Jared Bernstein

Jared Bernstein is an economist and senior fellow at the Center on Budget and Policy Priorities. He was formerly chief economist to Vice President Joe Biden and a member of President Barack Obama’s economics team.

 

Recent Articles

Wise Words

The annual meeting of the nation's economists isn't exactly a swinging affair. There's lots of talk about asset pricing models, and the hotel hallways resonate with arguments about the right way to specify vector autoregressions (don't ask). But at the meeting that wrapped up last month in San Diego, Alan Greenspan, our eminent chairman of the Federal Reserve, dropped a bit of a bomb. During the question-and-answer session, my Economic Policy Institute colleague Max Sawicky, to his immortal credit, inquired as to what Greenspan considered to be the lowest unemployment rate consistent with stable prices. In other words, what's the unemployment rate at full employment? The chairman stood up, thought for a few moments, and wryly replied, "I've spent many years trying to avoid that question. Thank you very much." Then he sat down. He got a great laugh, which he deserved. A lesser economist might have blathered on, blowing smoke while equivocating about why such an estimate cannot be made...

The Young and the Jobless

It's not easy being young today. While America moves through an economic recovery, young workers are being left behind. And that's largely because, since the recovery officially began in November 2001, employment is down by more than a million. Of the 10 economic expansions since World War II, this is the first in which jobs have taken so long to appear. And among those hurting the most, in terms of employment and wages, are young people in the early stages of their careers. This is true among low-wage earners, who commonly suffer when the economy slows down. But it's also true among young, white-collar adults, who have been relatively immune to other slowdowns. Why does this matter? Research shows that the greatest gains in a young person's earnings tend to occur at the start of his or her career. These early gains also have a major impact on long-term earnings, and thus set the stage for the future economic prospects of those starting out today. So today's high unemployment and...

Snow Job

It was my misfortune to tune in to the Sunday talk shows last weekend, when Treasury Secretary John Snow was making the rounds in support of the administration's tax-cut plan. Listening to Snow defend this misguided policy was deeply disheartening. You expect spin -- that's what the Sunday morning circuit has come to be about. But with the stakes so high and the costs of getting it wrong so steep, the secretary's interviews were painful to watch. This administration is fixated on shrinking government even if it means consigning the living standards of millions of working families to years of stagnation. Snow's performance showed that George W. Bush's henchmen will say anything to make their case. Kudos to George Stephanopoulos and Tim Russert, both of whom made admirable attempts to force their way through the secretary's litany of misinformation. At one point Stephanopoulos asked (Russert had asked a similar version of this question earlier): "You say the president's jobs programs is...

Savings Incentives for the Poor

The problem of poverty in America looms large even in the best of times. The most recent economic boom got the share of those officially deemed poor down to 11.7 percent, or about 33 million persons, but poverty rates are much higher for economically vulnerable groups such as single mothers, African Americans and Hispanics. Advocates of savings incentives and other asset-building programs for the poor convincingly and passionately make the case that while low incomes are the proximate cause of poverty at any point in time, the inability to accumulate wealth is what keeps people and their families stuck in poverty for generations. As Ray Boshara, who directs the asset-development program at the New America Foundation, wrote in a recent New York Times op-ed, "Lack of income means you don't get by; lack of assets means you don't get ahead." Income supports are a necessary palliative; asset building could be curative. The asset-building idea that has gone farthest politically and has the...

It's Full Employment, Stupid

N ewly released data on income and poverty suggest that the recent economic downturn hit lower-income families disproportionately. The latest Census Bureau report found that poverty began rising and median family income started falling in 2001, confirming what many of us have always known: The key to improved living standards for the bottom half was, and is, full employment. After tumbling through the latter half of the 1990s, the unemployment rate hit a 30-year low of 4 percent in 2000. With the onset of recession, it reversed course and climbed to 4.8 percent in 2001. Now, 4.8 percent doesn't sound that bad. Most economists used to think that you couldn't get below 6 percent unemployment without triggering dangerous inflation. But from the new data we learn that the 0.8 percent increment in unemployment led to higher poverty, less income for the typical middle-class family and a return to the 1980s and early 1990s pattern of highly unequal income growth. In one sense, this reversal...

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