Tag Archives: gdp

Chart of the Day: Health Care Spending as a Percentage of GDP

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

This is apropos of nothing in particular. I was over at the World Bank site fiddling around with some stuff and happened to look at their chart for health care spending. There’s a good case to be made that as GDP rises, the share devoted to health care also rises. This is because richer countries have more “spare” income and health care is what they spend it on.

But Sweden and Switzerland have per-capita GDPs as high as ours, and they still spend a whole lot less. The sooner we start reining in the growth of health care spending the better.

Read original article:

Chart of the Day: Health Care Spending as a Percentage of GDP

Posted in FF, GE, LG, ONA, Uncategorized, Venta | Tagged , , , , , , , , , | Comments Off on Chart of the Day: Health Care Spending as a Percentage of GDP

GDP Growth Anemic? Blame the Weather!

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

A reader emailed this morning suggesting that GDP growth in the first quarter was low because GDP growth in the first quarter is always low:

Something I’ve long wondered is if the seasonal adjustments BLS is making on these numbers is artificially skewing the 1Q results every year. As you recall 1Q09 was the bottom of the Great Recession, it feels like they are overcorrecting for that phenomenon. When you look at the quarterly progression of every year (minus 2015 it looks like) 1Q sucks and then you get q/q improvement during the year.

I remember having read some criticisms of BEA’s seasonal adjustments, so I got curious. Is Q1 growth routinely lower than later quarters?

NOTE: The original chart I used showed GDP growth compared to the previous year. That’s not what BEA reports. The headline number is annualized growth from the previous quarter. I’ve revised the chart, which significantly revises the text below too.

On average, reported first quarter growth really is considerably lower than it is in the other three quarters. Nor is this an issue of unusually high revisions from the advance print to the final print. For the past seven years, the advance number has been a little higher on average than the final revision.

FWIW, if you look at GDP compared to the previous year (i.e., Q1 of 2017 compared to Q1 of 2016 etc.), average growth rates are about the same in all four quarters. This is probably a better measure.

While we’re on the subject, though, the weather is one of my favorite topics when it comes to making excuses for poor growth. Here is Nelson Schwartz in the New York Times today:

Michelle Meyer, chief United States economist at Bank of America Merrill Lynch, said healthier business investment indicated that the overall economy was performing better than the headline numbers would suggest. “Warm weather meant consumers weren’t spending as much on electricity and natural gas and home heating,” Ms. Meyer said. “Government spending can also be affected by seasonal factors, and defense spending is especially volatile.”

Here is Nelson Schwartz in the New York Times three years ago:

In their initial estimate for growth in the months of January, February and March, government statisticians said output expanded at an annual rate of just 0.1 percent, although experts noted that figure was affected by one-time headwinds like unusually cold weather and slower inventory gains after businesses aggressively built up stockpiles in the second half of 2013.

Too hot, too cold, the weather is never just right, is it?

Original post – 

GDP Growth Anemic? Blame the Weather!

Posted in FF, GE, LG, ONA, Uncategorized, Venta | Tagged , , , , , , , | Comments Off on GDP Growth Anemic? Blame the Weather!

Leverage and Liquidity Are the Keys to a Strong Banking System

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

I’m a big fan of higher capital ratios (i.e., lower leverage) as a way of making the banking system safer, so I was disturbed when Tyler Cowen pointed to a new paper suggesting that high capital ratios don’t reduce the likelihood of financial crises. Instead, a team of researchers suggests that what’s more important is the type of capital. Deposits are the most stable source of funding for any bank, and liquidity is king. Put these together, and what’s important is the loan-to-deposit ratio:

As you can see, the LtD ratio rose steadily in the postwar era, doubling from 50 percent to over 100 percent by 2008. This indicates that credit was expanding, with banks making more loans for every dollar in deposits they took in. This, the authors say, is a better predictor of financial crises than raw leverage:

In this triptych, capital ratios are in the middle, and they don’t change much before and after a financial crisis (denoted by Year 0). However, right before a financial crisis there’s a steady decline in deposits as a percentage of total assets (which indicates a decline in the quality an;d stability of a bank’s capital base) and a steady rise in the loan-to-deposit ratio. These are the indicators that seem to be associated with financial crises.

