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Dean Baker

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10 Percent at the WSJ Isn't the Same as 10 Percent for the Rest of Us

Dean BakerApr 08, 2010

That is the only thing that readers can conclude from a statement in an article on Federal Reserve Board Chairman Ben Bernanke's urgings to reduce the deficit. The WSJ told readers that: "The government is running a budget deficit in excess of about $1.3 trillion, more than 10% of the nation's total economic output." Of course, the Commerce Department is telling us that GDP for the fourth quarter of 2009 was $14.5 trillion, which would mean that the deficit is less than 9.0 percent of GDP.

Globalization and the Green Economy: China Provides Expertise to the U.S.

Dean BakerApr 08, 2010

The NYT reports that China's government signed a deal with the state of California and General Electric to provide engineering expertise and high tech parts for the construction of high-speed rail. This is a fascinating and totally predictable story which cause great pain to many purveyors of the economic conventional wisdom (CW).

China has been building high-speed trains, the United States hasn't. This means that the country has substantially more expertise in this area than the United States. As a result the transfer of this green technology will go from China to the United States, the opposite direction assumed by purveyors of the CW.

Did the Media Miss the Bubble? Did Saddam Lose His Last War?

Dean BakerApr 07, 2010

Steven Pearlstein often has insightful columns, not today. He discusses a conference he attended in which a repeated theme was how the media contributed to the crisis with its poor reporting. He then comments: "although it's a bit overdone, I'll admit there is a dollop of truth in it."

A "dollop?" How about an enormous ocean full of truth to it and Pearlstein continues to contribute to the crisis today by covering up the earlier failure. He tells readers that:

They Still Haven't Heard of Patents at the NYT

Dean BakerApr 07, 2010

David Leonhardt had a column discussing overuse of expensive medical care in the NYT today. Remarkably, this discussion did not mention the effect of patents in complicated decisions on treatment and raising costs.

California Gets a Bad Rap on Pensions in NYT

Dean BakerApr 06, 2010

California has done some really really stupid things (like a tax credit for first time homebuyers), but the NYT did the state and its readers a disservice in going after California's pension fund liabilities. The basic story is that if you assume a 4.14 nominal rate of return on pension fund assets, then the state's pension liabilities look really really bad.

The big question that readers should ask is, so what?

There have been few people who have been more critical of assuming exaggerated market returns than me, but 4.14 percent nominal? Anyone want to take a bet that California's pension funds will do better than this?

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