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Why does /badeconomics hate Bernie Sanders? (self.badeconomics)

jlew24asu が 投稿

He seems to be gaining in the polls and Hilary is tanking. The rest of reddit seems to love him. what is wrong with his potential economic policies? what would a Bernie Sanders economy look like?

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[–]PonderayFollows an AR(1) process 27ポイント28ポイント  (37子コメント)

  1. A 15 dollar minimum wage is probably too high. It's hard to say at what point a minimum wage becomes harmful but the majority of economists tend to think that $15 is too high.

  2. He tends to be anti trade. Economists tend to like trade because when countries specialize it results in more output.

  3. He's anti immigration. More immigration can both improve the livelihoods of individual immigrants as well increase world gdp. This sub tends to be particularly pro immigration too.

Also this should be posted in the sticky. See RIV on the sidebar.

[–]gorbachevI am the representative shill, AMA. 15ポイント16ポイント  (5子コメント)

Bonus: We also don't like corporate income taxes. Bernie likes them more than average.

[–]wumbotarianI want to be the Walrasian Auctioneer when I grow up 2ポイント3ポイント  (0子コメント)

I don't know tax economics. Though I don't like taxes. Anyway what's a corporate income tax, why isn't optimal?

[–]urnbabyurnNeoPanglossian 2ポイント3ポイント  (3子コメント)

A compromise is possible, whereby effective rates are increased while statutory rates are lowered.

[–]gorbachevI am the representative shill, AMA. 5ポイント6ポイント  (2子コメント)

I mean, whatever may be politically feasible, that really hasn't got any bearing on what policy is optimal.

[–]_Rory_T.K. Whitaker's Ghost 0ポイント1ポイント  (1子コメント)

When talking about "we hate corporate taxes/taxes on capital" is that referring to capital gains, or corporation tax (on profits?)

[–]WeaselsWithEasels 0ポイント1ポイント  (0子コメント)

Under the typical models of taxes and investment behavior (eg, Jorgenson and Hall 1967 or similar), you want something like this:

Corporate income taxes can be okay provided that they allow the full, immediate deduction of capital outlays. Otherwise they suck, big time.

In practice, corporate taxes don't do this in most countries, but they could - and they would - if this were changed. Marco Rubio is one of the presidential candidates proposing this fix in the U.S., though there's no guarantee that goes anywhere.

The brilliance of structuring corporate income taxes this way is that the tax only falls on what people sometimes call "supernormal" returns and rents. There are lots of ways this can go wrong in practice - base erosion, defining the base wrong, etc - but it's super-awesome in theory.

Taxes on capital income at the individual level can also be done, but they should be done in the style that a lot of "savings account" provisions do it - that is, tax both the principle and the returns at ordinary rates only once, when they are withdrawn. (Similar to the U.S. 401k.)

[–]cosimothecatBasel III for the Iron Bank 5ポイント6ポイント  (9子コメント)

As someone who's personal politics (on economics matters and social matters) tend to straddle the two parties, Bernie Sanders is really the crystalization of all the badeconomics from both parties.

[–]jlew24asu[S] 1ポイント2ポイント  (8子コメント)

just curious, who do you support for president?

[–]cosimothecatBasel III for the Iron Bank 4ポイント5ポイント  (7子コメント)

I don't know. I can see myself voting for either Clinton or Bush (.... odd saying that...) - both have policies I like and both have polices I detest. But fundamentally, I think they are centralist candidates, which I think is good for the country.

I do know who I will not vote for. That's easier. I will not vote for Donald. I will not vote for Bernie. So I guess if it's Trump vs Clinton, there's no doubt I'll vote for Clinton. Likewise, if it's Bernie vs Bush (or even Cruz), I'll vote republican.

[–]jlew24asu[S] 0ポイント1ポイント  (6子コメント)

you would take Cruz over Bernie? oh man, say it aint so. really sucks that we are talking about Clinton vs Bush yet again. I think this is why trump is leading. people are sick of political dynasties.

