Category Archives: Friedman

Department receives Women for UMass Amherst award

Alexis Doyle

Alexis Doyle

Each year Women for UMass Amherst awards campus projects and programs selected by donors to the fund. The Department of Economics has received a $4,000 award from Women for UMass Amherst for the proposal, “Encouraging Women to Major in Economics.”

Fewer than 20 percent of economics majors at UMass Amherst are women, compared to between 30 and 40 percent nationally. In spring 2012 the department began research to identify aspects of our program that may fail to engage undergraduate women. Professor Gerald Friedman and Ph.D. student Alexis Doyle identified decision points where disproportionate numbers of women stop taking economics courses or choose other majors.

The Women for UMass Amherst award allows Friedman and Doyle to further their research with the aim of developing strategies to attract and retain more women for the major.

Friedman: $592 billion first year savings with ‘Medicare for All’

Gerald Friedman

Gerald Friedman

Even with the recent passage of the Patient Protection and Affordable Care Act, health care remains a major political issue, and one that also deeply impacts the U.S. economy. Recent research by Professor Gerald Friedman on the prospect of expanding Medicare to cover all Americans is promising; it shows almost $500 billion in savings in the first year alone, and it would cover the almost 50 million Americans who remain uninsured. Friedman’s research was mentioned by the organization Public Citizen regarding a push by Rep. John Conyers (D-MI) and Sen. Bernie Sanders (I-VT) to make ‘Medicare for All’ a reality. It was also mentioned by Salon‘s Adam Gaffney.

To Mark Medicare Anniversary, Lawmakers and Advocates Rally for Expansion of Program to Include Every American – YubaNet.com
7/31/13

The new study, done by Gerald Friedman, professor of economics at the University of Massachusetts Amherst and released today by Physicians for a National Health Program, shows that upgrading the nation’s Medicare program and expanding it to cover people of all ages would yield more than a half-trillion dollars in efficiency savings in its first year of operation, enough to pay for high-quality, comprehensive health benefits for all residents of the United States at a lower cost to most individuals, families and businesses.

Under the single-payer system envisioned by “The Expanded & Improved Medicare For All Act” (H.R. 676), the U.S. could save $592 billion – $476 billion by eliminating administrative waste associated with the private insurance industry and $116 billion by reducing drug prices – in 2014.

Your doctor copays are too high! – Salon
8/5/13

Yet, the United States already has more health care “consumerism” and cost sharing than other developed countries – and yet we have much higher costs. The truth is that there are safer and better-proven methods of cost control that we could employ, and which wouldn’t involve making a patient pay every time he or she gets sick.

We could, for instance, allow Medicare to directly bargain with drug companies over prescription drug prices, as other wealthy countries already do: by one estimate, the savings from this reform alone could range from $230 to $541 billion over ten years.

More ambitiously, we could work towards a “single payer system,” which could save billions through reduced administrative and clerical expenditures, while allowing costs to be directly controlled through global budgets and fee schedules. Gerald Friedman, an economist at the University of Massachusetts at Amherst, recently estimated the savings of such a system at $592 billion annually.

Friedman: ACA exchanges will be ‘mess’ but not ‘train wreck’

Gerald Friedman

Gerald Friedman

UMass Amherst Economics professor Gerald Friedman was featured in a McClatchy article on the implementation of the Affordable Care Act. Known for his research on health care, Friedman believes that the opening of health insurance exchanges on October 1 will not be a “train wreck,” but it will be “a mess.”

 

Gerald Friedman, a health care economist at the University of Massachusetts Amherst, also was skeptical.

“It’s not going to be a train wreck. It’s going to be a mess,” Friedman said. “I’m sure there’ll be places where you get on the website on Oct. 1 and it’ll crash. . . . I think October is not going to be the White House’s best month.”

Their somber assessments about the enrollment phase of Obamacare reflect concerns echoed in several recent government reports.

