An Actually Progressive Budget

Who knew that progressives actually have a voice? I didn't. The Congressional Progressive Caucus released a budget that I think does everything progressives ever wanted. It raises taxes on the rich, on capital gains, on corporations, and on estates. It cuts military spending and provides infrastructure spending and a public option. And somehow it reduces the deficit more than the Ryan plan. While I am sure most of the policies will never be adopted, its nice to know that somewhere progressives are gathering to voice their opinions in Congress.

Also rather late, for critiques of the Ryan plan: the nerdy technical one by Macroeconomic Advisors and a more English version by Bruce Bartlett.

A Foreclosure Fee For Banks

This may be old news, but California Assembly member Bob Blumenfield introduced legislation that imposes a $20,000 fee on banks when they foreclose on a home. The logic is pretty simple. First, many of the costs of foreclosures are “paid for” by community members and local governments. For local governments, empty foreclosed homes require additional police. Neighbors eventually must pay for this additional service, but they also pay in the form of reduced home prices. Banks are not taking account of these costs when they are foreclosing homes. The $20,000 fee forces banks to account for the true cost of their actions, both to themselves and to the community. This reduces the incentive to foreclose, which increases the incentive for banks to negotiate with homeowners. I don't know if the measure will pass, but I like the logic. 

Here, Mike Konzcal of the Roosevelt Institute outlines the reasons why this additional fee would likely not be passed on to homeowners.  

Krugman Profile

Krugman has always been an interesting figure for me. In economics classes, he is a Nobel Laureate who revolutionized international trade economics. He wrote my international monetary economics textbook. At the same time, he is a contentious political columnist who most conservatives no longer take seriously. So I was interested to read about his dual personality in New York Magazine’s recent profile of him. Some great quotes in there, including: 

"On the right, there’s something of a cultural underlay to the worldview: We are the real Americans, and they are not. Liberals want to say, We are correct on the evidence, and they are not.”

and  

"Part of the basic loneliness of economic study is that you are always looking back, at data sets that are already completed. And so you realize your vision of a perfect society just as it disappears from view."