This morning's post from Dr. Brad DeLong is worth a read, as are his daily musings.
DeLong is a brilliant gent, as one can see in his short bio:
J. Bradford DeLong is a professor of economics at the University of
California at Berkeley, chair of its political economy major, a research
associate of the National Bureau of Economic Research, and was in the
Clinton administration a deputy assistant secretary of the U.S.
Treasury.
OS has never had the privilege of having his very occasional questions published under Dr. DeLong's posts. Which is perfectly ok--it's his house, he gets to do as he pleases.
OS did send some questions along this morning, and as of this moment, they haven't been acknowledged. It's the academic year now, with all those pesky students stalking the halls, so patience is a virtue.
In the meantime, OS will post his questions here, to see if anyone else may have the same thoughts in mind.
Dear Professor DeLong:
At what degree of downward slope, for how long a period of time, will you perhaps consider the notion that the Obama Administration, with its parade of economic advisors, stimulus packages, 'Summer(s) of Recovery', etc. has not been an effective steward of the privilege of governance granted to it by the electorate? Their task was to reverse the direction of those lines.
Bin Laden is dead, thank heavens. GM is operating, but still significantly underwater if we look at its share price. It's better that it be operating than not, granted, but it's not quite as resuscitated as JoeB would have us believe.
What we were told last week was that all those promises made in 2008 simply were unattainable. Bill Clinton himself said that. Many of us knew that in 2008, just not a majority of us. Then, in his acceptance speech, the President seemed to reiterate those promises. I'm genuinely concerned by that.
What course of action do you see the Obama Administration taking that truly would turn those lines significantly in the other direction? We are 16 trillion in debt, which does limit our room to maneuver a bit.
You are a brilliant gent, and this is said with not a hint of irony. No one occupies your position in academia without that quality of brilliance and true achievement.
So, what do we do next? It appears to me that Obama will retain his office, as will most of the GOP House.
What should HE do next, the day after he is re-elected? Much of what he had done to date has not been effective.
Many thanks and good wishes--your blog is a favorite read.
2 comments:
A distinction: the downward-slopiing straight lines--the "full employment" upper envelope for labor-force participation and for the employment-to-population ratio--are not something that Obama or anybody else is going to reverse, nor should they. They represent demography, technology, and wealth: as our population ages, as improving technology makes it more worthwhile for more people to stay in school for longer, and as increasing wealth allows more of us to feel as though they can get out of the rat race earlier, both employment-to-population and labor force participation will trend down.
The worrisome thing is the gap between both employment-to-population and labor force participation and their full-employment trends.
In a good world Obama ought to have had the cooperation of the congress--or at least the cooperation of Republican moderates like Snowe, Voinovich, Collins, Brown and Democratic moderates like Nelson and Lincoln--and ought to have been able to fix that. In the existing world all he has been able to do is keep things from getting even worse, as they have been getting in Europe. Plus he has made a bunch of bad decisions: keeping Bernanke, keeping DeMarco, passivity on housing refinance.
The problem is that the policies that Romney is currently selling are policies that would make things much much worse.
The hope is that Romney is simply running a con during this campaign--he has economic advisors like Mankiw who are much more loose money on monetary policy than Bernanke, and like Hubbard who are much more aggressive on housing refinance than Geithner-DeMrco--and that the policies he would follow after winning are not the policies he is plumping for now which would make employment much worse.
You can gamble if you want on the bet that Romney is right now running a con. I am more cautious and wish you would not...
Brad DeLong
Thanks for our response, Dr. DeLong. But our wealth is in fact not increasing. People are dropping out of sight in the labor force, giving up. Mid-20's kids moving back into the parents' houses, mid-50's experienced folks shown the door, never to return to their previous levels of earnings and productivity. The gent who runs the lawn service that mows my grass used to build houses, and I can't believe how little he charges for his services.
The first argument therefore seems to be: Well, had Obama gotten his way, everything would be better. Well, in the first two years, he had unfettered freedom. He used his energies to pass a health-care bill that none of the Democrats even cared to read, and that the rest of the country resents. He also borrowed and spent boatloads of money, with little effect. He promised to turn things around, and claimed early on that if he couldn't, he should be a one-term president.
The second argument is: Well, no matter how badly Obama has failed, Romney and Ryan would be worse.
Hmm...
I thought incumbents ran on their records, not on the prospect of what the opposition might possibly do.
And then there's that pesky 16 trillion in debt to pay off.
How do you propose Obama will do that?
Many thanks,
OS
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