Tax Deductions or Tax Expenditures?

Chances are, you’re going to spend tonight finalizing your taxes, making sure that you ferret every last deduction. And probably pretty pleased to be getting these deductions; but when you dig in a bit deeper, you may not be so sure — at least that’s what Betsey Stevenson and I argue in our latest column.

In fact, tax breaks are no different from either government handouts, or federal mandates, whether evaluated in terms of your finances, the government’s finances, or incentives:

Instead of looking at all the breaks for mortgage interest, health care, retirement savings and so on as deductions, picture the government writing you a check for each item. This equivalence between tax deductions and government spending leads economists to call them “tax expenditures.” Reformers have hit on an even more pointed description: spending through the tax code.

Who Lived in Your House in 1940?

Here’s a splendid diversion if you’re a data nerd, a history buff, or even just like good detective work: Tell the story of the family that lived in your house in 1940. 

A bit more background.  If you are in the United States, you probably remember participating in the Decennial Census in 2010.  These forms are kept confidential for 72 years—roughly an average American’s life span.  But this same rule means that today (actually, a couple of days ago), the 1940 Census results became public information.  The good folks at the National Archives have scanned all of these census forms, and put them all online. With a bit of work, you should be able to find your house—or if you are in a newer neighborhood, perhaps a neighboring house.

In Defense of Two-Handed Economists

My latest Bloomberg View column with Betsey Stevenson is now online:

Here’s something you don’t often hear an economist admit: We have very little idea where the economy will be next year.

Truth be told, our best guesses just aren’t very good. Government forecasts regularly go awry. Private-sector economists and cutting-edge macroeconomic models do even worse.

Our objective isn’t to beat up economists. Rather, we want to make the point that when we recognize our shortcomings, we’re forced to confront the enormous uncertainty that lies ahead.  And appropriate humility about the economy changes how we think about policy.

Charts: Name That Rap Song

Like most economists, I spend much of my day analyzing data, distilling it into the perfect charts. And I also like to listen to music, while doing this.  The brilliant Elisabeth Fosslien has found a way to combine the two.  Yes: Rap Music in Charts. Brilliant! Here’s a chance to test your pop culture knowledge and chart reading […]

What If It Rained on the Tea Party Parade?

My latest Bloomberg View column with Betsey is all about the Tea Party.  Well, actually, it’s really about some superb research about the Tea Party, by Andreas MadestamDaniel ShoagStan Veuger and David Yanagizawa-Drott.  Their big question: “Do Political Protests Matter? Evidence from the Tea Party.”  We know that lots of people turn out to Tea Party rallies. But does it really change anything?

What can Eeyore and Tigger Teach Bernanke About Monetary Policy?

What can Eeyore and Tigger tell us about the current state of monetary policy?  A lot.  At least that’s the argument that Betsey Stevenson and I make in our new column for Bloomberg View.

The Fed is now engaged in the game of “forward guidance”—they’ve announced that they anticipate keeping interest rates at zero, until late 2014—and hope that it will shape the recovery.  But what effects will this announcement have?  To figure this out, let’s visit two of the greatest ever Fed Chairmen: Eeyore and Tigger.

The Life of the Number-Crunching Analyst

Thousands of economics majors head off to industry each year to work as analysts. They’re lured by the promise that they’ll learn a lot, work hard, play hard and get ahead.  But is it true?  Who better to ask than the brilliant young analyst Elisabeth Fosslien.  And as a good young analyst, she’s distilled her portrait of life as an analyst into charts.  Having once lived the analyst life—my first job out of college was at the Reserve Bank of Australia, crunching numbers and making charts—all of these resonated with me.

Why Nations Fail

One of the great experiences of my stint in grad school was taking Advanced Macro classes from a fellow who at the time was regarded as a promising young professor at MIT -- Daron Acemoglu.  It was well worth making the bike trip from Harvard, down Mass. Ave., to learn from him.  He is surely the most productive economist alive.  And his frequent collaborator Jim Robinson may just be the most interesting political scientist.  Their joint research program — figuring out what works and what doesn't in economic development -- involves asking some of the most important questions any social scientist can ask.  

Happy Valentine's Day: Economist Edition

 You might think that the dismal science has very little to offer on matters of the heart.  But I disagree.  And so does Elisabeth Fosslien. She’s a brilliant young analyst interested in design, math, and economics. Yes, she’s the sort of person who dressed up as a bear market for Halloween.  All this makes her the perfect person for economics-themed data visualization. And so when #FedValentines lit up Twitter last week, she decided to go a step further, and provide the perfect valentine for the economist in your life.  Make your selection, below:

It’s the Economy, Honey

Yesterday’s NY Times contained a very flattering (and quite personal!) profile of Betsey Stevenson and me. For me, it was all worth it just to get a great family portrait. (Have you ever tried to get a dog and a toddler to look at the camera at the same time?)

I don’t really have a lot to add, other than to say that I thought the author, Motoko Rich, did a fabulous job.  Hopefully it gives folks outside the ivory tower some sense of just what it is that animates the lives of economists.  And yes, I admit that reading it, you’ll quickly conclude both that we are passionate about economics, and that we fit the usual stereotypes about academics.  And if the article makes it sound like we are crazy about our kid, that’s because we are.