2021年4月30日 星期五

The Daily: The First 100 Days

What we heard during the Biden administration's first sprint in office. Plus, a dispatch from Odessa, Texas.

By Lauren Jackson and Desiree Ibekwe

Hi everyone, Happy Friday. This week, our team has been listening to this artist, this album and this live performance. We're also thinking about Martin Scorsese's recent Tik Tok appearance and the news that computers are getting much, much better at writing (see how one finished an old, incomplete masterpiece here).

Today, we're looking back at President Biden's first 100 days and wrapping up our series on one Texas high school's reopening.

The Biden administration at 100 days

Although President Biden has pushed a liberal agenda in his first 100 days, he has pushed back on popular proposals to cancel student debt and adopt the entirety of the Green New Deal.Doug Mills/The New York Times

This week, Joe Biden reached his first 100 days as president. Our episodes have closely tracked this formative period — from the initial flurry of executive orders that sought to undo former President Donald Trump's legislative legacy to the debates surrounding the new administration's big spending plans.

In honor of this milestone, we have asked The Daily's resident political expert Rachel Quester (you can read her producer profile here) to share the most significant takeaways from the administration's first few months.

How Joe Biden is trying to get things done: Before the 2020 campaign, Joe Biden spent his career developing a reputation as a bridge builder who could work across the aisle. When he ran for president, we heard a similar message — that he was the one to cut deals and get legislation passed. Considering the political climate we're in, a question I had going into his presidency was: Whom exactly would he be cutting deals with? Would he work with Republicans like he'd done as a senator? Or would his version of bridge building in this era mean bringing together different factions in his own party?

I think his first 100 days in office have begun to answer that question. The Biden presidency has thus far been about keeping the Democratic coalition together in an era where bipartisanship seems unattainable. One of the most interesting things throughout these first few months has been watching the calculations that Mr. Biden has made in order to try and follow through on his pledge to get things done in Washington.

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The power of a single senator: So much of Washington, and the policies that will determine the direction of the country, hinge on Senator Joe Manchin of West Virginia. American politics is usually dominated by tribalism and a competition to be the loudest voice in the room. It's interesting how, in these first 100 days, it is a single voice that seems to have reverberated the loudest, particularly when it comes to getting rid of the filibuster and the contents of the stimulus package. I'm interested to see how President Biden will respond to this in the next 100 days, all while trying to get his massive infrastructure bills passed in Congress, address racial injustice, respond to a migration crisis at the southern border and convince the country of his version of government.

Convincing other countries that they can trust the United States: American politics can often be a pendulum every four to eight years — and the past few swings have been especially sharp. When Donald Trump became president, his agenda focused on undoing the Obama legacy. And when President Biden got into the White House, he immediately began undoing the undoing, reversing the Trump policies that had reversed the Obama policies.

The challenge for Mr. Biden after a particularly turbulent period for American foreign policy is to convince foreign leaders that they can trust the United States to maintain long-term commitments — something foreign leaders appeared to question at Mr. Biden's recent climate summit. (You can hear more about that in Tuesday's episode.) In the meantime, the administration will also need to think proactively about how to manage the public health needs of the American public while also competing in the new soft power arena of vaccine diplomacy.

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A public health crisis becomes a mental health crisis

Joanna Lopez, 18, a senior at Odessa High School.Tamir Kalifa for The New York Times

Today, we released the finale of Odessa, our four-part audio documentary series about one Texas high school's reopening. You can listen to the full story now, and read this article by our producer, Annie Brown, about her experience working on the show. Here's how Annie described the way the team's reporting changed over time.

Early in the process, we figured the story would be about a school district navigating the trade-offs between the health crisis and the education crisis. We braced ourselves to cover outbreaks in classrooms — to document teachers getting sick or students losing family members to the virus. Fortunately, none of our sources experienced that kind of loss firsthand. And as was the case in many schools across the country, the coronavirus outbreaks never occurred. Instead, a new crisis emerged: a crisis of mental health. — Annie Brown

On The Daily this week

Monday: How Russia is using its vaccine, Sputnik V, as a tool for international diplomacy.

Tuesday: America's credibility when it comes to climate policy is shot on the global stage. Can Joe Biden win it back?

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Wednesday: India is experiencing the worst coronavirus outbreak in the world. We speak to Jeffrey Gettleman from New Delhi.