So is there any point to higher capital standards? Yes indeed: they may not prevent financial crises, but they make recovery from a financial crisis much quicker. Just compare the green line and the red line in the charts below:

Both of these charts show the same thing: in countries with higher capital ratios, recovery from a financial crisis was far faster. Five years out, the difference was a full 13 percentage points of GDP per capita.

If these researchers are right—and I’ll add the usual caveats about this being only one study etc.—then the key to a strong, resilient banking system is twofold: a low loan-to-deposit ratio produces a liquid capital base that helps avoid financial crises, while a low leverage ratio produces the necessary capital to recover quickly if a financial crisis hits anyway.

Leverage and liquidity are key. In one sense, this is nothing new, since anyone could have told you that. But this paper suggests that they’re important for slightly different reasons than we thought.

See original article:  

Leverage and Liquidity Are the Keys to a Strong Banking System

Posted in FF, GE, LG, ONA, Safer, Uncategorized, Venta | Tagged , , , , , , , , | Comments Off on Leverage and Liquidity Are the Keys to a Strong Banking System

Fiscal Conservatives Should Love National Health Care

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

David Frum is a conservative, but he grew up in Canada and lacks an American conservative’s instinctive revulsion toward national health care. Today he writes that maybe American conservatives should put aside their revulsion too. After all, the debacle over the Republican health care plan suggests that the public is unwilling to see health coverage withdrawn from millions of people. Democrats seem to have finally won the battle over ensuring health coverage for all, and that means Republicans can’t control costs by simply denying health care to anyone who can’t afford it. They have to figure out other ways to bring down costs:

Republicans have had too many competing goals in health-care reform. They have wanted to lower costs (to free fiscal room for tax cuts and military spending), but also to avoid tangling with entrenched health-care interests….What that money has bought is a huge and costly health sector….“Patient-centered medicine” sought to transform the user of health-care services as the system’s decisive cost-controller. Confronted with the full cost of medicine, the patient would consume care more prudently—or forgo it altogether.

That hope is listing badly. When and if it finally sinks, Republicans may notice something else. The other advanced countries with universal coverage manage to buy significantly better outcomes at the expense of 11 or 12 percent of GDP instead of America’s 16 percent. That extra increment of GDP could pay for a lot of military spending and a lot of tax cuts. Once politics has eliminated coverage reduction as a means of forcing economy, other possibilities open before a center-right party—and indeed have opened for center-right parties across the rest of the English-speaking world. Perversely, the effort to keep government out of health care has empowered health care to consume more and more government dollars. Where government has been deployed more effectively than in the United States, health care has consumed less.

I dissent in part and agree in part. For starters, it’s true that the United States has by far the biggest health care bill of any country in the world:

However, our costs are high because we pay more for everything: doctors, nurses, pharmaceuticals, hospital stays, etc. Politically, it’s impossible to adopt a system that would suddenly cut everyone’s pay by a third. If America were to adopt national health care, our per capita costs would almost certainly start out right where they are now: far higher than any other country in the world.

In the long run, however, Frum is right. It’s ironic, but it turns out that central governments are a lot better at keeping a lid on health care costs than the private sector. The reason is taxes. National health care is paid for out of tax revenue, and the public pressure to keep taxes low is so strong that it universally translates into strong government pressure to keep health care costs low. By contrast, the private sector is so splintered that no corporation has the leverage to demand significantly lower costs. Besides, if health care costs go up, corporations can make up for it by keeping cash salaries low. This is part of the reason that median incomes have grown so slowly over the past 15 years. Corporations simply don’t care enough about high health care costs to really do anything about it.

