Economics, recent

The Economic Illiteracy of Alexandria Ocasio-Cortez

In a recent interview with Rolling Stone, newly elected Congresswoman Alexandria Ocasio-Cortez was compared to Donald Trump in her “ability to galvanize [her] supporters through social media.” To this she replied: “In order to resonate with people, you have to tell them what you mean, you have to be willing to make mistakes, you have to be willing to be vulnerable and learn as you go.”

Ocasio-Cortez has indeed garnered a lot of attention since upsetting Joe Crowley in the race to represent New York’s 14th district in the U.S. House of Representatives last year. With over 3.5 million followers on Twitter, an initialism (AOC) that has caught on with cable news, and an audacious personality, she has become a vociferous presence in the contemporary social discourse—particularly on issues like race, taxes, health care, Amazon, economic inequality, and climate change.

In the latest example, AOC sparked controversy when she took former U.S. President Ronald Reagan to task, as related by Huffington Post, by bringing up “one of [his] favorite anecdotes from his 1976 presidential primary campaign…about a Chicago woman who was accused of fraudulently collecting public benefits under a variety of names.” AOC remarked: “So you think about this image, ‘welfare queens’…and what [Reagan] was really trying to talk about… He’s painting this really resentful vision of essentially black women who were doing nothing, [who] were sucks on our country, right? … That’s not explicit racism, but it’s still rooted in racist caricature. It gives people a logical—a “logical”—reason to say, ‘Oh, yeah, no. Toss out the whole safety net.’”

While the remark sparked controversy because of the alleged racism implicit in Reagan’s anecdote, AOC seemed intent on blaming Reagan not for racism per se but for instigating efforts to “[t]oss out the whole safety net.” Indeed, perhaps the most common feature of her public remarks on policy matters is that they relate to economic issues, such as the role of the government in the economy. Unfortunately, however, another common feature of her public remarks is that she is alarmingly prone, not simply to making mistakes that arise from climbing the learning curve on complex policy issues, but to making reckless intellectual mistakes that should easily be avoided by someone who has gloated about having an economics degree. Rarely does an AOC remark on economic issues go by, in fact, in which she does not demonstrate an ideological impulsiveness that compromises any presumed adherence to sound economic reasoning, prompting doubts about how much she learned when she studied economics at Boston University.

To be fair, her soak the rich tax policy draws on legitimate debates among economists about the pros and cons of supply-side economics, which was a central tenet of what came to be known as Reaganomics, and whether high marginal rates on large levels of income would have severe counter-productive effects on the marginal propensity to consume (probably not). But this is a debate that has been rehashed like so much old laundry that even a lay person without a college education can understand the basics of what is at stake. More generally, there is no reason to take AOC seriously when she speaks about economics, whether about the social safety net or any other issue related to economics, even though she studied economics as a college student. The reason is that AOC repeatedly demonstrates a glaring lack of command not only of facts, but of basic economic principles. 

First, her Green New Deal, which appears to be inspired by the highly-risky, nonsensical ideas of Modern Monetary Theory (MMT, which I have written about here). Instead of focusing on entitlement reform and addressing the demographics and rising health care costs which lie at the root of America’s looming debt crisis, the Green New Deal would “spend the U.S. into oblivion,” likely beyond anything that could have been imagined when President Reagan’s critics blamed his supply-side fiscal policies for increasing America’s debt load (as a percentage of GDP) during the 1980s.

Second, she demonstrated her F-grade economic literacy when tweeting about tax incentives and her opposition to Amazon’s attempt to establish offices in Long Island City. She subsequently claimed, “If we’re willing to give away $3 billion for this deal, we could invest those $3 billion in our district ourselves if we wanted to,” as if the $3 billion were a giveaway from funds already available in the tax coffers, rather than “$3 billion that would go back in tax incentives…only after we were getting the jobs and getting the revenue,” as New York City mayor Bill de Blasio (and fellow progressive) explained during an interview with NBC’s Meet the Press.

Third, ione high-profile PBS interview last year, she claimed that unemployment in America “is low because everyone has two jobs” and “people are working 60, 70, 80 hours a week.” She was subsequently chastened by Politifact, which pointed out that “[f]ewer than one in 20 employed Americans holds a second job of any type, and the people who might be working as much as 70 or 80 hours a week represent a tiny fraction of that tiny fraction.” Moreover, “[w]hen…[the government] determines the unemployment rate, a person is counted as employed as long as they have at least one job” (i.e. the U.S. government does not double-count jobs when people with multiple jobs report being employed).

It’s not just that she often gets facts wrong, or that her pie-in-the-sky idealism convinces her to take seriously MMT’s cavalier attitude about budget deficits. These can be expected from a political neophyte, and perhaps even forgiven. More astonishing is that her views garner so much attention on matters of economic significance despite how transparently her remarks make her sound as if she’s never taken an economics course.

This can best be illustrated by example, so let’s unpack a recent AOC tweet that flatly ignores basic economic principles. Earlier this month, she tweeted an NPR story about a study finding that Uber and Lyft drivers earn $3.37 per hour.

In the same thread, she claimed that “Uber runs at a deliberate loss to monopolize market share,” supposedly as part of “a post-profit model” (presumably, she meant “pre-profit model,” as it’s not at all clear what a “post-profit” model is). Then she made a claim that seems more akin to the obtuse central planners one finds in Ayn Rand’s dystopian world of Atlas Shrugged than to someone who has a solid grasp of economic fundamentals: “If you’re a shoe business, you don’t get to pay half price for the leather you need just because you’re not profitable. Living wage is the minimum cost of labor. Anything less is exploitation.”

It is hard to emphasize how chillingly inept this remark is, especially for someone with a degree in economics. First, although the study pertains to both Uber and Lyft drivers, she chastises Uber as an aspiring monopolist, while also failing to observe that Lyft, not Uber, was the first to file an IPO, and that, according to Lyft’s S-1 statement: “Our U.S. ridesharing market share was 39 percent in December 2018, up from 22 percent in December 2016.” This hardly qualifies Uber as a potential monopolist, and maybe not even a duopolist, considering that Uber and Lyft conceivably compete with taxicabs, buses, subways, and perhaps other forms of for-hire transportation services like shuttle buses or even Bird, though to varying degrees (a relevant market analysis would have to be conducted to delineate the precise product and geographic contours of Uber’s effective competition).

Second, a “living wage” is a worthy policy objective, but it is a lot harder to define a living wage than to summarily declare that everyone has a right to it. Not that economists have not tried. But simply asking a few questions demonstrates how hard it can be. Should a living wage be set at a level sufficient to afford basic necessities like food, shelter, and clothing? What types of groceries, and does the composition of the basket of groceries remain fixed over time? If the prices of Red Delicious apples rise, should wages rise, or should wages remain the same if consumers can buy cheaper Granny Smith apples and consider themselves equally well-off? Should it include milk? If so, what about people who are lactose-intolerant? Moreover, what constitutes sufficient shelter accommodations? How many rooms? Should a home include a dishwasher? Washer and dryer? How many pairs, and what types, of shoes or pants should be affordable with a living wage? Should a living wage include the monthly payment for an iPhone or Android smartphone simply because smartphones are so ubiquitous?

Questions abound, but the point is not to play devil’s advocate. These are not the idle questions of a gadfly, but serious questions about the composition of goods and services that constitutes an acceptable standard of living. If you think it is easy to define a standard of living, you clearly have not studied cost-of-living theory, which underlies one framework for measuring consumer price inflation. In fact, for all the talk about stagnant real wages, there is a valid argument to be made that “stagnant” real wages reflect shortcomings in the measurement of inflation rather than a decline in living standards or affordability (just thinking about being able to install an app to play chess on a smartphone, or about all the other apps available on a smartphone, should be enough to realize how much more bang for a buck one can get today compared to a few decades ago).

Equally pertinent is the fundamental economic point that a “living wage” is equivalent to a price floor. While not necessarily the same as a “minimum wage”—which is legislatively-determined and enforced by law—it is closely related in that the crucial economic matter is where this price floor stands in relation to market equilibrium. At equilibrium, the incremental revenue from hiring an additional worker is equal to the incremental cost. There is no incentive for firms to hire more workers, and there is no incentive for workers to supply more labor. In short, demand equals supply and the optimal output is supplied. Needless to say, in the real world, it is hard to figure out where that equilibrium point is. It is quite possible to observe an expansion in hiring even as authorities raise the minimum wage if, for example, the economy is growing (the demand curve shifts to the right). But if the floor is set above equilibrium, there is an excess supply of workers, which, by definition, means the wage is too high and many workers, who might otherwise be able to find work if the market were at equilibrium, will be unable to find work (see here for a concise summary of this point and a helpful graph).

One major complication is that a market equilibrium is rarely static. For example, a recent study by JP Morgan on the earnings of ride-sharing drivers concludes that “alongside the rapid growth in the number of drivers has come a steady decline in average monthly earnings.” Uber and Lyft dispute this finding, as well as the study concluding that drivers earn $3.37 per hour (the study to which AOC referred has faced such sharp criticism that “its authors say they will redo their analysis,” and other studies—by the likes of highly-touted economists like Alan Kreuger and John List, among others—have indicated that drivers earn approximately $20 per hour). Nonetheless, the idea that inter-temporal growth in the supply of drivers, all else equal, would lead to a decline in earnings is easily understood as a shift in the supply curve which results in a new equilibrium at which drivers provide more rides for lower wages (assuming that increased demand absorbs the increase in supply).

These are not merely academic points, they have real-world consequences, as anyone who has studied the history of taxicab regulation in the U.S. will understand. This report and this book provide a more comprehensive history, but suffice it to say that similar concerns about an excess supply of taxicab drivers emerged during the Great Depression of the 1930s. Unemployed workers were using their cars to earn a few extra bucks. This “ruinous competition” caused a steep decline in earnings, not to mention detrimental effects on traffic safety, convincing regulators to push for restrictions on the supply of taxicabs in cities like Boston and New York City. The subsequent half-century saw the emergence of barriers to entry which artificially increased the value of taxicab licenses, allowing a rent-seeking industry to become entrenched, at the expense of both driver earnings and consumer welfare.

No need for a deep dive into that history, but the taxicab industry offers a vivid example of the dangers presented by ill-conceived regulatory efforts that stemmed initially from reasonable concerns about driver earnings. Smart regulation can undoubtedly improve market efficiency, and a “living wage” is, in principle, a worthy goal for policymakers to pursue. But regulatory efforts and policy goals must competently take into account how markets work. Profitability depends critically on the cost of labor, which depends on demand and supply rather than arbitrary definitions (as it seems one would expect from AOC given what I have argued thus far) of a “living wage.” In the long run, if a firm is not profitable, there is no “living wage” because there is no wage at all. The firm goes out of business, and no longer demands any labor at all (and speaking of the disappearance of jobs, or prospective jobs, when firms are not there to hire people, it is thanks in part to AOC’s opposition that Amazon will not be bringing 25,000 new jobs to Long Island City, and that New York will miss out an estimated $27.5 billion in extra tax revenue).

Yes, there are all sorts of complications one can introduce into the basic framework of supply and demand. But rudimentary as it may be, it is also fundamental, and one that anyone with an economic degree should have grasped. But like much of the commentary from AOC on economics, it sounds like, at the very least, the boldness of her style matters more than the validity of her ideas. Instead of lending her credence based on her economics degree, we should be asking her to take some refresher courses. Until then, her recent comments on Reagan and the safety net should be ignored.

 

Jonathan Church is an economist and and writer. His publications can be found at www.jonathandavidchurch.com and you can follow him on Twitter @jondavidchurch

213 Comments

  1. K. Dershem says

    “There is no reason to take AOC seriously when she speaks about economics.” I completely agree, and think that AOC is an albatross around the neck of the Democratic Party. She’s the personification of sophomoric socialism and performative wokeness. Her media presence is wildly disproportionate to the level of her accomplishments and the seriousness of her ideas. I suspect that most of her fame derives from the fact that she’s young, attractive and outspoken. Fortunately, she’s too young to run for President until 2028 at the earliest!

    • She is a sock puppet run by her speech writers. She is fine as long as she is reading from a prepared script but once she goes off, it’s idiotic blather. She is a media darling though.
      The tale that wags the dog.

        • Ray Andrews says

          @mikegre2014

          Yabut this isn’t the first time that’s happened. The joke at the time was that Reagan should have received an Oscar for his role as POTUS, no? Mind … I don’t think there’s ever been actual auditions before AOC, or has there? Anyway, yes, she’s a talking head.

          • GrumpyBear says

            @Ray Andrews
            Reagan still has my all-time favorite political quote. There were variants at different times, but generally when responding to criticism about being unqualified because he was an actor, he’d say something like “I don’t see how anyone BUT an actor can do this job.”

            And I’d guess that 90% of the outrageous Trump comments that send the MSM (and half the country) into apoplectic fits are consistent with this.

          • Ray Andrews says

            @GrumpyBear

            “I don’t see how anyone BUT an actor can do this job.”

            Ha! Yes, there was a certain honesty about the Gipper. In hindsight he seems like a great statesman.

          • Grant says

            His critics did and still do ignore the fact that Reagan was governor of CA for 8 years, except when they want to, to this day, blame homelessness on Reagan even though Democrats have run this state for a generation.

          • Craig Willms says

            @Ray
            It is ridiculous to compare Ronald Reagan to this ditz. The book Ronald Reagan:In his Own Hand makes it clear that Reagan was not playing some scripted role. His beliefs and policies were his own. He was elected the year I graduated high school and the economy was very, very bad. By the time he left office the economy is roaring along with my prospects. That’s a fact. What this AOC is proposing from stem to stern would destroy the American, and likely the world’s economy.

            Please don’t compare the two.

    • Fred says

      There’s no reason to take AOC seriously when she talks about anything. Professor beer wench is so dumb she couldn’t pour water out of a boot if the instructions were written on the heel. If Trump can hang her and the other two Stooges,Tlaib and Omar, around the Democrat candidate’s neck in 2020, he as a pretty good shot at reelection.

    • Ron says

      The current undergraduate curriculum for the Boston Economics department teaches:

      CAS EC 102 Introductory Macroeconomic Analysis
      The second semester of a standard 2-semester sequence for those considering further work in management or economics. Coverage includes national economic performance; the problems of recession, unemployment, and inflation; money creation, government spending, and taxation; economic policies for full employment and price stability; and international trade and payments.

      CAS EC 356 Economics of the Labor Market
      Prereq: CAS EC 201. Analysis of labor force, labor supply, wages, and unemployment in terms of labor market experience and current theories. Appraisal of the effects of unions and government policies on the economic position of labor.

      CAS EC 367 Economics of the Public Sector
      Prereq: CAS EC 201. Basic principles of public finance; consideration of classical and modern attitudes toward government revenues and expenditures. Survey of problems related to public debt and budget making. Evaluation of fiscal policy as an instrument of control.

      CAS EC 377 Government, Business, and Labor
      Prereq: CAS EC 201. Examines economic growth from the perspective of the structure, conduct, and performance of business. Combines economic theories of conduct and strategy with industry case studies and evaluates the effect of government policy toward business and labor on the performance of the economy.

      She should definitely be able to understand what a tax incentive is.

      One wonders how she could graduate cum laude.

      • Ray Andrews says

        @Ron

        “One wonders how she could graduate cum laude.”

        Affirmative Action marking? If we must have Equity in admissions, surely we must also have Equity in grading? The number of cum laude graduates would have to be DIE, would it not?

