I've written before about the alarming consensus developing in certain wonkish circles that suddenly labor markets are tightening up, and accelerating inflation is just waiting in the wings. Paul Krugman has now weighed in several times against these "inflationistas," and his latest effort is the most comprehensive.
He adduces four arguments: First, measured wage growth is probably to some extent a statistical artifact representing the fact that during bad weather hourly workers, who are paid less, tend to be idled — making measured wages only seem to increase. Second, if you look closely at the data, the case for wage growth even existing at all is barely there. Third, wage increases are well below what they were before the financial crisis, and everything we've learned since then suggests that a greater fraction of GDP coming in the form of wages would be highly beneficial.
The fourth is especially interesting, though:
Fourth, there's good reason to believe that everyone is working with the wrong paradigm here. Ever since the 1970s, textbook macroeconomics — reflecting the experience of the 1970s — has assumed an "accelerationist" framework, in which low unemployment leads not just to rising wages but to an ever-rising rate of wage increase. But the actual data haven't looked like that for a long time. Since the mid-1990s, in fact, they have looked much more like an old-fashioned Phillips curve, with a relationship between the unemployment rate and the level of wage increase, not the rate of change of wage increase. [New York Times]
This brings to mind a Steve Randy Waldman post arguing that the economics profession has completely misinterpreted the 1970s, and the accelerationist view was wrong even back then. By this reading, inflation is even less of a concern than people assume. If true, this loads the policy scale even more heavily on the side of stimulating like mad.
Of course, as Krugman says, regardless of who is actually right about this, the relative risks involved clearly militate on the side of stimulus. One doesn't have to buy the Waldman view of the '70s for that — it will hold regardless.
In other words: Damn the inflation, Captain Yellen, full speed ahead! Ryan Cooper
The Cleveland Cavaliers' LeBron James hit back at President Trump on Twitter Saturday morning in response to Trump's tweeted announcement that the Golden State Warriors will not be invited to the White House to celebrate their NBA championship after point guard Stephen Curry criticized Trump's policies and rhetoric. As James sees it, Curry's Friday statement that he does not want to meet Trump means the president had no invitation to rescind:
U bum @StephenCurry30 already said he ain't going! So therefore ain't no invite. Going to White House was a great honor until you showed up!
— LeBron James (@KingJames) September 23, 2017
James, who is vice president of the NBA Players Association, was not the only pro athlete to take issue with Trump's weekend critiques of Curry and Colin Kaepernick, the latter of whom Trump referred to as a "son of a bitch" for his habit of declining to stand for the national anthem to protest police brutality and racial injustice in America.
Trump stay in ur place... football have nothing to do wit u smh
— Zach Brown (@ZachBrown_55) September 23, 2017
And I doubt he's man enough to call any of those players a son of a bitch to their face...
— Chris Paul (@CP3) September 23, 2017
— Benjamin Watson (@BenjaminSWatson) September 23, 2017
A #POTUS whose name alone creates division and anger. Whose words inspire dissension and hatred can't possibly "Make America Great Again"
— Kobe Bryant (@kobebryant) September 23, 2017
Mexico was struck by a 6.2-magnitude earthquake Saturday morning, sparking alarm and suspending ongoing rescue efforts in response to two other recent quakes.
The new tremor follows Tuesday's 7.1-magnitude earthquake, as well as an 8.1-magnitude quake that struck off the coast of Mexico earlier this month. The combined death toll from the earlier quakes has nearly reached 400 people.
Saturday's tremor, believed to be an aftershock of the 8.1 quake, collapsed a bridge in the town of Juchitan and toppled some previously damaged buildings. "Homes that were still standing just fell down," said Bettina Cruz, who lives in Juchitan. "It's hard. We are all in the streets." Bonnie Kristian
Iran has successfully tested a new ballistic missile, state-run media reported Saturday, one day after displaying the weapon at a military parade.
The Khorramshahr missile has a range of 1,200 miles, and Iranian President Hassan Rouhani labels it "a deterrent" to guard Iranian security against attack. President Trump has accused Tehran of violating "the spirit" of the 2015 nuclear deal with this sort of test, but Rouhani maintains Iran is committed to upholding the agreement.
The Department of Homeland Security (DHS) on Friday notified 21 states they were targeted for hacking by the Russian government in advance of the 2016 election.
