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Unemployment Alarmism

November 1, 2013 at 9:48 am

From a Times news article by Catherine Rampell, who should know better:

unemployment benefits to jobless workers for longer than the normal maximum of 26 weeks have been extended repeatedly, although the maximum duration of benefits has fallen from a peak of 99 weeks to 73 weeks. The Emergency Unemployment Compensation program, financed by the federal government for states that meet certain unemployment and state benefit thresholds, is scheduled to end Jan. 1.

The recent fiscal showdown in Washington make further extensions less likely. And the end of these emergency unemployment benefits could create a further drag on the economy.

The so-called food stamp cliff "may be more of a sidewalk curb," Mr. Feroli wrote in an email. "The bigger cliff, which I'm surprised people aren't talking about, is emergency unemployment benefits Jan. 1." That, he estimated, could shave 0.4 percentage point off growth in the first quarter next year.

The article mentions only the potential negative consequences to the end of extended unemployment benefits, without any mention of the potential positive consequences, which are well documented. For example, a 2011 letter from the Federal Reserve Bank of San Francisco:

Economists have cited a number of possible reasons why the natural rate of unemployment may have risen in recent years. In early 2009, eligibility for unemployment benefits was extended from 26 weeks to as much as 99 weeks. Extended benefits reduce the hardship on unemployed workers and their families during this severe downturn. However, they may also reduce the incentive of the unemployed to seek and accept less desirable jobs, which in turn may raise the measured unemployment rate. Indeed, some European countries may have higher natural rates of unemployment because they offer more generous unemployment benefits than the United States....

Valletta and Kuang (2010) estimate that the extension of unemployment benefits increased the natural rate by about 0.8 percentage point. Other estimates suggest even larger effects (Fujita 2011). Importantly, the direct effects from unemployment benefits should end after the maximum eligibility period is brought back to its normal level....

Mounting evidence suggests that structural factors may have increased the "normal" rate of unemployment to about 6.7%. Much of this increase is likely to be temporary. In particular, the extension of unemployment benefits probably accounts for about half of the increase.

And Harvard Professor Greg Mankiw's textbook Principles of Economics, which states "While unemployment insurance reduces the hardship of unemployment, it also increases the amount of unemployment. The explanation is based on one of the Ten Principles of Economics in Chapter 1: People respond to incentives. Because unemployment benefits stop when a worker takes a new job, the unemployed devote less effort to job search and are more likely to turn down unattractive job offers."

And a 2013 paper from the National Bureau of Economic Research, which found, "Our estimates imply that most of the persistent increase in unemployment during the Great Recession can be accounted for by the unprecedented extensions of unemployment benefit eligibility."

 

Obama and ObamaCare

November 1, 2013 at 9:30 am

The front page of today's New York Times features an article about three people who are being "Forced out of their existing health insurance plans" because of ObamaCare. It says:

Each, in a different way, represents the relatively small part of America that the Obama administration did not talk about while campaigning for the Affordable Care Act: people who have health insurance that they like, but who will be unable to keep it under the law.

That's a strange way of putting it. It's not accurate that the Obama administration "did not talk about" this while campaigning for the Patient Protection and Affordable Care Act. The president himself talked about it repeatedly — he falsely claimed it was not going to happen. See this video for example after example.

 

Outing an Anchor

October 31, 2013 at 8:59 am

Having already run one column making the point that no one much cared when the web site Gawker ran an item outing a Fox News anchor as gay, the New York Times bizarrely runs a second news article making pretty much the same exact point. If the point is that the Fox News anchor's sexual orientation isn't particularly newsworthy — and, agreed here, it isn't — then the second article in the Times emphasizing that point sort of undermines the contention. If it's so un-newsworthy, why run two news articles about it?

