A Gilded Planet

Super Sad True Love Story by Gary Shteyngart Super Sad True Love Story offers a vision of the future that follows present day social, political and economic trends to their sardonically satirical dystopian conclusion. It is a novel that sets a star crossed romance against the backdrop of the decadent west in decline. The author, Gary Shteyngart, imagines his future dystopia literally rather than allegorically. This allows him to create characters that are more real than symbolic. But it also leads to some odd examples of a kind of warped literary prescience. The emergence of an Occupy Wall Street type movement in the imagined future of the novel is probably the most prominent example of this prescience. The book was published over a year before the tents started to go up at Zucotti Park, but the parallels between the rolling campsite protests that occur in the novel due to the U.S.'s continued economic problems bear an eerie resemblence to what transpired in reality not so ...

Republicans in the state legislature of Michigan have come together this week to institute new prohibitions on the freedom of contract in their state. These new state-mandated prohibitions would put certain restrictions on people's right to bargain and sign contracts reflecting the outcomes of such bargaining. Republicans often portray themselves in opposition to big government regulations of the economy. However, when it comes to putting new restrictions on the type of contracts that can be arranged between free and consenting adults, they always seem to forget they are against big government. See also "tort reform." Prominent Example of Big Government Interfering with Freedom of Contract For some reason, many prominent reporters and news commentators have decided to refer to the legislation in Michigan as a "right-to-work" law. I guess newspaper editors decided it would be a good idea to try to confuse their readers as much as possible. Instead of calli...

If I held public office right now, this is the speech I would make over and over again. I would stand on every soapbox that would have me delivering this message. And I would probably be ignored or marginalized. "The official unemployment rate is nearly double what used to be considered normal just a few short years ago. And that official rate does not even include millions of underemployed and long term unemployed Americans. Years after the financial crisis, employment in this country is still deeply depressed. Not only does this mean untold hardship for millions of unemployed Americans and their families, but it is also causing permanent damage to our economy since long term unemployment damages the skills and earning power of workers forever. Given this stark reality, it is unconscionable that the leadership of this country is not doing everything in its power to end this jobs crisis now. "The saying goes that those who don't know their history are doomed to r...

Continued from  Part IV . Taxing the Lords of Finance  The financial crisis of 2008 has exposed deep-seated problems in our country’s finance sector. Besides the obvious dangers of over-leveraged banks, largely unregulated “shadow” banking operations and housing bubbles, the crisis demonstrated the unmatched political influence wielded by these businesses that were able to extract an enormous bailout over the loud, passionate objections of nearly everyone in the country. Many began to question whether some of these institutions had any redeeming social value whatsoever other than as a government-backed casino of the elites. Most of these problems can only be addressed through public engagement and legislation such as that passed into law earlier this summer. But it is worthwhile to note what role tax policy can play. Any true free market capitalist would be alarmed at the enormous profit margins that the financial industry enjoyed in the 2000s. In a well-functioning ...

Continued from  Part III . The Mechanics of a Carbon Tax Carbon taxes have been successfully implemented in many European countries. However, most of these countries do not rely on their carbon taxes as a primary source of revenue for the government as I am proposing. If the payroll tax were repealed, it would leave a hole in the budget of approximately $1 trillion. In order to raise this amount of revenue from a carbon tax, the U.S. would have to tax carbon at a rate of roughly $175 per metric ton emitted. Most European countries do not have a such a steep tax on carbon. However, Sweden started putting a tax on carbon comparable to what we would need almost two decades ago and has continued to experience stronger than average economic growth ever since. They also have a rate of carbon emissions per capita that is about one fourth of the U.S. average. If the U.S. achieved Swedish rates of carbon emissions, worldwide carbon emissions would drop by 15 percent. Sweden levies ...

Recently, Michael Moore made a speech to protestors in Wisconsin which was published as an editorial in the Huffington Post under the title "America is Not Broke." The idea that America is not, in fact, broke has come as a surprise to many. Don't we have a giant federal budget deficit? Aren't state governments (including our own here in California) scrambling to deal with massive shortfalls? What about high unemployment? And on and on. The geniuses at Reason.tv recently decided to tap into such misunderstandings in order to make the following highly misleading video: The breathtakingly ugly dude in this video either has no understanding of how finance works, or he is being deliberately obtuse in order to keep his viewers from understanding the financial condition of the U.S. The most obvious way to look at whether the US government is broke is to look at interest rates on federal government bonds. This is the same as looking at how much the government has to pay t...

I've long been concerned that Doug Elmendorf has been a less than fair referee on health care reform, but what he said about global warming makes it clear that he's a clown unfit to fill Peter Orszag's shoes: "Most of the economy involves activities that are not likely to be directly affected by changes in climate." Check out this Truthout article for a more complete description of why this claim is bogus, but you don't really need much more than an elementary understanding of the anthropogenic global warming trend to know that it spells doom for the U.S. economy as well as ever other economy on the planet. I understand that Elmendorf is trained in the narrow thinking of short term cost-benefit analyses, but as Congress' accountant he should figure out a way to accurately express the economic conclusions of climate science or he should resign.

The University of California employs thousands of people to keep the business of educating California's young people running smoothly. These people work every day to keep the ten campuses that make up the UC system clean and safe. They are also responsible for feeding students, faculty, administrators and campus visitors. These people work hard every day as employees of the best public university system in the world. And far too many of them live in poverty. 96% of UC service workers qualify for at least one form of public assistance , whether it's food stamps or public housing subsidies. Wages are so low for these workers that many cannot afford to meet their basic family needs. And so they work two or even three jobs. With wages for middle and low-income workers falling in the past decade (otherwise known as the Bush Years) even as the price of energy, housing, education and health care continued to rise, even with two (or three) jobs, it's very tough to make ends meet. M...

I'm working on a longer post about the current status of the U.S. economy, but I want to quickly note that Ryan Lizza's article for the New Yorker, though impeccably written, is really quite lacking as far as good piece of reporting goes. As a puff piece designed to burnish the reputation of Larry Summers, it gets four stars. But I expect a lot more from the New Yorker than that. For more on the problems with Lizza's profile, check out what Dean Baker and Matt Yglesias have to say. Paul Krugman has an interesting take as well. I do want to try to clear up some fuzzy thinking about economic policy that appeared in New Yorker and that Nikhil Dixit over at the Cal Dems blog seemed to commend in his post: Yes, unemployment is rising, but that doesn’t mean the stimulus is a failure. It wasn’t designed to stop job loss altogether. Rather, it was designed as a backstop. Don’t ask what unemployment is now, ask what it would have been without the stimulus (FYI, most economists ...

Aside from the indispensable Ezra Klein , I don’t usually read the Washington Post because it seems to have adopted a policy of deliberately misleading its readers on its editorial page while its news section…well, the less said , the better . But the other day as I was walking into Moffitt Library, a WaPo headline caught my eye and I had to stop to see if I was hallucinating. The headline read “World's Wealthy Pay a Price In Crisis.” I blinked and rubbed my eyes in disbelief. The richest people in America were richer in 2007 than at any time since the 1920s. Similar statistics showed the same story around the world. Many economists and policy analysts further believed that the rich were the only people seeing real income gains from growth across the entire economy for many years before the recession. Since the recession began, I understand that the rich became slightly poorer than before. Instead of being unimaginably wealthy, they are now only obscenely wealthy. But...