In most cases, this targeting amounted only to research and preparation, and no voting machines were compromised in any state. "What this boils down to is that someone tried the door knob and it was locked," explained Reid Magney of the Wisconsin Elections Commission.
DHS announced the 21-state figure several months ago but had not previously communicated to the states in question. Friday's notification is intended to give the targeted states, a complete list of which has not been released, time to beef up security before 2018. "We heard feedback from the secretaries of state that this was an important piece of information," said Bob Kolasky, acting deputy undersecretary of the National Protection and Programs Directorate at DHS. "We agreed that this information would help election officials make security decisions."
In his Friday night speech in Alabama, President Trump again denied election collusion with Moscow. "No, Russia did not help me, that I can tell you, OK?" he said, calling this "hoax" Democrats' greatest achievement of 2016. Bonnie Kristian
President Trump announced on Twitter Saturday morning that he is no longer willing to host the Golden State Warriors at the White House, a traditional way to honor their NBA championship victory, because of comments from point guard Stephen Curry:
Going to the White House is considered a great honor for a championship team.Stephen Curry is hesitating,therefore invitation is withdrawn!
— Donald J. Trump (@realDonaldTrump) September 23, 2017
Trump's tweet comes hours after Curry on Friday told reporters he did not wish to meet the president, alluding to Trump's much-criticized responses to the white nationalist violence in Charlottesville, Virginia.
"You can talk about all the different personalities that have said things and done things — from [Colin] Kaepernick to what happened with [Michael] Bennett to all sorts of examples of what has gone on in our country that has led to change," Curry said. "We're all trying to do what we can using our platforms, using our opportunities, to shed light on that. That's kind of where I stand on that. I don't think us going to the White House will miraculously make everything better, but this is my opportunity to voice that."
This is Trump's second clash with professional athletes this weekend. On Friday night, he told a campaign rally crowd that NFL players like Kaepernick, who has knelt during the national anthem to protest police brutality and racial injustice, should be fired. "Wouldn't you love to see one of these NFL owners, when somebody disrespects our flag, to say, 'Get that son of a bitch off the field right now?" Trump said. Bonnie Kristian
As-yet unidentified tremors were detected in North Korea early Saturday near the site of previous nuclear weapons tests. While China labeled the 3.4-magnitude quake a "suspected explosion" that could be Pyongyang's second nuclear test in a matter of weeks, an official from South Korea's meteorological agency said initial assessments indicate it was more likely a natural earthquake. North Korea has not commented either way.
On Friday, North Korea's foreign minister, Ri Yong Ho, said his government might test a hydrogen bomb over the Pacific Ocean. "This could probably mean the strongest hydrogen bomb test over the Pacific Ocean," Ri announced. "Regarding which measures to take, I don't really know since it is what Kim Jong Un does."
President Trump issued a profane call to NFL team owners to fire players who engage in peaceful political protest on the field while speaking Friday night at an Alabama rally for Sen. Luther Strange (R). "Wouldn't you love to see one of these NFL owners, when somebody disrespects our flag, to say, 'Get that son of a bitch off the field right now?'" Trump asked his audience. "Out. He's fired. He's fired." The rally crowd responded with cheers.
"You know what's hurting the game?" the president continued. "When people like yourselves turn on television and you see those people taking the knee when they're playing our great national anthem." Trump encouraged his supporters to walk out of the stadium in counter-protest should they ever observe an NFL player's protest in person.
Trump was referring to football players like Colin Kaepernick, formerly of the San Francisco 49ers, who has silently declined to stand for the national anthem to protest police brutality and racial injustice in America.
Trump's comments were widely decried, including by other NFL players, with many noting his words for Kaepernick were harsher than his responses to the white nationalist violence in Charlottesville, Virginia. The NFL Players Association issued a statement Saturday vowing to "never back down when it comes to protecting the constitutional rights of our players as citizens as well as their safety."
Watch an excerpt of Trump's comments below, or see the entire speech here. Bonnie Kristian
Trump: NFL owners should tell players who kneel to "get that son of a bitch off the field right now." pic.twitter.com/eUYtJgNixK
— Philip Lewis (@Phil_Lewis_) September 23, 2017
Editor's note: This article originally incorrectly identified Kaepernick's former team. It has since been corrected. We regret the error.