- On Capitol Hill
- On Wall Street
- In the Press
- Policy Reform Work
Our projects are designed to empower policy makers to create positive change. With a focus on collaboration and outreach, we provide original, standards-based research on key policy issues.
SCEPA joined with the Economic Policy Institute on Capitol Hill to brief congressional staff and policy experts on tax expenditures, or incentives given through the tax code without scrutiny by Congress.
SCEPA economists are working on the prospects for a more progressive economic order to emerge from the shock of the recession. They have published papers and documents that place current events in a longer-term context as well as policy proposals to deal with short-term concerns. They are also documenting the emerging discussion of how the discipline of economics is reacting to the Great Recession and the questioning of conventional economic analysis.
Lance Taylor, a SCEPA Faculty Fellow, presents an overview of his new book, Maynard’s Revenge, in a Google Tech Talk.
The book, published this November by Harvard University Press, is a timely analysis of mainstream macroeconomics, posing the need for a more useful and realistic economic analysis that can provide a better understanding of the ongoing global financial and economic crisis.
The government spends $143 billion through tax breaks in an effort to expand pension coverage and security. Yet, over half of the American workforce does not have a pension. Retirement insecurity hurts business plans, workers’ lives and retiree well-being. Reform is needed.
SCEPA’s Guaranteeing Retirement Income Project, sponsored by the Rockefeller Foundation and in collaboration with Demos and the Economic Policy Institute, has a plan to guarantee safe and secure retirement income for all Americans.
by Rick McGahey, SCEPA Faculty Fellow
This morning's May employment report continues the trend of slight improvement but subpar overall economic performance. The unemployment rate stayed stuck at 6.3 percent while jobs increased by 217,000. So far in 2014, job creation has averaged 214,000 per month, and if that rate continues for the entire year, it will be the strongest year since 1999.
But it is still not a great number. True, if May’s job performance continues, then the Atlanta Fed predicts we will reach 5.5 percent unemployment in ten months. But any lowering in the unemployment rate is driven in part by weak labor force participation, which remains near its lowest level in over thirty years.
Heidi Shierholz at the Economic Policy Institute points out how weak our recovery remains, noting that we are six-and-one-half years away from the Great Recession’s start. If you take population growth since then into account, we still are short around 7 million jobs.
The ongoing weakness of the job market also can be seen in data on wages and hours worked. Over the last year, average hourly earnings have increased by 2.1 percent, virtually the same as the low two percent growth in overall inflation. And the average hours worked each week hasn’t increased at all in the past year. A tighter labor market should see increasing wages and hours, but we don’t have that, underscoring that many people still lack work, and employers aren’t hiring at a vigorous rate.
This month, we mark the five-year anniversary of the Great Recession’s technical end. Five years is a long time for an expansion; the eleven U.S. business cycle expansions in the post-World War II period have averaged 58.4 months, although more recent expansions have lasted longer. And other data point to macroeconomic weakness. Real GDP growth in the first quarter of 2014 actually fell by one percent, making the relatively consistent job gains this year harder to understand.
But policy makers feel no urgency for further economic stimulus. We are in danger of accepting slow job growth, wage stagnation, and inequality as a “new normal.” The U.S. should be borrowing more with today’s very low interest rates, creating jobs in infrastructure and public services, but instead we drift along with slow growth, low wages, and a lack of shared prosperity.
On May 3rd, the Economics Department of The New School for Social Research honored Professor Edward J. Nell's 39 years of teaching with a conference celebrating his many contributions to the field of economics. Prior to his retirement in 2013, Nell served as the Malcolm B. Smith Professor of Economics since 1969. He published more than twenty books and wrote hundreds of articles for leading journals on macroeconomic theory, monetary analysis and finance, economic methodology and philosophy, and transformational growth and development.
Below is a sample of the working papers contributed to the conference by former students inspired by Professor Nell.
Willi Semmler: "A New Chapter"
Anna Shoysta: "Edward Nell as the Worldly Philosopher: Shaping the Minds of the Future Economists"
David Laibman: "Democratic Planning and Incentives – Coming to Grips with (Yet Another) Impossibility Theorem"
Louis-Phillippe Rochon: "The Monetary Circuit and the State"
Sergio Parrinello: "A Search for Distinctive Features of Demand-led Growth Models"
by Rick McGahey, SCEPA Faculty Fellow
New rules from the Obama Administration to control emissions from coal-fired power plants signal a new phase in America’s battle over climate change. The science is settled—climate change is occurring and it is caused by humans. Now we need to figure out the economics.
On Monday, the Environmental Protection Agency (EPA) announced tough new rules restricting emissions from power plants, requiring a thirty percent cut in their carbon emissions by the year 2030. But even though these new economic rules will be caught up in polarized political combat, they are a major step forward, and not just because of their beneficial environmental impact. They signal that the United States, however haltingly, is moving from denying the science on climate change to a necessary debate about how to control it and pay for the associated costs.
Even before the new rules were issued, attacks on them were intensifying. The U.S. Chamber of Commerce launched a pre-emptive strike last week, saying that the new power plant rules could cost up to $50 billion annually and lose hundreds of thousands of jobs.
Fighting back, the Natural Resources Defense Council (NRDC) claimed that the Chamber’s negative economic estimates are wildly overstated, in part because the Chamber study doesn’t recognize any of the new businesses and hundreds of thousands of jobs that will be created in alternative energy, other benefits from environmental clean-up, and lower electric bills as alternative energy gets to scale.
Many economists would say that NRDC has the better of the argument—regulations, when done correctly, can induce new jobs and businesses and technological innovation, while producing other social benefits like cleaner air and water.