[–]cosimothecatBasel III for the Iron Bank 6ポイント7ポイント  (5子コメント)

you would take Cruz over Bernie

Them are the breaks. I find Cruz' stance on social issues to be horrible. I find Bernie's stance on economic issues also to be horrible. But if I have to choose between setting social progressiveness back or setting economic growth back, I'll choose the former. If anything, the former can be fixed much much more easily than the latter;

I fully appreciate that this is entirely a result of my own utility function. I'm fully aware that I make such a choice because the social issues only affect me in abstraction while the economic issues affect me in a very real sense. And that others will feel the opposite. And that's great.

[–]jlew24asu[S] -1ポイント0ポイント  (2子コメント)

I hear ya. I almost feel the opposite. I feel going backwards on social issues hurts in many ways, including economically, over the long run. Clowns like cruz would bring us back to 1950s and require morning bible sessions for every america or risk jail time. of course thats exaggerating, but that seems to be the mindset. makes my skin crawl.

[–]cosimothecatBasel III for the Iron Bank 2ポイント3ポイント  (1子コメント)

Clowns like cruz would bring us back to 1950s and require morning bible sessions for every america or risk jail time.

I don't think that's possible. The president is not a dictator. To stop social progressiveness is one thing, but to revert would require more than just the president. It would require the full support of the legislature and probably a very sympathic judicary. Not to mention the states. Not likely to happen. While Obama has helped, I think the move to gay marriage and pot legalization is much much broader than the presidential agenda.

On the other hand, to implement hamfisted economic policies and fudge up trade relationships is a lot more easy for a President as a chief executor.

So in short, to sum up my view: it's much easier to fudge up the economy as the president than to plunge us back to the 50s. So that's my preference for voting for someone I agree with economically than socially.

[–]jlew24asu[S] 0ポイント1ポイント  (0子コメント)

The president is not a dictator.

no, but he can hand down executive orders.

To stop social progressiveness is one thing, but to revert would require more than just the president. It would require the full support of the legislature and probably a very sympathic judicary.

republicans already have the power in congress. and cruz can appoint some new far right judges while he is pres.

While Obama has helped, I think the move to gay marriage and pot legalization is much much broader than the presidential agenda.

not when president and republican congress are in power. Chris Christie already said he was stop pot use in Colorado if elected.

On the other hand, to implement hamfisted economic policies and fudge up trade relationships is a lot more easy for a President as a chief executor.

sure, I agree. but it would be interesting to see just what exactly Bernie would do. Advisors, congress, lobbists, will all have a say before something really drastic becomes law.

[–]Logseman -1ポイント0ポイント  (1子コメント)

The economic cycle is a cycle, it ebbs and flows. Anti-social legislation which discriminates against people, reduces welfare, etc. Is much longer lasting.

[–]cosimothecatBasel III for the Iron Bank 2ポイント3ポイント  (0子コメント)

That's ridiculous. The economic cycle is a cycle. Anti-social legislation which discriminates against people, reduces welfare, etc. Is much longer lasting.

Hang on - are you arguing that the president cannot affect the long run economy but only the cylical components? Because that's nonsense.

Further, how does one account for the welfare loss due to a ban on gay marriages (let's pick an example)? And is that really worse than, say, a $15 federal min wage? And while we can be uncertain about the exact cost of both, it's certain that the effects of both are very long run.

"That's ridiculous" is ridiculous.

[–]besttrousers"Then again, I have pegged you for a Neoclassical/Austrian." 1ポイント2ポイント  (8子コメント)

He's anti immigration.

Is this actually true?

I mean, I know Sanders is against open borders, but so is Michael Clemens (not to mention every other candidate). My understanding is that he has a good voting record on this issue.

[–]strayadvice 12ポイント13ポイント  (2子コメント)

He thinks H1-B expansion is a corporate ploy to attract cheap labor and cites wage stagnation as an indication that demand for labor isn't going up.

[–]errordrivenlearning 0ポイント1ポイント  (1子コメント)

Honest question - can you provide me with some good citations that argue/prove that h1bs aren't a ploy for cheap labor and the stagnant wages aren't a sign of low demand for labor?

[–]wumbotarianI want to be the Walrasian Auctioneer when I grow up 0ポイント1ポイント  (4子コメント)

So open borders will obviously drastically increase immigration, however, I don't see how limited immigration will change immigrants coming in and working for "2 or 3 dollars an hour" as Bernie states.

