Econ Roundup: More Bad News | Bleader

Econ Roundup: More Bad News


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By all accounts, Lenise has no hope. Everyone has told her that she’s out of luck. Because she signed the order of possession, there’s no reversing it now.

* Let's start with some microeconomics - Megan Cottrell has an outstanding post about a Cabrini-Green resident who is facing homelessness after the confluence of a couple events.

* One of the funniest things to happen on the political scene in recent days - funny perplexing, not funny whoopie cushion - is that the politician behind the strongest effort to prevent too-big-to-fail bank welfare is, um, a socialist. Welcome to 21st century America. James Kwak has more on TBTF.

* 10% unemployment sounds bad, but it actually puts the best face on a job market that's worse than the figure implies. Here's a little reminder on the difference between U3 and U6 unemployment and why boiling the job market down to one figure is grossly simplistic. Even unemployment generally doesn't tell the whole story:

Now as a way of sharing the pain, many firms are telling their workers to cut hours, take furloughs and accept lower wages. Specifically, that fall in hours worked is equivalent to another 3 million full time jobs lost on top of the 7.5 million jobs formally lost.

* Unemployment is also very dissimilar across education, age, and race. The New York Times has an outstanding interactive chart called "The Jobless Rate for People Like You" that's worth messing around with. The unemployment rate for people like me is 3.9%; for white men in my age bracket who didn't finish high school, it's 17.5%; for black men, it's 29.8%.

* Along those lines, Kathy Bergen of the Trib had an outstanding cover story last week that splits the difference between the macro and micro perspectives.

* More from Cottrell, who's been reading Greg Mankiw, and passes along the following:

A woman called me out of the blue last week and told me her self-sufficiency counselor had suggested she get in touch with me. She had moved from a $25,000 a year job to a $35,000 a year job, and suddenly she couldn’t make ends meet any more. I told her I didn’t know what I could do for her, but agreed to meet with her. She showed me all her pay stubs, etc. She really did come out behind by several hundred dollars a month. She lost free health insurance and instead had to pay $230 a month for her employer-provided health insurance. Her rent associated with her section 8 voucher went up by 30% of the income gain (which is the rule). She lost the ($280 a month) subsidized child care voucher she had for after-school care for her child. She lost around $1600 a year of the EITC. She paid payroll tax on the additional income. Finally, the new job was in Boston, and she lived in a suburb. So now she has $300 a month of additional gas and parking charges. She asked me if she should go back to earning $25,000.

Emphasis mine, because I also just read this piece in the Isthmus about Madisonians against commuter rail:

"If they want to have walkable communities with high-rises and the corner grocery store or pharmacy, that's fine: Build those. Sell those," she says, preferring that the market, not government, dictate lifestyle choices. "But don't make me subsidize it."

FFS. Yes: government-constructed commuter rail is a means of guiding development and land use towards distinct goals, or at least towards something, intentional or not. But so are government-constructed roads and highways:

Officials still face the challenge of making sure enough toll-paying motorists use the 286-mile system to pay off a debt load that will soon hit $4 billion and isn't scheduled to disappear until at least 2034.

That's almost ten times the cost of building the original 187-mile, four-lane system, parts of which opened in 1958.

When you get in your car, you're driving with Marx!

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