David Leonhardt talks about the real issue in health care spending (it's not administrative costs). Tyler Cowen calls the column "superb." I would give it no more than a B, because the question is posed in terms of which centralized solution will work. The idea of having consumers foot more of the bill for medical procedures is so crazy that no one ever mentions it. They don't mention it in this morning's Washington Post story on the need for health care rationing. Obviously, individual consumers are irrelevant. Only Robert McNamara can solve health care.
Also in the Post, we have an article on the stimulus that features this priceless quote:
"It is clear from the data that there needs to be more fiscal stimulus in the second half of the year than there was in the first half of the year," White House economic adviser Lawrence H. Summers said. "Fortunately, the stimulus program designed by the president and passed by Congress provides exactly that."
In other words, the delay in spending is not a bug, it's a feature!
Note to Greg Mankiw: when Larry comes back to Harvard, you should invite him to take ec 10. He seems to have no concept of how the multiplier is supposed to work.
When people suggest a "second stimulus", my reaction tends to be that there might be call for a first stimulus, but not a repeat of the exercise that took place this spring.
How is the multiplier supposed to work?
Am I wrong here:
The Myth of the Economic Multiplier
As I see it, government spending doesn't multiply anything. It takes resources from taxpayers and applies them to government projects. You get a bridge or some paperwork, that is it.
"It is clear from the data that there needs to be more fiscal stimulus in the second half of the year than there was in the first half of the year," White House economic adviser Lawrence H. Summers said. "Fortunately, the stimulus program designed by the president and passed by Congress provides exactly that."
Will Larry Summers become the next Paul Klugman? Or was Summers overrated prior to his association with the Obama administration? His recent performance resembles that of an economic neophyte and/or a political yes-man.
That's funny. I read Summers' comment as a statement of fact with regard to actual timing - which it is, no ? - rather than a claim of credit for the fact.