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Robert Reich:
Friends, I’ve shared with you the plans of Trump’s unelected multi-billionaires, Elon Musk and Vivek Ramaswamy, to undermine Social Security — the most popular and successful program in the federal government, into which you’ve paid your entire working life. Today I want to share their plan to gut Medicaid. Medicaid is less politically popular than Social Security or Medicare, because it mainly supports poor children and families who have little or no political voice.
But Medicaid covers far more Americans. Medicaid insures nearly half of all children in the United States. It covers 1 in 5 women of childbearing age. It also pays for a large portion of the nation’s nursing home care and mental health treatment. States and the federal government share its costs, which totaled $880 billion last year. How are the DOGE billionaires planning to gut it? First, by turning Medicaid into “block grants,” in which states get lump sums regardless of how many people sign up for the program. Republican senator and founding DOGE caucus member John Cornyn has already publicly stated that he favors this approach. As more poor children and needy families sign up, block grants will force states to increase their own spending on Medicaid or restrict who gets it. Given the strain on state budgets and the negligible political voice of Medicaid recipients, it will almost surely be the latter.
A second method for gutting Medicaid favored by Musk, Ramaswamy, Cornyn, and other DOGE caucus members is to impose work requirements on Medicaid recipients. They claim this would save the federal government at least $100 billion over the next decade. But the reason for the saving is that work requirements would cause an estimated 600,000 people — most of them unable to work — to lose coverage (according to estimates from the Congressional Budget Office). The third idea DOGE is considering is to cut back on the expansion of Medicaid that came with the Affordable Care Act. That expansion enabled adults in families earning up to $43,000 a year to get health care coverage. (Under it, the federal government pays 90 percent of the costs.)
Step back for a moment and consider what’s being proposed. If the Affordable Care Act’s expanded Medicaid is cut back, hundreds of thousands of Americans in families earning up to $43,000 a year will lose their health care. If Medicaid is turned into block grants or if work is required of people unable to work, many hundreds of thousands more will lose their only access to health care, including large numbers of children.
[...] They may never discover that Trump is behind this because Trump won’t have his fingerprints on the Medicaid cuts. He’ll hide behind Musk and Ramaswamy’s DOGE and the newly formed DOGE caucus in Congress. Not even their fingerprints will be obvious because block grants to the states, work requirements, and elimination of the Affordable Care Act’s Medicaid expansion will all do the dirty deed quietly. Nor will working Americans discover that big corporations and the wealthy are reaping most of the savings from the gutting of Medicaid in the form of lower taxes. Most working Americans haven’t yet discovered how skewed the 2017 Trump tax cut has been to the wealthy and big corporations, so why should they discover it in future years? One more thing. Employer-sponsored health insurance — available to most salaried workers in large corporations but rarely to hourly workers or contract workers — remains untaxed.
The Trump-Musk-Ramaswamy plutocratic trifecta are plotting to kill Medicaid as we know it. This is yet another moronic idea from DOGE.
#DOGE#Medicaid#Robert Reich#Elon Musk#Vivek Ramaswamy#DOGE Caucus#Congressional Budget Office#John Cornyn
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Elizabeth Warren on weaponized budget models
In yesterday’s essay, I broke down the new series from The American Prospect on the hidden ideology and power of budget models, these being complex statistical systems for weighing legislative proposals to determine if they are “economically sound.” The assumptions baked into these models are intensely political, and, like all dirty political actors, the model-makers claim they are “empirical” while their adversaries are “doing politics”:
https://pluralistic.net/2023/04/03/all-models-are-wrong/#some-are-useful
If you’d like an essay-formatted version of this post to read or share, here’s a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:
https://pluralistic.net/2023/04/04/cbo-says-no/#wealth-tax
Today edition of the Prospect continues the series with an essay by Elizabeth Warren, describing how her proposal for universal child care was defeated by the incoherent, deeply political assumptions of the Congressional Budget Office’s model, blocking an important and popular policy simply because “computer says no”:
https://prospect.org/economy/2023-04-04-policymakers-fight-losing-battle-models/
When the Build Back Better bill was first mooted, it included a promise of universal, federally funded childcare. This was excised from the final language of the bill (renamed the Bipartisan Infrastructure Bill), because the CBO said it would cost too much: $381.5b over ten years.
