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For a while now I’ve been arguing the political crises in the developed world can be understood as the breakdown of a two (dominant) party system in which power alternated between hard (Thatcher) and soft (Clinton) versions of neoliberalism (or market liberalism), with two sides drawing respectively on the votes of the racist/authoritarian right (Trumpists) and the disaffected left (environmentalists, socialists/social democrats etc) who had nowhere else to go, even if they were...

from David Ruccio Inflation continues to run hot—and now, finally, the debate about inflation is heating up. On one side of the debate are mainstream economists and lobbyists for big business, the people Lydia DePillis refers to as having a simple mantra: “Supply and demand, Economics 101.” In their view, inflation is caused by supply and demand in the labor market, which is allowing workers’ wages to increase at an unsustainable rate (a story that, as I showed in April, has no validity),...

from Lars Syll This critique goes beyond the narrowly technical — that the workhorse neoclassical model of the economy was found to be lame when it came to running a real crisis race. The deeper critique is that these models, and the technical language that accompanies them, have played a role in policy and in society that has been disproportionate in two senses. First, disproportionate relative to our state of knowledge. Existing economic frameworks have shouldered a policy weight that...

Leveling off at approximately pre-Covid levels. The growth rate slowed as deficit spending dropped: Still in expansion but it has come way down with the post-Covid war.Drop in deficit spending that has been driving the general deceleration: Not looking good. The parts shortage is largely over, so it is about a lack of demand as deficit spending falls and prices in general rise faster than incomes: Oil prices (not money supply, for example) continue to drive headline...

from Lars Syll In the real world, it’s my impression that almost all the mediation analyses that people actually fit in the social and medical sciences are misguided: lots of examples where the assumptions aren’t clear and where, in any case, coefficient estimates are hopelessly noisy and where confused people will over-interpret statistical significance … So how to do it? I don’t think traditional path analysis or other multivariate methods of the...

It’s become customary in Australian politics to define some subset of the population as “real Australians” whose views and concerns deserve special attention. In the wake of the election outcome, I wrote a somewhat tongue-in-cheek piece for Crikey, imagining how this frame might be applied to metropolitan Australians. It’s over the fold While both major parties treated urban Australians with a degree of disdain, it was the conservatives who paid the highest price for it this...

That’s the headline for my latest piece in The Conversation. Text is over the fold. Labor will form a majority government with a climate policy carefully calibrated to provide a clear point of distinction with the Coalition, while doing as little as possible to alienate any significant group of voters. While Labor’s emissions reduction target is stronger than the Coalition’s, Labor refused to commit to any policies phasing out domestic use of coal, oil and gas, or any...

from Dean Baker There is good reason for believing that the prices of many items that drove inflation higher in the last year have stopped rising and are may even be going in the opposite direction. Used cars are the best example. The CPI index for used vehicles rose 40.5 percent from January 2021 to January 2022. In the three months from January to April, the CPI index has fallen by 4.5 percent. More generally, the supply shortages that drove prices higher in 2021 seem to be replaced by...