If he was principled (I don't think he is), then any low-skill immigration whatsoever is a race to the bottom as they are willing to take lower than federal minimum wage.

[–]besttrousers"Then again, I have pegged you for a Neoclassical/Austrian." 0ポイント1ポイント  (3子コメント)

Do you have sources for this?

Here's the (old) on the issues: http://www.ontheissues.org/International/Bernie_Sanders_Immigration.htm

Voting record seems generally pro-immigration.

[–]wumbotarianI want to be the Walrasian Auctioneer when I grow up 0ポイント1ポイント  (1子コメント)

If he is pro-immigrantion why was he so anti open borders?

He could've said "open borders are a bit extreme but drastically increasing immigration is a good way to make everyone, including the poor, better off."

Instead he went full left-communitarian and pulled the "race to the bottom" card.

[–]besttrousers"Then again, I have pegged you for a Neoclassical/Austrian." 1ポイント2ポイント  (0子コメント)

If he is pro-immigrantion why was he so anti open borders?

Because those aren't necessarily incompatible?

Has anyone else come out for open borders?

[–]thedrunkennoob 0ポイント1ポイント  (0子コメント)

I've seen Bernie described as Pro Immigrant but anti immigration.

[–]Lambchops_Legion 0ポイント1ポイント  (0子コメント)

He's anti immigration. More immigration can both improve the livelihoods of individual immigrants as well increase world gdp. This sub tends to be particularly pro immigration too.

To add onto this, it appears that Immigration helps stabilize local labor demand shocks.

[–]jlew24asu[S] 2ポイント3ポイント  (4子コメント)

He tends to be anti trade.

can you expand on that? what exactly is "anti trade" and where/how have you seem him support that.

downvoted? really? are questions and discussion not allowed?

[–]NicCageKillerBees 8ポイント9ポイント  (3子コメント)

He's been very vocal against the TTP and TTIP, and is pretty critical of NAFTA. His rhetoric in talking about these things seems to imply that he thinks trade is bad and costs the US jobs.

[–]jlew24asu[S] 2ポイント3ポイント  (0子コメント)

interesting, I didnt know that. I wonder if he has some flexibility there.

[–]venuswasaflytrap -1ポイント0ポイント  (5子コメント)

A 15 dollar minimum wage is probably too high. It's hard to say at what point a minimum wage becomes harmful but the majority of economists tend to think that $15 is too high.

Is there something that backs this up? I've seen a lot of people on here say that this is so, and intuitively it makes sense to me, but I've never seen anything that explicitly indicates that the majority of economists agree with this.

[–]urnbabyurnNeoPanglossian 6ポイント7ポイント  (2子コメント)

IGM had economists split over the $9 minimum wage, which makes me think there is less of a split towards being against for $15

http://www.igmchicago.org/igm-economic-experts-panel/poll-results?SurveyID=SV_br0IEq5a9E77NMV

[–]venuswasaflytrap -1ポイント0ポイント  (1子コメント)

Yeah I've seen that. My laymen's intuition leads me to agree that is the case, but I also could see how they might be equally split on a $15 min wage.

Mostly I'm getting a lot of min wage posts on my facebook - Both US and Canada, which generally have comments amounting to "If we pay people more money then everyone will be richer!" - which seems to me to be kinda shallow reasoning on a complex issue.

It would be nice to have some sort of accessible, easily digestible source that shows that minimum wage isn't a yes-no sort of thing, and that it's possible that raising it (or lowering it) could easily be good or bad for lots of interests.

[–]urnbabyurnNeoPanglossian 3ポイント4ポイント  (0子コメント)

Economists are usually smart enough not to give a boiled down yes or no answer. Extrapolating from existing natural experiments is unlikely to be fruitful, and in places where $15 has just been passed, its way too early to get any data. Not to mention that those locations have already had a higher cost of living and average wage.

We need to convince a random midwestern state to pass it as an experiment. Let Ohio do it, wait a couple years and go from there.