Over the course of a few decades, then, our costs would probably converge on the rest of the world if we adopted universal health care. Contra Frum, this wouldn’t open any headroom for lower taxes or higher military spending—government spending would still go up even if overall health care spending slowed down—but it would make the country a better, safer, more efficient place. What’s not to like?

See original article:

Fiscal Conservatives Should Love National Health Care

Posted in Everyone, FF, GE, LG, ONA, Safer, Uncategorized, Venta | Tagged , , , , , , , | Comments Off on Fiscal Conservatives Should Love National Health Care

18 Great Trends of the Obama Administration—And 2 Terrible Ones

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

So how has the country been doing during President Obama’s term in office? Here’s a scattering of indicators and how they’ve changed from 2008 (the last year of the Bush presidency) to now:

  1. Unemployment rate (U3): DOWN from 5.8 percent to 4.7 percent.
  2. Underemployment rate (U6): DOWN from 10.6 percent to 9.6 percent.
  3. Violent crime rate (per 100,000 residents): DOWN from 459 to 366.
  4. Fear of crime: DOWN from 37 percent to 35 percent.
  5. Uninsured rate: DOWN from 19.7 percent to 10.3 percent.
  6. Number of illegal immigrants: DOWN from 11.8 million to 11.3 million.
  7. Illegal immigrants from Mexico: DOWN from 6.6 million to 5.6 million.
  8. Teen pregnancy rate (per thousand females): DOWN from 40 to 25.
  9. Current account balance (trade deficit): DOWN from 4.6 percent of GDP to 2.3 percent of GDP.
  10. American war deaths: DOWN from 469 to 28.
  11. Inflation rate: DOWN from 3.8 percent to 1.1 percent.
  12. Shootings of police officers: DOWN from 149 to 120.
  13. Abortion rate (per thousand women): DOWN from 19 to 16.9 (through 2011).
  14. Federal deficit: DOWN from 3.1 percent of GDP to 2.5 percent of GDP.
  15. Drug abuse: DOWN from 22.4 million to 21.6 million (through 2013).
  16. Drug abuse among teenagers: DOWN from 7.7 million to 5.2 million (through 2013).
  17. Household debt (as percent of disposable income): DOWN from 12.8 percent to 10 percent.
  18. Public high school graduation rate: UP from 74 percent to 82 percent (through 2013).

I’m not presenting this stuff because I think it will change anyone’s mind. Nor because Obama necessarily deserves credit for all of them. You can decide that for yourself. It’s mostly just to get it on the record. And it’s worth noting that none of this may matter in the face of two other statistics that might be more important than all the rest put together:

  1. Median household income: DOWN from $55,313 to $53,657 (through (2014).
  2. Americans killed in terror attacks: UP from 14 to 50+ (so far in 2016).

If you measure household income more broadly, it looks better than the raw Census figures. And household income has finally started increasing over the past couple of years. On the terror front, the absolute number of American fatalities from terrorist attacks is obviously very small. Still, the number of brutal attacks in the US and Europe (the only ones Americans care about) has obviously spiked considerably over the past year.

Are these two things enough to outweigh everything else? Maybe. Come back in November and I’ll tell you.

Source: 

18 Great Trends of the Obama Administration—And 2 Terrible Ones

Posted in FF, GE, LG, ONA, Uncategorized, Venta | Tagged , , , , , , , | Comments Off on 18 Great Trends of the Obama Administration—And 2 Terrible Ones

Even With a Teleprompter, Donald Trump Is Full of Shit

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

Professor Trump delivered a lecture on the evils of international trade today. Here’s a snippet:

Massive trade deficits subtract directly from our Gross Domestic Product. From 1947 to 2001 — a span of over five decades — our inflation-adjusted gross domestic product grew at a rate of 3.5%. However, since 2002 — the year after we fully opened our markets to Chinese imports — that GDP growth rate has been cut almost in half.

