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A Few Quick Announcements – The Baseline Scenario
By James As I wrote a couple of years ago, I don't post here anymore. I just have a couple of updates for people who subscribe and may be interested in my work. I upgraded my personal website to the 21st century. I have a new book! The Fear of Too Much Justice: Race, Poverty,…
Thoughts About COVID-19: PPE – The Baseline Scenario
By James Kwak PPE, as we now know, stands for Personal Protective Equipment, like face masks and gloves. Right now there isn't enough of it, and that's one of the constraints on being able to test people, which is one of the biggest problems we face. The only point I want me make here is…
Assessment: Stacey Abrams’ Budget Plan – The Baseline Scenario
By Simon Johnson, Ronald A. Kurtz Professor of Entrepreneurship, MIT Sloan School of Management The plan is based on sound economic and fiscal assumptions and allows for the implementation of policy initiatives without tax increases. This note provides my assessment of the financial viability of Stacey Abrams’ budget plan for the state of Georgia through…
COVID-19: The Butcher, the Brewer, and the Baker – The Baseline Scenario
By James Kwak "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest." —Adam Smith, The Wealth of Nations This is the most famous line from the most famous justification of market capitalism. Smith's point is that it is…
Quick Housekeeping Note – The Baseline Scenario
By James Kwak I've been asked if you can sign up for email notifications when I write stories on Medium. Apparently you can, but the option is a bit buried. (One of the nice things about Medium is the clean interface. One downside of that clean interface is that sometimes you have to go looking…
Letter to Treasury Secretary Janet Yellen: In Support of a Price Cap on Russian Oil Exports – The Baseline Scenario
The Honorable Janet L. Yellen U.S. Department of Treasury 1500 Pennsylvania Ave., NW Washington, D.C. 20220 October 11, 2022 Dear Secretary Yellen: We are a group of economists with expertise in oil markets, international trade, and political economy, writing to express our support for the proposed price cap on Russian seaborne oil…
COVID-19: Winners and Losers – The Baseline Scenario
By James Kwak I think it's highly likely that the dust will clear eventually and that our economy will come back to life at some point in the next two or three years. I know there are certain disaster scenarios that can't be ruled out, but I think they are unlikely. I'm not going to…
COVID-19: Inequality – The Baseline Scenario
By James Kwak By some measures, in the short term, COVID-19 will surely reduce inequality of wealth, and probably inequality of income as well. As a purely mechanical matter, the rich have a lot more money to lose when the stock market crashes and most sectors of the economy grind to a halt. At the…
COVID-19: The Statistics of Social Distancing – The Baseline Scenario
By James Kwak It seems that social distancing is the primary strategy for slowing the propagation rate of COVID-19. That and widespread testing are the key tools for containing an outbreak, for reasons discussed repeatedly in the media. But does it work? Or, more to the point, how well do different degrees of social distancing…
The COVID-19 Economy: What Can We Do? – The Baseline Scenario
By James Kwak Today, the Washington Post's Outlook section published my article on the future of the American economy in the wake of the pandemic. They invited me to write it because of my earlier blog post on "Winners and Losers." (Hey, despite all appearances, maybe blogs are still worth writing.) The article is pretty…
Moving On – The Baseline Scenario
By James Kwak I've decided not to post on The Baseline Scenario anymore. I've thought about this on and off during the several years that the site has been mostly dormant, but I never pulled the trigger, mainly because this blog still has thousands of email subscribers and an unknown number of followers on Facebook.…
COVID-19: Not One Penny – The Baseline Scenario
By James Kwak The airline industry is trying to hold up the federal government for $29 billion in grants and another $29 billion in loans. They threaten that if they don't get the grants they will lay off employees, and that if they don't get the loans they will use their remaining cash on dividends…
COVID-19: Who Bears the Losses? – The Baseline Scenario
By James Kwak Our business and household sectors are losing lots of money every day, and will continue to lose money for the foreseeable future. People no longer spend money at restaurants. Restaurant owners can no longer pay the rent or pay back their business loans. Restaurants fire their workers, who lose their paychecks and…
About that Democratic Primary … – The Baseline Scenario
By James Kwak Today is the day of the New Hampshire primary, and, perhaps more importantly, lots of people in California are getting their ballots around now. Before you cast your vote in the Democratic presidential primary, I wish you would read Take Back Our Party, either online (for free) or in print. But I…
Imposing Sanctions on Russian Energy Exports – The Baseline Scenario
March 3, 2022: By Oleg Ustenko, economic advisor to the president of Ukraine, and Simon Johnson, MIT. Contact: sjohnson@mit.edu. This post is taken from a one page memo, currently circulating. Sanctions imposed in response to Russia’s invasion of Ukraine are not degrading Russian energy production capacity or putting enough pressure on Russian financial markets. On…