Daily Digest - January 7: New Fed Chair, Same Economic Challenges

Jan 7, 2014Rachel Goldfarb

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This is the Biggest Challenge Janet Yellen Will Face as Fed Chair (WaPo)

Neil Irwin considers an op-ed by Larry Summers, which argues that without fiscal policy changes from Congress, the Fed's policies have side effects that encourage bubbles. Yellen's dilemma is whether those bubbles are worse than slow or stalled economic growth.

Just a Reminder: The US Still has Ludicrously High Long-Term Unemployment (Quartz)

Tim Fernholz demonstrates just how unusual current long-term unemployment rates are with a chart covering 65 years of data. Eliminating emergency unemployment benefits, the federal program that expired last week, won't magically create jobs for these workers.

In Jobless Youth, U.S. Is Said to Pay High Price (NYT)

Shaila Dewan looks at a new report from the Young Invincibles, which estimates that state and federal governments could recoup nearly $9 billion through increased taxes and reduced social services if youth unemployment returned to prerecession levels.

Wisconsin Lawmaker Wants To Take Away Workers’ Weekends (ThinkProgress)

Bryce Covert looks at Wisconsin state Senator Glenn Grothman's proposal to allow workers to give up their right to one day off work out of seven. Grothman seems to think there are more workers who want to work seven-day weeks than there are employers who would force it.

GOP Declares War on ‘War on Poverty’ (MSNBC)

Morgan Whitaker reports that Senator Marco Rubio (R-FL) has declared the "big government" approach to fighting poverty a failure, but he doesn't suggest any new options for solving the problem. Repealing the Affordable Care Act is the most solid suggestion he has right now.

New on Next New Deal

Do Economists Understand How Power Shapes the Labor Market?

Roosevelt Institute Senior Fellow and Rediscovering Government Director Jeff Madrick praises Paul Krugman for recognizing that employers hold far more power than workers in the current labor market. This power suppresses wages, which Jeff connects to the need for a minimum wage hike.

The Bernard L. Schwartz Rediscovering Government Initiative: Building on the Successes of 2013 in the New Year

Jeff also wrote a retrospective on the Rediscovering Government Initiative's accomplishments in 2013. Highlights include the Jobs Emergency conference held in D.C. in June and a panel tackling youth unemployment in New Orleans in August.

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