What does this mean for Americans? For every one percent of GDP growth we fail to generate in any given year, we also fail to create over one million jobs. America’s “job creation deficit” due to slower growth since 2002 is well over 20 million jobs — and that’s just about the number of jobs our country needs right now to put America back to work at decent wages.

There are two interesting things about this. First, Trump was reading off a teleprompter, and you can tell. The real Donald Trump would have ranted about the real unemployment rate being 40 percent and 50 million people being out of work or something. Who knows? But the carefully handled Donald Trump produces a well-modulated stream of numbers that actually sounds plausible.

And yet—even with someone else carefully vetting the numbers, they still don’t come close to making sense. Consider: the U6 unemployment rate right now is 9.7 percent. This represents every single human being in the country who wants a job but can’t get one, or who wants a full-time job but can only get part-time work. Even if they’re discouraged and not currently looking for work, they’re counted.

The U6 series only goes back to 1994, but a good guess is that the lowest it’s been in all of postwar history is about 6.5 percent. We’d hit that mark if 5 million more people were working. If you do the calculation based on the current output gap instead of the U6 rate, you come up with roughly the same number.

In other words, 5 million is the absolute max, even in theory. If that many more people had jobs, the economy would be roaring along at a 1960s boom level. So where does 20 million come from? If it were just Trump blathering away, the question wouldn’t be worth asking. But this supposedly came from someone who actually thought about these numbers. And they’re still off by a factor of at least four. I sure hope Trump doesn’t run his business with financial estimates like this.

Original article: 

Even With a Teleprompter, Donald Trump Is Full of Shit

Posted in alo, FF, GE, LG, ONA, Uncategorized, Venta | Tagged , , , , , , , , , , , | Comments Off on Even With a Teleprompter, Donald Trump Is Full of Shit

If U.S. health care were a country, it would rank 13th for emissions

If U.S. health care were a country, it would rank 13th for emissions

By on Jun 14, 2016Share

A visit to the doctor’s office or hospital evokes images of cleanliness: sterile countertops, white walls, and sleek tools. But any given hospital needs to run lights and heat 24/7 and energy-hungry machines. All this winds up making America’s massive healthcare system a big source of the pollution that makes some patients sick.

According to new research from Yale University, if the U.S. healthcare system were a country, it would rank 13th in the world in terms of greenhouse gas emissions. That means it emits more than the entire United Kingdom, contributing to climate change and harming public health. U.S. healthcare is also responsible for 12 percent of acid rain, 10 percent of smog, and 9 percent of respiratory diseases from particulate matter.

And the portion of our emissions generated by the health industry is steadily expanding: The Yale study reported an increase from 7 percent of the United States’ total emissions in 2003 to nearly 10 percent in 2013, over a period when the health care industry grew as a whole. The United States also spends nearly twice the average of what other developed countries spend on health care in terms of GDP.

While doing vital work to make us healthier, the industry could also be doing more to avoid the pollution that makes us sick.

Find this article interesting?

Donate now to support our work.

Get Grist in your inbox

Read the article – 

If U.S. health care were a country, it would rank 13th for emissions

Posted in alo, Anchor, Everyone, FF, GE, LAI, ONA, solar, Uncategorized | Tagged , , , , , , , , , | Comments Off on If U.S. health care were a country, it would rank 13th for emissions

21 countries shrank their carbon pollution while growing their economies

21 countries shrank their carbon pollution while growing their economies

By on 5 Apr 2016commentsShare

There’s some handwringing even among skeptics who accept climate change is real and human-made that rising greenhouse gas emissions is the inevitable product of a growing economy. And for years, that was pretty much the case: The only time a country saw emissions dip was in an economic recession.