[–]complexsystemsMWG is my homeboy 3ポイント4ポイント  (1子コメント)

The issue is that an effective doubling of the minimum wage just has never happened recently, and most of modern studies can only see the relatively minor changes that happen. Even if we assume that there is some positive value that we can increase wages and not see negative employment effects (imperfect substitution between labor and capital inputs, monopsony arguments, etc), I think it might be safe to assume that as that value gets larger, the chance of hitting a negatively impactful area of firms' response is fair a fair assessment. i.e. most cases that say there is a non-harmful effect of raising the minimum wage, or even beneficial effect, still say that if you raise it too much you can see negative employment effects.

[–]venuswasaflytrap 0ポイント1ポイント  (0子コメント)

Yeah, I understand that there wouldn't be a case study that accurately reflects the situation, and the reasoning for why a dramatic change would likely be dangerous.

I was more wondering if there was something like an IGM panel survey that showed various economic opinions on the matter.

[–]irondeepbicycleI got 99 problems but technological unemployment ain't one 9ポイント10ポイント  (1子コメント)

Bernie is probably not much worse than most other candidates but at /be we mainly post badeconomics that we find on reddit, and Bernie's fanboys can get pretty bad. If this site were full of Hillary supporters we'd probably be just as harsh.

That said, Bernie is well known for a few positions that are certainly bad economics, such as opposition to trade, support for a 15 min wage, and opposition to increased immigration. Personally I think the only real difference between Bernie and everyone else is that Bernie is beholden to a different set of special interests than everyone else.

[–]wumbotarianI want to be the Walrasian Auctioneer when I grow up 0ポイント1ポイント  (0子コメント)

Ron Paul had Paulbots, Bernie has...Berniebots?

They're basically the same.

[–]Aransentin 5ポイント6ポイント  (3子コメント)

/u/HealthcareEconomist3 wrote a long effortpost about Sanders here.

He's also a proponent of a fringe economical theory - MMT - which was discussed here.

[–]wumbotarianI want to be the Walrasian Auctioneer when I grow up 0ポイント1ポイント  (1子コメント)

He actually isn't an MMT supporter. MMTers just tend to be very left-wing and fit into Sanders political views very well.

[–]usrname42There is no God but Keynes, and Krugman is his prophet 1ポイント2ポイント  (0子コメント)

He chose Stephanie Kelton as his chief economist.

[–]laboreconomist3Camp Counselor for a Gulag 0ポイント1ポイント  (0子コメント)

lol at the attempt to debunk MMT with a link from Mises.org.

[–]urnbabyurnNeoPanglossian 16ポイント17ポイント  (12子コメント)

I like Bernie. Doesn't mean I need to ignore the bad economics of his campaign.

His views on immigration and jobs is antiquated at best. It's what the old unions pushed during each wave of new immigration, Chinese, Irish, etc. It's a position not even held by new labor such as the SEIU, and other major progressive unions.

Bernie makes the grossly incorrect claim that immigration is causing or will cause the depression of wages for the working class. This is simply not true. As every new wave of immigrants comes in, they also bring new businesses and boost demand. They do have some impact for wages of low paid, unskilled native workers. But given the benefits broadly, and the humanity of allowing immigrants come here to build a better life, it certainly should be and largely is a liberal position to have more generous immigration.

If Bernie is so concerned about the low paid, unskilled and rather small group of native workers, he should be promoting ways to give them skills or assistance in other ways.

I'm not against raising the minimum wage. I also don't think it's highly effective one way or the other. And a $15 minimum wage is, in my opinion, just his way of staking a position to pull it up by a more reasonable amount, say to 10 to 11.

I really wish he pushed for more market based welfare alternatives, like a more generous NIT. I'm all for a public jobs program to tighten the labor market. I'm all for public higher education funding increases. I generally like Bernie, despite being more centrist than his positions.

Well, that's until it's crunch time and I vote for Clinton.

[–]besttrousers"Then again, I have pegged you for a Neoclassical/Austrian." 15ポイント16ポイント  (10子コメント)

/sign

The immigration stuff is a HUGE deal. This is the biggest low-hanging policy fruit right now.

I'll also note that Sanders probably has the best environmental policies (since he's pushed for a carbon tax).