This is a completely nonsensical number, and the way that CBO arrived at it is illuminating, throwing the ideology of CBO modeling into stark relief. You see, the price tag for universal childcare did not include the benefits of childcare!
As Warren points out, this is not how investment works. No business leader assesses their capital expenditures without thinking of the dividends from those investments. No firm decides whether to open a new store by estimating the rent and salaries and ignoring the sales it will generate. Any business that operates on that basis would never invest in anything.
Universal childcare produces enormous dividends. Kids who have access to high-quality childcare grow up to do better in school, have less trouble with the law, and earn more as adults. Mothers who can’t afford childcare, meanwhile, absent themselves from the workforce during their prime earning years. Those mothers are less likely to advance professionally, have lower lifetime earnings, and a higher likelihood of retiring without adequate savings.
What’s more, universal childcare is the only way to guarantee a living wage to childcare workers, who are disproportionately likely to rely on public assistance, including SNAP (AKA food stamps) to make ends meet. These stressors affect childcare workers’ job performance, and also generate public expenditures to keep those workers fed and housed.
But the CBO model does not include any of those benefits. As Warren says, in a CBO assessment, giving every kid in America decent early childhood care and every childcare worker a living wage produces the same upside as putting $381.5 in a wheelbarrow and setting it on fire.
This is by design. Congress has decreed that CBO assessments can’t factor in secondary or indirect benefits from public expenditure. This is bonkers. Public investment is all secondary and indirect benefits — from highways to broadband, from parks to training programs, from education to Medicare. Excluding indirect benefits from assessments of public investments is a literal, obvious, unavoidable recipe for ending the most productive and beneficial forms of public spending.
It means that — for example — a CBO score for Meals on Wheels for seniors is not permitted to factor in the Medicare savings from seniors who can age in their homes with dignity, rather than being warehoused at tremendous public expense in nursing homes.
It means that the salaries of additional IRS enforcers can only be counted as an expense — Congress isn’t allowed to budget for the taxes that those enforcers will recover.
And, of course, it’s why we can’t have Medicare For All. Private health insurers treat care as an expense, with no upside. Denying you care and making you sicker isn’t a bug as far as the health insurance industry is concerned — it’s a feature. You bear the expense of the sickness, after all, and they realize the savings from denying you care.
But public health programs can factor in those health benefits and weigh them against health costs — in theory, at least. However, if the budgeting process refuses to factor in “indirect” benefits — like the fact that treating your chronic illness lets you continue to take care of your kids and frees your spouse from having to quit their job to look after you — then public health care costings become indistinguishable from the private sector’s for-profit death panels.
Child care is an absolute bargain. The US ranks 33d out of 37 rich countries in terms of public child care spending, and in so doing, it kneecaps innumerable mothers’ economic prospects. The upside of providing care is enormous, far outweighing the costs — so the CBO just doesn’t weigh them.
Warren is clear that there’s no way to make public child care compatible with CBO scoring. Even when she whittled away at her bill, excluding millions of families who would have benefited from the program, the CBO still flunked it.
The current budget-scoring system was designed for people who want to “shrink government until it fits in a bathtub, and then drown it.” It is designed so that we can’t have nice things. It is designed so that the computer always says no.
Warren calls for revisions to the CBO model, to factor in those indirect benefits that are central to public spending. She also calls for greater diversity in CBO oversight, currently managed by a board of 20 economists and only two non-economists — and the majority of the economists got their PhDs from the same program and all hew to the same orthodoxy.
For all its pretense of objectivity, modeling is a subjective, interpretive discipline. If all your modelers are steeped in a single school, they will incinerate the uncertainty and caveats that should be integrated into every modeler’s conclusions, the humility that comes from working with irreducible uncertainty.
Finally, Warren reminds us that there are values that are worthy of consideration, beyond a dollars-and-cents assessment. Even though programs like child care pay for themselves, that’s not the only reason to favor them — to demand them. Child care creates “an America in which everyone has opportunities — and ‘everyone’ includes mamas.” Child care is “an investment in care workers, treating them with respect for the hard work they do.”
The CBO’s assassination of universal child care is exceptional only because it was a public knifing. As David Dayen and Rakeen Mabud wrote in their piece yesterday, nearly all of the CBO’s dirty work is done in the dark, before a policy is floated to the public:
https://prospect.org/economy/2023-04-03-hidden-in-plain-sight/
The entire constellation of political possibility has been blotted out by the CBO, so that when we gaze up at the sky, we can only see a few sickly stars — weak economic nudges like pricing pollution, and not the glittering possibilities of banning it. We see the faint hope of “bending the cost-curve” on health care, and not the fierce light of simply providing care.