Sacramento Bee – 8/13/13

The State (South Carolina) – 8/13/13

Fort Worth Star-Telegram – 8/13/13

Tampa Bay Times – 8/14/13

Sun Herald (Mississippi) 8/13/13

 

 

Friedman: $1 trillion in savings in first year of single payer system

Gerald Friedman

Gerald Friedman

UMass Amherst Department of Economics Professor Gerald Friedman has completed a new study for the Physicians for a National Health Program that concludes upgrading Medicare and expanding it to cover all Americans would create $1 trillion in efficiency savings in its first year of operation, enough to pay for comprehensive health benefits for all U.S. residents and lower costs to most people and businesses. The report was unveiled in Washington, D.C. on the 48th anniversary of Medicare by advocates of a single payer health insurance system (Yubanet.com [Calif.], 7/31/13). Download the study.

Austerity Comes to America

This post by UMass Amherst Department of Economics Professor Gerald Friedman was originally published on May 20, 2013 by the Center for Popular Economics.

Gerald Friedman

Gerald Friedman

Austerity Comes to America
by Gerald Friedman

Economists at the University of Massachusetts and elsewhere have thoroughly discredited research suggesting that cutting government spending will promote economic growth during a time of recession.  Even while scholarship has exposed the fallacy of austerity economics and this news has reached wide audiences through Twitter and the Colbert Report, the United States government is embracing austerity’s policy prescriptions.  While employment has barely kept up with the growth of the labor force and the best measure of the unemployment rate (which accounts for those who have given up on looking for work or who work part time because they can’t find full time employment) remains stuck at 14%, the federal, state and local governments are slashing payrolls and reducing spending in order to meet arbitrary deficit targets. The ghost of bad austerity economics continues to haunt, and even to drive, the living.

In 2007 and 2008, as we entered the Great Recession, economists knew what should be done to prevent another Great Depression.  Drawing on theory developed in the shadow of the Great Depression, Keynesian economists argued that government needed to spend to fill the gap when private spending and investment contracted during an economic crisis.  The work of Milton Friedman, Anna Schwartz, and their students and followers, had persuaded monetary authorities that they needed to act aggressively to provide liquidity to prevent a financial system meltdown.  There was a politics here.  On the left, those who favored a large public sector and a generous social wage seized on the opportunity created by fiscal stimulus to boost public spending while conservatives and their Wall Street allies favored monetary policy because it subsidized banks while avoiding public spending.

These disputes were put aside after the financial market collapse in the Fall of 2008 when both Friedman monetarists and Keynesian fiscalists stared into the abyss.  For a brief moment, economists and policy makers joined in recommending that we walk on both legs and use all the tools available to prevent the Great Recession from becoming a full-fledged Depression.  In striking contrast with the experience of the early 1930s, the Federal Reserve aggressively pushed liquidity into the banking system, and the new Obama Administration pushed an $800 billion stimulus program through Congress.  While the Obama stimulus was much smaller than Keynesian economists recommended, and was further diminished by political bargaining that substituted tax cutting for some needed spending, it did provide funds for infrastructure and for local and state programs threatened by the plunge in state and local revenues that resulted from the recession.  Together with the Federal Reserve’s actions, the Obama stimulus prevented a complete economic collapse.

The stimulus worked well enough that some economists quickly forgot why it was enacted.  Already in 2009, some were denouncing stimulus spending. They defended the Great Recession and its attendant suffering in terms reminiscent of Andrew Mellon’s appreciative analysis of the effects of the Great Depression: “liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate . . . It will purge the rottenness out of the system.”  They quickly won over the Republican Party; hating Obama, Republicans never saw any reason to promote economic recovery on his watch.  And when Obama’s stimulus did not cure all ills, they blamed it for those that remained; post hoc ergo propter hoc.

With Republicans in control of the House of Representatives, in a position to block action in the Senate, and in control of many state governments, it has been impossible to prevent spreading austerity.  Sensible economists, of which there are a few even outside of Amherst, have condemned spending cuts and tax increases as the wrong policy during an economic recession.  But the debate is no longer about economics; those who oppose fiscal stimulus do so from a sense of moral outrage.  Advocates of austerity like the Tea Party Patriots have little rational argument about the economics of government stimulus spending but a strong sense of grievance that others are getting away with something. They assume that the allocations of a free market are just and fail to see the substantial benefits they (and all of us) receive from public spending; they conclude, therefore, that government help must be bad because in giving to those who need help, government is subsidizing the wicked.  While we can show them that their economic analysis is wrong, it will have little effect on those whose real goal is not to help the needy or to comfort the afflicted but to punish the guilty.