      • John Baker says

        Grade inflation has been on the rise in our educational system for some time. At this point the only programs I would trust would be STEM. Economics is a soft science, I would trust it as far as I could throw it when it comes to measuring intellectual aptitude.

      • Grant says

        She’s not an idiot. Her marxists impulses just cancel her reasoning. Happens all the time.

      • Michael Fort says

        She has a BA in economics which is way different than a BS.

    • I can’t help but wonder if some unusual concessions weren’t made by a left leaning institution in a left leaning region to retain a rare Latina economics student who might not have been up to par. Such things are far from unheard of. To not only employ the concept of equity without any apparent caution, but to explicitly guarantee economic security for those “unwilling to work,” well that’s just gratuitous even in the theoretical context of a utopia where such a thing were possible.

      That said I’m a little more optimistic about our ability to calculate something closer to a livable wage. It’s not obvious, but it’s not rocket science either. One bedroom for a couple, two for a young family, a week’s worth of clothing per person, a caloric intake broken down at their discretion, modest transit costs, basic health insurance, a reasonable retirement, etc. The specific criteria in question is hardly challenging, but perhaps these things are simply that much more apparent to those who live with the daily reality. To ward off any potential systemic revision whatsoever is as dangerous as hyphenated socialism in a time and place where one side of the aisle is heavily armed and the other is entrenched in collectivist moral hierarchy and ideological possession.

      • Stephanie says

        WH, as someone who lives with the daily reality, you should understand that a “caloric intake broken down at their discretion” varies wildly. I can survive on $30 a week if I eat nothing but pasta, but would prefer spending $30 a day for balanced meals with little carbs. My father maintains a healthy diet for only $80 / month. What is the appropriate benchmark?

        Why should a couple be able to afford a one bedroom apartment, and not settle for a studio? Or rent a bedroom in a house with a few roommates for a fraction of the cost? Should the minimum wage be different depending on your family status? How often should it be affordable to replace the week’s worth of clothing?

        Anyone who’s experienced financial hardship knows that you can drastically lower your standard of living while still living. A “living” wage is presumably a wage you can live on, and if that is the benchmark the minimum wage is probably too high in most places. The minimum wage is supposed to be the minimum, so it’s not clear to me you should be able to afford to save for retirement, or even health care. Minimum wage jobs should not be for adults, and an artificially high minimum wage keeps teens from entering the market and incentivises the replacement of workers with machines.

        • Ray Andrews says

          @Stephanie

          But that’s just being a gadfly. Of course there are any number of questions. You could throw up your hands exactly the same way about speed limits — too fast? too slow? what if you’re a formula one driver? what if you’re tired? what if you have only one eye? what if it’s raining? … But we arrive at a speed limit, don’t we? It would be the same with a UBI — after millions of words and much wringing of the hands a number would be arrived at. The essential thing is that it’s fixed — no matter how much you whine, it never goes up. If you can’t make a go of it on UBI, then you are declared an incompetent ward of the state and sent to The Institution, which is vaguely half way between an asylum and a daycare and a work-camp and a prison , but it’s not that you’re a criminal, it’s that you can’t manage your own affairs.

      • Troy says

        I take it you don’t have a degree in nutrition if you think that all caloric intake is equal in quality and cost.

    • Jon Pajar says

      True, and it says a lot about affirmative action policies. I strongly recommend Jonathan Haidt’s “The Coddling of the American Mind” and checking out his youtube stuff.

  2. Karl says

    Well, in her defence she did explain that signalling her virtue was more important than knowing any facts. Or words to that effect.

    I’d look up the exact quote but I hardly think I need to – after all there’s a lot of people more concerned about being precisely, factually, and semantically correct than about being morally right.

    • Declan says

      OCASIO-CORTEZ: If people want to really blow up one figure here or one word there, I would argue that they’re missing the forest for the trees. I think that there’s a lot of people more concerned about being precisely, factually, and semantically correct than about being morally right.

      COOPER: But being factually correct is important–

      OCASIO-CORTEZ: It’s absolutely important. And whenever I make a mistake. I say, “Okay, this was clumsy,” and then I restate what my point was. But it’s — it’s not the same thing as — as the president lying about immigrants. It’s not the same thing at all.

  3. bumble bee says

    Yes, AOC is cringe worthy to listen to. She opens her trap and nonsense comes out. She is the poster child for Millennial self aggrandizement. I would be content if she went away.

    However, she does have a point about Reagan’s comments on welfare that is still quoted today by those who want to get rid of welfare and all safety net programs. We have all heard the story of the welfare person getting steak and/or lobster with their welfare benefits while the rest of the working class is eating ketchup sandwiches five time a week. If anyone has worked with the poor in any capacity, you know full well how Reagan’s comment is nothing but BS.

    Does that mean that there is no fraud with welfare or any other similar program? No, there is fraud, as there is fraud in any sector of society. Doctors cheat Medicare/Medicaid out of millions each year. You never hear the same outrage nor demands for a pound of flesh for those frauds. While I do not have the statistics, I would guess that the percentage of fraud from safety net programs are the same as other forms of fraud. Not that it makes any of it permissible, but it needs to be put into perspective.

    What AOC should have done, not to encourage her, but if she really wanted to cite a Reagan economic policy that is total junk, it is the Trickle Down Theory. The old crumbs from the wealthy that we can all scramble to get. If she or anyone wants to liberate the economy from the dipole it has become, then she needs to look at the stock market.

    While the stock market in its simplest form allows people to invest in business which in turn allows growth and jobs. However, having people invest also removes revenue that could benefit companies not listed in the stock market. Then of course there is the issue of satisfying the investors to the detriment of the employees. Where investors demanding more and more profits has lead to stagnant wages, as well as massive layoffs when things are not going as well in their eyes. Essentially, investors are being paid as if they were executive employees while those that make the company exist are preyed upon. It makes one wonder if the new economy, the new personal income for everyone should be investing and leave the work to the new slave pool.

    Don’t get me started on the GND and all the mindless sheep who put any stock into its viability. My own senator, Markey, has co-sponsored this charade. Why any of the Dems are giving it any notice or support is remarkable, and in the process have elevated AOC which has came back to bite them and will continue to do so.

    So to sum up AOC, she is the dumpster fire that continues to burn the Dems until they return to sanity.

    • MMS says

      @bumble bee This is quillet where all are free to speak as we will but your approach and word choices are in poor taste and negate any point you might be attempting to make.

      • Ray Andrews says

        @MMS

        I found @bumble bee’s post quite on par. What word choices did you find to be in poor taste?

    • Jeff says

      Mr./Ms. Bumble Bee,
      President Regan did not coin the term “Welfare Queen”. It was (apparently) originally used in the press to describe a specific person (Linda Taylor). He did use her story and the term to highlight welfare fraud (perhaps overstated) and it was a part of the push under President Clinton for welfare reform.

      From Wikipedia: “Taylor was ultimately charged with committing $8,000 in fraud and having four aliases.[7] She was convicted of illegally obtaining 23 welfare checks using two aliases and was sentenced to two to six years in prison.[8][9] During the same decade, Taylor was additionally investigated for murder, kidnapping, and baby trafficking.[10]”

      Extrapolating from this one person to all welfare recipients is wrong, but highlighting, combating, and attempting to control fraud in government programs seems like a good idea. I think (but I am nobody) President Regan’s objective may have been that proper fraud control was not in place given the activities of some one like Linda Taylor. While her actions were extreme, I doubt she was the only person taking advantage of the system.

      It seems like we are condemned to always to focus on the extremes of the spectrum (zero fraud or 100% fraud) and maybe neither reflect reality. I read about fraud in other government programs. It does seem to me that eliminating fraud is a good goal.

      Could you point me to those people you say use President Regan’s comments “…..Reagan’s comments on welfare that is still quoted today by those who want to get rid of welfare and all safety net programs.” I guess I am poorly read since I have not read any argument to completely get rid of welfare and all safety net programs. Is this a big push that I have missed? Or is it some small fringe idea with little support.

      Put me in the class to eliminate/control fraud in all government programs–but that in no-way indicates I want to get rid of them.

      Nevertheless, this could be a “Rosanna Danna” moment for me, in which case “Never mind.”.

      Jeff

      • Ray Andrews says

        @Jeff

        Thanks. Yes, if only we could be reasonable. If I point out that the boat has a leak, it does not imply that I want to sink it entirely or have it scrapped. I merely think that the leak should be fixed.

      • “If anyone has worked with the poor in any capacity, you know full well how Reagan’s comment is nothing but BS.”

        Um I work in a poor urban school district. All my students are Title 1 and on free lunches. 100%. They are all “poor” by any economic definition. I’d say about 1% are what most people would think of as ‘genuinely’ poor, e.g. no car, though even these are no food insecure (breakfast and lunch at schools are free, and the soup kitchen operates regularly). Reagan’s comment – which you distort – is anything but BS.

        Indeed it’s gotten far worse now. Though the intentions are good, the “safety net” has decimated this community over time. The situation is horrible as enabled parents who are rewarded for failure, raise enabled kids who don’t know what success even looks like, much less what it takes. It is common for mothers to have 5-10 kids by different fathers. It is common for people not to work; many kids don’t know what work is (“when the check comes in,” is their response to when they’ll be able to get their nails or hair done). This may sound racist but a) I’m not talking about race; I’ve worked in both majority white and majority black impoverished districts and the behavior is the same and b) I’m reporting reality. That’s the point.

        Some parents do work, not saying all are “on welfare.” I’d say more than half though are not working. They have many dysfunctions, including drug abuse and mental health issues. But they are incentivized to keep having kids. Many start when they’re teens. I am describing reality. Only people who don’t live and work among “the poor’ see this.

        We have an obesity problem. Yes, you read that right.
        Nearly all of the kids have smart phones and many have ones nicer than mine. All have gadgets, including expensive tablets, games, etc.
        Nearly all wear expensive clothes, e.g. $200 sneakers.
        They regularly go out to eat and prefer fried or prepared foods. There are plenty of ways to get healthy food, contrary to the claim that it is ‘hard.’

        There is zero incentive to work. I sometimes look at their families and wonder why I’m working 55 hours a week. They eat out more than I do, wear more expensive clothes, have more expensive gadgets, and are offered multiple free services like free therapy and free educational camps. As far as fraud, yes, many do commit it– but they don’t have to. All they have to do is not work and have a ton of kids.

        Again, nothing to do with race. I see this across races, both white and black.The people who talk about “the poor” as a monolith are the ones who have the stereotyped, insulting image, not those describing fraud and the very real problems of rewarding people for not working and not being responsible parents, over generations.

        • Alan J Green says

          They are not all poor by any economic definition. From a world-wide perspective, they are quite well off, especially if one includes the assistance they receive from the government.

          I certainly don’t wish to make light of their hardship. I simply wish to add perspective. There are still millions in the world who live on less than $1 per day, & who don’t have electricity, clean water, or any chance at an education.

      • Jeff

        Thanks for the clarifications. Having worked myself in government human services for several years and having had intimate dealings with other social welfare systems, I would testify that there is indeed all kinds of fraud and waste.

        I find it interesting and revealing when good intentioned people get upset when fraud and inefficiencies are pointed out. As often as not these people have little or no first hand experience with the kinds of people who are dependent upon government services. Don’t they get that abuse of social welfare systems hurts most those in need the social welfare systems?

    • ga gamba says

      However, she does have a point about Reagan’s comments on welfare that is still quoted today by those who want to get rid of welfare and all safety net programs. We have all heard the story of the welfare person getting steak and/or lobster with their welfare benefits while the rest of the working class is eating ketchup sandwiches five time a week. If anyone has worked with the poor in any capacity, you know full well how Reagan’s comment is nothing but BS.

      Nothing but BS? Hmmm…. let’s check it out,

      Reagan’s welfare queen was Linda Taylor, though he didn’t use her name. She used multiple aliases to apply for and obtain benefits. In 1977 Taylor was sentenced to imprisonment for two to six years on the welfare fraud charges, and a year on the perjury charges.

      Abuse of the system still continues. This this not fraud though, because her entitlements allow her to buy whatever is permitted, in this case lobster, and nothing forbids her from feeding it to her dog, which she does.

      At the video’s 52-second mark, on her receipt you’ll see EBT (electronic benefit transfer) food; this is gov’t electronic system that allows state welfare departments to issue benefits via a magnetically encoded payment card. You’ll see that her current balance is $167.91 after buying her lobster. What’s the value of her monthly assistance is I don’t know. Barring certain exclusions such as alcohol and cigarettes, a recipient may spend benefits money as s/he wishes on food, and presumably may choose to splurge for a few days and starve the rest of the month, though I doubt this is viable for long.

      Of course, I doubt all the other benefits recipients are stuck with eating ketchup sandwiches five days a week. There’s government cheese after all, which makes a nice addition to all those ketchup sandwiches.

      In the United States in 2008–09, the Social Security Administration Office of the Inspector General received 129,495 allegations of fraud and closed 8,065 cases, with 1,486 criminal prosecutions. These activities involved over US$2.9b in ‘questioned costs’; with US$23.3m in recoveries, US$2.8m in fines and a further US$25.5m in settlements, judgment and restitution orders. Social Security is just one of several benefits programmes.

      You’re right that the abuse and fraud is up and down and across the systems, be it by individuals or businesses. This is what happens when set asides, legs up, subsidies, and hand outs are provided. Some people will be tempted and act on it. This is not the majority of recipients, just like the majority of men aren’t rapists and whites aren’t white supremacists, but we see the progressives make incessant assertions that imply such things, or may be inferred that way, to the point of such amplification that people believe there’s a crisis. For some reason progressives dislike using the words few, some or other quantifiers. Ever wonder why that is? At least Reagan limited his comment to a welfare queen by stating “There’s a woman in Chicago….”.

      • Ray Andrews says

        @ga gamba

        “government cheese”

        Do I want to know?

        • ga gamba says

          Looks tasty, doesn’t it?

          Warehouses stacked to the rafters with delicious not-to-sold-or-exchanged flavoured cheese.

          Powdered milk as well.

          • peanut gallery says

            I had some govt cheese as a child. It has a… unique flavor.

    • Tome708 says

      Bumble bee, Reagan never coined anything “trickle down economics”. The Democratic opposition did with much assistance from Liberal media. It was an insulting term. Equivalent to today’s “nazi” or “racist”.
      The fact that you believe that Reagan coined that discredits your opinion on this subject.
      Do you believe Sarah Palin said that she could see Russia from her home?

    • Craig Willms says

      @Bumble
      What serious politician or right-wing think tank is advocating getting rid of ALL social safety net programs? It’s not even a thing.

      There is more serious talk about ending corporate welfare and crony capitalism (which is good) than about so-called welfare queens.

      It was called supply side economics not trickle down, which was a made up term used to ridicule the Reagan years.

      As for shareholders demanding more and more, forcing companies to focus on the short term which is no help to average employees, guess which politician advocates for changes in corporate earning reporting to demphasize short term maneuvering. Yeah Donald Trump.

    • Michael Fort says

      A few of things:

      Do you know anyone, never mind legions of people, who call for an elimination of all safety nets?

      and

      Trickle down is me giving my money to the government hoping that some significant benefits will come my way not the government letting me keep more of the money I have earned.

      and

      Fraud in government entitlement programs is pervasive and needs much better monitoring as does fraud in all other areas but fraud in entitlement programs may be worse because it takes money away from people who really need it.

