

​As much progress as M4A has made, it will still be a huge lift to get it implemented. A universal Medicare system would mean shifting somewhere around 8 percent of GDP ($1.6 trillion at 2019 levels) from the private system to a government-managed system. It would also mean reorganizing the Medicaid program and other government-run health care programs, as well as the Medicare program itself. The current system has large co-pays and many gaps in coverage, such as dental care, that most proponents of M4A would like to fill. It also has a large role for private insurers in the Medicare Advantage program, as well as the Part D prescription drug benefit.



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Japanese Nukes—On the Horizon?

6/17/2019

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Graham E. Fuller 
Former Senior CIA Official and former Vice Chairman of the National Intelligence Council at the CIA in charge of long-range strategic forecasting; Adjunct Professor of history at Simon Fraser University in Vancouver.
PictureIllustration of a nuclear bomb explosion. (Credit: Flowgraph).
​Membership in the nuclear club is jealously guarded. The fewer the members the better. And the latest member to work his way in the door invariably calls for the gates now to be locked behind him; no new members after me. 
 
There are good reasons for this. One is the world perceives that the less nukes around, the better; they are less likely to get used and surely that’s good for everybody. But the more realistic reason for keeping the club tiny is that no nuclear state wants to yield up any more power to any other ambitious states in the world than absolutely necessary, to preserve their own monopoly. 
​
And there is a theological issue among strategists about whether states going nuclear makes it more, or less likely that war will break out between them. So far, at least, that seems to be the case, even between the unstable nuclear states of Pakistan and India. But who knows what the future will bring?


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Why is Populism on the Rise and What do Populists Want?

4/28/2019

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Dean Baker
Senior Economist at The Center for Economic and Policy Research (CEPR)
PictureEditorial credit: Rachael Warriner / Shutterstock.com; Picture Detail. Washington DC/USA- November 13, 2018:Student activists with the Sunrise Movement occupy Nancy Pelosi's office to demand that she and the Democrats act on climate change.
In the United States, the pay of a typical worker has badly trailed productivity growth over the last four decades, allowing only marginal improvements in living standards over this period. At the same time, a small number of people have gotten incredibly rich in the finance and tech sectors and by being top executives in major U.S. corporations. There is a similar, if somewhat less stark, picture in most other wealthy countries.
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The standard story for this rise in inequality is that this is just the inevitable course of globalization and technology. While many in the elite may feel bad for those left behind, and even propose policies to help them, the line is that the rise in inequality is something that happened, not the result of conscious policy.


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Pete Buttigieg Trivializes the Impact of Trade on U.S. Job Losses

4/28/2019

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Dean Baker
Senior Economist at The Center for Economic and Policy Research (CEPR)
PictureEditorial credit: JStone / Shutterstock.com Picture detail: NEW YORK - APRIL 4, 2019: Democratic presidential candidate Pete Buttigieg speaks during the National Action Network Convention on April 4, 2019, in New York.
In his campaign for the Democratic presidential nomination, Pete Buttigieg has been telling audiences that the U.S. lost six times as many jobs due to automation than trade from 2000 to 2010, according to The Washington Post. This is literally true, but for all practical purposes it is a very big lie.

The way in which it is true is that we always lose jobs to “automation,” which is known to economists as productivity growth. Productivity growth averages around 2 percent annually (it has been closer to 1 percent since 2005). If productivity grows by 2 percent, this means that we can produce the same amount of goods and services with 2 percent fewer worker hours.


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