“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.
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Dean Baker: Don’t believe what you hear about the U.S. economy
The latest numbers, when put in context, hardly impress
The end of the year produced a number of media celebrations for the United States’ economic comeback. News stories endlessly touted the 5.0 percent GDP growth number for the third quarter, contrasting it with weak growth in Europe, slowing growth in China and a recession in Japan. Reporters also touted the 321,000 jobs gained in November – the strongest such growth in almost three years. In addition, the month’s 0.4-percent rise in the average hourly wage was taken as evidence that workers were now sharing in the benefits of growth. [..]
Real, sustained real wage growth requires much more tightening of the labor market. Even if the economy were to sustain a pace of 300,000 new jobs a month (it won’t), the labor market still would not have made up the ground lost in the recession by the end of 2015. Most American workers are still far from feeling confident that they can ask for a pay raise or find another job that will pay them more.
These circumstances should be front and center as the Federal Reserve Board sets economic policy in 2015. There will be growing pressure on the Fed to raise interest rates as the financial industry starts warning about incipient inflation. Everyone should realize the purpose of higher interest rates is to slow the economy and keep people from getting jobs. That is not a policy that is in most people’s interests.
Robert Kuttner: Austerity Killing You? How About a Trade Deal?
Europe is right on the edge of another downward lurch into prolonged deflation. GDP growth is hovering right around zero. Germany, as an export powerhouse, continues to thrive, but at the expense of the rest of the continent — victims of German-imposed budget austerity demands. The euro, which keeps sinking against the U.S. dollar, is now trading at just $1.20, its lowest level in four and a half years. [..]
So what does Europe have left? It is a mark of the delusion of Europe’s leaders that the EU is putting its chips on a trade deal with the U.S. — the so-called Transatlantic Trade and Investment Partnership. TTIP is not really a trade deal at all but a series of measures intended to promote further deregulation of economic, financial, health, labor, safety, privacy, and environmental protections on both sides of the Atlantic. TTIP was designed by corporations to weaken labor and government — and would do just about nothing to get Europe out of its austerity trap.
The War Machine is the violent nexus of military and economic forces that grinds us up to perpetuate itself. With politicians of all stripes in its pockets and buoyed by lobbyists, the War Machine is beyond the reach of civil government and easily tramples individual souls, especially when they inhabit bodies of color. War is a big, multi-trillion-dollar business, requiring the sales, construction and operation of guns, drones, missiles, governmental armies, private armies, public prisons, private prisons and the like.
While the War Machine has been operated most obviously overseas in places like the Middle East, and domestically behind bars, it is now increasingly clear that the War Machine is also operating on America’s streets.
The War Machine has always made for strange bedfellows. Even as the conflict in Afghanistan, America’s longest foreign war, ostensibly ends, America’s largest police department and its union are in sometimes open conflict against their civilian commander, supported by a right wing that normally hates public unions.
Jared Bernstein: Ed Kleinbard Calls Out ‘Dynamic Scoring’
There are many strong, substantive reasons to be worried about the use of “dynamic scoring” by the new Republican Congress. As Ed Kleinbard tells it in Saturday’s NYT, the new majority is instructing the official scorekeepers of the revenue implications of tax changes to employ models that incorporate macroeconomic feedback.
As I argued here, such a move engenders at least two big concerns. First, there’s the uncertainty of the estimates, providing a plum opportunity for cherry picking: [..]
Or, as Ed puts it, dynamic scoring provides us with “…greater exposure to the risk of a political thumb on the scale.”
The second problem, well covered by Ed, is that the R’s obviously hope that dynamic scoring will provide them the cover they need to cut taxes in ways that the current scoring approach will not (though I should note here that David Wessel disagrees – he doesn’t think these scores will differ enough from current methods to provide such cover; I’m with Ed on this). That leads to larger budget deficits and since tax increases are off the table with this crowd, that means greater pressure on the spending side of the budget.
Norman Solomon: Why Jeffrey Sterling Deserves Support as a CIA Whistleblower
The trial of former CIA officer Jeffrey Sterling, set to begin in mid-January, is shaping up as a major battle in the U.S. government’s siege against whistleblowing. With its use of the Espionage Act to intimidate and prosecute people for leaks in “national security” realms, the Obama administration is determined to keep hiding important facts that the public has a vital right to know.
After fleeting coverage of Sterling’s indictment four years ago, news media have done little to illuminate his case — while occasionally reporting on the refusal of New York Times reporter James Risen to testify about whether Sterling was a source for his 2006 book “State of War.”
Risen’s unwavering stand for the confidentiality of sources is admirable. At the same time, Sterling — who faces 10 felony counts that include seven under the Espionage Act — is no less deserving of support.
Revelations from brave whistleblowers are essential for the informed consent of the governed. With its hostilities, the Obama Justice Department is waging legalistic war on our democratic rights to know substantially more about government actions than official stories. That’s why the imminent courtroom clash in the case of “United States of America v. Jeffrey Alexander Sterling” is so important.
Les Keopold: The Eight Ugly Scars of Runaway Inequality
America is the richest country in all of history. We have the largest economy and the largest number of millionaires and billionaires. At the same time, however, we lead the developed world in economic inequality. In 1965, CEOs received $20 for every dollar earned by the average worker. Today the gap is $354 to $1. [..]
These are more than cold statistics. They also tell the story of a nation in serious trouble. Runaway equality is lacerating the fabric of our society. [..]
The powerful will never be persuaded by intellectual arguments from even the very best economists. Instead, history shows it will take countervailing power and a virtual uprising by the rest of us. For a short time, Occupy Wall Street focused the national debate on economic inequality. It will take a massive new movement for economic justice with staying power to remove the ugly scars of runaway inequality.
In this new year, let’s hope we gain the courage to build it.
Before the bridge was built, the only practical short route between San Francisco and what is now Marin County was by boat across a section of San Francisco Bay.
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