Mike Konczal

1 month ago | mikekonczal.substack.com | Mike Konczal

Even though I had braced for bad numbers, the sheer scale of the Medicaid cuts in the House-passed Big Beautiful Budget (BBB) bill still stunned me. Cuts this vicious, even as the wealthy and well-off get big tax cuts and the deficit explodes further, appear historically unprecedented. Are they?

1 month ago | mikekonczal.substack.com | Mike Konczal

Subscribe to get all the aughts-era economic blogging memes you know you want. Consider three major Republican tax cuts from this century: (1) the George W. Bush cuts of 2001 and 2003, (2) Trump’s TCJA of 2017, and (3) the 2025 proposed Big Beautiful Bill (BBB) tax cuts working their way through Congress. All three massively increase the deficit by lowering taxes disproportionately for the wealthiest, throwing off any kind of long-term balance of revenues and spending.

2 months ago | mikekonczal.substack.com | Mike Konczal

There was an online back and forth about polling from the Cato Institute that found 80 percent of people agree “America would be better off if more people worked in manufacturing,” but only 25 percent agree “I would be better off if I worked in a factory.”Frank Luntz tweeted it out, Tej Parikh wrote about it at the Financial Times (“Nostalgia for manufacturing will make the US poorer”), as did Oren Cass of American Compass and Scott Winship at AEI at their sites.

2 months ago | mikekonczal.substack.com | Mike Konczal

Were we in a secret labor market recession in 2024? Was the labor market experiencing a ‘private-sector recession’ as the Trump administration took over? No. But as the reality of Trump's disastrous trade war and the growing threat of an actual recession set in, we’ll hear more of this excuse from Trump officials. It’s wrong—and worse, the Trump team's current actions represent the most harmful response possible to any underlying economic slowdown.

2 months ago | mikekonczal.substack.com | Mike Konczal

Summary:As Trump’s tariffs hit the real economy, a reasonable estimate is that unemployment rises by 1 percentage point—possibly 2—meaning a loss of between 1.7 and 3.4 million jobs. The Fed will aim to protect inflation expectations—and there’s already evidence those expectations are starting to shift. The COVID supply shock was a one-time shift in the price level; tariffs at this magnitude could create a one-time shift in the inflation rate. It’s not just the stock market.