Friedman presents at the Physicians for a National Health Plan convention

Gerald Friedman

On October 27, Professor Gerald Friedman spoke to the 25th annual convention of Physicians for a National Health Plan in San Francisco about his plan to finance a universal single-payer health care system as proposed in HR 676: the United States National Health Insurance Act. After taking account of nearly $600 billion in administrative savings under the single-payer system, Friedman proposed funding the program with a combination of payroll taxes, a surtax on high incomes, and a financial transactions tax as proposed by UMass Amherst Economics Professor Robert Pollin. Friedman’s presentation was warmly received by the nearly 500 conference attendees.

Friedman advocates for single-payer healthcare

Gerald Friedman

Gerald Friedman, UMass Amherst economics professor and associate chair of the Department of Economics, consults with groups advocating single-payer health care across the United States. Most recently Friedman met with legislative leadership in Maryland to present his report, “Financing the Maryland Health Security Act.” He also discussed his report on WEAA’s The Marc Steiner Show, WYPR’s Midday with Dan Rodricks, and at the annual meeting of the Maryland Physicians for a National Health Plan.

Legislature considers single-payer healthcare bill

Gerald Friedman

S501, “An Act Establishing Medicare for All in Massachusetts,” was presented at a legislative hearing earlier this month at the State House and supported by state Sen. JamieEldridge (D-Acton) and state Rep. Jason Lewis (D-Winchester), health care advocates, providers, employers, and employee union leaders. UMass Amherst Economics Professor Gerald Friedman noted during the hearing that a single-payer healthcare system would reduce costs, extend coverage and create jobs. (Nashoba Publishing, 12/15/11)

Economist Gerald Friedman, from UMass-Amherst, noted at the hearing that a single-payer system could reduce health care costs by nearly $13 billion a year (or 19 percent ) in Massachusetts. Even after expanding coverage to all Massachusetts residents, this would leave savings of over 17.6 percent of current expenditures. Municipalities in particular would benefit; according to Friedman’s calculations, local governments would save over $350 million a year.

Friedman also noted that, when added to significant administrative savings within companies, a single-payer system would dramatically enhance the competitiveness of Massachusetts companies, adding nearly 100,000 additional jobs to the economy.

Faculty support of Occupy Wall Street movement

UMass Amherst Economics Department faculty continue to participate in events and publish information on the Occupy Wall Street movement. The “Occupy” protests started on Wall Street and have spread internationally. Protests have been held locally in Amherst, Boston and Northampton.

UMass Amherst Economics Professor Arindrajit Dube, who is also a research fellow at the Institute for the Study of Labor (IZA) based in Bonn, discussed the Occupy Wall Street movement with his colleague Marta Murray-Close for the UMass Amherst Department of Economics Echoes alumni newsletter. (Echoes, 12/12/11)

In her Economix blog, Nancy Folbre, UMass Amherst economics professor, says concerns about growing economic inequality that spurred the rise of the Occupy Wall Street movement should be the focus of a wider discussion by economists about capitalism and its effects. (New York Times, 11/28/11)

Gerald Friedman participated in an Occupy Wall Street Teach-In at Smith College. His talk can be viewed here. (11/12/11)

More than 350 economists have added their name in support of the Occupy Wall Street movement. Read their statement and watch a video featuring UMass Amherst Professors James Boyce, Nancy Folbre and Mwangi wa Githinji.

Friedman interviewed on Press TV

Gerald Friedman

Gerald Friedman, a professor of Economics at University of Massachusetts Amherst, says there is “a general rise in popular discontent” in the United States due to the country’s economic downturn. 

Back in 2009 and 2010, Americans saw a revival of the Tea Party, the right wing populism and “now with Wisconsin, with Ohio, with the Occupy movements we may see a revival of the left wing populism,” he told Press TV’s U.S. Desk on Saturday.

He also said that the public in Wisconsin is supporting collective bargaining rights of unions which state officials have been targeting as a method to balance their troubled budgets by cutting jobs and benefits. Watch the interview. (Press TV, 12/12/11)