 

Decay at Sears

October 30, 2013 at 9:17 am

Sears Holdings is a stock I own, and I know and like and have done business with some of the company's directors (though I haven't discussed either this post or the Times article it addresses with them), so I hesitate before plunging in on this one. But sometimes the Times comes along with a story that is such an egregious example of bad journalism that it deserves to be ripped apart.

The Times makes a front-of-the-business section news article out of a photograph some guy took of a shoe rack at a Sears or K-Mart store with some empty slots. This is supposed to be a sign of the "decay" of Sears. That fails basic logic. Suppose the rack is empty because people bought the merchandise? That's how stores sell stuff and make money. If the Times editors don't understand this, consider an analogy from the newspaper business. If you own the New York Times, what would you prefer to see when you stroll by Manhattan newsstands at 7 p.m.? Racks groaning full of stacked-high copies of the New York Times? No, you want the racks to be empty, because you sold all the newspapers earlier in the day.

The Times article quotes Gary Balter, an analyst with Credit Suisse. The Times doesn't mention that Mr. Balter has been predicting that Sears Holdings stock will plunge. Instead the stock is up 50 percent year to date. What credibility does Mr. Balter have on the matter? Is Credit Suisse or its clients short Sears Holdings? The Times doesn't say. The other people quoted in the story — Mary Ross Gilbert of Imperial Capital and Brian Sozzi of Belus Capital Advisors — are pretty small fish in a money management world in which some other, much larger fish, not mentioned in the article, like Bruce Berkowitz's Fairholme Fund, are reportedly betting on Sears Holdings. That doesn't necessarily mean the smaller fish are wrong — small fish sometimes get it right and become bigger fish — but the Times doesn't give readers much help in evaluating the credibility of these sources. Do they have financial bets for or against Sears Holdings? How large are the bets? How much money do they manage?

Then there's this, about Sears CEO Edward Lampert: "Mr. Lampert, a mercurial free market advocate and a professed Ayn Rand fan, declined requests for an interview." How are Mr. Lampert's tastes in politics or literature relevant here? An online dictionary defines mercurial as "characterized by rapid and unpredictable changeableness of mood." If the Times has evidence that Mr. Lampert has rapid unpredictable mood swings that have affected the performance of the company he leads, it might report them rather than slinging around unsubstantiated pejorative adjectives.

 

Politics in the Restaurant Review

October 30, 2013 at 7:59 am

Times restaurant reviewer Pete Wells has an unfortunate habit of allowing his political views to seep into his restaurant reviews, and today's review offers another example:

As Hearth approaches its 10th anniversary next month, you can tell the kitchen is paying attention most of the time. Not always: one night the gnocchi would have had no flavor if not for the melted butter and grated cheese on top. Dry, stringy salt cod mantecato needed more richness, and it was stuffed in a bitter roasted yellow Hungarian pepper that needed more sweetness. Siobhan DeCarlo's desserts were variable, too. I had a nearly perfect cardamom panna cotta with a coffee-caramel sauce one night, and a dry, drab pear spice cake with almost no hint of spices on another. I noticed the lapses because they were so out of character, like John Boehner vaping on an e-cigarette.

What does Pete Wells know about John Boehner's character? Has the Times restaurant reviewer been slinking away from the table to cover Capitol Hill? Why make fun of Mr. Boehner's cigarette habit rather than, say, President Obama's, if not to convey the reviewer's sense (doubtless shared by a large portion, but not all, of the Times readership) that Mr. Boehner is somehow uncouth, or evil, or irredeemably out-of-date.

Some editor should have just ended the sentence at the comma, and deleted the cheap political pot shot. It has no place there. If readers want Maureen Dowd or Gail Collins, they can read the op-ed page. Instead that tone is infecting the rest of the paper.

 

Taxation Without Representation

October 28, 2013 at 9:42 am

A James B. Stewart column in Saturday's New York Times proposes to increase taxes on what Mr. Stewart describes as "Ultrawealthy nonresidents who own property in New York City."

