Paul Krugman

Paul Krugman @paulkrugman

So I was off Twitter, getting some actual work done, and only recently learned that there's suddenly a popular theory on the right that the whole Ukraine War is Wag the Dog — not really happening. I take this as more evidence that we're living in a badly designed simulation. — PolitiTweet.org

Paul Krugman @paulkrugman

RT @michaeldweiss: “What catturd2 said,” says the former National Security Adviser to the President of the United States. — PolitiTweet.org

Paul Krugman @paulkrugman

RT @nytopinion: “In modern America,” @paulkrugman writes, “some of the biggest beneficiaries of means-tested programs are rural white peopl… — PolitiTweet.org

Paul Krugman @paulkrugman

If you ask me, our big prediction problems now don't involve aggregate supply — what we're seeing is more or less consistent with a nonlinear Phillips curve — but aggregate demand. Why is spending so resilient? 3/ — PolitiTweet.org

Paul Krugman @paulkrugman

The big Biden stimulus was two years ago; its effects should be receding. The Fed has raised rates 450 basis points, and despite all the talk of financial conditions not responding, mortgage rates — where the rubber usually meets the road — are way up 2/ — PolitiTweet.org

Paul Krugman @paulkrugman

While we shouldn't make too much of one month's report, pretty clear that economy is still running too hot, which isn't really a shock given everything else we know. The puzzle — and I'm genuinely puzzled, without strong priors or a political axe to grind — is why it's so hot 1/ — PolitiTweet.org

Paul Krugman @paulkrugman

So picture might look like this, with unemployment gap on horizontal axis. The problem hasn't been a difficult inflation tradeoff; it has been the resilience of the economy to rate hikes 3/ https://t.co/gxzJgrxjgE — PolitiTweet.org

Paul Krugman @paulkrugman

What I think/fear is happening: significant disinflation came easily, suggesting a steep tradeoff and no need for many years of mass unemployment. But economy has barely cooled off despite rate hikes. 2/ — PolitiTweet.org

Paul Krugman @paulkrugman

Late to this, but yes. Putting all the various indicators together, inflation seems to be moving sideways, and is still unacceptably high. Suggests that the economy remains too hot, and very hard to argue against more Fed hikes. — PolitiTweet.org

Paul Krugman @paulkrugman

Why the right can't handle the truth about Russia's weakness https://t.co/shWnMCMOKU — PolitiTweet.org

Paul Krugman @paulkrugman

I'm getting a few people saying "but the programs will be bankrupt because payroll taxes will fall short of expenses". Yes, SS and Medicare Part A are supported by dedicated taxes. But that's an accounting convention, not a real constraint — and taxes can be increased. — PolitiTweet.org

Paul Krugman @paulkrugman

Yes, costs will rise. But we don't have to cut benefits https://t.co/k4RlFX0MIa — PolitiTweet.org

Paul Krugman @paulkrugman

And if you really worry about deficits, as opposed to wanting reasons to kill social insurance, you should be asking how America — which has incredibly high health costs — can bring them down 3/ — PolitiTweet.org

Paul Krugman @paulkrugman

Projections of rising costs depend in large part not on hard truths about demography but on *assumed* increases in health spending. Recent history doesn't support that pessimism on health costs; in fact, CBO has drastically reduced its own projections 2/ https://t.co/77pjAMYFk7 — PolitiTweet.org

Paul Krugman @paulkrugman

So we're getting the usual suspects showing up to say that Medicare and Social Security can't possibly remain as they are. I should have a newsletter about all this later today; but here's the key chart from CBO 1/ https://t.co/rPbHbeOQA0 — PolitiTweet.org

Paul Krugman @paulkrugman

What this is about (and I invented the phrase!) 2/ https://t.co/jKgRjaly96 — PolitiTweet.org

Paul Krugman @paulkrugman

Irish officials in denial 1/ https://t.co/9XAD3adDC7 — PolitiTweet.org

Paul Krugman @paulkrugman

The "tough guy" who preceded him 2/ https://t.co/vDLNTmtEaC — PolitiTweet.org

Paul Krugman @paulkrugman

A tale of two presidents. The one we have 1/ https://t.co/OYIY5XBXHY — PolitiTweet.org

Paul Krugman @paulkrugman

Obviously lower life expectancy not a good thing: dying tends to hurt the quality of life. But it says that we're thinking too much about the fiscal side 3/ — PolitiTweet.org

Paul Krugman @paulkrugman

Good reasons to believe that there will be more downward revisions — and not just bc of slowing medical costs. Demographic projections assume a rise in life expectancy at 65 that's becoming questionable 2/ — PolitiTweet.org

Paul Krugman @paulkrugman

More about how predicted future Medicare outlays keep going down. CBO projection from 2009, actual through 2022, current projection — some wonky stuff in 2023 involving treatment of receipts, but as you can see catastrophic predictions have been revised way down 1/ https://t.co/qzY9E0xB5P — PolitiTweet.org

Paul Krugman @paulkrugman

And one more update, to show how hard it is to project future medical costs — which are the main source of budget doom and gloom. CBO provides spreadsheets on budget projections going back to 2009. Here's how the Medicare projection has changed 10/ https://t.co/Gon3aNrcwk — PolitiTweet.org

Paul Krugman @paulkrugman

So please, can we not go through all this again? 9/ — PolitiTweet.org

Paul Krugman @paulkrugman

Finally: much of the media seems to be back to its old deficit-reporting mode (as Ezra noted back when), presenting anti-social-insurance editorializing — "Medicare and Social Security must be reformed" — as if it were straight reporting 8/ https://t.co/LOm06SOThA — PolitiTweet.org

Paul Krugman @paulkrugman

So it's not unreasonable to believe that we can do a lot of health cost control. And while the demographic drag on the budget isn't small, it isn't gigantic either — <3% of GDP. So a future of cost control plus moderate tax increases is arguably feasible 7/ — PolitiTweet.org

Paul Krugman @paulkrugman

Gah. Here's the chart 6/ https://t.co/r2QNHIWrJk — PolitiTweet.org

Paul Krugman @paulkrugman

Bear in mind that US health costs are much higher than anyone else's — and also that their rate of growth has been slowing 5/ — PolitiTweet.org

Paul Krugman @paulkrugman

The news is that CBO is getting more optimistic about our ability to contain health costs, which is crucial: demography alone isn't *that* big a deal. Here's CBO's chart from last July 4/ https://t.co/FUuKSjWhuV — PolitiTweet.org

Paul Krugman @paulkrugman

What? Medicare's prospects look better than they did before? I'll bet you didn't get that impression from the stories. All you read was that an aging population plus rising health costs will be a financial problem — but that wasn't news 3/ — PolitiTweet.org