We can do politics. We have done it before. Every park and every highway, our libraries and our schools, our ports and our public universities — these were created by people no smarter than us. They didn’t rely on a lost art to do their work. We know how they did it. We know what’s stopping us from doing it again. And we know what to do about it.
Have you ever wanted to say thank you for these posts? Here’s how you can: I’m kickstarting the audiobook for my next novel, a post-cyberpunk anti-finance finance thriller about Silicon Valley scams called Red Team Blues. Amazon’s Audible refuses to carry my audiobooks because they’re DRM free, but crowdfunding makes them possible.
[Image ID: A disembodied hand, floating in space. It holds a Univac mainframe computer. The computer is shooting some kind of glowing red rays that are zapping three US Capitol Buildings, suspended on hovering platforms. In the background, the word NO is emblazoned in a retrocomputing magnetic ink font, limned in red.]
#empirical facewash#wealth tax#elizabeth warren#cbo#congressional budget office#penn wharton budget model#budgeting#economics#economism#computer says no#pluralistic#universal childcare#build back better#bipartisan infrastructure bill
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Entregamos historias. También te damos guías, consejos y trucos sobre cómo crear el tuyo propio. Este canal está dedicado a cosas aleatorias que pasan por nu...
#us supreme court#student loan repayment plan#biden administration#gop states#legal challenge#lower courts#deepening legal fight#department of education#interest-free forbearance#white house department of justice#congress budget#8th us circuit court of appeals#emergencycket#congressional budget office#alaska#south carolina#texas#0 presidential campaign#democratic primary#majority#department of education.
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Will the expanding US fiscal deficit derail things?
Last week I looked at the US economy noting its good GDP performance in 2023 and also the fiscal issue. The latter got a bit of an update as the week progressed. Here is the Congressional Budget Office. In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0…
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#bond yields#business#CBO#Congressional Budget Office#Debt Costs#Economics#economy#Finance#Fiscal Boost#Interest Rates#Investing#Treasury Bills#Treasury Secretary Yellen#US Deficit
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Another Documentation of the U.S. Need for Immigrants
Just yesterday this blog published a lengthy post about how the problems in the U.S. asylum system were promoting increases in U.S. immigration that were benefiting the U.S. economy.[1] Now the New York Times has published a lengthy article focusing on the positive impact of new immigrants to this country with its declining and aging population.[2] The Example of the State of Maine The State of…
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#Africa#Ben Conniff#Congressional Budget Office#Congressional Budget Office (CBO)#Ernie Tedeschi#Luke’s Lobster)#Middle East#Office of New Americans#Republic of the Congo#State of Maine#U.S. economy#U.S. immigration#Venezuela#Yale Law School
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Federal Budget Deficit Reaches $383 Billion: Latest News from the Congressional Budget Office
The Congressional Budget Office reports a staggering $383 billion deficit in the first two months of fiscal year 2024. Find out the factors contributing to this significant increase in spending and its implications for the economy. Stay updated with the headline horizon of the federal budget.
#Congressional Budget Office#federal budget deficit#spending increase#headline horizon#news#latest news
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Sam Seder: Video: ObamaCare Equals Freedom?
. The New Democrat Freedom if that is really what this is about is the ability for people to run their own lives and be able to make the decisions about their own lives. And I’m talking about both from an economic and personal vantage point. And to get that freedom people have to have the skills they need to be able to make the income to live in that freedom. Which is why education is so…
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#Affordable Care Act#Congressional Budget Office#Conservatives#Economic Freedom#Freedom#Individual Freedom#Libertarians#ObamaCare#Personal Freedom#Personal Responsibility#Sam Seder#The Majority Report
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The problem with economic models
When students of statistics are introduced to creating and interpreting models, they are introduced to George Box’s maxim:
All models are wrong, some are useful.
It’s a call for humility and perspective, a reminder to superimpose the messy world on your clean lines.
If you’d like an essay-formatted version of this article to read or share, here’s a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:
https://pluralistic.net/2023/04/03/all-models-are-wrong/#some-are-useful
Even with this benediction, modeling is forever prone to the cardinal sin of insisting that complex reality can be reduced to “a perfectly spherical cow of uniform density on a frictionless plane.” Partially that’s down to human frailty, our shared inability to tell when we’re simplifying and when we’re oversimplifying.