  4. E. Olson says

    Economic major AOC is a poster child for the problems created by affirmative action and/or a sad demonstration of the dismal quality of economic education at leading universities. The fact that she receives so much positive coverage from the mainstream media also reinforces the idea that journalists also lack any economic understanding.

    Economics is simple supply and demand, but when it comes to minimum wage laws (or living wages), mandated health care insurance, and other policies that increase costs and decrease demand for labor, or support for open borders that increase labor supply and lowers wages, the Left flunks economics every time and yet continues to act surprised when they bankrupt companies and tax revenues are less than predicted. It’s the same with welfare policy, as they somehow think that paying people not to work will decrease unemployment, or that giving homeless people free shelter and food will decrease homelessness, or giving druggies free needles will help them live healthy lives, and we see how well these policies work by the total lack of homeless populations and welfare dependency in all the Democrat run major cities. But at least they are consistent in their stated desire to help the poor, although why they think doing everything in their power to make energy more expensive benefits the poor remains a mystery. In fact it is hard to think of any policy area where the Left doesn’t continually try to contradict economic laws, which suggests they also have no knowledge about history either.

    AOC is a privileged idiot, which means she fits right in with the rest of her Democrat colleagues and too many of her Republican colleagues as well. Perhaps our universities should go back to teaching real topics with real world application instead of focusing on all the social justice nonsense.

    • Lewis says

      I attended BU, albeit for sciences, and my professors were great. But I can attest to BU’s affirmative action. Many people in my high school’s graduating class who (according to grades, extracurriculars, sports, community service, and SAT scores) should have gotten in to BU, did not, while many that did get in, should not have.

    • Nakatomi Plaza says

      Nice job, E. Olson. Everything single thing you wrote is either totally wrong or extremely dubious.

      And, please, tell us about these magical “economic laws” that have made Uber a billion-dollar company even though they haven’t made a single nickel, ever. Tell us about the deficit, which I’m sure you care about, and how it grows under the GOP and inevitably shrinks when Democrats run the show.

      And why in fuck would you bring up affirmative action? You’re a racist. I have no doubt about that when you drag something like that into the conversation for no reason whatsoever. You’re just pissed because a Latina woman is getting attention, and you can’t stand it so you call her an idiot, privileged (WTF?), and demean her achievements because of race.

      You’re a sick puppy.

      • Child free zone says

        Can someone call NP’s mommy and tell her NP is having a tantrum and needs his diaper changing and a hug.

      • E. Olson says

        NP – an obviously stupid “victim” minority female graduate of a supposedly good school = affirmative action. Nothing racist about it. I could never say the same of Nikki Haley who is also a female minority college graduate, because she rarely says or does stupid things.

        As for Uber – you raise a good point that you don’t even realize. How do you explain AOC’s suggestion that a company that has never made a profit is supposed to pay drivers an even higher “living” wage? But I do share your amazement that so many investors are stupid enough to put such a high valuation on a profitless company, but can only assume they believe that Uber will one day be highly profitable by putting taxi companies out of business.

        As for Republican’s who also drive up the budget deficit – as I originally wrote – too many Republican’s are also stupid when it comes to understanding economics, although they at least seem to have some sense that deficit spending is wrong – so perhaps they are more like drug addicts rather than just stupid.

      • Etiamsi omnes says

        Hardly a day goes by, I reckon, without Nagasaki Blabla nuking someone in the comments section. Very rude.

      • Judgment aside, the data is clear on who has to perform at what level to be accepted into what school, racially/ethnically, and rubber stamping is a problem in several areas. So it should come as little surprise that people would be suspicious, you don’t have to be racist.

      • Peter Schaeffer says

        NP, You should think twice (and try a mirror) before you call anyone a “sick puppy”. Quote from you.

        “Tell us about the deficit, which I’m sure you care about, and how it grows under the GOP and inevitably shrinks when Democrats run the show.”

        Let’s see if that is true. Bush (43) increased gross national debt by $5.849 trillion. Obama (remember him?) increased the debt by $8.588. You can look up what the words “increased” versus “shrinks” mean online.

        In Q1 2001 (when Bush took office), U.S. debt was 55.1% of GDP. When Obama took office it had risen to 77.3% of GDP. When Trump took office it was 103.57%. Bush’s debt record was hardly stellar. However, Obama was worse than Bush. Note that this data is from FRED series GFDEGDQ188S.

        FRED series FYGFDPUN gives “Federal Debt Held by the Public”. In Q1 2001 it was $3.434 trillion. In Q1 2009, it was $6.836 trillion. In Q1 2017 it was $14.374 trillion. Do the math. Obama was far worse (in this respect) than Bush.

        Check facts before you write. You may not like the facts, but they are still true.

        For fun try FRED series FYGFGDQ188S. Wow, just wow.

      • Nakatomi Plaza says

        E Olson , I have more on my mind for you. I know u r a Racist because I don’t know enough to argue your points. And literally everything you say is wrong, because it makes me feel not good.
        I would call you another bad name right now, but my mom just walked in

      • Nakatomi Plaza, what is your problem. Stop attacking E. Olson, whose points are sound and interesting (and even if they weren’t, don’t warrant this invective). You’re the sick puppy.

      • Denny Sinnoh says

        Plaza-Chan, you need to spend less time here and go get yourself a girlfriend, or at least a new anime pillow.

    • Ray Andrews says

      @E. Olson

      “It’s the same with welfare policy, as they somehow think that paying people not to work will decrease unemployment”

      I can’t speak for ‘them’, but I myself would have no such illusion — paying people not to work will increase unemployment (tho how much is disputable), but it will also reduce extreme poverty and the crime and blight that they produce, not to mention the next generation of broken people. No, it will not eliminate those things but even the Victorians had some consensus that having people starving on the sidewalk was unsightly so whereas, say, a flood of desperate immigrants from Ireland might very admirably drive wages down to 102% of starvation, if they fell to 70% of starvation then there would be the workhouse where people would be fed at 101% of starvation. It’s anachronistic, but in my mind right now are those charming movies from the Warsaw ghetto of those starving kids and the daily removal of the corpses from the streets. Well, if there’s surplus labor, labor being a commodity, and people being nothing but purveyors of that commodity, then supply must contract, no? The Free Market is never wrong.

      • E. Olson says

        Ray – there is no doubt that welfare has created multiple generations of broken people who are totally dependent on welfare. What would happen if long-term welfare disappeared for the able-bodied? Some would no doubt die or end up in prison, but perhaps that is not a bad thing for the truly broken? Others would find help from private charity, but most of the others would be forced to find a way to get off their butts and start working. Of course those who are born with real physical or mental handicaps, or suffer unfortunate permanent injury via accident, may need to receive some welfare assistance, but even here it is easy to find examples of people with down-syndrome or missing limbs still going to work everyday and earning some of their own keep, while the much more able bodies claim disability and a need for permanent welfare. Keeping a functioning safety net and a healthy economy requires that long-term welfare be limited to legal residents who are truly helpless. We’ve clearly gone too far when the poor are fat, smoking, drinking, and buying lottery tickets much more frequently than the taxpayers who support them.

        • Ray Andrews says

          @E. Olson

          There is truth in what you say, the ‘welfare trap’ is a very real thing. Nevertheless, economic dislocation can leave people without means and I think it is a flat out lie that the Free Market always provides employment, we’ve seen endless examples throughout history where it does not. I detest the welfare parasite as much as the rentier parasite, but there must be some sort of safety-net.

          You know, the tricky thing is that above you make several references to worthiness and although that’s an obvious moral vector, I’ve come to believe it does more harm than good because we end up with bureaucrats deciding who is able, lazy, helpless and so on. Finally we end up with the institutional Victim Identity who is considered to be always worthy. I’m sure you agree that’s toxic.

          The thing about UBI is that it’s automatic thus it obviates all Victimhoods and all fraud. But if you want more than subsistence you have to work and I suspect most will because I think that very few people really want to be useless sacks of shit. Nope, the way most Western countries do it now is flawed, it isn’t even in the long term interests of the poor themselves. But I’ll not see folks destitute. I like workfare, you?

          • K. Dershem says

            In the U.S., at least, welfare dependency is a much less pervasive problem than it was in the past. Since Clinton signed the welfare reform bill into law in 1996, it’s been far more difficult for poor families to get cash payments, especially in more conservative states that have very strict standards and limits. It’s much easier to qualify for SNAP benefits (food stamps); some people sell these to obtain cash for paying rent and bills. The Earned Income Tax Credit works well for poor people who are able to stay employed, but individuals who can’t find or keep a job often struggle to make ends meet.

    • David of Kirkland says

      But Trump’s Wharton school education was top notch based on his understanding of tariffs, trade deals or lower taxes on the rich during a strong economy while running the highest deficits ever recorded in the USA?

    • Amin says

      @ E. Olson

      “AOC is a privileged idiot”

      It cannot be you name calling people can it? And with prized nonsense like this:

      “Economics is simple supply and demand”

      No it isn’t. It clearly isn’t.

      ” the Left flunks economics every time and yet continues to act surprised when they bankrupt companies”

      How many companies were bankrupted and under whom?

      The above comment is typical of your comments. It is filled with half formed empty rants at the Left. And there isn’t an ounce of anything of actual value. You post variation of this at almost every comment. Challenging your nosnense is a hard job – you simply either ignore, or answer with more empty nonsense.

      • E. Olson says

        Amin – I’ve been wondering where you were, but I’m pleased that your your mommy gave you back your Internet privileges. Try to behave yourself this time.

        • Amin says

          E. Olson

          Yeah. Such irrelevant replies when your BS is challenged. Just as predicted. You’ll just continue this cycle of making up silly little lies as you go along…

          • Ray Andrews says

            @Amin

            Why don’t you try acting like an adult and actually engage with what Olson says? I do. I think his economics are far too harsh, but notice that we discuss the issue without insulting each other. Notice that K is rather to the left of me, but, again, we converse without insult. Care to join in?

            “Economics is simple supply and demand”
            “No it isn’t. It clearly isn’t.”

            Yes, I agree with you, that’s a bit of an oversimplification, mind it’s almost an aphorism and so we expect a deliberate oversimplification — but still you are right. I myself think that virtually the whole of Wall St, far from engaging in supply and demand, are in fact employed in deliberately distorting both.

      • Amin, your arguments would be so much stronger if you actually engaged E. Olson as opposed to acting exactly like you claim he/she does. You say his/her posts are ‘filled with half formed empty rants” but then you do the same.

        I do agree that “economics is more than “simple supply and demand.” But when you say, “no it isn’t. It clearly isn’t” you don’t make the case. My own impression was that E. Olsen was speaking roughly, and didn’t literally mean that it was purely supply and demand, and was using hyperbole to make the case, but I could be wrong. But why not explain what economics is then?

        challenging the ‘nonsense’ isn’t hard. You just go over it point by point. If you know what you’re talking about, it isn’t difficult. I would be interested in seeing actual analysis by more learned people than I, of what works and what doesn’t in economics.

        What I see on the ground – rewarding people for not working and making poor decisions as parents – is a disaster, really a disaster. Whole communities are now decimated. All my students are “the poor” but many have a higher standard of living than I do, with nicer phones, nicer cars, and larger houses. Many families are not fraudulent per se – though some are, e.g. working or dealing drugs under the table, lying about disabilities – but a majority “work the system.” This wouldn’t show up in stats but is very obvious if you live/work in an impoverished area. Again this doesn’t have to do with race; human nature is human nature. I saw the same behavior in my white “trailer trash” – what they were unfortunately called – district. That the system is able to be ‘worked” is indicative of the underlying problem.

        I do not think we should abolish all social help – I myself used unemployment several times when I was laid off, and it was invaluable in keeping me afloat – but I do think we need to really rethink the difference between good intentions and actual results, between reason (what we think people should do if they were Dr.Spock) versus emotion and human nature (what they really do). Just because a policy has good intentions – helping the poor, e.g. – by no means means its results will be good. What is going on now is not working at all. It is human nature that you cannot reward people for poor decisions. Obviously one must not stand idly when children and elderly are starving, but that is not the same as saying our current system is working when so clearly it isn’t. Enabling and infantilizing people even more is definitely not the answer

        • Amin says

          @ d

          “Amin, your arguments would be so much stronger if you actually engaged E. Olson”

          No they wouldn’t. I tried and failed. Why should I waste time on writing reams? There is no point to it.

          Then all one has to do is challenge BS. Burden of Proof.

          https://en.wikipedia.org/wiki/Burden_of_proof_(philosophy)

          It is not my job to counter-argue BS at length.

          And thridly, I wonder why people like you selectively miss where his BS is called out and challenged.

    • Johhny says

      My friend graduated last year with an economics degree from Georgetown University. He was able to secure employment at the Department of Labor and uses the knowledge he gained from his degree on a regular basis. AOC graduated with the same degree albeit from a slightly less prestigious school and went to work as a bartender. I know plenty of other people who have econ degrees who went to work for banks and other financial institutions. AOC is bartender because she clearly isn’t able to impress any recruiters with her command of economic knowledge accept apparently the voters of New York’s 14th district.

      • OleK says

        But but…she FOUNDED and worked for non-profits! She’s just not interested in working for those financial institutions etc. LOL!

  5. thatsmysecretcap says

    All the dems need to do now is latch onto gun control a la New Zealand and they will have perfectly threaded the needle of how to loose the next presidential election to the most disgusting, ridiculous, despicable incumbent in modern history. The only thing we need right now is exactly the thing we can’t have. Proper, competent, conscientious execution of the laws, policies, norms, standards, and values that we already have and that made the USA what it is. The pubs use conservatism as a smoke shield for blatantly criminal malfeasance and the dems respond by wanting to throw the baby, bathwater, bathtub, toilet, and kitchen table out in a demonstration of wokeness while asking the local grievance studies department for permission to pull up the floorboards.

    • Thatsnysecretcap, you do realize that in your argument that the conventional dems and republicans are corrupt, you kind of make a backwards admission that the most despicable candidate is the best solution to that problem. At least he’s pretty much the only politician out there fighting the entrenched interests you rail against.

      • Ray Andrews says

        @WW

        There is a sick and twisted logic to that. I know people who voted for Trump precisely because he was the most despicable candidate — they hoped to send a message to Washington, failing which, they hoped he’d burn the place to the ground.

  6. OLd NiK says

    I’ve listened to many people with a LOT more letters after their names than this fool, they say the very same things and have, for a great many years. I attended a Canadian University on the strength of a GED 30 years ago, rest assured they haven’t gotten any pickier in the meantime. Institutes of higher learning have become clown factories for the most part, the joke has come upon us.

  7. the gardner says

    The econ faculty at BC has some ‘splainin’ to do.

      • Tome708 says

        Yeah. Kirkland. Trump is really driving the economy into the ground. It’s sooooo bad They better impeach him

      • APP says

        @davidofKirkland-

        I know this is some simple ‘whataboutism’ because a lot of people hate Trump; but it doesn’t work here.

        A) most of the faculty responsible for Trumps acceptance and education are dead. The current dean was BORN 2 years after Trump graduated. You can hold him responsible for what happened before he was alive…………it would be immoral to hold people accountable for the actions that happened before they were even alive. On the other hand, AOC graduated in 2011 cum laude. The current faculty certainly can be questioned how a top graduate of theirs doesn’t understand basic tax incentive policy.
        B) Trump is a scoundrel and cheat, not an ignorant doofus. Perhaps Wharton needs to make sure it has an ethics class or two, but that is a far cry from the total lack of basic Econ understanding AOC demonstrates.

