How Redistribution Makes America Richer
Modeling the numbers on bottom-up and middle-out economics.
Modeling the numbers on bottom-up and middle-out economics.
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The #MMT Case for Progressive Taxes
If you’re looking to save the planet and deliver inclusive prosperity, it’s crazy to rely on deficit spending alone.
By Steve Roth There’s a curious fact among the current crop of discussions surrounding Modern Monetary Theory: Leading figures in the MMT world — strong progressive voices, they — are surprisingly dismissive of higher, progressive […]
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The Real Reason Stock Buybacks Are a Problem
Buybacks are a massive tax dodge for shareholders
By Steve Roth Bernie Sanders and Chuck Schumer’s New York Times op-ed, “Limit Corporate Stock Buybacks,” has thrown internet gasoline on the buyback debate. The left is waving the flag, and the right is trying […]
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Four Definitions of Money. All Correct.
Understanding what we mean by the most important word in economics.
By Steve Roth Money makes the world go round. That may well be true, but money certainly makes the economics world go round. It’s the discipline’s special purview, the numeric linchpin that gives economics its dominant […]
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Capital’s Share of Income Is Way Higher than You Think
Almost half of households’ market income is received for just being wealthy: owning stuff.
By Steve Roth The shares of income going to “capital” and “labor” are vexed issues. How much is received for doing work, and how much is unearned “property income”— interest, dividends, etc.? For a long […]
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Insanely Concentrated Wealth Is Strangling Our Prosperity
Today’s mountains of wealth throttle the very engine of wealth creation itself.
By Steve Roth Remember Smaug the dragon, in The Hobbit? He hoarded up a vast pile of wealth, and then he just hung out in his cave, sitting on it (with occasional forays to further pillage […]
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Why a Consumption Tax May not Make any Sense at All
The devil’s in the (accounting) details — and the economic effects
By Steve Roth You often hear calls out there — mostly from Right economists but also from some on the Left — for a consumption tax in the U.S. As presented, it’s a super-simple idea: […]
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Two Big Questions About the Job Guarantee: God, Devil, and the Details
Progressives have these questions. Others will too.
By Steve Roth Should government guarantee a “good” job for anybody who wants one? It’s one of the biggest ideas among progressive economists who are trying to seize the Overton window of what’s politically feasible, […]
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How Amazon’s Accounting Makes Rich People’s Income Invisible
Increasingly, businesses don’t generate profits. They generate capital gains. It’s fiendishly clever.
By Steve Roth Image you’re Jeff Bezos, circa 1998. You’re building a company (Amazon) that stands to make you and your compatriots vastly rich. But looking forward, you see a problem: if your company makes […]
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What in the Heck Is “Money Printing,” Anyway?
People — especially economists — use this term every which way from Sunday.
By Steve Roth “Printing money.” You hear it all the time in economics discussions — from economists in every phylum of the (rapidly) evolving field, from financial types, from reporters and everyday news consumers, and […]
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How Do Americans Get Rich? (And Stay Rich?)
Income inequality is rampant, and rising. But it’s not even close to the whole story.
By Steve Roth It’s the American dream. A third of Americans think they’ll be rich someday. More than half of 18–29 year olds think they will be. Less than 5% actually make it.* And many of those […]
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Why Economists Don’t Know How to Think About Wealth (or Profits)
Until 2006, they quite literally weren’t playing with a full (accounting) deck. Most still aren’t.
By Steve Roth In the next evolution of economics taking shape around us and among us, perhaps no school has been so transformational over recent decades as a loose, worldwide group best described as “accounting-based” economists. Modern […]
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Does Saving Cause Lending Cause Investment? (No.)
The idea that household saving funds business investment is both incoherent and empirically wrong.
By Steve Roth Households save money and lend it to businesses, who invest it in productive enterprises. That’s the economic story you’ve been hearing your whole life, right? Or at least since Econ 101. Saving […]
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Democracy. Capitalism. Socialism. Choose Any Three of the Above
If you don’t have a big bathtub of oil in the ground, you need all three to deliver widespread economic well-being.
By Steve Roth In the millennias-long evolution of human societies and economic systems, we find ourselves today at a pass where three systems predominate, and fitfully cohabit: democracy, capitalism, and socialism. Most countries in the world operate […]
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Did Money Eat Our Brains?
Our heads got bigger for two million years. For at least ten thousand years, they’ve been getting smaller. Is the Money-Zombie Apocalypse upon us?
By Steve Roth “This invention will produce forgetfulness in the minds of those who learn to use it, because they will not practice their memory. Their trust in writing, produced by external characters which are […]
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Economists Agree: Democratic Presidents are Better at Making Us Rich. Eight Reasons Why.
Democratic administrations over the last century have delivered far faster economic growth. What explains that?
By Steve Roth In 2013, economists Alan Blinder and Mark Watson — no wild-eyed liberals, they — asked a very important question: Why has the U.S. economy performed better under Democratic than Republican presidents, “almost regardless […]
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How Perfect Markets Concentrate Wealth and Strangle Growth and Prosperity
The winners have us all playing a loser’s game
By Steve Roth Capitalism concentrates wealth. Ridicule Marx and his latter-day disciples all you like (I’ll help); he definitely got that right. But capitalism is a big word with lots of meanings, and enough ideological baggage to […]
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Isn’t it Time to Stop Calling it “The National Debt”?
How about Government-Issued Assets instead?
By Steve Roth Fourteen. Trillion. Dollars. That’s how much the U.S. government “owes.” You hear that massive number all the time, right? And people are forever telling you that you and your family are on the hook to pay […]
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You Don’t Own That! The Evolution of Ownership
Get off my lawn.
By Steve Roth In a recent post on the “evolution of money,” which concentrated heavily on the idea of (balance-sheet) assets, I promised to come back to the fundamental idea behind “assets”: ownership. Herewith, fulfilling […]
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Note To Economists: Saving Doesn’t Create Savings
Is Saving a Sin?
By Steve Roth If you save more, if everybody collectively saves more, there are more savings, right? There’s more money that firms can borrow and invest to make us all more prosperous. Household saving “funds” […]
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Why Economists Ignore Much of Rich People’s Income
Did you “earn” that money?
By Steve Roth The standard definition of income makes much of rich people’s income invisible. If your home or stock-portfolio value goes up over a decade or three, have you received “income,” “saved,” or increased […]
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It’s Simple! Concentrated Wealth and Inequality Crushes Economic Growth
More billionaire dollars, slower growth. Full stop.
By Steve Roth Like it or not, if countries want to join the “rich-country club,” they need to redistribute wealth. What has not been studied much — at least partially because the data is hard […]
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Did Money Evolve? You Might (Not) Be Surprised
It’s all about social accounting
By Steve Roth You probably won’t be surprised to know that exchange, trade, reciprocity, tit for tat, and associated notions of “fairness” and “just deserts” have deep roots in humans’ evolutionary origins. We see expressions […]
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Why Welfare and Redistribution Saves Capitalism from Itself
Rich countries share wealth and create economic security
By Steve Roth There’s a curious fact about the wealth and growth of nations that you rarely see mentioned: No country has ever joined the modern, high-productivity, rich-country club without massive doses of redistribution, and […]
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