But complex mathematics are also a very powerful smokescreen: because so few of us are able to interpret mathematical models, much less interrogate their assumptions, models can be used as “empirical facewash,” in which bias and ideology are embedded in equations and declared to be neutral, because “math can’t be racist.”
The problems with models have come into increasing focus, as machine learning models have increasingly been used to replace human judgment in areas from bail assessment to welfare eligibility to child protective services interventions:
https://memex.craphound.com/2018/01/31/automating-inequality-using-algorithms-to-create-a-modern-digital-poor-house/
But even amidst this increasing critical interrogation of models in new domains, there is one domain where modeling is all but unquestioned: economics, specifically, macroeconomics, that is, the economics of national government budgets.
This is part of a long-run, political project to “get politics out of budgeting” -a project as absurd as “getting wet out of water.” Government budgeting is intrinsically, irreducibly political, and there is nothing more political than insisting that your own preferences and assumptions are “empirical” while anyone who questions them is “doing politics.”
This model-first pretense of neutrality is a key component of neoliberalism, which saw a vast ballooning of economists in government service — FDR employed 5,000 economists, while Reagan relied on 16,000 of them. As the jargon and methods of economics crowded out the language of politics, this ideology-that-insisted-it-wasn’t got a name: economism.
Economism’s core method is reducing human interaction to “incentives,” to the exclusion of morals or ethics — think of Margaret Thatcher’s insistence that “there is no such thing as society.” Economism reduces its subjects to homo economicus, a “rational,” “utility-maximizing” automaton responding robotically to its “perfect information” about the market.
Economism also insists that power has no place in predictions about how policies will play out. This is how the Chicago School economists were able to praise monopolies as “efficient” systems for maximizing “consumer welfare” by lowering prices without “wasteful competition.”
This pretense of mathematical perfection through monopoly ignores the problem that anti-monopoly laws seek to address, namely, the corrupting influence of monopolists, who wield power to control markets and legislatures alike. As Sen John Sherman famously said in arguing for the Sherman Act: “If we will not endure a King as a political power we should not endure a King over the production, transportation, and sale of the necessaries of life.”
https://marker.medium.com/we-should-not-endure-a-king-dfef34628153
Economism says that we can allow monopolies to form and harness them to do only good, enforcing against them when they abuse their market dominance to hike prices. But once a monopoly forms, it’s too late to enforce against them, because monopolies are both too big to fail and too big to jail:
https://doctorow.medium.com/small-government-fd5870a9462e
Today, economism is helpless to do anything about inflation, because it is ideologically incapable of recognizing the inflation is really excuseflation, in which monopolists blame pandemic supply shocks, Russian military belligerence and supposedly overgenerous covid relief programs for their own greedy profiteering:
https://pluralistic.net/2023/03/11/price-over-volume/#pepsi-pricing-power
Mathematics operates on discrete quantities like prices, while power is a quality that does not readily slot into an equation. That doesn’t mean that we can safely discard power for the convenience of a neat model. Incinerating the qualitative and doing arithmetic with the dubious quantitative residue that remains is no way to understand the world, much less run it:
https://locusmag.com/2021/05/cory-doctorow-qualia/
Economism is famously detached from the real world. As Ely Devons quipped, “If economists wished to study the horse, they wouldn’t go and look at horses. They’d sit in their studies and say to themselves, ‘What would I do if I were a horse?’”
https://pluralistic.net/2022/10/27/economism/#what-would-i-do-if-i-were-a-horse
But this disconnection isn’t merely the result of head-in-the-clouds academics who refuse to dirty their hands by venturing into the real world. Asking yourself “What would I do if I were a horse?” (or any other thing that economists are usually not, like “a poor person” or “a young mother” or “a refugee”) allows you to empiricism-wash your biases. Your prejudices can be undetectably laundered if you first render them as an equation whose details can only be understood by your co-religionists.
Two of these if-I-were-a-horse models reign invisibly and totally over our daily lives: the Congressional Budget Office model and the Penn Wharton Budget model. Every piece of proposed government policy is processed through these models, and woe betide the policy that the model condemns. Thus our entire government is conducted as a giant, semi-secret game of Computer Says No.
