The Dysfunction and Corruption of Our Healthcare System, Its Damage to the National Economy and other Basic Healthcare Matters (Guest Post) Describing a system that is destroying global competitiveness of American business, that violates fundamental insurance risk principles, and that has inherent conflicts of interest preventing quality national health care delivery and cost efficiency; and proposing a solution.
The other American Dream of rising incomes—Horatio Alger stories One of my earliest and longest inquiries into upward socioeconomic mobility in America. The rate of upward mobility has been declining since 1980, and Horatio Alger stories are now more likely to occur in Denmark, Norway, Finland, Canada, Australia, and other advanced nations than in the US.
The American Dream died in February 1973. With graphs showing stagnation of inflation-adjusted middle class incomes since the 1970s after strong and steady post-WWII growth.
In reporting about a rigorous statistical analysis showing different rates of intergenerational income mobility, NYT leads with stuff they just made up. The article bungles the reporting of a significant new study by saying that commuting difficulties were found to cause reduced intergenerational income mobility. The study does not say anything like that, as the author (David Leonhardt) clarifies in a blog post pointing out a striking similarity between the map of immobility and the map of race. The Executive Summary of the study is quoted in my post.
The Citigroup Plutonomy Memos With key quotations from documents that are being disappeared. This post has been the #1 response to a Google search for "plutonomy memo."
Two hypotheses for why US CEO pay is so high Charts show that US CEO pay is about double that in other advanced countries, meaning there is either a shortage of talent in the US or the US CEO pay market is broken.
How mortgage backed securities increased systemic risk The securitization of mortgages and other debt obligations gives senior tranche holders less risk of individual defaults, but increases the risk to a general economic downturn. The increase in systemic risk was not generally appreciated but is demonstrated by Coval, Jurek, and Stafford in The Economics of Structured Finance. The paper contains exceptionally lucid descriptions of how structured finance works and uses simple examples to demonstrate the sources and magnitudes of systemic risks. This post is my summary of the paper.
The history of US per-capita petroleum consumption will surprise you. A graph and other data show US per-capita consumption of petroleum is down substantially from the 1970s, has been very stable since 1983 because of CAFE standards, and has fluctuated only slightly with retail price changes.
America's foreign trade agreements have not only been bad for jobs and deficits but have actually been bad for trade as well. US trade deficits have worsened by 440% with FTA countries while improving 7% with non-FTA countries. US exports to FTA partners have increased more slowly than have exports to non-FTA partners. Quoting a deputy US trade representative telling Koreans they should expect their trade surpluses to go up after the Korean FTA, which has happened. I name several goals that are more important to US trade negotiators than "trade." Links to data.
Comparative Advantage—The Unicorn of Free Trade Collection of sources and analyses demonstrating that the assumptions of classic Ricardian trade theory rarely if ever align with real-world conditions.