But that doesn’t look to be the case any longer, particularly for industrialized nations. A new analysis from the World Resources Institute (WRI), based on data from BP and the World Bank, finds 21 countries have cut greenhouse gas emissions since 2000 but have seen their economy grow all the same. That includes the United States:

World Resources Institute

The WRI analysis lends further support to a trend at the global level of decoupling emissions from economic growth. Last month, the International Energy Agency (IEA) announced that energy-related emissions stayed flat in 2015 for the second year in a row, while global GDP had continued to grow at about 3 percent. In the U.S. alone, there was a 6 percent drop in energy-related carbon emissions and a 4 percent increase in GDP from 2010 to 2012.

It will be hard to deny this decoupling of growth and emissions, but science deniers always find a way.

Please

enable JavaScript

to view the comments.

Find this article interesting?

Donate now to support our work.

Get Grist in your inbox

Link:

21 countries shrank their carbon pollution while growing their economies

Posted in alo, Anchor, FF, G & F, GE, LG, ONA, Radius, Uncategorized | Tagged , , , , , , , , , , | Comments Off on 21 countries shrank their carbon pollution while growing their economies

China’s new 5-year plan is out, and it doesn’t sacrifice the environment for the economy

Harvest in Yili, Xinjiang Autonomous Region. REUTERS/China Daily

China’s new 5-year plan is out, and it doesn’t sacrifice the environment for the economy

By on 18 Mar 2016commentsShare

On Wednesday, Chinese lawmakers approved the country’s 13th Five-Year Plan, the high-level document that will guide policymaking through 2020, including the country’s approach to climate and energy policy. As the world’s second-largest economy and the largest emitter of greenhouse gases, China necessarily plays a role in shaping global climate policy — and if it can deliver on the goals outlined in the plan, that role will undoubtedly expand.

The plan is the first to set a national cap on energy consumption — 5 billion tons of standard coal equivalent for 2020 — as well as offering new visions for energy efficiency and air pollution. A World Resources Institute analysis concluded that this FYP sets China on a path to a 48 percent reduction in carbon intensity levels by 2020, compared to 2005 levels. (Carbon intensity refers to the ratio of CO2 emissions to GDP.) For reference, China’s pledge to the Paris Agreement has the country slashing carbon intensity by 60-65 percent of 2005 levels by 2030.

All told, it’s the “greenest Five-Year Plan that China has ever produced,” said Barbara Finamore, director of NRDC’s Asia program, on a press call.

Click to embiggen.World Resources Institute

There’s a lot more to the FYP than energy policy, but many of the other pieces are complementary when it comes to the climate. New standards on air quality indicators like PM 2.5, for example, will no doubt rein in the country’s rampant coal burning.

But it’s not all about coal, either. While China saw a cut in coal use of around 3 percent in 2015, it increased its oil consumption by 5.6 percent in the same year. “If China is going to peak its CO2 emissions, it cannot just rely on [cutting] coal,” said Finamore. “Transportation emissions and oil consumption are going to be exceedingly important.” And they are: The FYP addresses vehicle emissions and public transportation in cities, in addition to allocating new money to high-speed rail initiatives.

Advertisement – Article continues below

It’s easy to raise questions about China’s ability to follow through on these kinds of ambitious plans in the face of slowing economic growth. The FYP outlines a target GDP growth rate of 6.5 percent through 2020 — speedy by global standards, but a far cry from the 10 percent growth rate of yesteryear.

But that’s not the right way to think about it, said Paul Joffe, senior foreign policy counsel at WRI. “China envisions a ‘new normal’ level of growth,” explained Joffe to press. “At that level, they view the economic and environmental targets as entirely compatible.” In other words, anyone wildly gesticulating at China’s flagging growth rate needs to take a chill pill. Ten percent is simply not sustainable.

Joffe’s description of coinciding economic and environmental goals bucks the conventional economic logic that says “you need to consume more to grow more,” said Kate Gordon, a vice chair at the Paulson Institute. That logic is faltering. Earlier this week, the International Energy Agency released data suggesting energy-related emissions and global GDP growth are decoupling. Indeed, Gordon argues that China’s energy-efficiency savings have in part allowed for that kind of decoupling. As the economy transitions to a larger focus on services — which the FYP has growing from 50.5 to 56 percent of the Chinese economy by 2020 — and a lesser emphasis on industry, the split between GDP growth and emission trends becomes even more apparent.