This week, The American Prospect is conducting a deep, critical dive into these two models, and into the enterprise of modeling itself. The series kicks off today with a pair superb pieces, one from Nobel economics laureate Joseph Stiglitz, the other from Prospect editor-in-chief David Dayen and Rakeen Mabud, chief economist for the Groundwork Collaborative.
Let’s start with the Stiglitz piece, “How Models Get the Economy Wrong,” which highlights specific ways in which the hidden assumptions of models have led us to sideline good policy (like increasing spending during recessions) and make bad policy (like cutting taxes on the rich):
https://prospect.org/economy/2023-04-03-how-models-get-economy-wrong/
First, Stiglitz sets out a general critique of the assumptions in neoclassical models, starting with the “efficient market” hypothesis, that holds that the market is already making efficient use of all our national resources, so any government spending will “crowd out” efficient private sector activity and make us all poorer.
There are trivially obvious ways in which this is untrue: every unemployed person who wants a job is not being used by the market. The government can step in — say, with a federal jobs guarantee — and employ everyone who wants a job but isn’t offered one by the public sector, and by definition, this will not crowd out private sector activity.
Less obvious — but still true — is that the private sector is riddled with inefficiencies. The idea that Google and Facebook make “efficient” use of capital when they burn billions of dollars to increase their surveillance dragnets is absurd on its face. Then there’s the billions Facebook set on fire to build a creepy dead mall it calls “the metaverse”:
https://www.youtube.com/watch?v=EiZhdpLXZ8Q
Then we come to some of the bias in the models themselves, which consistently undervalue the long-run benefits of infrastructure spending. Public investments of this kind “yield very high returns,” which means that even if a public sector project reduces private sector investment, the private investments that remain produce a higher yield, thanks to public investment in a skilled workforce and efficient ports, roads and trains.
A commonplace among model users is that we must make “The Big Tradeoff” — we can either reduce inequality, or we can increase prosperity, but not both, because reducing inequality means taking resources away from the business leaders who would otherwise build the corporations whose products would make us all better off.
Despite the fact that organizations from the OECD to the IMF have recognized that inequality is itself a brake on economic growth, fostering destructive “rent seeking” (seen today online in the form of enshittification), the most common macroeconomic models continue to presume that an unequal society will be as efficient as a pluralistic one. Indeed, model-makers treat attention to inequality as an error bordering on a mortal sin — the sin of caring about “distributional outcomes” (that is, who gets which slice of the pie) rather than “growth” (whether the pie is getting bigger).
Stiglitz says that model makers have gotten a little better in recent years, formally disavowing Herbert Hoover’s idea of expansionary austerity, which is the idea that we should cut public spending when the economy is shrinking. Common sense tells us that this will make it shrink faster, but expansionary austerity (incorrectly) predicts that governments that cut spending will produce “investor confidence” and trigger more private investment.
This reliance on what Paul Krugman calls the “Confidence Fairy” is tragically misplaced. Hoover’s cutbacks made the Great Depression worse. So did IMF cutbacks in “East Asia, Greece, Spain, Portugal, and Ireland.”
Expansionary austerity is politics dressed up as economics. Indeed, the political ideology subsumed into our bedrock models has caused governments to fail to anticipate crisis after crisis, including the 2008 Great Financial Crisis.
The politics in modeling are especially obvious in the process running up to the Trump tax cuts (as is often the case with Trump, he draws with a fisted crayon where others delicately shade with a fine pencil, making it easier to see the work for what it is) (see also: E. Musk).
Axiomatic to model-building is the idea that if you tax something, you’ll get less of it (“incentives matter”). The theory of corporate tax cuts goes like this: “if we tax corporations for the money they might otherwise use to build new plant and hire new workers, they will do less of those things.”
That’s a reasonable assumption — which is why we don’t tax companies on capital investments and their payrolls. These expenses are deducted from a company’s profits before it calculates its taxes. Corporate taxes are levied on profits, net of spending on labor and plant.
But when the CBO modeled the Trump cuts, it operated on the assumption that the existing tax system was punishing companies for hiring people and expanding operations, and thus concluded the reducing taxes would lead to more of these activities. On that basis, the tax cuts were declared to be expansionary, a means of driving new private sector activity. In reality, all they did was create more profits, which rich people used to bid up the prices of assets, creating a dangerous asset bubble — not investment in productive capacity.