  8. Cornfed says

    Leftist economic thinking has always been largely based on fairy tales, long on sentiment, short on facts. AOC is a typical young leftist marinated in this nonsense. Take her defense of the GND: it will rely on technologies that do not currently exist, she says. But we just have to make it happen. You can’t do great things if you’re afraid to be bold. And so on. It’s like she has a drawer full of motivational posters and every time she needs to answer a question, she pulls one out.

    Unfortunately (for us all), the days of big thinking are coming to a close. Our national debt is swelling to such an extent, the only big idea we’ll be thinking about is how to stay afloat.

    • Nakatomi Plaza says

      No, she has a bunch of very specific policy ideas. She very obviously does not just trade in motivational cliches. It’s her policy ideas that people like you are so horrified about, or have you forgotten? None of what you wrote is remotely true. She is all about policy and taking action. And you’re seriously complaining that she has faith in technology and innovation? You’d prefer she didn’t anticipate the future? No matter what AOC does you’ll complain, obviously.

      Wait. You can about the deficit? You’ve got to be joking. Have you looked at the deficit? Have you noticed what happens to the deficit every time the GOP takes power? They cut taxes, raise military spending, and the deficit grows. EVERYTHING TIME.

      You are pathetically uninformed.

      • Johan says

        @ Nakatomi Plaza…People like her has been around for a century. Ever since universal suffrage. Left wing populists in the Americas and Europe has been rampant. Can’t think of one who didn’t fail. Europe’s socialdemocratic parties are all but gone. Latin America is turning to right wing hardliners…Still there are people like you, Naktomi Plaza, that once again believe in that old fairytail…I don’t understand…You don’t make me more optimistic about mankind. Everything just repeats itself. Not enough people learn from history. That is the weakness of democracy. You are the weakness, Nakatomi…

      • Joetundra says

        You admit the deficit is a problem…yet you want to make it orders magnitude worse with the GND. She actually never made any policy ideas with the GND…zero specifics. Lots of vague concepts, though.

        She plans to have government take over the entire US economy, refit every building to meet impossible codes, have miracle tech do impossible things, have the government pay for it, pay people for not working…AND tax the crap out of everybody to pay it off.

        I’m sure I’m leaving out a few things. Even taking only her complete fuck up on Amazon into account, that you take her word on anything, says a lot about her average supporter.

      • Nakatomi Plaza, print more god damned money is NOT a valid policy idea!! The Green Nude Eel would cause massive inflation, its orders of magnitude more expensive than the expensive tings you bitch about in your post.

        As for being against “faith in technology”, well if the technology you’re promising to save us requires violating the laws of thermodynamics and physics, then all the faith in the world won’t be enough.

        You are a leftist totalitarian shill.

        • Nakatomi Plaza says

          WW. You are just racist that’s why you hate her. Oh. And you are misogynistic. Yeah. She has like tons of policy like. Ah. If you don’t like put up windmills your a nazi. That’s a good one.
          She has another great super specific policy called hope and change, I think. But that’s super good.
          She has a great policy that’s like abolish the kkk Ice unit. Can I say racist again, oh yeah I only used it twice.
          Ummm Green is great. Can u get more specific than that. Strive for the stars. Dream big. Make the impossible possible. You just don’t understand SJW POLICY. Because you are RACIST

      • Grant says

        @nakatomi

        We know she’s all about policy action. Problem is her policies are insane, especially the NGD. And corn fed is correct, our deficit has worked us into a place where staying afloat is shortly boing to be the only goal. We’ve long spent our wriggle room. AOC’s nightmare of employing millions of Americans washing solar panels as a solution to either energy or employment is staggeringly ignorant. She clearly has no idea what she’s talking about in regards to global warming or economics.

        • I think people need to stop responding to @Nakatomi. I will do so. He/she is either a troll or unbalanced. Either way, no need to feed this person.

      • Alan J Green says

        I’m certainly not commenting to defend Republicans, but I would say the recent history of each party on issues of the deficit is more mixed than you assert:

        I consider Bill Clinton to have the best record on deficit spending of any recent president, but he was helped by republicans Newt Gingrich and especially Dick Armey (who earned the nickname “Dr. No” on spending). Bill Clinton wisely increased ordinary tax rates & cut long term capital gains tax rates – a good mix.

        After 9/11 Bush threw spending control out the window, & unfortunately Tom Delay took over after Gingrich & Armey left. Delay had no desire to control spending (& no republican congressional leader has since been serious about spending control). And Bush’s tax cuts, in my opinion, were a disaster, since they din’t spur the economy & tremendously reduced the tax base.

        Obama was an even worse big spender than Bush, as were the Democrats once they took control of Congress. And his tax increases neither helped close the deficit or spur the economy.

        Trump so far has paid no attention to controlling spending, but at least his tax cuts were the right kind, juicing the economy in a big way. Notice that in 2018 tax revenues did not decline. The problem, as always, is that spending still is out of control, so the deficit went up.

    • Craig Willms says

      The problem is that what AOC proposes via the Green New Deal is a radical departure from the existing structure. Whether you like the existing structure or not (who really does?) we can’t do radical…

      By monkeying with radical changes the likelihood of making things even a little better is slim, the likelihood of making things infinitely worse is high. Look at Venezuela. You can’t make sweeping changes to a delicate, fine-tuned system like world economics. Small changes to tax policy, trade agreements, and over bearing regulations are the way to go – . hmmmm kinda-like the quaffed-haired, orange man is doing.

  9. S. Cheung says

    AOC has limitations to be sure. But it’s also amazing how she triggers people who hold different political viewpoints than her. She has an undergrad degree in economics….she’s no Paul Krugman. I don’t imagine too many bachelors degree holders are expected to have all the answers. Now, to be sure, she’s a politician, and as such she has the potential power to shape policy, and her ideas, and her lapses in knowledge and/or judgement, could potentially do far more harm to far more people than the average holder of a BA. On the other hand, many of those triggered by her are Trump voters….which is to say that voiced concerns about her lack of expertise seem more politics-based than principles-based (cuz oh look,Trump also has a BA in economics).
    And before Trump types get more triggered, here’s what CBO projects our deficits and debt to look like, with his signature tax cut in place:
    https://www.cbo.gov/publication/54918

    As someone mentioned earlier, and in retrospect, Reagan and his trickle-down nonsense may have been the earliest sign that his neurons were already starting to misfire.

    And if the author here is to nit-pick, as is his right to do so, he should at least try to compare like things. He objects to AOC on twitter about Uber: “median of $3.37 per hour after taking expenses into account”, where she is just quoting NPR, by counterpointing with this: https://medium.com/uber-under-the-hood/an-analysis-of-ceeprs-paper-on-the-economics-of-ride-hailing-1c8bfbf1081d
    THe problem is that those “Stanford professors estimated gross hourly earnings of $21.07¹ for all US drivers between January 2015 and March 2017.”….which is not the same as the net income NPR was referring to. I wonder if it would be fair for me to infer that the author, an economist, doesn’t know the difference between gross and net income?

    As for “living wage”, yes the goal is laudable. The devil in the details is tricky. But as a start, begin with consumer price index, factor in housing cost which will have to be a local value rather than nation wide, and build in a metric for inflation. If the CPI doesn’t fret about one type of apple vs another, I’m not sure why the author gets his knickers in a twist about it here.

    There can be much to criticize about AOC. And there can certainly be disagreement about her point of view. But hit pieces like this don’t really advance the discussion. Just click-bait for members of a tribe.

    • Nakatomi Plaza says

      I can’t believe it’s taken them this long to publish an attack piece against AOC. I would have expected this to be a running theme around here. A young, non-white woman who doesn’t have her lips clamped to the asshole of big business? She might as well be Hitler to Quillette.

      • Funny, the only one here comparing her to Hitler is you. In actuality she’s more like a reincarnation of Eva Peron.

        • Johan says

          @WW…When HITLER is mentioned, you know the guy name-dropping is a nutcase.

      • georgopolis says

        Nakatazi Plama,

        You don’t think The Young Turks is big business? It is the largest progressive media organization by a considerable margin.
        https://www.youtube.com/watch?v=1h5iv6sECGU

        Every day you hurl invective nonsense absent any actual argument or counterfactual to whichever comment you’ve set your sights on. I know a few people like you. And I sleep like a baby thinking of you in a blind rage at the keyboard, spinning in whirlwind of willful ignorance.

      • Why are you here? You clearly don’t read. All you’re doing is making people like Die Hard a little less.

        • peanut gallery says

          You have no idea what a relief it is that someone finally mentioned Die Hard. It’s been bothering me for months, but I had no idea how to bring it up casually.

    • Jack B. Nimble says

      @S.Cheung

      You make some good points about net vs. gross income. From talking to Uber drivers, I understand that they have to cover all the usual car expenses including depreciation, plus insurance [when not actually carrying passengers], taxes, workers comp., etc.–if they want to be completely legal. Most of those are fixed costs that eat into the income of a low-volume driver.

      Concerning Ronald Reagan, AOC is actually going easy on him when she re-tells the ‘welfare queen’ story. There is another welfare story that Reagan told, but only when campaigning in the south:

      “…..During the 1976 campaign Reagan often talked about how upset workers must be to see an able-bodied man using food stamps at the grocery store. In the South — but not in the North — the food-stamp user became a ‘strapping young buck’ buying T-bone steaks.”

      I traced the source to a February 1976 New York Times article by reporter Jon Nordheimer about Reagan’s Florida primary campaign. The article states that Reagan made no direct appeals for antiblack votes, and said explicitly he didn’t welcome them. However, Nordheimer added, sometimes “the impression is left, perhaps inadvertently, that he comes close to an indirect appeal in this regard.” The example he gave is that the previous night, Reagan gave a speech in which he repeated a favored anecdote about people being upset when they see a healthy young man buying a steak with food stamps. However, Nordheimer wrote, in Ft. Lauderdale this young man became a “strapping young buck,” a phrase he didn’t use in New Hampshire and other states with small black populations. “Young buck,” the reporter adds “to whites in the South denotes a large black man.**”…….” http://volokh.com/2014/01/08/revisiting-krugman-reagan-race-part-ii/

      The strapping [that is, big and strong] young buck fantasy carries an undertone of threat that is absent from the Welfare Queen story. So much of Reagan’s appeal to southern whites in his 1980 campaign was based in symbolism that flew under the radar of northern voters, such as giving a states’ rights speech in Mississippi just miles away from where 3 civil rights workers were murdered in the 1960s. https://en.wikipedia.org/wiki/Reagan%27s_Neshoba_County_Fair_%22states%27_rights%22_speech

      **buck–noun
      -the male of the deer, antelope, rabbit, hare, sheep, or goat.
      -the male of certain other animals, as the shad.
      -an impetuous, dashing, or spirited man or youth.
      Disparaging and Offensive . a contemptuous term used to refer to an American Indian male or a black male.
      From Dictionary.com

      • S. Cheung says

        Jack – you mean the Gipper was race-baiting with specific and selective audiences? Say it ain’t so. Maybe there were more similarities with Trump than I had thought…
        I actually try to use Lyft now when I can, cuz based on what the drivers tell me, Lyft takes a smaller cut than Uber. But that’s just hearsay cuz I haven’t driven for either.

        • Peter Schaeffer says

          JBN, Sc, You folks are living in the past. Reagan was elected 43 years ago. Since then racism and bigotry have become the core tools of the ‘progressive’ left. Don’t believe me? Let me quote from Tucker Carlson. From the Amazon description of his book.

          “The patchouli-scented hand-wringers who worried about whales and defended free speech have been replaced by globalists who hide their hard-edged economic agenda behind the smokescreen of identity politics. They’ll outsource your job while lecturing you about transgender bathrooms.”

          Presumably you don’t regard Tucker Carlson as authoritative. Fair enough if your politics are on the left. However, consider the following quote (also) from Tucker Carlson.

          “If we broke up the big banks tomorrow….would that end racism? Would that end sexism?”

          Sorry, that quote isn’t really from Tucker Carlson, it is from Hillary Clinton.

          The identify politics left has not hesitated to sell its soul to promote inequality. Consider Apple. Overpriced products made by impoverished workers living in dormitories. Global tax ‘avoidance’. 9 figure incomes for executives (the CEO) and 3 figure incomes for workers.

          But Apple waves a rainbow flag and is a darling of the left. Go figure.

          • S. Cheung says

            Peter-
            I’ve regarded Carlson as a 5-star idiot even before Jon Stewart dunked on him years ago. Naturally, he was still good enough for Fox. I’d be surprised if he could simultaneously walk and chew gum.
            Ben Shapiro is my source for a conservative POV these days. Don’t always agree with him, but he’s principled and consistent in applying them. His Daily WIre persona is maybe a bit rabid for my taste, but he’s usually measured and reasonable on his Sunday Report, or when he’s a guest on other people’s podcasts. And others on the IDW, who now refer to themselves as “classic liberals”, I find informative as well.
            I share your disdain for the “regressive left”.

          • Jack B. Nimble says

            @Peter Schaeffer

            I mentioned Reagan because J. Church mentioned Reagan because AOC mentioned Reagan. AOC has also criticized FDR and Obama for being too timid.

            Willingness to analyze and criticize American history is not only a good thing, it is necessary if we are to understand today’s political and economic environment, which includes wage stagnation and endless wars. AOC is doing everyone a favor by taking on the sacred cows of both right and left, even if she makes some people upset.

          • Craig Willms says

            @S.Cheung
            Funny you should bring up the IDW. Yes they identify with classical liberalism, but I’ll guarantee you the core audience for IDW members are primarily center/right. They, the members of the IDW, are running form leftists like AOC as fast as they can.

            While the IDW as well as 9/10s of all the ‘writers’ on these Quillete pages will never side with the right they do find acceptance and a fair challenge from the center/right, not the venom and hate of what has become of the left these days.

            My question: who do they think the right is? If Tucker Carlson, or God forbid Sean Hannity is the scariest thing they’ve got then they are panty-waists.

    • MMS says

      @S.C. I think both AOC and Trump are ignorant fools and both sides of the political spectrum are idiots for expanding the decifit – Just Saying

      • S. Cheung says

        MMS – i agree. It’s too bad that too many flimsy-minded individuals have subsumed their individual identity to their tribal identity, and merely toe the tribal line regardless of how stupid it is. That said, to me, “the right” is even worse with deficits than “the left”, but due to different levers of course (lowering taxes vs increasing spending). But it boggles my mind that people still trot out “cons are better for economy” when decades of history prove otherwise. But as I’ve said elsewhere, people are religious about their tribes, and there is no reasoning with religiousy types.

        • peanut gallery says

          Republicans will occasionally play lip-service to responsible spending, but it’s clear they don’t mean it unless they have libertarian leanings.

      • Peter Schaeffer says

        JBN, I don’t know what AOC has said about FDR. However, I am familiar with FDR’s actual record. FDR took the U.S. off Gold. That was a very radical measure at the time (and very necessary). U.S industrial production doubled in the first three years FDR was in office. See Fred series INDPRO. After 1937, FDR’s policies failed and the economy crashed again (and then rebounded with the start of war production).

        In truth, much of the New Deal failed. However, FDR was wiling to do what Hoover was not. Hoover continued the post-1929 deflation. FDR ended it.

