Maybe Not So Volatile?

When Jacob Hacker's Great Risk Shift came out, many liberals were super excited, here's a brand new argument for a bunch of conclusions I already agree with. I had no quarrel with Hacker's data, showing a rise in economic instability over the past few decades, but I wasn't so excited about his book which struck me as an unduly esoteric argument on behalf of policies that are perfectly defensible on other grounds -- I think, for example, that a better-designed health care system would boost economic growth, improve public health, and enhance social justice and any consideration relating to volatility is putting us on track to debate a side issue.

Well, now here comes the CBO and its very credible director Peter Orszag to report that "In previous work released in 2007 ... report concluded ... earnings volatility had not increased" and in a new study "preliminary results suggest that household income is much less volatile than individual worker’s earnings, and that household income volatility has not increased over time — and perhaps even declined slightly." Now as I say, I still think the vast majority of Hacker's policy ideas are perfectly good whether or not the CBO is right about this but obviously this is going to be a problem for folks who've tried to hang progressive policies on Hackerian arguments so it's no surprise that Greg Mankiw's linking to the report.