In “Hidden in Plain Sight,” the other Prospect piece that dropped today, Dayen and Mabud tell us just how wrong the models were about the Trump cuts:
https://prospect.org/economy/2023-04-03-hidden-in-plain-sight/
The CBO predicted that the cuts would drive a 0.7% increase in GDP over a decade, while Penn Wharton predicted 0.6–1.1% growth. Both were very, very wrong:
https://www.npr.org/2019/12/20/789540931/2-years-later-trump-tax-cuts-have-failed-to-deliver-on-gops-promises
Despite the manifest defects of these models, we still let them imprison our politics. When Elizabeth Warren proposed a 2% wealth tax on assets over $50m, she asserted that this would reduce billionaires’ fortunes by $3.75T over 10 years, but the Penn Wharton model knocked $1T off it, and declared that the real impact of the policy would be a reduction in investment, depressing long-run growth. The politics of a wealth tax are sound — the kind of politics that wins elections and restores faith in democracy — but the economism of models sweeps the proposal off the table and into the dustbin of history.
The Penn Wharton model simply refuses to factor in absolutely key aspects of a wealth tax plan, from the impact of increased enforcement to the economic benefits of universal child care, increased education funding, student debt cancellation and other programs that could be enacted with the fiscal space opened up by reducing billionaires’ spending power.
The Warren policy is rare because we got to hear about it — through a national election campaign — before it was strangled by the model-makers. More often, proposals like this are quietly snuffed out even before they’re introduced to the legislature, when they are run through the model and told Computer Says No.
Modeling isn’t intrinsically bad, but “all models are wrong” and what determines whether a model is useful are the politics of its assumptions. Economism insists that there are no politics in model-making, which creates unfixable flaws in its models.
One core political assumption in economism’s models is that government shouldn’t exercise power to produce outcomes — rather, it should “nudge” markets with incentives (which, we are constantly reminded, “matter”). This means that we can’t ban pollution — we can only offer “cap and trade” systems to incentivize companies to pollute less. It means we can’t do Medicare For All, we can only “bend the cost-curve” with minor interventions like forcing hospitals to publish their rate-cards.
Economism — and its institutions, like the CBO — are “short-run Keynesian and long-run classical” — that is, they only consider the benefits of public spending over the shortest of timespans, and assume that these evaporate over long time-scales. That’s exactly backwards, as anyone who’s ever traveled on a federal highway or visited a national park can attest:
https://prospect.org/politics/congress-biggest-obstacle-congressional-budget-office/
All of this is worsened by politicians, who exploit the primacy of economism to attack their adversaries. When the CBO or Penn Wharton release a report on a policy, they often wrap their conclusions with caveats about uncertainties and ranges — but these cautions are jettisoned by opportunistic politicians who seize a single headline figure and use it as a club against their opponents.
In the coming week, the Prospect will run deep dives into the defects of CBO and Penn Wharton, along with other commentary. It’s very important work, throwing open the doors to the inner sanctum of economism’s sacred temple. I’ll be following it eagerly.
Have you ever wanted to say thank you for these posts? Here’s how you can: I’m kickstarting the audiobook for my next novel, a post-cyberpunk anti-finance finance thriller about Silicon Valley scams called Red Team Blues. Amazon’s Audible refuses to carry my audiobooks because they’re DRM free, but crowdfunding makes them possible.
Image: bert knottenbeld (modified) https://www.flickr.com/photos/bertknot/8375267645/
CC BY-SA 2.0 https://creativecommons.org/licenses/by-sa/2.0/
[[Image ID: A Tron-like plane of glowing grid-squares. Two spherical cows roll about on the plane, chased by motion lines. The gridlines are decorated with complex equations from the Penn-Wharton Budget Model.]]
#pluralistic#the american prospect#penn wharton budget model#some models are useful#congressional budget office#macroeconomics#all models are wrong#joseph stiglitz#economism#inevitabilism
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The Truth About Immigrants and the Economy
Immigrants are good for the economy and our society! Don’t let anyone tell you otherwise.
For centuries, immigration has been America’s secret sauce for economic growth and prosperity.
But for just as long, immigrants have been an easy scapegoat.
One of the oldest, ugliest lies is to falsely smear immigrants as criminals.
It’s just not true. Crime is way down in America. Anyone who says otherwise is fearmongering.
