Robert Kuttner

The State of Our Union? Economically Unjust

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To honor Martin Luther King, Jr., the White House declared a “day of service” in Dr. King’s memory, and President Obama spent a few minutes on Monday helping to serve meals in a soup kitchen near the White House. Talk about a tin ear, or a timid one.

David Brooks’s Worst Column Ever

Well, this is getting to be a habit. Alert readers may recall that a few weeks ago, I wrote a piece about Tom Friedman’s worst column ever, plugging efforts by a billionaire hedge fund friend to persuade college students that their enemy was Social Security. 

Now, Friedman’s colleague David Brooks has written an even worse column. It’s really hard to determine Brooks’ worst column ever, since he seems to turn out one every week. 

A Dubious Budget Deal

The years of Republican obstructionism and the corporate campaign for deficit reduction have taken such a toll that merely the fact of getting a budget deal at all looks like a great achievement. This one is better than continued impasse, but the deal itself is a stinker.

Representative Raul Grijanva, co-chair of the House progressive caucus, put it well: “I feel like punching myself in the face, but I’ll vote yes.”

Peter B. Lewis: An Original

AP Images/TONY DEJAK

Peter B. Lewis died suddenly of a heart attack on Saturday at the age of 80. A billionaire chief executive of the Progressive Insurance Company, Peter was a true progressive in his values and his deeds. After his father’s death, Peter and his mother took charge of the company. He became chief executive in his early 1930s and built Progressive from a small 100-employee company into America’s fourth-largest auto insurer, with $17 billion in premiums and 26,000 employees. He expanded his market by insuring high-risk customers, deliberately offering price comparisons with competitors, and setting claims promptly. He led Progressive with exemplary transparency.

Krugman Boots One

Paul Krugman has played an indispensable role challenging the conventional wisdom in the financial crisis and the slump that followed. He has been proven right again and again, in his brilliant debunking of austerity as the cure for recession.

Therefore, it was astonishing to read a rare, truly wrongheaded Krugman column in Monday’s New York Times. The offending column is titled “A Permanent Slump?”

Bretton Woods Revisited

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On July 22, 1944, as allied troops were racing across Normandy to liberate Paris, representatives of 44 nations meeting at the Mount Washington resort in Bretton Woods, New Hampshire, created a financial and monetary system for the postwar era. It had taken three weeks of exhausting diplomacy. At the closing banquet, the assembled delegates rose and sang “For He’s a Jolly Good Fellow.” The fellow in question was John Maynard Keynes, leader of the British delegation and intellectual inspiration of the Bretton Woods design.

The Next Battle at the Fed

AP Images/Pablo Martinez Monsivais

With the Administration’s stunning decision to name Janet Yellen to chair the Federal Reserve, at least one major government institution will weigh in strongly on the side of economic recovery, right?

Well, maybe.

Beware a Grand Bargain

AP Photo/ Evan Vucci

Will President Obama and the Democrats win a major battle only to lose the war?

The longterm war that Republicans are fighting is a deadly serious struggle to destroy the most important and valued achievements of the New Deal-Great Society legacy, Social Security and Medicare.

Wall Street billionaires like Peter G. Peterson and Stanley Druckenmiller have been softening the ground for decades by claiming that Social Security is bankrupting the country and destroying future prospects of America’s youth.

A Spine Is a Useful Thing to Have

AP Photo/Charles Dharapak

How much damage have the Republicans done to themselves going into the elections of 2014 and 2016? And has President Obama resolved to hang tough, not just in this round, but in the one that follows and the one after that?

The contrived shutdown crisis proved two things.

Take the Fourteenth!

AP Images/Charles Dharapak

Remember the proposals that were current back in 2011 to have President Obama invoke his authority under the 14th Amendment to keep funding America’s public debt, even without approval from Congress? Well, that proposal has suddenly become highly relevant again, even urgent.

Tom Friedman’s Worst Column Ever

AP Photo/Mark Lennihan

Sometimes, Tom Friedman writes a column that is such complete baloney it makes you want to retch. Rather than risking soiling my shoes, here is a point-by-point rebuttal to Friedman’s opus du jour, titled: “Sorry, Kids. We Ate It All.”

Friedman’s column swallows whole the budgetary malarkey of the corporate Fix-the-Debt lobby and its Wall Street sponsors. Namely, the reduced horizons of the next generation are the result of the gluttony of old folks—and of unions.

Thinking the Unthinkable

Listen up, class. World War I never happened.

It didn’t happen because nobody wanted it, and everybody grasped the horrific risks. In the event, the common European civilization was destroyed, three empires fell, 16 million people died, and 20 million were wounded. So World War I couldn’t happen because everyone knew how awful it would be.

In August 1914, virtually all leaders anticipated a short set of skirmishes, a readjustment of borders as in other recent wars, and everyone would be home for Christmas. But, you know, stuff happens.

An Ignoble Prize

Eugene Fama, one of the winners of this year’s Nobel in economics, is the fellow who proposed that all markets are efficient all of the time—more precisely that market pricing accurately captures all available information and thus creates “correct” prices. Fama also insisted that there is no such thing as a price bubble.

Somehow, the man missed one of history’s great bubbles and the collapse that followed—an epic case of markets getting prices wrong. He also missed the fact that markets have incorrectly priced carbon, leading to global climate disaster, which Lord Nicholas Stern correctly termed “history’s greatest case of market failure.”

For this, they give the man a Nobel. What timing!

The Task Rabbit Economy

TskRabbit.com markets itself as a Web service that matches clients seeking someone to do odd jobs with “college students, recent retirees, stay-at-home moms, [and] young professionals” looking for extra income. The company website calls it “a marketplace dedicated to empowering people to do what they love.” The name Task Rabbit doesn’t exactly suggest the dignity of work, and the love often takes humble forms. Customers hire Task Rabbits to clean garages, haul clothes to the laundry, paint apartments, assemble Ikea products, buy groceries, or do almost anything else that’s legal.

Enter Yellen

AP Images/Eugene Hoshiko

With President Obama’s belated decision to name Janet Yellen to chair the Fed, several questions arise.

First, is Yellen likely to be confirmed? Almost certainly. The Republicans have lost a lot of public support by shutting down the government and playing chicken with the debt ceiling. They are not likely to trifle with the one functioning branch of government. Despite the Republicans’ intermittent uses of the filibuster, I’d be surprised if they went to the barricades to block Yellen.

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