John S. Irons, Research and Policy Director, Economic Policy Institute
Biography provided by participant
John Irons joined the Economic Policy Institute in 2007. His areas of research include the U.S. economy and economic policy, with an emphasis on federal tax and budget policy. He previously worked as the Director of Tax and Budget Policy at the Center for American Progress (2004-2007) and as a tenure-track Assistant Professor of Economics at Amherst College (1999-2003). He has also worked for the Brookings Institution (1995) and at the Federal Reserve Board of Governors (1992-1994). His academic publications have appeared in several journals including the Journal of Monetary Economics, Journal of Applied Econometrics, and the Review of Financial Economics. He is also co-editor of Testing Exogeneity, published by Oxford University Press. He has won several awards for his economics Web sites, including top-5 awards from The Economist and Forbes. He currently serves on the Committee on Electronic Publishing for the American Economic Association, and on the Board of Governors of the National Economists Club.
(Joint post with Josh Bivens at EPI…) There are a couple (nonexclusive) explanations worth exploring. First, it could be the case that we are seeing a once-in-a-generation shift in consumption preferences to reduce or delay consumption in favor of increased savings. As the story goes, everyone is feeling more insecure about their job, their retirement, and their future prospects; and so decide to cut back on their consumption. There is plenty of anecdotal evidence that this is the case, but in total it’s hard to determine how much this matters for the overall savings rate. Second, it could instead be… Read more
Let’s be clear about what’s going on here. The economy that Obama inherited was much worse than most forecasters were predicting at the time of the CEA analysis. The administrations forecasts were informed by blue-chip forecasters, which, in hind-sight, were much too optimistic. Mankiw correctly notes that there is a “shifting baseline” problem, and that the actual unemployment outcome could be the result of incorrect forecasts and/or a changing landscape. (Here’s a dramatic illustration of the systematic errors of the Blue Chip forecasters.) The recovery act has already helped create and save jobs, and will continue to do so… Read more
(Written with EPI colleague Heidi Shierholz) While the apparent peaking of job losses in April is an important first step, the turning point that really matters is the one where the labor market starts creating enough jobs to bring the unemployment rate down. And that is still a long way off. The rate of job loss for the first part of the year has been staggering – 2.7 million jobs lost so far in 2009. The April losses were indeed smaller than the first quarter, and we’re cautiously optimistic that trend will continue. One of the reasons for caution,… Read more
As many have noted, an ideal stimulus would both get the economy moving today while meeting the long-term needs of tomorrow. Investing in our national infrastructure certainly meets these dual goals, and has already been part of the discussion. However, while funding for roads, bridges, public transit and water systems has gotten plenty of attention, we cannot forget about the need to repair and improve our nation’s schools. At least an additional $127-322 billion is needed to bring facilities into good overall condition, according to a 2000 study by the National Center for Education Statistics. A Department of Education survey… Read more
I think it's important to recognize that in many ways the short-term vs. long-term distinction is a fairly arbitrary construct. Economists like to use different theoretical models to articulate the forces that are relatively more important in each time frame (be it aggregate demand in the short-run or technological growth in the long-run). This is a useful classroom device--dividing the world into long-run and short-run--but in the real world short-run outcomes do influence long-term growth. Consider a few examples. The closure of otherwise viable start-up companies in a recession would mean a delay or abandonment of promising new product R&D. Increased… Read more
Previous comments have noted the need for extended unemployment benefits, an increase in food stamp benefits, and aid to states to prevent cuts. These are all sensible provisions that should be included. As Simon Johnson noted though, the total value of this stimulus—with $50 billion for states-would be on the order of $60-70 billion. Unfortunately, we will need significantly more to avert the worst of the crisis. A recovery package that includes these measures plus an additional $75 billion in investments in infrastructure would begin to reach an adequate size. Investments in roads/bridges, schools, and wastewater systems could go a… Read more
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