And whatever crime there is is not being driven by immigration. Immigrants, regardless of citizenship status, are 60% less likely to be incarcerated for committing crimes than U.S.-born citizens.
Maybe that’s why border cities are among America’s safest.
Immigration opponents also claim immigrants are a drag on the economy and a drain on government resources.
Rubbish!
Quite the opposite, the major reason immigrants are coming to America is to build a better life for themselves and their families, contributing to the American economy.
The long-term economic benefits of immigration outweigh any short-term costs. The nonpartisan Congressional Budget Office estimates that adding more immigrants as workers and consumers — including undocumented immigrants — will grow America’s economy by about $7 trillion over the next decade. And those immigrants would increase tax revenue by about $1 trillion, shrinking the deficit and helping pay for programs we all benefit from.
Immigrants of all statuses pay more in taxes than they get in government benefits. Research by the libertarian Cato Institute found first-generation immigrants pay $1.38 in taxes for every $1 they receive in benefits,
This is especially true for undocumented immigrants, who pay billions in taxes each year, but are excluded from almost all federal benefits. After all, you need documentation to receive federal benefits. Guess what undocumented immigrants don’t have. Hello?
And of course, one of the most common anti-immigrant claims also isn’t true.
No. Immigrants are not taking away jobs that Americans want. Undocumented immigrants in particular are doing some of the most dangerous, difficult, low-paying, and essential jobs in the country.
Despite what certain pundits might tell you, immigration has not stopped the U.S. from enjoying record-low unemployment.
And as the Baby Boom generation moves into retirement, young immigrants will help support Social Security by providing a thriving base of younger workers who are paying into the system. The fact that so many immigrants want to come here gives America an advantage over other countries with aging populations, like Germany and Japan.
What’s more, immigrants are particularly ambitious and hardworking. They are 80% more likely to start a new business than U.S. born citizens. Immigrant-founded businesses also impressively comprise 103 companies in last year’s Fortune 500.
And immigrants continue to add immeasurably to the richness of American culture. We should be celebrating them, not denigrating them.
It’s time to speak the facts and the truth. We need immigrants to keep our economy — and our country — vibrant and growing. They are not “poisoning the blood” of our nation. They’re renewing and restoring it.
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Urgent update!
Stop HR9495!
Say NO to S.5384! (Stop the bill that Abolishes the Department of Education, and for Other Purposes)
Say NO to H.R. 9218! (Stop the bill that would allow Representatives to re-define what Biological Sex is)
Say NO to SB72! (Ref 1) (ref 2)
Tell Congress: Take action to prevent cuts to IRS funding in the end-of-year government funding bill! (HURRY BEFORE DECEMBER 20TH COMES!)
(PLEASE CHECK AND COPY THE LINKS HERE AND REBLOG/REPOST THEM ON A NEW POST TO KEEP IT TO RELEVANCE!)
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Listening to Linkin Park vtuber covers while at work fantasizing about founding a militant revolutionary centrism faction. AK-47's and berets passing along not-so-subtle threats of violence to any politician who doesn't poll-test their messaging for cross-tab demo appeal. Storming the offices of every rep that releases legislative proposals that haven't been appropriately scored by the Congressional Budget Office. Show trials with stacked crowds jeering and mocking the victims for their refusal to restructure primaries along electorally-maximizing lines. The dream.
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Cecilia Nowell at The Guardian:
On the campaign trail this year, Donald Trump routinely criticized US media. The president-elect called for CBS to be stripped of its broadcast license after it aired an interview with Kamala Harris, refused to participate in an interview with 60 Minutes and routinely called journalists the “enemy of the people”. But perhaps no American media has attracted as much ire from the president-elect as the Corporation for Public Broadcasting – a non-profit corporation created by federal law in 1967 to distribute funding to public media organizations like PBS and NPR.
“NO MORE FUNDING FOR NPR, A TOTAL SCAM!” Trump wrote in a post on Truth Social in April. “THEY ARE A LIBERAL DISINFORMATION MACHINE. NOT ONE DOLLAR!!!” As the Trump prepares to take office next month, public media organizations – such as NPR and PBS, which have aired longtime favorites such as Curious George and All Things Considered – are readying themselves for funding cuts and other attacks against their programming. After Trump was re-elected in November, NPR member stations circulated a report warning that “it would be unwise to assume that events will play out as they have in the past” where funding is concerned, the New York Times reported Friday, and PBS board members received an update from political consultants earlier this month. Trump and his allies have repeatedly called for the federal government to cut all funding to public media. In March 2017, Trump called for Congress to cut all funding to the Corporation for Public Broadcasting in the first proposed budget of his presidency – a call he repeated throughout his presidency.
