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Brad DeLong: Worthy reads on equitable growth, May 25–June 1, 2021

Summary:
Worthy reads from Equitable Growth: 1. The very sharp Adriana Kugler, one of Equitable Growth’s grant recipients, on MPR news. I would highlight the urgency of accomplishing the tasks with respect to reforming unemployment benefits that she lays out. This really must be done before the next recession, which could come any year. And they should be done immediately. In the end, the United States may turn out, all in all, to have handled the coronavirus pandemic better than other North Atlantic economies because of the extraordinary vaccine success and a fiscal response that was, for once, at the proper scale. But the average accomplishment of the comparison group was so bad that “best in class” is very weak praise indeed. Listen to Kugler on MPR and read a synopsis

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Worthy reads from Equitable Growth:

1. The very sharp Adriana Kugler, one of Equitable Growth’s grant recipients, on MPR news. I would highlight the urgency of accomplishing the tasks with respect to reforming unemployment benefits that she lays out. This really must be done before the next recession, which could come any year. And they should be done immediately. In the end, the United States may turn out, all in all, to have handled the coronavirus pandemic better than other North Atlantic economies because of the extraordinary vaccine success and a fiscal response that was, for once, at the proper scale. But the average accomplishment of the comparison group was so bad that “best in class” is very weak praise indeed. Listen to Kugler on MPR and read a synopsis of the report, in which she explains that critics of the benefit increases should remember that the dollar amounts in question are relatively modest. Even including boosts from the Federal Pandemic Unemployment Compensation program, the average American family of four would receive only $26,400 from a year of unemployment benefits. “’That doesn’t exactly make you rich,’ Kugler said. … Many unemployed workers found it difficult to navigate the arcane federal-state system that in many cases proved under-resourced and outdated. Some workers without recent full-time employment fell through the cracks due to complicated qualification rules. And structural racism persists in the construction of the system as a whole. The work of undertaking these and other reforms is urgent, and ‘it needs to be done before the next recession,’ Kugler said.”

2. Equitable Growth Steering Committee member Alan Blinder, in an op-ed in The Wall Street Journal, “Biden’s Plan Encourages True Supply-Side Economics;” asks: “Do you remember supply-side economics … the doctrine that claimed that lowering taxes (especially on the wealthy) would cause a gusher of growth and bring in more new revenue than it lost[?] It wasn’t true, as the Reagan and Bush tax cuts demonstrated. …The Trump tax cuts … [did] little to stimulate growth as well. But certain supply-side policies really could be counted on. … Some of them were even tax cuts. … But many of the most promising supply-side policies involve government spending, including investment in physical infrastructure like roads, bridges, ports and airports. The argument for more public investment is essentially the same as the argument for more private investment. … Selecting the right projects, however, is crucial. This means not limiting ourselves to physical investments like factories and roads, because investments in human capital offer many of the highest returns. Fortunately, much of President Biden’s American Jobs Plan and American Families Plan pushes in that direction. … Opponents of programs like these often denigrate them as ‘socialism.’ I like to praise them as real supply-side economics.”

Worthy reads not from Equitable Growth:

1. No. We do not know yet how the coronavirus pandemic has altered workplace and work-from-home technologies and preferences, and how it has altered relative bargaining power over health and safety on the one hand and convenience and commuting on the other. Any other questions? Read Anna North, “Bosses are acting like the pandemic never happened,” in which she writes: “The last year transformed work in terrifying ways. … Workers were forced to take on health risks … with line cooks facing the highest risk of Covid–19 mortality of any occupation. … While essential workers risked their lives on the job, millions of others were able to work from the relative safety of their homes. … The pandemic may have brought some workplaces closer to what Prithwiraj Choudhury … calls a ‘work from anywhere’ ideology. … But now, some companies are trying to turn back the clock on remote work.”

Bradford DeLong
J. Bradford DeLong is Professor of Economics at the University of California at Berkeley and a research associate at the National Bureau of Economic Research. He was Deputy Assistant US Treasury Secretary during the Clinton Administration, where he was heavily involved in budget and trade negotiations. His role in designing the bailout of Mexico during the 1994 peso crisis placed him at the forefront of Latin America’s transformation into a region of open economies, and cemented his stature as a leading voice in economic-policy debates.

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