      • S. Cheung says

        Craig-
        I think the previous labels have lost their usefulness in the current climate. Whereas in the past, the distribution was more across the spectrum, it seems now to be several distinct groups. There are uncomfortably large numbers of wingnuts on either end, and a more ill-defined and non-homogeneous group in the middle.

        The IDW themselves are diverse.Shapiro is probably the most classically conservative, but he voted for Jill Stein. Petersen is also more conservative. Rubin calls himself a libertarian, I believe. THe Weinstein brothers and Heather Heying might be more typical middle. Harris skews left I think. And then Joe Rogan, who supports UBI…but also 2a…yet hunts with bow and arrow. I think what connects them is the strong belief in freedom of speech and freedom of inquiry, rejection of tribalism, and commitment to anti-fragility.

        I agree, their audience is more center/right, particularly for Shapiro and JP. I’m not their target audience, but find nothing offensive or disquieting about their views.

        I’m not sure about the Quillette writers. I’m new to these parts. But it seems most commentators are right of center. Which is perfect for me, cuz what I don’t need is an echo chamber for my own views.

        • Craig Willms says

          @S.Cheung

          Thanks for the thoughtful response.

          My main point is that these IDW types are literally no longer welcome on the left. The Brett Weinstein story is a perfect example. He has expressed that the center/right is quite welcoming despite the fact that they differ greatly on political views. Shapiro aside, this is true for all of then to one degree or another.

          The basic media knee-jerk assumption that right-of-center people are all hateful, nazi monsters is belied by the experience these left leaning intellectuals are finding as they crawl out from under their respective rocks. Some of Jonathan Haidt’s research is also bearing this out.

          Just because center/right individuals don’t blindly accept leftist B.S. doesn’t disqualify them from being serious or thoughtful.

          • S. Cheung says

            Craig-
            The Evergreen thing is full-on bizarro world. I listened to Weinstein and Heying on JRE. That is an intelligence power couple who are anything but racists. The fact that two centrists like them can be rejected by the “left” just shows how far off the deep end the regressive left has gone.

            I read a bit of Righeous Mind. I’m starting into Coddling of the American Mind this week. Probably should’ve included him in IDW list, or certainly adjacent. I don’t think he has experienced the personal blowback at NYU and UVa(??) that others have, but he’s certainly not happy with the fragility he sees in the Gen Z student body these days.

            Since you mention Haidt, are you part of Heterodox? I’m just a “friend”, as I am not an academic professor.

    • Nakatomi Plaza says

      S Cheung, you go girl. You are like super smart like me and AOC. You go girl.

      • Peter Schaeffer says

        NP, Super smart people don’t claim to be super smart. Anyone who claims such status, isn’t.

    • Peter Schaeffer says

      SC, Let’s assume the $21.07 gross earnings number is correct. What can we estimate net earnings to be? NPR says $3.37. Does that make sense? The IRS estimates the cost of operating a car at 54.5, 18, and 14 cents per mile. Say Uber and Lyft vehicles average 15 miles per hour (sounds high to me). That works out to be costs of $8.18, $2.70, and $2.10 per hour.

      Online I found estimates ranging from $0.26 to $0.61 per mile. That works out to be from $3.90 to $9.15 per hour.

      Based on these numbers, it looks like Uber and Lyft driver net around $10-15 per hour. Would NPR gets its facts wrong? Only some days of the week. Sundays, Mondays, Tuesdays, Wednesdays, Thursdays, Fridays, and Saturdays are all problematic for NPR.

      • Grant says

        People drive for Lyft or Uber for many reasons. Some to make a living, some to make a few extra bucks since they’re driving somewhere anyway, some because they’re bored and they like meeting people.
        It’s one of the biggest problems with technology and has been for 150 years, that it creates change sometimes quite rapidly that makes it hard for people to adjust.
        But people do adjust and we should have mechanisms for helping them do so.
        But requiring a living wage paid by employers is not without consequences.

      • S. Cheung says

        Peter-
        To know whether $21.07/hr gross is correct, or if $3.37/hr net is correct, we would have to see the methodologies used by the Stanford profs, and by NPR, to arrive at those numbers.
        And you have to recognize your inherent POV and assumptions…because one could just as easily assume NPR to be correct, apply those same IRS estimates, and question the Stanford claims.
        I will say that IRS estimates factor into what you can claim for mileage deductions, but that may or may not reflect actual costs. I don’t know what other assumptions factored into those other estimates you found.
        So i’m not really questioning either amount per se. i was just shocked that the author of the OP, who is apparently an economist, would knowingly conflate gross and net income. That was a pretty weak move.

    • Grant says

      @cheung

      Well that’s a pretty low bar you’ve erected. Some basic knowledge might be expected after 4 years of college. I don’t think AOC is interested at all in truth or facts. It’s typical of arrogant minds who have no regard or knowledge of the institutions, minds and efforts that make up a stable economic society. She merely sees problems, without any idea of their causes or solutions.
      This is a hit piece because she deserves the criticism because of the ideas she has proposed which lack any nuanced analysis.

      What’s her beef with Uber anyway? Uber is an efficient way of providing transportation and most drivers don’t do it for a living so the living wage argument is crap. If it won’t pay well enough, drivers won’t do it, simple as that.

      • S. Cheung says

        Grant –
        I suppose it depends on how much expertise you expect from someone with a Bachelors degree in anything. “Some basic knowledge”? Sure. Discovering the cure to all the socioeconomic ailments of American society that no one else has solved over decades? Maybe not. But like I said, she’s out there trying, and those attempts affect people, so they should rightfully be examined and critiqued.
        I think her comments about Amazon were egregious, and she should know better.
        But my larger point here was that the examination and critique can be vigorous while still being fair. IMO, a “hit” piece like this isn’t, and I’ve pointed out the areas where the author was needless petty, and at times outright wrong, which detracts from his desired point, and instead casts light on his lack of professionalism.

        As for the Uber thing, if you believe NPR, that’s not even minimum wage. Like I said, “living wage” involves much more nuanced calculus. But I guess you need to ask yourself whether you even believe in minimum wage.

  10. mitchellporter says

    Aren’t the three richest people in America worth the same as the poorest hundred million, something like that? And most of Amazon’s market value is based on expected enormous future profits, rather than money it is making now? In fact, it’s a whole business model now, where a company like Uber can be famous, ubiquitous, go on for years, all on the basis of investor hope rather than profits now? The vast usefulness of Uber (though I have never used it myself) suggests that this ‘business model’ is not all bad, but it doesn’t have much to do with anything you learn in an economics textbook.

    I have two points. First of all, economic theory seems to have fallen behind real life. I suppose some ideas from micro (supply and demand) and macro (inflation and unemployment) have a perennial usefulness. But the economics of an economy based on apps, and on ‘clouds’ administered by enormous quasi-monopolies, is scarcely understood.

    Second, the extraordinary gap between life and power as experienced by the ultimate rich, and as experienced by almost everyone else. I remember a tweet by Stefan Molyneux where he said that some enormous fraction of the wealth of the world had been created by five people or so. It was an Objectivist-like interpretation of the present economic situation, an interpretation which overall approves of it. I am ambiguous about it myself. I do see that enormous concentration of capital in private hands allows certain remarkable things to get done, which otherwise might never get done at all.

    I am more firmly convinced that there is something deeply corrupt about the role and power of banking in western societies. I also sometimes say that the difference between countries like China and Russia, and countries like America and perhaps India, is that over there, the state has the final say over the captains of industry, whereas over here, the captains of industry, and especially the financial industry, dictate their terms to the state.

    Anyway, if the choice is between AOC being listened to, and AOC being ignored, I ‘vote’ for the former. There’s actually a similarity with Trump. Trump also has an economic philosophy, and who knows, maybe you could discern it if you dug around in his speeches deeply enough, but the core of it would clearly be America-first economic nationalism. But there will never be a discussion of it in American mainstream media, because just like AOC, it is a threat to the western model of political economy. AOC is an outright democratic socialist (American-speak for social democrat). Trump was supposed to be part of the apolitical business class who prospered from the western political model regardless of who was in power, but it turned out that his political itch was strong enough, that he volunteered to become the standard-bearer of populist nationalism, challenging the neoliberal system from the right.

    The liberal media has tried to drown out Trump’s agenda from day one, filling the airwaves with Russiagate above all, and then any other distraction and devious interpretation they can muster. They are friendlier to AOC because they share many cultural values. The determined sandbagging of AOC is mostly coming from conservative media. I don’t know if this essay exactly falls in that category, but there is something ‘conservative’ about any defense of existing economic theory, given that it functions in practice mostly to leave our digital and financial ruling class to their own devices.

    • S. Cheung says

      Mitchell – well said.
      Amazon’s P/E ratio in the last quarter was something like 90 I believe, which is very high and seemingly not a good deal. But I think their reinvestment in growth may have suppressed their earnings per share…which would inflate their P/E. So I agree with you that their market value is likely pricing in the future earnings from the present investments in growth (full disclosure: i know even less about economics than AOC).
      I read a different statistic than you: something like the top 1 % in the world own 50% of the world’s wealth. But same general gist. I don’t think I have an issue with wealth concentration per se, but the most notorious of the world’s uber rich seem to operate businesses that behave in monopolistic fashion (FB, Amazon, Google, etc), which I do find objectionable (ie they become more successful in wealth creation for themselves, rather than by building a progressively better mousetrap that benefits their customers).
      I agree with your last paragraph. It seems the knee jerk of the left towards Trump is mirrored by the knee-jerk of the right towards AOC…which seems to highlight the stupidity of tribes more than anything else.

      • E. Olson says

        S. Chueng wrote “full disclosure: i know even less about economics than AOC”. Happy to see you have some self-awareness of your limitations, but you hardly needed to mention it since your economic knowledge limitations are obvious from your persistent commenting on economic matters.

        What do you think happens to the 50% of the wealth owned by the 1%? Do they bury in their backyards until some future date when they can use it for some nefarious racist, sexist, greedy purpose? Or do they invest in companies such as Uber and Tesla that may fail to make profits for years (if ever), but in the meantime provide employment and desirable products and services to customers? Or do they reinvest in their own business such as Bezos does with Amazon, which also provide even more jobs? Or do they pay the disproportionate share of taxes (i.e. the top 1% also pay about 50% of all taxes)?

        How are customers hurt when they gladly exchange their money for the products that make some people very rich? How are employees hurt when the freely exchange their time and skills for wages and benefits associated with a job? Even Uber and Amazon bashing AOC is a frequent customer of both. Thus I fail to understand why Lefties get upset when some people get rich by selling goods that improve the lives of billions of people, and in so doing also create jobs for millions of people and pay the vast majority of taxes. Could it possibly be some of those 7 deadly sins?

        • Ray Andrews says

          @E. Olson

          ” (i.e. the top 1% also pay about 50% of all taxes)”

          Last time you said it was 90%, which I pointed out was hard to believe since it would imply that taxes could be abolished for the 99% if only the rich would pay 10% more. So now 50%? That’s at least believable, but I wonder if there are not other values that someone might put forward.

          In any case, as I always say, only workers pay taxes really since only workers produce anything and all real wealth is production. The payment of tax by the rentier class is a performance. And yes, the rich can and do perform real work on occasion. But their income and percentage of ownership have increased by [statistic] since [date], and one wonders if that might not be strictly necessary and inevitable.

          And again, the issue is not so much capital as it is consumption. That which is consumed by parasites is not consumed by producers, that’s all. I basically don’t care how rich Warren B, is, they say that until a few years ago he drove the ancient old Datsun that he’d had for ages, and that he still lives in his old house that he’s had since when he was a regular guy. I’d tax him perhaps slightly more than his secretary (rather than slightly less), but basically, Warren’s fine with me.

          • E. Olson says

            Ray – they pay 90% of personal federal income taxes, and 50% of all taxes (which include payroll taxes that everyone with a job pays). The main point is concentrated wealth does not hurt anyone as long as the money isn’t locked in a vault and thus circulates, so if Warren trades in the Datsun for a Cadillac, the Cadillac salesman and dealer make some of Warren’s money, and GM and the Cadillac assembly line worker get some of Warren’s money, which they in turn will spend on Heinz Ketchup and Coca-Cola (stocks owned by Berkshire Hathaway) and Warren will get some of it back. Warren doesn’t take any money from anyone who doesn’t want something Warren (or is companies) is selling. In contrast the government takes money from people who earn it, and gives it to people for doing nothing except perhaps a voting D.

          • Ray Andrews says

            @E. Olson

            Like I said, I have little difficulty with Warren. They say he has nothing to do with the moneyist manipulators, he likes real businesses making real products. But if he drives a Cadillac (do they make good cars anymore? Does America make anything anymore?), then I’d tax that. Yes, the plebes get wages making and selling Cadillacs, but if they were making and selling Model T’s they’d also get to drive them.

            I return to my axiom: Workers make things. They make some things for themselves, and some things for parasites. As much as possible I’d like workers to make things for themselves. But real, wealth producing capitalism is very good it ‘focuses’ labor into new enterprises. The folks who actuate such enterprises can be considered to be very productive and they are fully welcome to get very rich. Rentier capitalism, speculation, manipulation and such are not good. Boards of directors that don’t really represent shareholders are not good. Soros and the Koch brothers — tho on opposite sides — are not good.

          • Craig Willms says

            @ Ray…
            I try resisting replying to your comments, but yes for God’s sake America manufacturers a ton of things, it’s a huge part of the economy. And yes Cadillac makes good cars, I proudly own one. The fact is when I was 20 I couldn’t afford a Cadillac – but now in my 50’s I can. I’m thinking the same is true for the workers who build Cadillacs,Is that hard to understand?

        • S. Cheung says

          E. Olson – I know I am intensely self-aware, particularly of my own limitations. That is a skill you evidently lack. Is it genetic? Perhaps…but I did earlier suggest you buy a mirror to allow you to visualize your own blindspots, of which you have several just based on your comments here, each of which appear sizable.

          Not surprisingly, you are balls deep in the trickle down. In some realms, I am beginning to agree with you that it is genetic….cuz it doesn’t seem to change in the face of evidence.

          And for all your self-proclaimed expertise (which I always find to be the most persuasive kind), you lack some skills in basic English comprehension. Your entire second paragraph is in response to this (“top 1 % in the world own 50% of the world’s wealth”), whereas quite literally 4 words later, I said “I don’t think I have an issue with wealth concentration per se”. So I think you literally need to keep it in your pants, and not shoot your wad so bloody fast. Or maybe you’re just so exceedingly intelligent that you have the attention span of an ant.

          Monopolies have an effect on competition, or have you not heard? Sure, customers buy willingly. But are they actually getting the best that they can in a monopolistic environment? Is a monopoly the ultimate manifestation of a free-market economy, which provides the best value for customers in general?

          Besides your banal reflections on IQ and climate, you also like to resort to tribal generalizations. So it’s pretty obvious to me what you are, even if you lack the capacity to perceive it. But the reach should exceed the grasp, or what’s a heaven for, right?

          • E. Olson says

            S. Cheung – I get that you don’t like my political or economic viewpoints, but that doesn’t make them wrong. A true believer in Capitalism (me) does not like monopolies (or fraud), and that is one of the few areas that government has a true duty to intervene into free-markets to prevent the concentration of market power (and fraud), which they all too often fail to do because governments are inherently corrupt and large government is hence the most dangerous of monopolies.

