- Not My Great^(11) Grandfather William Bradford’s Thanksgiving: Thursday Focus
- John Cassidy Explains That Those Parts of ObamaCare That Are “Liberal” Are Working Very Well
- A Longer Version of the Accusations Jacobo Timmerman Lays Before the Bar of History Regarding Gabriel Garcia Marquez and Fidel Castro
- How Much There Is There in Attempts to Ascribe Any Significant Component of Our Current Economic Distress to “Policy Uncertainty”?: Wednesday Focus
- The Deficiencies of Bureaucratic Planning: Reading Jacobo Timmerman on Gabriel Garcia Marquez on Fidel Castro…: Tuesday Focus
- Afternoon Must-Read: Larry Summers at the IMF: Approved Transcript
Josh Marshall: A Realist's Take on Obamacare: "Here's why I think the... law will be a success. Much of what I'm going to say below is based on worst case scenarios, most of which I don't think will materialize.... I base this relative optimism on four assumptions. The first is legislative... this law will not undergo substantive changes before January 2017... Obama has complete control over this part of the equation.... This is a cardinal fact. Second and under-appreciated: the major national insurance carriers have heavily bought into the "Obamacare"/exchange model.... Third: By early next year you will have millions of new people enrolled in Medicaid, large numbers of people who have health care covered who couldn't get it at any reasonable price before... and you will have large numbers of people who have care that is better or cheaper and often both.... It's one thing to have millions of uninsured or people boxed out because of pre-existing conditions. But once they have affordable coverage, I don't think you're going to be able to take it back. Fourth... I think Obamacare is good policy.... Now, one response... goes something like this: Sure, most of the uninsured will get covered and people will preexisting will be protected and you won't be able to be dropped if you get sick but it's just going to be an endless PR nightmare and the Dems will be paying for it in 2014 and 2016 and maybe 2018 and it may 'work' but never be popular.... But here is where the question comes to the prism and the standard of success. We didn't pass Health Care Reform for it to reap electoral gains for Democrats (though I think it still will) or to have it be popular.... The aim was to get people covered... reduce the scale of human suffering... tied to your wealth and your luck. By that standard, I think it will be a success and I think there will be no going back. And that's the only standard that matters."
Nicole Huberfeld: Medicaid is expanding faster than you may think: "[The Supreme Court ruling that made the Medicaid expansion a state option] led to constant speculation regarding which states would exercise the ability to opt-in or opt-out of Medicaid.... Though the media have reported that only half of states are participating, of the remaining states categorized as not participating or leaning toward not participating, all but about six are actively debating and planning to expand. The future of Medicaid expansion is not nearly as bleak as the media suggests... beginning to expose an animated set of political choices at both the state and the federal level that feed a dynamic federalism story that has so far evaded the Court’s understanding. The story of the Medicaid expansion is just beginning... but the preliminary enquiry indicates strong prospects..."
Stumbling and Mumbling: Inequality & growth: "Boris Johnson demonstrates a first-class mind--such a mind being one that tell its audience what it wants to hear.... 'Some measure of inequality is essential for the spirit of envy and keeping up with the Joneses that is, like greed, a valuable spur to economic activity.'... [But] is the inequality we now have conducive to growth or not? Two big things suggest not... GDP growth recently... has been poor even as inequality... has risen... we enjoyed decent growth in the 50s and 60s when inequality was lower than it is now.... Perhaps there are some mechanisms offsetting the ones Mr Johnson mentions.... The urge to keep up with the Joneses doesn't just spur useful work. It might also encourage people to get into debt... over-gearing and a financial crisis.... Inequality can reduce trust.... Inequality might be a symptom of a dysfunctional economic and political system.... Inequality might itself create dysfunctional politics.... Now, I don't say this to claim that inequality is always and everywhere bad for growth. I do so merely to suggest that Mr J was expressing a very partial point of view, and was simplifying horribly. It's a good job he is merely a minor local politician who isn't in charge of anywhere important..."
Jennifer Thompson and Ben McLannahan: Japan inflation data offer fillip to Shinzo Abe: "Japan is on track to win its war on deflation with the latest consumer price inflation figures showing the highest reading since the country slipped into deflation 15 years ago. Core consumer price index inflation, which excludes fresh food but includes energy, hit 0.9 per cent in October, up from 0.7 per cent the previous month and in line with economists’ expectations. Excluding both fresh food and energy, it reached 0.3 per cent, the highest reading since 1998, indicating that rising energy costs alone were not the sole factor in inflationary pressure..."
Ken Houghton: Middle Class Political Economist: Median Wealth Increases, but U.S. Still Stuck at 27th in World: "While the United States has a higher gross domestic product per capita than all but four of the 26 countries ahead of it in median wealth per adult (Qatar, Luxembourg, Singapore, and Norway), the long-term trend of economic policies has clearly hurt the middle class. Inequality is a big part of the explanation here: mean wealth per adult in the U.S. is 6.7 times median wealth per adult, the highest ratio in the top 27. By contrast, in #1 Australia the mean-to-median ratio is only 1.8:1. In fact, this ratio is less than 3:1 for 19 of the 26 countries with higher median wealth per adult..."
Gavyn Davies: Carney fires the first blast from “macro pru”: "Mark Carney’s announcements today about the UK housing market represent the first blast from a major country of a new policy weapon that is increasingly available to the global central banks, a weapon known as macro prudential regulation... an alternative to raising short rates.... The Carney announcement will represent an important restraint on the UK housing market.... The specific action taken today impacts the Funding for Lending Scheme (FLS), which will be adjusted in order to redirect lending from the mortgage sector towards small businesses (SMEs).... Mr Carney has simultaneously issued a strong warning that he believes that there are rising risks of over-exuberance developing in the housing market, and has spelled out the possible actions he may take in the future to control the market..."
Erik Zwick and James Mahon: Do Financial Frictions Amplify Fiscal Policy? Evidence from Business Investment Stimulus: "We estimate the causal effect of temporary tax incentives on equipment investment using a difference-in-differences design and policy shifts in accelerated depreciation. Analyzing data for over 120,000 US firms from 1993 to 2010, we present three findings. First, bonus depreciation raised investment by 18.5 percent on average between 2001 and 2004 and 31.2 percent between 2008 and 2010. Second, financially constrained firms respond more than unconstrained firms. And third, firms respond strongly when the policy generates immediate cash flows, but do not respond at all when the policy only benefits them in the future. The results provide an estimate of the discount rate firms apply to future cash flows: constrained firms act as if $1 next year is worth 38 cents today. The estimated discount rate is too high to match the predictions of a frictionless model, nor can it be explained entirely by costly external finance, unless firms also neglect financial constraints binding in the future."
Rob Stavins: The Warsaw Climate Negotiations, and Reason for Cautious Optimism | Ashoka Mody: Europe: Stop trying to muddle through | Star Trek Re-watch: Let That Be Your Last Battlefield | Eric S. Rosengren: Flirting With Money-Market Madness | Sober Look: Brent-WTI spread widens again as the discount shifts to the Gulf for the first time | Nick Rowe: Why inflation will not fall off a bottomless cliff |