Thursday: What we learned from Joe Biden's first address to a joint session of Congress.

What to listen to this weekend

That's it for The Daily newsletter. See you next week.

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Wonking Out: Why doesn’t cutting taxes on the wealthy work?

Maybe because it's a giveaway, not an incentive.
Author Headshot

By Paul Krugman

Opinion Columnist

Today's column was mainly about the payoffs to expanded child care, but I also talked a bit about the consistent failure of conservative predictions that say raising taxes on high incomes will lead to economic disaster and introducing tax cuts will lead to nirvana. However, I didn't talk about why tax rates on the rich don't seem to have major economic consequences. So I thought I'd devote today's newsletter to some speculations on that question.

It's not because incentives don't matter. Clearly, they do. France's high taxes haven't led to low employment of prime-age adults, but generous benefits for those who retire early have led to low employment among near-seniors:

The French are a retiring people.OECD

How, then, can we explain the lack of clear responses (other than tax avoidance) to changes in the tax rate on top incomes?

One answer, which I suspect is relevant in the uppermost strata of the income distribution, is that at that level people don't seek more money so they can afford more things, since they're already able to afford far more luxury than anyone can enjoy. Instead, it's about keeping score; that is, their goal is to make as much or more than the people they compare themselves with. And raising taxes on rich people in general doesn't eliminate the race to out-earn one's rivals.

Even to the extent that the rich seek income for what it can buy, however, it's not clear that cutting their taxes will lead to greater effort. Indeed, it could lead to reduced effort, because it becomes easier for them to afford what they want.

Readers who took economics probably realize that I'm talking about income effects as opposed to substitution effects, a distinction that plays a crucial role in understanding how wages affect labor supply.

As most intro econ texts including the best one explain, higher wages have two effects on workers. They have an incentive to work more, because an extra hour gets them more stuff. But they're also more affluent, which lets them consume more — and one of the things they might choose to consume is more leisure, i.e., they might choose to work less.

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Historically, in fact, higher wages have generally led to reduced working hours. Wages have increased enormously over the past century and a half, but the workweek has gotten a lot shorter:

Wages up, hours down.Our World in Data

So if tax cuts for the rich are like a wage hike, they could lead to less rather than more effort.

But wait: the top tax rate is a marginal rate, not an average rate. Individuals making, say, $600,000 a year pay 37 percent on the last dollar they earn, but most of their income is taxed at substantially lower rates — and those rates won't be affected if President Biden succeeds in raising the top rate back to 39.6 percent. So you might think that raising or lowering the top rate is not, in fact, much like changing affluent Americans' wages.

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But here's the thing: most of the earned income accruing to people in the top tax bracket is, in fact, taxed at the top rate. (Capital gains etc. are a different story.) Why? Because the distribution of income at the top is itself very unequal: there are huge disparities even within the economic elite. According to estimates by Thomas Piketty and Emmanuel Saez, almost half the income of the top 1 percent accrues to the top 0.1 percent, a category that begins at around three times as high a threshold.

Now, high incomes closely follow a Pareto distribution, indeed to an eerie extent. Here's a plot of high incomes versus the percentage of taxpayers with incomes above that level, both expressed in natural logs:

A weirdly exact relationship.Piketty and Saez

In such a distribution, the top .05 percent is to the top 0.5 percent what the top 0.1 percent is to the top 1 percent, so what is true of the distribution of income within the 1 percent is also true of the distribution within the roughly 0.5 percent of Americans subject to the top tax rate. This means that, as I said, most of the income accruing to that group is taxed at the top rate. And this in turn means that cutting that top rate is more like an across-the-board wage rise for the elite than you might think — and wage rises don't tend to increase work effort.

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Or to put it a bit differently, while tax cuts for the rich may offer an incentive to work harder, they're also a big giveaway that encourages the elite to work less.

Of course, the fact that tax cuts at the top are a big giveaway is precisely the reason that belief in the immense economic importance of low taxes is such an unkillable zombie. As Upton Sinclair famously said, it's difficult to get a man to understand something when his salary depends on his not understanding it.

Feedback If you're enjoying what you're reading, please consider recommending it to friends. They can sign up here. If you want to share your thoughts on an item in this week's newsletter or on the newsletter in general, please email me at krugman-newsletter@nytimes.com.

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