          • S. Cheung says

            E. Olson – in my earlier response to mitchellporter, I said “businesses that behave in monopolistic fashion (FB, Amazon, Google, etc), which I do find objectionable”.
            So in fact, we are probably talking about the same thing on this point, which you likely would’ve realized if you had only waited 0.5 seconds to respond. It’s one thing to disagree on the substance; less laudable when it’s on the basis of some mixture of failure to read and deficit of attention.
            Sure I disagree with your viewpoints. But it doesn’t make me right and you wrong. Importantly, the opposite is also true. Your inability to perceive that is your most notable personality trait on this board.

          • Ray Andrews says

            @S. Cheung

            You appear to have something to say. Why not just say it and drop the invective? The subject is interesting, your personal views of Olson are not interesting to anyone but yourself.

            “Monopolies have an effect on competition, or have you not heard? ”

            Yes, thanks for mentioning that. In your entire post above, this is the only contribution to the subject, so thanks again for it. Stop ranting and discuss the subject. Speaking of monopolies, it is interesting that Canada’s current government has no problem with our triopoly in the cell phone business. They have a ‘gentlemen’s agreement’ with each other to keep prices higher, and service worse, than in Mali. But our former Conservative government really tried to get some competition happening. So, who’s on the side of the consumer? In point of fact it was the Big Bad Conservatives.

          • S. Cheung says

            Ray –
            I did have an opinion on the OP, and left a de novo comment to that effect earlier. Elsewhere, I’m simply replying to others, and have mentioned them by name. Not sure how else to do it. They have a comment/response, and I make a comment/response back. Understandably, my opinion of Olson has nothing to do with the OP, and would not be of interest to anyone other than him/her. And if there was another way to respond to him on this board, then fine; but there isn’t, AFAIK. So I do it this way; he/she does it this way; and in fact you do it this way too. So I’m not too sure what you’re driving at.

            I wonder if you accept the premise that context matters. If you do, then the line you quoted from my last comment to Olson should be read in the context of the 5 or 6 comments that precede it. I don’t know how else to explain that to you.

            If you feel I’m ranting, then my apologies. I suggest you avoid my comments in the future. Interesting that you would single me out, and not address Olson…cuz y’know, it takes 2 to have a back-and-forth. But whatever floats your boat.

      • Grant says

        @cheung

        You think that Facebook, amazon, Uber, Google, Apple (and a million more) haven’t built progressively better mousetraps?

        Market prices of any stock always try to forecast performance. It’s the whole idea.

        • S. Cheung says

          Grant –
          I don’t consider Uber to be a monopoly (since there’s Lyft, and some cities have their own local rideshare platforms going). I also don’t consider them to have done anything particularly groundbreaking. It’s a taxi service provided by drivers who aren’t cabbies…and sometimes they give you mints.
          Apple is innovative with a capital I. But they’re not a monopoly…with the possible exception of their app store. But far more people use non-apple smartphones than use apple smartphones. And there are far more PCs than Macs. So there’s hardly a dearth of choice. If you choose to partake in the apple ecosystem, then there are limitations…but that’s your choice.
          Facebook, Amazon,and Google are different animals. Do you agree they each hold monopoly position in their own product spaces? They have built progressively better mousetraps, but I would argue those benefits skew more towards themselves than to the user. Does the selling of more and more of your personal info to advertisers, for the purposes of targeting ads, really benefit you? Maybe. But does it do more for their bottom lines? Undoubtedly.

          I agree about stock price. I was just responding to a point about P/E ratios.

    • Peter Schaeffer says

      MP,

      “Aren’t the three richest people in America worth the same as the poorest hundred million”

      That may or may not be true. However, it is more than a bit misleading. Roughly 20% of American households have a zero or negative net worth. In other words, if you have a net worth of $1 you are richer than tens of millions of Americans.

      However, that does not make you rich.

  11. Nakatomi Plaza says

    Please, Quillette, write a defense of contemporary capitalism. Defend the system that’s led us to a place where AOC is the most popular politician in America. Defend our collapsing social safety net, income inequality, and our pay-for-play political system. Defend the massive deregulation that has made socialism popular again.

    But you don’t get to pull this cheap bullshit of attacking anybody who opposing the system. That’s the easy way out. AOC only exists because of serious socioeconomic issues that have been getting worse for 40-50 years. Defend that shit, and when you cannot, you’ll know everything you need to know about the popularity of AOC.

    • Jeremy H says

      Quillette hasn’t written anything here, they’re a publisher, understand?

      “But you don’t get to pull this cheap bullshit of attacking anybody who opposing the system.”

      If someone opposed to the current corrupt system offers no legitimate solutions to the problem, but instead proposes cures that could be worse than the disease, they are clearly fair game for criticism. Simply opposing a current evil doesn’t make one “good” by default.

      “AOC only exists because of serious socioeconomic issues that have been getting worse for 40-50 years.”

      The same sweeping generalization could be made for the rising popularity of right wing nationalism, especially in Europe, which clearly has its roots in the socioeconomic events of the past few decades. This doesn’t mean that right-wing populism shouldn’t criticized on its own terms.

    • ga gamba says

      Day after day you rail and rant against what Quillette publishes. It appears capitalism is satisfying your masochistic compulsion. And for free too.

      Of course you could pitch an idea to Quillette and, if accepted, write and submit your take on whatever is bouncing around in your noggin. You might even get paid.

      One thing I know is that capitalism has also provided you the opportunity to read a wide variety of articles published by others as well. Have you heard of Jacobin? What’s not to like about a magazine named in honour of blood thirty, head choppy Jacobins? There’s also Mother Jones, named in honour of Mary Harris Jones. She was merely convicted of conspiracy to commit murder, so no blood on her hands. Can’t knock her for trying. There’s also The Nation, which is kind of ironic give their dislike of the nation. That’s just three of the 10 million-odd online digital magazines and, in the US, 7000+ print magazines, many of which have digital editions, so I reckon there’s something out there you’ll find appealing.

      Plenty of choices. Thanks, capitalism!

    • peanut gallery says

      AOC exists because the Justice Democrats took advantage of a loophole and got her primaried. She is emblematic of nothing, except the excesses of progressive ideology. The “failing social safetynet: has nothing to do with capitalism. It’s such an all or nothing worldview you have. Capitalism is not a political party. No one here is suggesting that free trade creates a Utopia. It’s certainly better than fuedalisim and socialism. Unfortunately, I think some people just feel they need to be ruled over.

  12. TarsTarkas says

    Ocasio-Cortez’s understanding of economics is so bad that I wonder if she even audited any economics classes. Or did she buy her papers from the faceless drones who toil like Morlocks in the underbelly of academia churning out work for others to earn their daily bread? I believe that culture has been written about on this forum in the past.

  13. Nakatomi Plaza says

    There’s a fellow named Hubert Horan who’s written a long, comprehensive serious of articles about Uber. It’s taken some time, but his articles are finally getting traction as it’s become obvious that Uber is not a viable business. I strongly encourage everybody to take a look, especially if you think of yourself as reasonably economically literate.

    The writer of this piece is not particularly economically literate. You must consider expenses when calculating Uber pay, which this writer does not. Taxes are one thing, but fuel, insurance, and wear-and-tear are costs that are realized almost immediately. Remember those horseshit stories about Uber drivers making $90K from several years ago? Yea, those stories came from writers like Johnathan Church. This isn’t rocket science, everybody. Just do the math and leave the corporate cheerleading out of it.

    • E. Olson says

      NP – you raise a very important issue – how is Uber getting around the bans on slavery and forcing people to use their own cars and drive around Uber passengers against their will? And where is the media to spread the word about this diabolical corporate abuse of power so that other innocent victims aren’t sucked into a life of slave-driving for Uber? Even more infuriating is the fact that Uber drivers have much newer and nicer cars than the taxi companies they compete with, so not only are the drivers working for slave wages, they are being forced to buy newer upscale cars to generate positive reviews from those bastard riders who are too cheap and greedy to pay for a taxi.

      Lead the way NP – we must follow the model of N. Korea, Venezuela, and other socialist paradises, where slave-driving Uber is not allowed to exist.

      • Ray Andrews says

        @E. Olson

        If we had UBI, then any stories of Uber slavery would be transparent nonsense since the slavery trope would not be viable. Uber would have to make it worthwhile for people who are not desperate, to drive for them.

        • E. Olson says

          Ray – I hope you realize I was being tongue in cheek about the slave-driving Uber, but you are really fixated on UBI, which ain’t never going to happen because the welfare state will never allow it. A simple payment system administered by the IRS would put too many federal bureaucracy jobs at risk.

          • Ray Andrews says

            @E. Olson

            Of course! Nevertheless these sob stories — true or false — could be put to bed by UBI. Or, nuts, it would be interesting to see what would happen anyway. I don’t disagree about the bureaucracy, OTOH, why throw in the towel? Yang seems like the best of the Rats, he has half a brain (unlike our SJW instant) and business experience, and maybe the electorate is ready for sanity. The federal bureaucracy would be the first beneficiaries of UBI! An out of control bureaucracy is a cancer.

          • ga gamba says

            Nevertheless these sob stories — true or false — could be put to bed by UBI.

            Newsflash: UBI Gave Me a UTI.

            UBI caused me to fail to budget my income. As a result, I didn’t have enough money for condoms and now I have a UTI.

            Sob stories won’t be put to bed. It’ll just require more imaginative contorting to blame others, but be assured accusations will be cast and believed.

        • Ray Andrews says

          @ga gamba

          It sounds like what you are saying is that nothing can be done to reform any notion of the safety-net, therefore the safety-net should be abolished entirely. But the safety-net has been changed many many times, sometimes improved, sometimes made even more broken than before. It seems to me that if people vote for real change then real change is possible. It will take a messiah tho — someone strong enough to get it done. Dunno, sometimes I’m quite sure we are in terminal decline and it’s all over but the bloodbath, but I’d at least like to go down fighting. I’m disturbingly un-Canadian in some ways.

          • ga gamba says

            No, I don’t oppose a safety net. But that net is to handle the spills from the tightrope that’s life. Too many people have decided that living on the safety net and adding a couple more generations to keep them there permanently is preferable to getting back on the tightrope. They’re missing out on the adventure that’s life, and that a safety net is there ought to give them the assurance to go forth boldly. Fall one time or a dozen times doesn’t bother me as long as the person has the desire and resilience to give it another crack.

            In addition to the safety net being created, there needs to be the kick in the butt for those who don’t want to get off of it and to reject their allies who create ever more conditions to be met.

            I read a great deal of the leftist press, from the centre left Guardian to those further left such as Jacobin, the New Statesman, etc. The writers themselves do a competent job polishing their turds, but I never ignore what the readership also says. There is a large group of people who genuinely resent work. They really believe it’s slavery – it isn’t hyperbole on their part. They think that by their mere existence they’re owed a living. Presumably this will come from all us other slaves who labour on their behalf. They tell me they’d spend their time in libraries, and do thinking, or write poems, and compose music. Those are all fine things, but why does the dustman, the doctor, and the driver get tapped to support them? Haven’t they got enough on their plate? “You have more than me, so you must give me some so I may do whatever I please” has never been an acceptable argument to me. “You have more than me, so you need to aid me acquiring sufficient skills so that I too can contribute to the common good by paying tax as well,” is one I can live with.

            To me this means education through secondary school at which point they ought to have enough skills to work part time if they want to continue their educations and take on loans if needed. Partial support by the public of tertiary education is fine, and I even accept full support for students pursuing and completing studies in critical-need subjects where shortfalls exist such as nursing.

            I recognise the appeal of the work-is-an-injustice argument, especially for young people starting out who get assigned the less desirable tasks, ones that are still necessary to complete and that also build their skills. Who wouldn’t like a life of leisure, or at least one of hassle avoidance?

    • ga gamba says

      Taxes are one thing, but fuel, insurance, and wear-and-tear are costs that are realized almost immediately.

      How is Uber (rideshare) similar to and different from a medallion owning taxi fleet operator, for example those in major US cities?

      Commonly, taxi fleet firms operate in two ways. They pay drivers a percentage (usually about a third) of the gross fares or they lease the cab by the day or week and the driver keeps all the takings less his/her costs. In the former the owner assumes almost all costs – petrol is almost always on the driver. If the driver has few fares his take is only that per cent of the gross. In the latter case, whether a driver has a good shift or a bad shift, he still pays the lease fee. This cost is not only a fee to use the medallion, which is the licence to operate a taxi, it also covers depreciation and general maintenance (unless it’s agreed the driver covers this maintenance as well). Further, fleet owners typically have ‘any driver’ insurance, so that cost is passed on to the driver too. Rideshare companies provide supplemental insurance coverage, but only while the app is on. When a passenger uses a credit card, the cab companies charge the driver a percentage of the fare in order to process the cards.

      Unlike the taxi fleet driver, the rideshare driver has his monthly payment if he borrowed to finance his vehicle, but this is still an asset that he can sell, trade, rent, or borrow against. The taxi driver does not have any of his own capital tied up in an asset. The fleet owner has money tied up in vehicles, facilities, and medallions.

      The taxi fleet driver is more at risk of fare dodging than a rideshare driver whose passenger already provided credit card information, which has been verified, to the rideshare operator. Rideshares typically don’t pick up passengers hailing taxis from the kerb because jurisdictions restrict street hails to fleet operators. Further, in the event of no-shows the passenger is still charged and the driver paid. A rideshare driver has more flexibility to set his/her own schedule, which is beneficial to those who drive irregularly. For those who want to maximise their drive times, leasing from a fleet often earns the driver more.

      Both rideshare and fleet drivers are not earning when their cabs are empty.

      Both drivers are loss averse. The question is how each person perceives and defines loss and then calculates it to his/her context. Ultimately, it’s an individual’s choice to pick one over the other.

      What is often excluded from the rideshare-versus-fleet conversation is what merits and demerits are presented to the consumers.

      Since the advent of rideshare services the big losers are medallion owners who in connivance with city officials created a very distorted system that ensured the value of each medallion was several hundred thousand dollars. From 1980 to 2010 the value of one NYC medallion increased by 1,900%, reported Bloomberg Businessweek. Holding a NYC taxi cab medallion had been a better investment than housing or gold over those 30 years; the increase was four-times faster than the price increase of an average home or a brick of gold. Medallions sold for more $1 million each in October 2011; in May of the same year Uber entered NYC. A few years later in 2018, 139 NYC taxi medallions were offered in bankruptcy auction; 131 were won by a hedge fund investor for about $170,000 each. This barrier to entry served consumers poorly and also had earlier medallion owners pay extraordinary amounts due to artificial government-sanctioned scarcity. I suppose the hedge fund was betting new restrictions on rideshare operators would be imposed and thus its medallions’ value would increase.

  14. So, AOC, Jonathan Church, and most commenters have a snipe at Ronald Reagan. Without Reagan the Cold War might still be plaquing us, or the USA might be Venezuela writ large, or the word might be a cinder. Our present-day political pygmies stand on the shoulders of giants.

    • E. Olson says

      It is amazing how many people still hate Reagan for creating the greatest economic expansion of the 20th century, which lowered minority unemployment to the lowest levels since at least the 1950s, and winning the cold war, just because he put the brakes on communism and welfare state expansion and beat the snot out of Carter, Mondale, and Dukakis (by proxy). Not bad for an amiable dunce (or dangerous racist) that his opponents claimed him to be.

      • Amin says

        “It is amazing how many people still hate Reagan for creating the greatest economic expansion of the 20th century”

        You mean the economic boom that came after Reagan? Once more, this is what you do constantly, make up crap like this.