Mr. Stewart tries to portray people in this category as undertaxed, but he conveniently neglects to mention the real estate transfer tax, which is paid by the people he is writing about. He also neglects to mention that America was founded on a revolution against taxation without representation. That's relevant here, because what Mr. Stewart proposes — jacking up tax rates on people who don't live in New York City and thus don't have a vote on those taxes — amounts precisely to taxation without representation.

 

Clutch Ortiz

October 28, 2013 at 9:40 am

That New York Times article trying to explain that David Ortiz isn't really a "clutch" hitter isn't looking very good now that the Red Sox star is hitting .727 in the World Series.

 

N.Y. Campaign Finance

October 25, 2013 at 9:44 am

A front-page news article in today's Times reports on a decision by three judges on the Second Circuit to allow unlimited contributions to independent groups involved in the New York mayoral race. Five people are quoted, in paragraphs totaling 312 words, denouncing the decision, while two people are quoted, in paragraphs totaling 180 words, supporting the decision. It's pretty clear the Times is siding with the speech restrictions, and against the three judges on the Second Circuit, just by who is quoted in the story and how much space they are given.

 

The Global Times Stumbles in Egypt

October 25, 2013 at 8:56 am

One of the hazards of Arthur Ochs Sulzberger Jr.'s plan to transform the New York Times into what he calls "a single, unified global media brand" is that some of the content adored by readers in, say, Egypt may be repellant to readers in New York, Miami, or Los Angeles.

A good example is the Times' decision to hire as a monthly columnist the Egyptian novelist Alaa Al-Aswany. The Washington Institute for Near East Policy's Eric Trager has an article in the New Republic describing Mr. Al-Aswany as "a choice the Times will regret," a writer who is "among Egypt's most prolific conspiracy theorists," and who "often uses his very public platform to reinforce some of Egypt's most popular bigotries." Mr. Trager reports that Aswany "said on Egyptian television, for instance, that a 'massive Zionist organization rules America,' which is why 'Obama is not able to go against Israel's desires.'"

Some might ask why the Times even needs Alaa Al-Aswany to make these claims when it already has Thomas Friedman, Roger Cohen, and the rest. But the serious question is whether, in chasing a global audience, the Times will dilute whatever attraction is has for its American audience. The bet of Times management seems to be that its American readership is less particularly American and more part of a global secular elite thought leadership. The Wall Street Journal has managed to publish a global newspaper without diminishing its essential Americanness. But my guess is that Alaa Al-Aswany is only the first of many instances where the Times will have to be careful as it tries to court new readers overseas without alienating its hometown loyalists.

 

The $12,000 Sconce

October 24, 2013 at 10:39 am

The New York Times, which issued an editorial just the other day complaining that a $400 ticket to a Broadway show was "astronomical" and "out of reach for the general public," now has an article in its Home section featuring a $12,000 sconce. This time around there's no criticism of the price and no suggestion that the money might be better spent on something other than an onyx and brass wall-mounted light fixture.

 

Sebelius' Defense Lawyer

October 23, 2013 at 4:01 pm

A front-page article in today's New York Times tries to defend against and explain away the criticisms of Kathleen Sebelius, the secretary of health and human services, following the fouled up rollout of the ObamaCare Web site.

Never mind that it's not really the role of a news article to take Ms. Sebelius's side against that of her critics, and never mind that if it were a Republican under attack, like, say, Donald Rumsfeld during the Iraq War, the Times wouldn't be in defense attorney mode.

The arguments the Times gives in defense of Secretary Sebelius are pretty lame. For example:

Republicans insist the buck stops with the secretary. But although Ms. Sebelius runs the Department of Health and Human Services, the agency directly responsible for the health care law, there are questions about how deeply she was involved in the development of the troubled Web site.

