At Barron’s: Thank Full Employment, Not AI, for Rising Productivity
The Slack Wire
by JW Mason
2w ago
(I write a monthly opinion piece for Barron’s. This one was published there in September. My previous pieces are here.) New data about productivity are some of the best on record in recent years. That’s good news for economic growth. But just as important, it offers support for the unorthodox idea that demand shapes the economy’s productive potential. Taking this idea seriously would require us to rethink much conventional wisdom on macroeconomic policy.  Real output per hour grew 2.6% in 2023, according to the Bureau of Labor Statistics, exceeding the highest rates se ..read more
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The Future of Health Care Reform
The Slack Wire
by JW Mason
2w ago
This is a guest post by Michael Kinnucan. The Collapsing Center and Solidifying Periphery of the US Healthcare System Contrary to what most people on the US left might tell you, there’s nothing intrinsically impossible about building a healthcare system that provides universal coverage on the foundation of employer-sponsored insurance. Germany and France and several other countries have done it, and we could do it too. The way you do it is to start with core-economy full-time workers and their families, and then steadily patch and regulate your way to universal coverage (“what about retirees ..read more
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Thoughts on International Finance, with Application to the US and China
The Slack Wire
by JW Mason
2M ago
(I wrote this back in 2020, and never posted it. The context is different now, but the substance still seems valid.) Here is my mental model, for whatever it’s worth: (1) The US-China trade balance is determined in the short to medium run by relative income growth in the two countries. In the medium to long run relative prices do play a role. But at least past the early stages of industrialization, the impact of exchange rates is thru producer entry/exit than thru expenditure switching. The impact of the overvalued dollar of the early 80s came mainly through e.g. the bankruptcy of US steel pro ..read more
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Thirteen Questions about Money
The Slack Wire
by JW Mason
2M ago
I taught a class last semester on alternative theories of money, drawing heavily on Money and Things, the book I am working on with Arjun Jayadev. It was one of the best classes I’ve ever taught in terms of the quality of the discussions. John Jay MA students are always great, but this group was really exceptional. It was a a privilege to have such  thoughtful and wide-ranging conversations, with such an enthusiastic and engaged group of (mostly) young people.  The class syllabus is here. A number of the readings were draft chapters from the book. I am not posting these publicly, bu ..read more
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2023 Books
The Slack Wire
by JW Mason
3M ago
Edward Biberman, Slow Curve, 1945. Books I read in 2023. I’m probably forgetting some. Geoffrey Ingham, The Nature of Money. One of the fundamental divides in thinking about money is whether we start from the commodity or the unit of account. Do we begin, logically and historically, with the idea of exchange and then bring in money, or do we start from an abstract unit of measurement which then, among other things, is used to value commodities? The latter view defines what’s known as chartalism; Ingham offers the most persuasive statement of the chartalist position that I know. The most visibl ..read more
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Eich on Marx on Money
The Slack Wire
by JW Mason
4M ago
I’ve been using some of Stefan Eich’s The Currency of Politics in the graduate class I’m teaching this semester. (I read it last year, after seeing a glowing mention of it by Adam Tooze.) This week, we talked about his chapter on Marx, which reminded me that I wrote some notes on it when I first read it. I thought it might be worthwhile turning them into a blogpost, incorporating some points that came out in the discussion in today’s class. Eich begins with one commonly held idea of Marx’s views of money: that he was “a more or less closeted adherent of metallism who essentially accepted … gol ..read more
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URPE Statement on Gaza
The Slack Wire
by JW Mason
5M ago
I’ve been struggling to find something to say about the unfolding horror in Gaza. What is happening there is not war, but murder on an industrial scale. It is a conscious effort to bring about the deaths of tens or hundreds of thousands of human beings, and to permanently drive millions from their homes. It is the deliberate destruction of a whole society. And it is happening in full view of the world, with the enthusiastic support of the governments of the United States and most of Europe. We can’t look away from this. We have to say something, whether or not our words have any effect. But I ..read more
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In Praise of Profiteering
The Slack Wire
by JW Mason
6M ago
Of the usefulness of the concept, that is.1  In my , I’ve emphasized supply disruptions more than market power. But as I’ll explain in this post, I think the market power or profiteering frame is also a valid and useful one. Thanks in large part to Lindsay Owens and her team at the Groundwork Collaborative, the idea that corporate profiteering is an important part of today’s inflation is getting a surprising amount of traction, including from the administration. So it’s no surprise that it’s attracted some hostile pushback. This sneering piece by Catherine Rampell in the Washington P ..read more
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Remembering Jim Crotty
The Slack Wire
by JW Mason
6M ago
Last weekend I went up to Amherst, for an event — half conference, half memorial — in honor of Jim Crotty. Jim was a very important presence for me when I was at a graduate student at the University of Massachusetts, as he was for many people who passed through the economics program there in the 1980s, 1990s and 2000s. His approach to economics, drawing on the traditions of Marx and Keynes, was for us almost the definition of heterodox macroeconomics. He was also a model for us as a human being. He never wavered from his political commitments, and he was — as many speakers at the event testifi ..read more
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Inflation Came Down, and Team Transitory Was Right
The Slack Wire
by JW Mason
6M ago
Line goes down, and up. Last week, I wrote out a post arguing that the inflation problem is largely over, and the Fed had little to do with it. Yesterday, the new CPI numbers were released and they showed a sharp rise in inflation — a 4 percent rate over the past three months, compared with 2 percent when I wrote the piece. Obviously, I’m not thrilled about this. It would be easier to make the arguments I would like to make if inflation were still coming down. But it doesn’t really change the story. Given that the spike last month is entirely energy, with growth in other prices continuing to s ..read more
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