      • Jack B. Nimble says

        @E. Olson

        ‘….many people still hate Reagan for creating the greatest economic expansion of the 20th century…..’

        Your Reagan fantasy is on a par with your good-guy-with-a-gun-at-Christchurch fantasy:

        ‘Here is the complete list of average annual real GDP growth by postwar president (in descending order):

        Johnson (1964-68), 5.3%
        Kennedy (1961-63), 4.3%
        Clinton (1993-2000), 3.9%
        Reagan (1981-88), 3.5%
        Carter (1977-80), 3.3%
        Eisenhower (1953-60), 3.0%
        — (Post-WWII average: 2.9%) —
        Nixon (1969-74), 2.8%
        Ford (1975-76), 2.6%
        G. H. W. Bush (1989-92), 2.3%
        G. W. Bush (2001-08), 2.1%
        Truman (1946-52), 1.7%
        Obama (2009-15), 1.5%

        https://www.hudson.org/research/12714-economic-growth-by-president

        • ga gamba says

          Yet GDP is one piece of the puzzle, isn’t it? There’s also inflation, interest rates, and unemployment, to name a few of the important ones

          Inflation and short-term interest rates reached 18 per cent in February and March 1980. Unemployment was 7.5 per cent when Jimmy Carter was inaugurated in 1977 and 7.4 per cent when he left office.

          Under Reagan, Federal Reserve Chairman Paul Volker attacked inflation. The result was higher interest rates and higher unemployment through ’82. By ’83 inflation fell to 3.2 per cent from 10.8 percent in ’81. In the last half of ’83 and into ’84 the economy’s growth rate hovered between 5 and 7.4 per cent. Unemployment was down to 7.2% from 10.7% – this 10.7% was higher than any point during the Great Recession. The ship had turned and righted its course.

          Look at the landslide election result of ’84. Mondale won only 40.6% of the vote. Miserable people unhappy about their economic prospects don’t vote that way.

          Because of Reagan and Thatcher a word all but disappeared from the English lexicon: stagflation. This had dominated the 70s. It’s the worst of everything: high inflation, high unemployment, and low growth. And the Misery Index also disappeared from the daily conversation.

          The cumulative rate of inflation of the 70s was 103.45%. In the 80s it dropped to 64.41%. The decrease continued throughout the 90s, where the cumulative rate was 33.47%. In the noughties it was 28.31%. From 2010 to 2018 it’s been 14.16%.

          It’s been Reagan policies, mostly adhered to by his successors as well, to include Clinton’s and Obama’s neoliberalism, that have kept this so well under control that we take 2% – 3% annual inflation for granted.

          • E. Olson says

            Thanks once again GG for a very another thoughtful and well researched comment.

          • Grant says

            @ ga gamba

            Well done. I remember the consequences of the horrible economic policies of Nixon, Ford and Carter. The late 70’s were a disaster; interest rates were devastating and the job market was abysmal.
            What was amazing was how quickly things turned around in Reagan’s first term. He win 49 states in 84, and there was a reason for it. I expected Admin to have some idea of it but I guess not.

          • Jack B. Nimble says

            @ga gamba

            ‘…..Under Reagan, Federal Reserve Chairman Paul Volker [sic] attacked inflation……’

            That implies that Reagan appointed Volcker, but in reality Carter appointed him on August 6, 1979, almost 18 months before Carter’s term ended. Source: https://en.wikipedia.org/wiki/Paul_Volcker

            Reagan deserves credit for reappointing Volcker in 1983, but by then the inflation battle had mostly been won.

            Look, any economic history of the 1970s has to take into account the effect of oil price shocks on the broader economy. Nixon and Carter both had the misfortune of being president while a series of economic shocks unfolded, some of them self-inflicted:

            1970 Nixon enacts price controls
            1971 Nixon takes US off gold standard
            1973 Stock market crash, recession
            1973 Arab oil embargo after ‘Yom Kippur’ War
            1979-80 2nd oil crisis after Iran revolution and Iran-Iraq war
            1980 Recession due to interest rate hikes

            The inflationary effect of oil price hikes eventually worked itself out, due to conservation efforts and increased production. Just think of how different the 1970s economy would have been, if the US had embraced solar and wind power!!

  15. Sean says

    I don’t think AOC’s economic policies have any merit. However, one of the main reasons she gets any attention is that mainstream (both democrat and republican) parties have made a mess of the economy. When was the last time the budget was balanced or even close to being balanced? Why do we even have debt ceilings when we constantly move to the new limit and have the threat of new shut down until we agree to the next limit and repeat?

    The democrats say they are spending to achieve equality yet the cities and states they run have poor/underfunded schools making it especially difficult for poorer children to get a head start and crime is often high.

    The republicans say they are fiscally responsible but while they may not increase the debt as fast as the democrats on average, they still increase the debt and do nothing towards smaller governments as they are always claiming.

    Frankly it’s hard not to be disillusioned with both parties but in these hyper partisan times there is no middle ground. As people fear the political seesaw is going down on the other side, they scramble further away from the center to try to get their side down.

    • Craig Willms says

      @Sean

      I think you are exactly right. I often say ‘the only thing I hate worse than Republicans are Democrats. I’m sure the same is true in most other Western countries (change the appropriate party names)

      The quandary is what to do about it?

      One side hates the so-called inequities of capitalism the other side hates the idea of socialist government control of EVERYTHING. There seems to be no path to the middle or enough clarity to think we should tack to the middle.

      AOC is not the answer, that much is clear!

  16. Pierre Pendre says

    The only authentic thing about AOC is that she’s a media sensation and genuinely charismatic. There’s no reason to take seriously anything she says about anything. There’s a compact between the millennial heavy media (which loves shiny new things to play with) and the people who actually pull her strings (her chief of staff in particular but there are surely others) to take advantage of her moment in the spotlight. Given the volatility of US politics, it would be a mistake not to recognise the danger she poses. The economically savvy might easily dismantle her economic arguments but most voters are not economically savvy and don’t care about the actual policies of the parties they always vote for. AOC and her friends work on the assumption that you don’t have to capture the electorate so long as you capture the party and the Dems are doing a good job with that. One thing that stood out for me during the Amazon fiasco was the claim that NYC had lost 25,000 jobs paying an average of $125,000 or so. I very much doubt whether the average salary would have been anything like that. AOC isn’t the only one to play fantasy football with figures.

  17. the gardner says

    People love shiny, entertaining objects. That’s all she is. She says outrageous things and hyponotizes people’s critical thinking. With any criticism, she doubles down, accuses racism, tweets a cute video of herself cooking or dancing. She is incapable of intelligent replies to questions people raise about her. She is big on chutzpah but empty of substance. Her 15 min of fame will be over soon.

  18. James says

    AOC is an economists similar to Obama being a “constitutional attorney.” It’s bogus claptrap. They may have accrued the credentialing somehow but they’re just simple, nickel-a-dozen, street activists. One day we will return to sanity and actually vet these clowns and pretenders before we make gods of them. That will be such a breath of fresh air.

    • E. Olson says

      James – correction: Obama was a “Constitutional Law Professor” who lost more cases in the Supreme Court than any modern president.

  19. Jack B. Nimble says

    @Sean

    “……The republicans say they are fiscally responsible but while they may not increase the debt as fast as the democrats on average, they still increase the debt….”

    I have to point out that the debt [as % of GDP] went down under all post-WWII presidents through Nixon’s first term. The only decreases since then were under Carter and Clinton:

    1949–1953 ….Truman ………….Democratic ………. -21.7*
    1953–1957 ….Eisenhower ………..Republican ………. -11
    1957–1961 ….Eisenhower ………..Republican ………. -5.2
    1961–1965 ….Kennedy, Johnson …..Democratic …… -8.3
    1965–1969 ….Johnson ………….Democratic ………. -8.3
    1969–1973 ….Nixon ……………….Republican ………. -3
    1973–1977 ….Nixon, Ford ………Republican ………. 0.2
    1977–1981 ….Carter ……………Democratic ………. -3.3 <–
    1981–1985 ….Reagan ………….Republican ……….. 11.3
    1985–1989 ….Reagan ………….Republican ……….. 9.3
    1989–1993 ….Bush Sr. …………Republican ……… 13
    1993–1997 ….Clinton ………….Democratic ………. -0.7 <–
    1997–2001 ….Clinton ………….Democratic ………. -9 <–
    2001–2005 ….Bush ………….Republican ……….. 7.1
    2005–2009 ….Bush ………….Republican ……….. 20.7
    2009–2013 ….Obama ………….Democratic ……….. 18.5
    https://en.wikipedia.org/wiki/History_of_the_United_States_public_debt
    *These values are changes in percentage points, not basis points

    Note in particular the large increases since 2001. Republicans have controlled Congress for most of that time. And Obama, grappling with the Great Recession, had a smaller percentage increase in the debt than Bush’s second term, when the economy was expanding.

    PS-Not even conservative economists recommend paying down the debt in absolute terms–that would withdraw billions of dollars from the economy. Instead, it would be best from an economic viewpoint if the debt stayed the same % of GDP, or decreased gradually over time.

    • Less government says

      Jack
      “Instead, it would be best from an economic viewpoint if the debt stayed the same % of GDP,…” What debt are you referring to? The current year deficit or the long term accumulated debt? There is no excuse to have a current annual deficit in a prosperous time. If the debt should be kept the same, then what is the acceptable percentage? Who decides if it’s 10, 20 or 70%. Why is this good?

      There is far more to economic management assessment that one metric. You mention Obama. Yes he had the recession at the start of his presidency but then had the advantage of a post recession rebound growth coupled with low interest rates and he still ran deficits. You have to look at all the factors.

      Also, you are choosing to only look at the federal government. What about the cities of Detroit and Chicago. Additionally, until recently, the heavy spending left leaning states had, effectively, additional tax transfers in the form of SALT deductions.

      • Jack B. Nimble says

        @Less gov……

        The debt is the debt, the deficit is the monthly or yearly amount by which govt. expenditures exceed revenue.

        If the govt. stopped running yearly deficits, then the debt as %GDP would decline at the rate of inflation. That would probably be a good thing, but it is not going to happen as long as Americans want tax cuts, a bloated military budget AND entitlement spending.

        “…….You mention Obama. Yes he had the recession at the start of his presidency but then had the advantage of a post recession rebound growth coupled with low interest rates and he still ran deficits. ………..”

        Replace ‘Obama’ with ‘Trump’ and your sentence is still true, minus the post recession rebound growth, of course. Whose fault is that?

        As long as you are tossing municipal bankruptcies and SALT deductions into the mix, why not add the kitchen sink? I was replying specifically to @Sean’s dubious claim that Republicans are somehow better on the debt and deficit than Democrats. That claim is flat-out wrong.

        • peanut gallery says

          Congress. They are the ones that are supposed to “balance” the budget. They should all be fired. Out of a cannon. Into the sun.

  20. Eurocrat says

    The article is missing the point. Let me use an example of a small EU member state with scarce employment opportunities, high social safety net and a trend of both qualified and non-qualified workers leaving for the better paying EU member states.

    A sectarian party, anti-establishment, anti-capital and anti-science has become, according to polls, third most popular party in the country. This party shares some of the “policies” that AOC is representing, but, much more importantly, shares the same emotion that AOC is able to convey to its supporters.

    And the basic emotion is this – some others are having a ball and it’s others’ fault you don’t have it all. It is the system, not you, which is responsible for your, imagined or real, unfulfilled life.

    Basically, AOC is the reflection of how infantile (parts of) American society have become. Her economic, or any other, illiteracy is irrelevant. In order to get rid of AOC, American society needs to mature, or, perhaps, deinfantilise. It means getting rid of political correctnes, affirmative actions, victimisation-encouriging practices…

    In other words, AOC is your future, our overseas cousins.

  21. TheSnark says

    AOC may have a degree in economics from a fancy university, but what she lacks is a degree in real life. After college she worked as a waitress. If instead she had the job of running the restaurant, she would have learned a lot about the real world: how to make payroll every month while dealing suppliers, contractors, government inspectors, employees, angry customers, banks, and all the other hassles involved in running the kind of business that provides people with jobs. That would have given her a completely different view of the world, one that I submit is more in tune with reality.

  22. Robert Franklin says

    It’s fine to criticize her lack of grasp of economic basics. But we should realize that she’s a politician with aspirations beyond U.S. Rep. As such, her remarks are more accurately understood to be pandering to her base. Her base, like her, has no interest in much beyond their ideology.

    • David of Kirkland says

      Indeed. Same as Trump. I mean, Trump has zero religious bones, cares nothing about Israel, is a Wharton grad with no understanding of economics; only his racism is something he truly shares with his base; the rest is the pandering of a reality TV show actor.

      • Kevin Herman says

        Am I racist Dave i voted for him? Is everyone of 66 mil that voted for him? Most the same people that voted for technocrat mitt Romney and quite a few dems who voted for Obama twice? You can’t be that ignorant.

      • the gardner says

        What racism are you referring to? Be specific please.

      • @David of Kirkland

        “… his (Trump’s) racism is something he truly shares with his base …”

        Your ignorance of his base is something you truly share with AOC.

      • Turd Ferguson says

        David your infantile tribalism is apparent in your ignorant comment. A great deal of why Trump won was because many working class white voters were horrified at the widespread false views that people like you hold about them as ignorant and racist. Trump will win again in 2020 because of people like you and the asinine views you hold about a huge percentage of the U.S. population.

      • Tome708 says

        David of Kirkland. Thought experiment. Try responding to something……..literally anything………any subject that ever has existed. Now, the only rule, You can’t say Trump. In my day when a boy named another boy that much, He has a crush.

      • Grant says

        Trump had very clear ideas that his base shared. That previous trade deals were poorly negotiated and that uncontrolled immigration were causes of stagnant wages and job loss in the US. He also campaigned that curtailing and eliminating onerous regulations would help spur growth. He ran against the idea that sub 2% growth was the new norm. Welp wages are up, growth is way up in two years.
        I certainly don’t agree with all he’s done, and I dint like him, but don’t ignore why people did vote, and will vote for him again.
        I know you like to think they are a bunch of knuckle dragging racists.

      • Craig Willms says

        @david

        I get so tired of being referred to as racist for policy differences… It’s so unoriginal, so lazy. Wanting a border wall/security does not mean we are racists.

        Mr. Trump has a growing number of black and hispanic supporters, are they racist too?

  23. David of Kirkland says

    “But regulatory efforts and policy goals must competently take into account how markets work.”
    Central planning is the problem that free markets resolve.
    “AOC” is shorthand because people are too racist to deal with her non-white hyphenated names. I can’t wait to see the names of the children who can have their entire family tree included in their “last” name.
    Why would anybody do the Uber/Lyft job is the pay wasn’t worth it?
    Low pay tends to mean the ride is more affordable, but I guess affordable is only sometimes the goal to help those with less money.

    • TheSnark says

      Mr D of Kirkland: If using “AOC” is racist, is it also racist to refer to past politicians as “JFK” or “LBJ”?

      Shortening a multi-syllabic name into a nickname is not racism, it is laziness (if done by others) or smart branding (if done by herself)

    • Stephanie says

      Spanish is a European language, calling Spanish names “non-white” is untethered from history.

      She gets an acronym because her name is too long.