[–]urnbabyurnNeoPanglossian 8ポイント9ポイント  (8子コメント)

carbon tax

Wow, that's a conservative policy. 1980 Ted Kennedy would never support allowing "companies to buy the right to pollute". Mark based solutions are now liberal in this country :)

[–]besttrousers"Then again, I have pegged you for a Neoclassical/Austrian." 5ポイント6ポイント  (2子コメント)

Economists have done a good job of capturing Democratic elites. Unfortunately, we lost Republican elites in the process....

[–]IntegraldsI am the rep agent AMA 5ポイント6ポイント  (0子コメント)

Republican economic policy is an answer in search of a problem. Compare 1975 to 2015:

  • 90% MTRs? Gone!
  • Flexible exchange rates? Implemented!
  • Unions? Busted!
  • Airlines? Deregulated!
  • Poverty reform? They got Clinton on board!
  • Free trade? CAFTA, NAFTA, KORUS, all passed!
  • Stabilization policy? Fiscal policy is relegated to the playpen while the Fed makes the real decisions.
  • Central banks? Inflation targeters that peek at unemployment occasionally, as God Friedman intended.

Before the ACA was passed, the Republicans had basically gotten everything they wanted on the economic policy front. There just wasn't much left to do.

Nowadays the big tinkering is on health/education/poverty/welfare, which (I think?) naturally draws more Democratic-leaning economists.

[–]urnbabyurnNeoPanglossian 1ポイント2ポイント  (0子コメント)

Thanks, Clinton...

[–]0729370220937022 2ポイント3ポイント  (4子コメント)

The Conservative party of Canada is against a carbon tax because they are against taxes in general. I don't know much about US politics but I assume it's the same over there.

[–]urnbabyurnNeoPanglossian 5ポイント6ポイント  (2子コメント)

The carbon tax was sold as a way to offset income taxes. It had support among conservatives through most of the 90s in the U.S. and now is vehemently opposed. For some reason, they think taxing carbon is more economically disruptive than taking labor and capital.

I wonder if the Canadian conservatives had a similar change of heart in the 90s as they did in the U.S.

[–]0729370220937022 0ポイント1ポイント  (0子コメント)

I looked it up and the conservatives actually supported a cap-and-trade program up until 2008.

[–]NewmanTheScofflawRA for Ethan Hunt 0ポイント1ポイント  (0子コメント)

I'm pretty sure they did, since the Canadian Conservative party supports cap and trade. They want carbon tax to be revenue neutral.

[–]Beatsters 0ポイント1ポイント  (0子コメント)

They're against it because it was a central plank in the Liberal platform in 2008. They want it to be perceived as a bad Liberal idea.

[–]irondeepbicycleI got 99 problems but technological unemployment ain't one 0ポイント1ポイント  (0子コメント)

Or O'Malley. He has a long record as a green governor. I've seen him support cap and trade, which is at least adequate.

And I probably should reconsider Sanders and O'Malley. I was really disappointed in Hillary's environmental plan.

[–]wumbotarianI want to be the Walrasian Auctioneer when I grow up 1ポイント2ポイント  (0子コメント)

I don't see how you "like" Bernie. Anyone who hasn't updated his beliefs in the face of overwhelming evidence in like 50 years is someone I cannot like, will not like and no one should respect him for being so stubborn.

[–]geerussell 1ポイント2ポイント  (0子コメント)

Why does /badeconomics hate Bernie Sanders?

Most of it seems to center around Sanders support for policies that favor maintaining or increasing wage share. Ranging from things like unionization and raising the minimum wage over a period of years to prioritizing wage effects when considering trade and immigration.

what would a Bernie Sanders economy look like?

A hellscape of shirking and productivity collapse with output and innovation slowly grinding to a halt in a death rattle of bread and circuses as workers strip the carcass of a once-proud market economy for their own craven low-MPL benefit. Obvs.

[–]1994bmw 0ポイント1ポイント  (0子コメント)

Going to go out on a limb here and say it's his being bad at economics.

[–]Fearltself -2ポイント-1ポイント  (0子コメント)

He's a (self admitted) socialist. Socialists lack a deep understanding of economics, and therefore propose ludicrous policies that will achieve the opposite of their intending effect.

The reason reddit loves him so much is because he promises "free" things like education and healthcare which appeals to young people. People like "free" stuff.