Beat the Press

European Union Enlargement and Mexico

Both the Clinton and Bush administrations were eager proponents of European union expansion, calling on the EU to quickly admit the former Soviet bloc countries, as well as Turkey. The media have typically presented resistance to rapid expansion as reflecting perverse European fears of globalization. The Post had another piece in this vein this morning.

In assessing this resistance to expansion, it would be helpful to point out that the EU is more than just a NAFTA type trading bloc. It is a quasi-state, that in principle allows free movement of people and workers across borders and provides for substantial subsidy flows from richer regions to poorer ones.

Immigration ID Logic

Perhaps I'm missing something, but it seems that there is an obvious flaw with President Bush's proposal to have a tamper proof identification card for guest workers. As I understand it, under his program guest workers would be required to present this ID to employers when they get a job.

The flaw in the logic is that all workers are already required to present ID to employers showing that they are either a U.S. citizen or have legal authorization to work in the United States. The problem is that the necessary documents can be readily forged, which is why so many workers are employed illegally.

No Fun With Numbers: Another Cost of Intellectual Property

The Times had a piece this morning about how Major League Baseball is suing to prevent fantasy baseball games from using players' statistics without paying a licensing fee.

Two Points on Health Care

Since questions continually arise on my health care postings, I will make a couple of points here that do not directly relate to the news coverage.

First, health care costs have posed a problem everywhere, but nowhere do they pose as much of a problem as in the United States. If we look at the OECD data, in 2003 (the most recent year available) the United States spent 15.0 percent of its GDP on health care. The next three countries ranked by expenditure as a share of GDP are Switzerland, Germany, and Iceland at 11.5 percent, 11.1 percent and 10.5 percent, respectively. Canada clocks in at 9.9 percent of GDP, Sweden at 9.4 percent, and the United Kingdom at just 7.7 percent.

The Medicare and Social Security Hoax

Medicare and Social Security costs are projected to soar over the next decade as the baby boomers retire. Medicare and road maintenance costs are projected to soar over the next decade as the baby boomers retire.

Copyrights and Consumers: Not at the Times

The New York Times had an article this morning about a new digital copyright law in France. The main features (according to the article) appear to be a requirement that music downloading services be usable on multiple devices (as opposed to Apple's Ipod monopoly) and a relatively small penalty for unauthorized downloading of copyrighted material.

The Times Discovers Temps in Europe

The New York Times had an interesting article about the growth of part-time and temporary employment in Europe. It notes that in several European countries, 20-30 percent of the workforce is employed either part-time, or on temporary employment contracts, or both.

It is good to see this piece, because part-time and temporary employment has been an important part of many European economies for close to two decades. As the article notes, these workers tend to enjoy far less employment protection than do full-time workers.

The Conservative Nanny State is Here!

The moment you have all been waiting for has finally arrived. You can download your copy of The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer today. The book is available as a free e-book (read chapter 4 for the reasoning). You will soon be able to order paperback copies at

The New York Times Discovers Sweden

The Times had an article this morning that reports on Sweden's success in sustaining healthy rates of economic growth, while also ensuring a high degree of economic security for its workforce. The article is mostly fair, but is misleading on a few points.

For example, the article reports that Sweden overhauled its Social Security system in the mid-nineties and added private accounts. This is true, but it would have been helpful to add that the defined benefit portion of Sweden's system is still approximately one-third larger (relative to wages) than the current U.S. system.

Post Columnist Advocates Default on National Debt

Washington Post columnist Allan Sloan called for defaulting on the U.S. national debt, or at least a portion of it, in his weekly column today. Mr. Sloan pointed out that the Social Security trustees project that the program will begin drawing on the government bonds in its trust fund in just over a decade. He said that repaying the bonds in the trust fund will be a burden to the government, and that his children, as future taxpayers, shouldn't have to bear this burden.

Dying Children and Numbers in Context

A New York Times article this morning, reporting that up to 4 million infants die every year for the lack of very simple medical care items, provides a classic example of reporting numbers out of context. The article informs readers that the Bush administration proposes to spend $323 million in 2007 on aid for maternal and child health care in developing countries, down from $356 million in 2006.

Missing Fact on British Health Care

The New York Times had an interesting piece on the poor state of the dental care provided by the British public health care system in its Sunday paper. The article reports that people face long waits for even emergency dental care, and that many now turn to private dentists or go to foreign countries for treatment.

Are Wages Rising?

Like everyone else, the media have been confused on this basic question, with the main data sources providing very different answers. Last Friday, the Bureau of Labor Statistics (BLS) released the employment cost index (ECI) which showed a sharp slowing in the rate of nominal hourly compensation growth in the first quarter to an annual rate of just 2.4 percent. This is well below the rate of inflation, which, depending on the course of gas prices, will be in the range of 3.0-4.0 percent for this year.

Correction: Productivity Growth Clocks in at 3.2 Percent

I plead guilty to the same sort of sloppiness I have noted elsewhere. Earlier this week I commented on the coverage of Commerce Department's release of data for March on consumer spending and prices. I then noted that the consensus forecasts for first quarter productivity growth appeared to be too high. I based this on the fact that the hours data reported in the monthly employment reports indicated that hours were growing at close to a 4.0 percent annual rate in the quarter. As it turned out, hours growth was reported as 2.5 percent. What went wrong?

Corruption in the Pharmaceutical Industry: Why Is Anyone Surprised?

The New York Times has run many excellent articles over the years describing various forms of corruption in the pharmaceutical industry. (The latest describes the battle over monitoring the prescribing practices of individual physicians.) The one thing missing from these articles is any economic analysis.