  24. Kevin Herman says

    High marginal tax rates probably don’t have a negative effect on the economy
    ? I think a unbiased look at history says otherwise even if there effects might be overstated. Why do you think the economy got better after Carter and ObAma when republicans took over? Magic? Questions like that are never answered by people that casually dismiss supply side economics. Also why are many Scandinavian countries liberals love cutting taxes and spending. High taxes are a powerful disincentive to all sorts of economic activity. The end.

  25. TheSnark says

    Mr D of Kirkland: If calling her AOC is racist, is also racist to refer to past politicians as “JFK” or “LBJ”?

    Shortening a multi-syllabic name into a nickname is laziness (if done by others, like me) or smart branding (if done by herself).

    • @David of Kirkland

      ““AOC” is shorthand because people are too racist to deal with her non-white hyphenated names.”

      Well, you know, Dave, Alexandria Ocasio-Cortez’ Twitter address is “…@AOC”.

      https://twitter.com/AOC?ref_src=twsrc%5Eappleosx%7Ctwcamp%5Esafari%7Ctwgr%5Eprofile

      I assume that the lady herself decided to use AOC as a kind of personal trademark.

      I also see that Paul Krugman – the legendary scourge of white racists everywhere – referred to her as AOC in a NYT (oops! raaaaacist!) column last year.

      https://en.wikipedia.org/wiki/Alexandria_Ocasio-Cortez#cite_note-2

      I guess if people like Paul Krugman and AOC herself approve of the usage, we can safely presume they don’t consider it a sign of white racism.

      And I’d appreciate it if you would be a little more careful in the future about making false allegations of racism. I, for one, am no longer content to simply let them pass.

  26. David K says

    The article ended by saying we can ignore her comments about Raegan because she is economically illiterate, but the article didn’t actually refute those comments. AOC referenced Raegan in the context of talking about how politicians have leveraged racial animosity to further the interests of the elite, which does happen. Indeed, one of Raegan’s advisors Lee Atwater admitted this as part of his “Southern strategy”:

    “You start out in 1954 by saying, “Nier, nier, nier.” By 1968 you can’t say “nier”—that hurts you, backfires. So you say stuff like, uh, forced busing, states’ rights, and all that stuff, and you’re getting so abstract. Now, you’re talking about cutting taxes, and all these things you’re talking about are totally economic things and a byproduct of them is, blacks get hurt worse than whites.… “We want to cut this,” is much more abstract than even the busing thing, uh, and a hell of a lot more abstract than “Nier, nier.””

    We have continued to see this up to the present day. Trump appeals to white people in much the same way as Atwater was describing to enact policies that favor the rich at the expense of his poor and middle class white supporters, while center-left Democratic politicians similarly appeal to minorities and leverage animosity that minorities feel toward white people to do the same and protect the economic status quo.

    Both parties therefore have an interest in dividing the working class by race and pitting them against each other to prevent them from working together to actually change things. If working class black and white people were to realize that they have the same interests and actually form a coalition, that would be the worst case scenario for the elites in both parties. This is what makes politicians like AOC and Bernie Sanders so dangerous – they frame things in class terms, not racial ones. AOC’s comments were correct.

  27. soulstatic says

    I think her policies are the height of progressive craziness. That said, could you really say building a wall on the southern border that would be paid for by Mexico is a rational proposal? All of this is just red meat for those suffering from partisan blindness on both sides. Politics has turned into another source of content for endless clicks and eyeballs. It’s all very WWE. And it will probably get worse, as younger people, who were raised on social media, realize the only way to have a chance at an elected office will be to double down on outrage and irrational proposals.

  28. I regraduated with a degree in Economics from a mid tier university ranked similarly to BC the same year as AOC – AOC’s economic illiteralism is pretty much par for the course. I was amazed in our senior capstone how many incompetent and lacking in basic economic understanding my peers were. Econ classes were taught mainly as how to derive different values and functions, but rarely was any kind of interpretation required. Never once in four years did any Professor mention Milton, Schumpeter, Ricardo or any other other of the foundational thinkers in economics. The curriculum – especially in the core classes – was completely divorced from the social history and profession of economics.

    That being said, the idea that’s been expressed by commenters that AOC was only passed through because she was female and/or Hispanic is ludicrous. I doubt any of her professors even noticed her. She would have been numbingly average in any of my classes. Grade inflation has pretty much become the standard, rather than any benchmarking to a basic objective standard.

  29. As someone with 40+ years in urban transportation, I can assure the reader that AOC is actually mostly correct about Uber, but her comments are NOT original and overall, she is very much a lightweight on economic and other issues.

    Uber may have had $1.7 billion revenues in one quarter, but they also lost $1 billion+/-. Uber is living off the VC capital they’ve raised over the years, and exactly when it runs out is not clear. I seriously doubt they’ll raise much from their proposed IPO, particularly if the Lyft IPO fails.

    AOC also is correct about the $3.37/hour per figure for Uber drivers, the net after drivers properly subtract their auto-related costs such as fuel, insurance, maintenance, depreciation and interest on car payments.

    Uber and Lyft have fundamentally flawed business models. Unlike the network effects produced by and dramatically increasing profitability of successful tech startups that introduce truly new products and innovations, there is NO economy of scale in demand-responsive transportation like Uber and Lyft, nor taxis. Serving a few people at a time means having to roll out another car, just like taxis. That is, costs go up primarily as a function of the service levels provided, unlike fixed route transit or rail passenger services. In effect, there is NO feasible path to profitability for Uber and Lyft without resorting to illegal skullduggery.

    There was a long series of articles about Uber at https://www.nakedcapitalism.com/?s=uber that concluded Uber’s business model was to first force local taxi and similar services out of business in major services, then monopolize the markets and raise prices. This they have failed to do despite being in business for nearly a decade now. When they figured out that these ploys cannot work, the next “Great “Wh***” Hope” for them was self-driving cars, eliminating those pesky drivers. Now that sensible people have FINALLY been getting over the media’s hype about self-driving cars, the only logical conclusion is that Uber, Lyft and similar businesses are on Death Watch, perhaps extended a year or two by potentially foolish IPO investors–but I seriously doubt it.

    This is not to say that ride-sharing apps aren’t a useful innovation, but they only dramatically reduce the cost of taxi-type dispatching, e.g., a cost that was less than 10% of what taxi and other transportation companies were spending anyway on that function before Uber and Lyft.

    • Peter Schaeffer says

      MDS,

      “Unlike the network effects produced by and dramatically increasing profitability of successful tech startups that introduce truly new products and innovations, there is NO economy of scale in demand-responsive transportation like Uber and Lyft, nor taxis.”

      There may not be any economies of scale in actually delivering the transportation services provided by Uber and Lyft. However, there are profound economies of scale in running the Internet systems (web sites) that make Uber and Lyft work.

      To use an obvious analogy, there don’t appear to be any obvious economies of scale in auctioning off new and used goods online. However, the eBay website has profound economies of scale. eBay earned more than $10 billion in 2018. Not bad for a system that has no economies of scale (other than the eBay website).

      An other driving force behind the success of Uber and Lyft is growing inequality in the USA. For better or worse, Uber and Lyft are arbitraging the growing gap between high income earners at the top end and declining real wages at the low end.

      I don’t regard these trends as something to be proud of. However, I don’t see them going away any time soon.

    • Stephanie says

      MDS, it seems to me to be a statistical slight of hand to include maintenance, depreciation and interest on car payments as expenses that are to be subtracted from drivers’ wages. Presumably no one is buying a car only for it to be used to drive other people around. Drivers own their own car and would have to pay for the maintenance and interest regardless. The car’s depreciation is an even more sneaky trick: it doesn’t actually cost anyone anything that the car they are not selling has depreciated in value with age.

      The $3.37/hour figure doesn’t pass the sniff test. If this were the case very few could afford to be Uber drivers, and would not work for the company. Assuming Uber drivers are either independently wealthy and uninterested in earning income, or mentally deficient slaves doesn’t seem reasonable.

      • Tome708 says

        Stephanie, you are correct again. Imagine that the “urban transportation” driver (ie Cab Driver) wholly agrees with the disparaging comments about Uber. Wonder why them folks keep driving for Uber if they are making that ridiculous amount.

  30. Nicolas says

    Lehman so wishes she could be as smart, strong and successful as Ocasio-Cortez. The power of ressentiment among the lowly simple-minded is irresistible. Quillette has become the forum of a slave morality. Only failed academics, failed journalists and vulnerable undergrads. This is the stuff of dreams, of incels’ dreams. No more, no less. An utter failure of the intellect.

    • K. Dershem says

      Genuine question: if Quillette is so useless, why do you bother to read and respond to articles here?

      • Nicolas says

        To trigger snowflakes like you, rain on your hateful parade and state the truth: this site is vile.

    • jakesbrain says

      I’m endlessly amused by the adoption of “incel” as an insult on the left and right alike. When part of your argument is literally HA HA LOSER YOU CAN’T GET ANY PUSSY, it generally suggests that every other word out of your mouth is equally garbage and can be safely ignored.

      • peanut gallery says

        “incel” is the prog version of the “cuck” usage that was popular a few years ago. It’s quite “dank” as the kids say.

    • Tome708 says

      Nicolas, you forgot “racist” and “nazi”. Come on boy. You know better

  31. We now have the intellectual equivalence to the Khmer Rogue in congress. It’s chilling.

  32. Tome708 says

    Nicolas, you forgot “racist” and “nazi”. Your comments and arguments are slipping boy.

  33. JamesNick says

    An undergraduate degree in Economics is a liberal arts degree, similar in value to an undergraduate degree in Sociology, Psychology, Criminal Justice, etc.

  34. Hestia says

    I don’t know why you people even pay attention to her. The world is going to end in, like …, 12 years. Like, I mean, like this lady has the intelligence of a salamander.

    • @Hestia

      We should all pay attention to her because of the kind of people who are likely to gather around her as she moves up the Party food chain. Those standing in the shadows are the ones we most have to worry about.

  35. Capo says

    This may have been said already, but AOC is just the Left equivalent of Trump. Even scanning through the comments here you have people saying things that are applicable to both once you swap names/genders/parties:

    “I completely agree, and think that AOC is an albatross around the neck of the Democratic Party”

    “She is a sock puppet run by her speech writers. She is fine as long as she is reading from a prepared script but once she goes off, it’s idiotic blather. She is a media darling though.”

    “AOC is a privileged idiot, which means she fits right in with the rest of her Democrat colleagues and too many of her Republican colleagues as well.”

    “AOC has limitations to be sure. But it’s also amazing how she triggers people who hold different political viewpoints than her.”

    I remember during Trump’s campaign and to this day that his followers would hand wave away the lies/hyperbole because its all about the core meaning. “Build a wall to keep out the rapists” was really just a way of saying we have to watch who comes into this country etc. It’s not the exact words or the literal truth of it, but the underlying sentiment that speaks to his base.

    This is AOC’s tactics now except she is preaching to other end. ‘Uber drivers only make $3.35 an hour’ is really to highlight wage discrepencies, and the high costs of being poor. The exact numbers don’t matter, it is the sentiment. AOC and the Democrats have learned what works in the country from Trump.

  36. sethgoldman says

    How good a grasp of Economics does Donald Trump have? What about Obama? Bush? It doesn’t matter if her ideas are all wrong. As long as they sound right to enough voters and that seems to be the case.

    To me, one of her silliest comments relating to Amazon in NYC was that she didn’t think the Government should be deciding where and how businesses develop. She seems to have forgotten that her beloved Socialism needs more Government involvement in this arena in order replace the invisible hand of the market.

    • gz@va says

      Well, at least she should know that tax credit means. Anyone paying taxes knows that.
      She probably never had to pay taxes until now, so she’ll figure it out. May get couple more surprises along the way that will change her worldview.

  37. Chad Chen says

    The writer of this article makes a fool of himself pretending that defining a living wage for Americans is an enormously complicated problem.

    It is not, because the calculations are not materially affected by different answers to the long list of questions he insists must be answered before we can construct a proper safety net.

    He akso makes a fool of himself, as have so many others, by raising the alarm about federal government spending. Since the Reagan tax cuts exploded federal deficits in the 1980s, thousands of economists have predicted everything from hyperinflation to collapse of the dollar. Hasn’t happened. Printing trillions of dollars of money is America’s unique privilege because the dollar is the world’s reserve currency, and demand for dollars is not unlimited, but it is enormous.

  38. stevengregg says

    A living wage is not a worthy goal. The price of any labor should be set by the market, not by politicians. If you want to take a job for low pay, you should be free to do so because obviously that is the best you can do. There are millions of kids who take min wage jobs, which do not pay a living wage, which provides them an introduction to the working world and provides them the skills to ascend to better paying jobs. There are a lot of people who don’t work for a living but want a few extra bucks in their pocket and do ad hoc pick up work.

    Simply put, the world does not owe you a living. Economically illiterate nitwits like AOC who demand the world provide you a living would destroy many jobs that would put money in people’s pockets.

    • Chad Chen says

      Many adults are saddled with minimum wage jobs, not just teenagers. The problem facing millions of Americans is that they work full time, bur still cannot escape poverty. For them, the hovefnment should increase their income by offering refundable tax credits, or force increases in the minimum wage. In a country with America’s wealth, full time wirjers should not live in poverty. And no, the market is imperfect, and cannot be blindly relied on to set wage rates.

  39. gz@va says

    Now, isn’t her “recent” tweet about Uber and Lyft is from more than a year ago? In Twitter years it’s like BC…May be she educated herself between then and now. Just saying. Would want the article to be factually correct.

  40. Less government says

    “As long as you are tossing municipal bankruptcies and SALT deductions into the mix, why not add the kitchen sink?” Because all these things have to be considered when assessing performance.

    Just because Trump runs deficits doesn’t mean that it’s ok that Obama did too. This is just whataboutism. Neither should be running deficits.

    @Sean’s comments was that both parties have done a poor job economically. You are taking a partisan approach that your side is better.

  41. soulofsounds says

    I just cancelled my Quillette subscription. You can’t publish unsubstantiated tripe about MMT and expect to still be an authoritative resource. I’m really sorry about that. I like Claire and this platform but this concocted piece of garbage is three bridges too far. Anyone who understands MMT, immediately sees how disingenious the argument presented here is, besides being plain wrong.

    I really thought Quillette would provide a platform for heterodox thinking. This article shows the opposite. Really painful to watch.

  42. The author of this commentary writes about AOC: “More astonishing is that her views garner so much attention on matters of economic significance despite how transparently her remarks make her sound as if she’s never taken an economics course.”

    Later, he concludes: “But like much of the commentary from AOC on economics, it sounds like, at the very least, the boldness of her style matters more than the validity of her ideas.”

    The author should know that AOC garners the attention she does, not fundamentally because of the “boldness of her style,” but rather the moral fever with which she often speaks.

    However ignorant, willful or not, and wrong she is on economic matters, she is smart enough to exploit the moral argument in all of these economic issues that she always reduces to rich-vs.-poor clashes. That morality, the ethical code of altruism, calls for some to sacrifice for the needs of others, such as the billionaires to those who work for a so-called “living wage” or less.

    AOC knows, at least implicitly, that her Republican/conservative opponents have no effective answer on ethical grounds because they share the Christian-based altruist morality from which her criticism comes.

    The author here referenced Ayn Rand’s Atlas Shrugged. He would do well to return to that novel and study the revolutionary morality of self-interest that it champions and upholds on philosophic grounds. Therein lies the key to ultimately defeating the likes of AOC and her collectivist-socialist ilk. Arguing on mere economic grounds won’t cut it–never have and never will.

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