In response to a 2020 effort to defund public media, the PBS president and CEO, Paula Kerger, issued a statement noting that “PBS and our member stations have earned bipartisan Congressional support because of the vital role that public television plays in homes and communities across the country. For 50 years, PBS has served as a trusted source for educational and thought-provoking programming, including school readiness initiatives for children, support for teachers and caregivers, public safety communications and lifelong learning across broadcast and digital platforms.” But the conservative playbook Project 2025 has continued echoing conservative calls to cut funding to PBS and NPR, stating that the new Trump administration should strip public media of federal funding and licenses for noncommercial education stations.
[...] In November, shortly after Trump won the 2024 presidential election, Musk coauthored an op-ed in the Wall Street Journal with Vivek Ramaswamy (the two have been tasked with leading a “department of government efficiency”, an agency Trump claims he will create). In it, the pair identified the $535m Congress allocates each year to the Corporation for Public Broadcasting as one line item they would cut to reduce federal expenditures. As recently as this week, Musk posted on X that “legacy media must die”. Although these attacks against public media are growing more concerted, they’re not new. Every Republican administration has aimed to defund public media since the Corporation for Public Broadcasting was founded. American public media traces its origins to the Public Broadcasting Act of 1967, passed under Lyndon B Johnson’s administration. A public-private partnership, the Corporation for Public Broadcasting connects 1,190 public radio stations and 356 public television stations with federal grants, allowing those stations to maintain editorial independence and also raise funds from members and sponsorships. Today, 99% of the US population lives within listening range of at least one public media station.
The attacks on NPR and PBS should worry us all, as it is part of Donald Trump's authoritarian war on press freedom.
#Trump Administration II#NPR#PBS#Donald Trump#CPB#Corporation For Public Broadcasting#Project 2025#War On The Press#Public Broadcasting Act#Television
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Donald Trump and his fellow Republicans made the high cost of living a major focus of their campaigns in 2024. And for all of their vitriolic attacks on Democrats over issues like crime and immigration, it may have been their promise to reduce everyday prices that allowed them to win control of the White House and Congress.
But governing is harder than campaigning. The president-elect and other Republicans are likely to see this firsthand when their commitment to lower prices runs smack into their opposition to government spending on health care — and, no less important, to their antipathy toward so-called Obamacare. It’s going to happen sometime in the next few months, or maybe even the next few weeks. A finding that the Congressional Budget Office released Thursday shows why.
The finding was about the cost of health insurance for people who buy private coverage through the Affordable Care Act, the landmark legislation that Democrats passed and then-President Barack Obama signed in 2010. The short version of CBO’s conclusion is that insurance for millions of Americans will get more expensive if the Republicans don’t act.
The long version goes like this: These millions are the people who buy insurance directly through the Affordable Care Act marketplaces, HealthCare.gov and its state-run analogues like Covered California, because they make too much money to qualify for government programs like Medicaid and can’t get coverage through their jobs.
When they buy through the marketplaces, they can qualify for tax credits that effectively discount premiums by hundreds and frequently thousands of dollars annually. But in the Affordable Care Act’s early years, those tax credits were smaller than the law’s architects had hoped, because there weren’t enough votes in Congress to fund more generous assistance. It’s a big reason that so many people continued to struggle with high costs, or simply didn’t get insurance at all, in the program’s initial years. All of that changed in 2021, when President Joe Biden and the Democrats temporarily boosted the subsidies with extra money. The initial impetus was the COVID-19 pandemic; doing whatever it took to help people pay medical bills seemed like an especially good idea in the middle of a public health crisis. But there was always a second motive: trying to make insurance available through the Affordable Care Act more affordable.
The effects of the bigger tax credits have been clear. With cheaper insurance at the marketplaces, enrollment has surged to record levels. But the extra subsidies are set to vanish after 2025. And while Democrats have called for extending them, it would be up to Trump and Republicans in Congress to do so.
That’s not the sort of thing they’re inclined to do ― although, with Thursday’s CBO finding, they have a new reason to think about it.
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