Dean Baker

Recent Articles

Sick Europe and the Italian Elections

The elections in Italy prompted another round of knowing comments about how Europeans must get over their silly attachment to employment security (e.g. "Europe Stalls on Road to Economic Change"). None of the comments I saw even considered the possibility that the contractionary policies of the European Central Bank (ECB) play any role in Europe's economic weakness.

Immigrants and "Low Wage" Jobs

One of the great absurdities in the debate over immigration policy is the frequently repeated claim that the U.S. economy is generating more "low wage" jobs than can be filled by the domestic workforce. This line has been endlessly repeated in news stories on the issue.

Quick trip back to econ 101: recall the concepts "supply" and "demand." What makes a job a "low wage" job? In econ 101 world, a job will be a "low wage" job if the supply is high relative to the demand. When there is insufficient supply, then the wage rises. My students didn't pass the course if they couldn't get this one right. Econ 101 tells us that there is not a shortage of workers for low wage jobs; it tells us that there are employers who want to keep the wages for these jobs from rising.

When Out of Context Is Untrue

A couple of days ago, I gave my standard diatribe about the importance of putting numbers in context, especially budget numbers, which as isolated billions or trillions are virtually meaningless to the typical reader. In some cases, the issue is not just one of being uninformative, it's also a question of actually being wrong.

In budget reporting, the most obvious case in which out of context is wrong, is when comparisons of the deficit are made through time. There have been many news reports pronouncing the Bush deficits the largest in history based on the fact that nominal deficits (which peaked at $413 billion in 2004) were larger than the size of the deficits in any prior year.

Bush's Numbers Racket

The word from President Bush and his minions is that Social Security is on its last legs, facing imminent danger of bankruptcy. Fortunately, Bush is prepared to rescue this antiquated program by offering workers the opportunity to invest a portion of their Social Security taxes in private accounts. He would like us to believe that this plan will both get the government out from under a crushing debt burden, in the form of future Social Security obligations, and provide younger workers with a more secure retirement.

Bush's Numbers Racket

The word from President Bush and his minions is that Social Security is on its last legs, facing imminent danger of bankruptcy. Fortunately, Bush is prepared to rescue this antiquated program by offering workers the opportunity to invest a portion of their Social Security taxes in private accounts. He would like us to believe that this plan will both get the government out from under a crushing debt burden, in the form of future Social Security obligations, and provide younger workers with a more secure retirement.

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