Jay Shambaugh

My high school AP US history teacher taught us that John Adams was the most important person in the founding of our democracy because he lost to the opposition party and went home.

You can always learn a great deal about today when reading @trevondlogan.bsky.social write about our history.

The Trump admin backing off the ban of noncompetes is gratuitously bad policy. When I was Director of @hamiltonproject.org we did lots of work highlighting the bad effects on workers, wages, and the economy that comes with limiting workers ability to switch jobs.This will hurt people and the economy

#Manufacturing purchasing managers are severely depressed:

❗️"Tariffs wreak havoc"
❗️"Too much uncertainty"
❗️"Unstable" policy
❗️"Worse than Great Recession"
❗️"Layoffs" 15%
❗️"It's survival"
❗️"Made in USA more difficult due to #tariffs"

The letter is ready, thanks to all those who helped out! Starting to gather signature now, please consider signing (link at top of letter) & spread the word.

docs.google.com/document/d/1...

Yellen not at all pulling her punches in this op-ed for the FT www.ft.com/content/d2ea...

Good summary of Trump’s statement he fired Fed governor Lisa Cook. He cannot fire her without cause and it does not appear there is cause. Undermining the Fed will not generate an immediate crisis, but undermining the Fed and the rule of law is bad for the economy and country over time.

In the Matter of Lisa Cook Trump’s attempt to fire a Fed governor is illegal. Now we find out whether that matters.

I wrote about the manifestly illegal attempt to fire Lisa Cook 1/

paulkrugman.substack.com/p/in-the-mat...

This action by Lisa Cook is courageous, principled, and deserves broad support.

This is something the Administration would know if they read Lisa Cook’s work instead of attacking her. Arguably, her research has never been more relevant to the Fed’s mission. One has to assume innovation and biz formation by immigrants is falling right now.

Important article by @bencasselman.bsky.social Tariffs and cuts to key programs get attention and will do immediate damage. But Trump is also undermining long run growth. I’d add to Ben’s list: Trump is making parts of the population feel less secure which reduces innovation and entrepreneurship.

This will get lost in the shuffle of so many damaging high profile actions by this Administration. But this is just gratuitously bad. The government should support competition and try to help make sure consumers, workers, and small biz don’t get squeezed by huge firms’ market power.

@jasonfurman.bsky.social is appropriately blunt and brutal in his assessment of Trump’s firing of BLS Commissioner Erika McEntarfer and his atrocious nomination of EJ Antoni. Given the chaos Trump has unleashed on the economy, it’s important to have data to track it. This step undermines the data.

Ending publication of monthly Current Economic Statistics (CES) would violate the will of Congress as expressed federal law.

It would also violate OMB's Statistical Policy Directive 3, which governs all Principal Federal Economic Indicators, including the CES.
www.bls.gov/bls/statisti...

U.S. Government to Take Cut of Nvidia and AMD A.I. Chip Sales to China

The US Constitution forbids export taxes but I guess this payment isn't a "tax" but a payout....🤔 www.nytimes.com/2025/08/10/t...

This is awful. Reliable economic data is a key strength of the US economy.

When Argentina and Greece faked economic data it contributed to major crises.

I don't think Trump will be able to fake the data given the procedures. But there is now a risk plus an awful appearance.

For six months, I've said that threats to economic data have been more collateral damage than intentional harm.

No longer.

Firing the head of the BLS is five-alarm intentional harm to the integrity of US economic data and the entire statistical system.

Proposed SNAP cuts would permanently undermine recession readiness and responsiveness - The Hamilton Project Lauren Bauer and Diane Whitmore Schanzenbach warn that the budget bill would undermine SNAP's role as an automatic stabilizer during recessions.

I guess we're past the point of persuasion, but don't say we didn't warn you.

www.hamiltonproject.org/publication/...

China’s Xi singles out ‘disorderly low-price competition’ for attention Officials have favoured a vaguer term – “involutionary competition” – but president cut to the chase at top-level economic meeting.

Xi is *this* close to saying "overcapacity". On the tip of his tongue!

China needs to “lawfully regulate enterprises’ disorderly low-price competition, guide companies to improve product quality, promote the orderly exit of outdated production capacity”

www.scmp.com/economy/chin...

Evaluating the impact of two decades of USAID interventions and projecting the effects of defunding on mortality up to 2030: a retrospective impact evaluation and forecasting analysis USAID funding has significantly contributed to the reduction in adult and child mortality across low-income and middle-income countries over the past two decades. Our estimates show that, unless the a...

Elon Musk casually, and illegally, dismantled USAID. According to a new study in the Lancet, that action will lead to *14 million* premature deaths between 2025 and 2030.

Again: Elon Musk is directly responsible for 14 million coming deaths. 4.5 million will be children.

USAID programs have had meaningful impacts around the world, saving lives and bolstering U.S. soft power.

The cuts by the Trump admin have already killed thousands and millions more will die over the next few years. A tragedy.

Sometimes in policy, there are tradeoffs, but this 1 horrible bill is just awful in all dimensions.

It blows out the debt and deficit leaving us worse prepared for real challenges

Does serious damage to the safety net

Crushes US clean energy industry

Undermines long run growth

Truly awful

This story does an excellent job walking through why PEPFAR has been so critical to saving lives and what a successful program it has been. Destroying it and so much else of our overseas aid quickly and haphazardly has been a disaster for people and for US reputation and soft power.

This is an important issue raised by Gillian Tett. One part of the dollar’s central role in the global economy has been the ability / willingness of the Fed to provide liquidity globally via swap lines. If that is called into doubt, it will shift others’ willingness to be exposed to the dollar.

I’m on the Econofacts podcast with @mwkleinphd.bsky.social this week. Give it a listen to hear about China and international debt. Stick to the end to hear Michael and me discuss the talent in the civil servants at Treasury and why they should be lifted up, not treated like they’re disposable.

80:1 New #tariffs on steel and aluminum will destroy jobs. @kadeeruss.bsky.social & @lydiacox.bsky.social published original research in @econofact.bsky.social showing that the ratio of jobs that use steel in production to those that make steel is 80:1. econofact.org/will-steel-t...

Seems like if we want to increase a culture of work etc etc, this might be more promising than taking food benefits away from 60 year olds or parents of 9 year olds. Of course funding things like this wouldn’t open up budgetary space for tax cuts for rich people.

One thing that we mentioned but didn’t emphasize is how the 30% current tariff is on top of prior tariffs on China (or general MFN tariffs) so total right now is in the 30-80% range. This is still prohibitive for many firms.

Me on a podcast with @soumayakeynes.ft.com discussing interactions with China in Biden and Trump admins. There are many real issues to tackle. Trump leading with bluster and focusing (wrongly) on the bilateral trade deficit is counter productive.

.