The gist here is "Oh, there go those reckless Republicans, again, going after Ms. Sebelius even though it wasn't really her fault." But what the Times presents as exculpatory — "but although" she wasn't really that involved — is actually damning. Why wasn't she that involved? It turned out to be pretty important. Maybe she should have made it her business to get more involved instead of staying out and letting it fail. Did she deliberately stay out of it to try to avoid blame? That's the sort of question a tough or even reasonably skeptical report might try to answer.

Then there's this:

The ruckus over Ms. Sebelius, who is 65, may have roots in Kansas politics, where she rose to prominence as a daughter of a governor (John J. Gilligan of Ohio) and the daughter-in-law of a congressman, Keith Sebelius, a conservative Kansas Republican.

Please. The ObamaCare Web site doesn't work. No one was calling for this woman's resignation before the failed rollout. To say, dismissively, "Oh, this is just Kansas politics" is making excuses. Is it Kansas politics that is making the ObamaCare web site not work in all the other states that are not Kansas? Notice the way the Times doesn't even attribute this claim to Secretary Sebelius's defenders, but raises it itself using the speculative "may." At least the Times doesn't accuse the Sebelius critics of sexism, which "may" be the next step if the Web site doesn't start working and if the critics don't disband in the face of the defense mounted by the Times in this article.

One final note: The print headline for the article is "Sebelius Thrust Into Firestorm on Exchanges." At least the Times is using the term "Exchanges" rather than the newly Obama-preferred word "marketplace." "Thrust" is one of those newspaper terms that, because it is short, fits easily in a one-column headline. But it makes it sound like the Republicans are pushing Ms. Sebelius into a fire, rather than making it sound like the fire was of her own making. In the afternoon, the wording on the Times Web home page had changed and in my view improved to a more idiomatic and less tendentious "Sebelius Faces a Firestorm Over Health Exchanges."

 

Broadway Theater Ticket Prices

October 22, 2013 at 6:04 am

An editorial in Saturday's New York Times denounced the "astronomical" prices of tickets for some Broadway shows, complaining that "the most desirable shows" are "out of reach for the general public."

It's not clear why the price that a private business charges an individual in a voluntary transaction should be a concern to Times editors, who when they aren't bemoaning the high price of Broadway tickets can be found assuring us that the Federal Reserve's policies haven't led to any inflation, which, by the way (they say), the economy could actually benefit from a bit of.

And the same newspaper that is denouncing the $400 Broadway show ticket as out of reach for the general public is charging subscribers in the Boston area the rate of $837.20 for a home-delivery subscription. Why, one could buy two Broadway tickets for that sum. Attempt to memorialize a dead friend or relative with a death notice in the Times, and, at a reported $55 per 28-character line (that was the price in 2010), plus a $55 legacy.com fee, you'd be better off blowing the money on Broadway tickets.

 

Unregulated Milk

October 21, 2013 at 9:04 am

A front-page New York Times news article raises an alarm about what the article calls an "unregulated marketplace" for breastmilk. The article describes not a single instance of an infant who got sick or died from donated or sold breastmilk. It also doesn't mention that, even in the absence of specific regulations about breastmilk, the marketplace is governed by generally applicable civil and criminal laws that prohibit fraud in commerce.The Times article also fails to include response from the milk-sharing Web sites assailed in the article, even though such a response is readily available this morning here.

 

ObamaCare Achievement

October 21, 2013 at 8:58 am

From a front-page New York Times news article about the effort to repair the ObamaCare Web site: "The scrambling underscores the pressures on the administration to fix what is widely viewed as the president's biggest domestic achievement."

It's not clear from the sentence or the article what the "what" is. ObamaCare? The ObamaCare web site? Both things may be "widely viewed" within the Times newsroom as big achievements, but elsewhere, skepticism reigns.

 

Second-Largest Park

October 19, 2013 at 7:56 pm

An article in the Times metro section refers to "Harriman, the second largest park in the state." It seems to me that that is inaccurate: the largest park in the state is Adirondack Park and the second-largest is Catskill Park.

 

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