On February 28, Moody’s Analytics economist Mark Zandi warned that proposed Republican budget cuts would cut real GDP growth by 0.5 percent this year, resulting in 400,000 fewer jobs in 2011 and 700,000 fewer jobs in 2012.
Also on February 28, Macroeconomic Advisers estimated the economic impact of a government shutdown, as many Republicans are threatening. A brief impact would have a negligible impact, but a long shutdown would have much more severe effects. That same day, Stanford economist John Taylor also posted a commentary on the impact of a shutdown; he agrees that the impact would be minimal and may even be positive insofar as it signals to markets a serious intention by Congress to reduce spending and the deficit.
A February 28 working paper from the European Central Bank examined the role of inheritances in wealth in America. It finds that 21 percent of households received an inheritance in the 1989-2007 period and that it constituted 23 percent of their net wealth; future inheritances are expected to raise the percentage of recipients to 30 percent and constitute 40 percent of their net wealth. The study also finds that inheritances tend to equalize the distribution of wealth.
In a February 27 commentary, four New York University economists named the 10 most systemically risky financial firms in the U.S. Bank of America topped the list.
On February 26, the White House posted the 2011 edition of the Economic Report of the President.
In a February 25 commentary, the Bureau of Labor Statistics noted that in the period from 1947 to 1979 there was a fairly close relationship between growth in productivity and employee compensation. But since that time, higher productivity has tended not to lead to higher compensation to the same degree.
In a February 24 commentary, economic historian Nicholas Crafts argues that economists have actually done a pretty good job of mitigating the economic crisis.
A February 23 report from the Congressional Budget Office found that the Recovery Act had a substantial positive effect on the economy.
The January issue of Perspectives on Psychological Science has an article by Michael I. Norton and Dan Ariely of Harvard and Duke, respectively, which finds that people grossly underestimate the maldistribution of wealth in the U.S. and favor a more equal distribution.
The January issue of the Stanford Law Review has an article on the “benefit” of spying for businesses and the definition of economic espionage.
Bruce Bartlett is an American historian and columnist who focuses on the intersection between politics and economics. He blogs daily and writes a weekly column at The Fiscal Times. Bartlett has written for Forbes Magazine and Creators Syndicate, and his work is informed by many years in government, including as a senior policy analyst in the Reagan White House. He is the author of seven books including the New York Times best-seller, Imposter: How George W. Bush Bankrupted America and Betrayed the Reagan Legacy (Doubleday, 2006).