A reasonably glaring omission in China’s FYP is the lack of an explicit goal for new renewable energy installed, though it’s conceivable that new goals for solar and wind capacity could find their way into the sub-plans that will be released over the coming months. Existing targets include 150GW of new solar capacity and 250GW of wind by 2020. Of course, it’s also not just about capacity, said Gordon. You’ve also got to get that electricity on the grid. In its Paris Agreement pledge, China committed to raising its share of renewables to 20 percent of its energy mix by 2030.

The plan’s ambition gives post-Paris climate-action further momentum, and can only serve to strengthen the recent U.S.-China climate pact. As with all ambitious plans, though, implementation will be key — and the country is outlining some stark transitions. Upwards of 1.8 million workers in the coal and steel industries are expected to lose their jobs due to changes outlined in the FYP, and those workers will need to be retrained and reemployed. Truly delivering on those goals will require an unprecedented degree of foresight and coordination.

Or to put it in Finamore’s own words: “It’s going to be tough.”

Share

Please

enable JavaScript

to view the comments.

Find this article interesting?

Donate now to support our work.

Get Grist in your inbox

More: 

China’s new 5-year plan is out, and it doesn’t sacrifice the environment for the economy

Posted in Anchor, FF, G & F, GE, LAI, LG, ONA, Radius, solar, Uncategorized | Tagged , , , , , , , , , | Comments Off on China’s new 5-year plan is out, and it doesn’t sacrifice the environment for the economy

Here’s how major cities measure up on climate change spending

Here’s how major cities measure up on climate change spending

By on 1 Mar 2016 5:07 pmcommentsShare

This story was originally published by Mother Jones and is reproduced here as part of the Climate Desk collaboration.

The headline negotiations during the Paris climate summit in December were between national governments: What would China, the United States, and other big emitters be willing to do? But just outside the spotlight, some of the most optimistic commitments to curb greenhouse gas emissions, ramp up clean energy, and invest in adaptive measures were being made by cities.

A new analysis from social scientists at University College London sheds some new light on the money behind those municipal efforts — and the results paint a highly uneven picture. The researchers compared spending on climate adaptation in 10 major global cities — that is, investments in infrastructure, public health, water systems, etc., aimed at making them more resistant to climate change. All 10 cities are members of the Compact of Mayors, an initiative that came out of Paris to hold cities to a high standard of climate action.

On average among those 10 cities, spending on climate adaptation accounted for one-fifth of one percent of GDP in 2015, or about $855 million. Not surprisingly, cities in wealthier countries such the U.S. and the U.K. spent far more than cities in African countries and Southeast Asia:

Nature

Cities in developing countries also lag behind on spending on a per-capita basis. (The Paris figure is so high in part because the study counted population just within a city’s official boundaries, not the surrounding metropolitan area, and Paris’ boundaries are relatively small) …

Nature

… and as a share of GDP:

Nature

The findings illustrate that spending on climate adaptation is more a function of wealth, and the value of local real estate, than the size of a city’s population or its relative vulnerability to climate impacts. The researchers conclude that “current adaptation activities are insufficient in major population centres in developing and emerging economies.”

That may not be very surprising — of course New York and London will be better able to rally funds for climate readiness than Addis Ababa. But it’s an important snapshot of the uphill battle developing countries face in confronting climate change.

Share

Please

enable JavaScript

to view the comments.

Find this article interesting?

Donate now to support our work.Climate on the Mind

A Grist Special Series

Get Grist in your inbox

Source: 

Here’s how major cities measure up on climate change spending

Posted in Anchor, FF, GE, LAI, LG, ONA, Radius, solar, Uncategorized | Tagged , , , , , , , , , | Comments Off on Here’s how major cities measure up on climate change spending