Tuesday, February 22, 2011

General Economics

News                                                                                                                         
Fox Business | Consumer Confidence Rises to 3-Year High
U.S. consumer confidence rose in February to a three-year high amid improved optimism about the economy and income prospects, according to a private sector report released Tuesday.
CNN Money | How the rich became the ├╝ber rich
There's a growing income gap in America, but it's not necessarily between the rich and the poor.
WSJ | Home Sales Data Doubted
Realtor Group May Have Overstated Number of Existing Houses Sold Since 2007
CNN Money | Home prices near 2009 lows
Home prices took a big hit at the end of 2010, even as the economy gained steam.
Fox News | In sign of growth, businesses are borrowing again
Now that demand is up and business is finally improving for many companies, they're doing what they always do at the beginning of an expansion — calling the bank and asking for a loan.

Econ Comments                                                                                                             
WSJ | The Showdown Over Public Union Power
At last, politicians and voters are fighting back against the most potent lobby for government spending and ever-higher taxes.
Cato Institute | Madison Protest: Unions Are Angry -- but Wisconsin Should Go Even Further
Chaos in government. Tens of thousands of angry protesters in the streets. Schools closed. Yes, Wisconsin looks a lot like Egypt this week. But while Arabs are fighting to end extraordinary overreach by government, Wisconsin union protesters are fighting to preserve it.
AEI | A Healthy Crisis at a UN-Backed Health Fund
The UN-backed effort to fight AIDS, tuberculosis and malaria is in trouble. But that's not necessarily a bad thing.
Minyanville | Fiscal Stimulus in the US: Too Much or Not Enough?
In response to the Great Recession, net consolidated fiscal stimulus in the US was modest at best. Cross-country data analysis raises question of whether US should have stimulated more
National Review | Social Security’s No Afterthought
The long term matters less when the short term is sufficient to do you in.
Minyanville | Is the Mortgage Interest Deduction Doomed?
While eliminating the MID may sound like a popular, hard-line approach to expensive government subsidies for the housing market, the reality is it's not going anywhere anytime soon.

Blogs                                                                                                                         
The Atlantic | What's at Stake in Wisconsin?
I understand why Democratic politicians are supporting the unions in all of this--they're very dependent on these unions for money and political legwork. But I don't understand why the wonks and the outside activists are so determined to turn this into a high-profile fight to the death.
Public Sector Inc. | JFK ... union buster?
The nation's public-sector union movement received a big boost in 1962 when President John F. Kennedy signed an executive order allowing federal employees to form unions. However, Kennedy's order only required federal agencies to "meet ... and confer" with unions "with respect to personnel policy and practices and matters affecting working conditions, so far as may be appropriate subject to law and policy requirements."

Reports                                                                                                                         
RCM: Wells Fargo | Economics Group
Weekly Economic & Financial Commentary
Mercatus Center | Out with the BRICs, Time for the TIMBIs
China and Russia are very differently positioned for the future, facing fundamentally different demographic trajectories and technical and trade opportunities, than the TIMBIs.

Health Care

News                                                                                                                             
Fox Business | U.S. Confidence on Health Care Spending Rises: Poll
That attitude could translate into an improvement for health-care providers and medical companies after U.S. consumers cut back on health services in recent years because of the recession.
NY Times | Long-Term Care Needs Changes, Officials Say
To make the program viable, Ms. Sebelius said, she is considering changes in the eligibility criteria, including employment and earnings requirements, to ensure that only active workers may enroll. She also said she favored adjusting premiums to rise with inflation.
Fox Business | 5 Ways to Fill The Health Care Gap Before Medicare
If you are laid off or experience some other job loss prior to your 65th birthday, there are several techniques you can use to simplify your search for a plan, and to ease the cost burden.

Econ Comments                                                                                                             
WSJ | Cuomo's Medicaid Warning
The New York Governor tries to clean up Tammany health care.

Blogs                                                                                                                             
Heritage Foundation | When Snow Melts, FEMA Funds Can Be Used for Health Care and Pensions
Now we learn that it isn’t just disaster response and recovery costs we are subsidizing; now we are federalizing and subsidizing health care and pension costs of local government workers.
Cato Institute | Two Reasons Governors Should Stop Implementing ObamaCare
So far, the only governors I've seen take a firm stand against implementing the law are Rick Scott (R-FL) and Sean Parnell (R-AK), who respectively govern the fourth-largest and the fourth-smallest states.

Taxes

News                                                                                                                             
Fox Business | Fixing State Deficits With Higher Cell Phone Taxes
At more than 16%, the average federal and state cell phone taxes and fees are now more than double the average 7% or so charged for other goods and services, according to Congressional estimates.

Econ Comments                                                                                                             
Washington Times | FEULNER: Dark days for solar power
When feds pick market winners, taxpayers lose.

Blogs                                                                                                                             
CSM: Tax VOX | Where will Obama find new tax revenues?
Most corporations and individuals won't get hit with a tax increase, but money to reduce the deficit has to come from somewhere.

Monetary

News                                                                                                                             
The Economist | Learning to like inflation
Higher inflation could help to rebalance China’s economy.

Econ Comments                                                                                                             
The Fiscal Times | Inflation Predictions: The U.S. is a Late Riser
Little wonder many people think inflation is getting worse. The cost of some of two of the things they buy most frequently with highly visible prices, food and gasoline is going up sharply.

Blogs                                                                                                                             
Barron's | Pricing Power in the Grocery Aisle
General Mills is in a better position than rivals to boost prices on items like Cheerios to offset skyrocketing ingredient costs.
ThinkMarkets | ThinkMarkets: Sand Castle Monetary Policy
From a short-run point of view there is no reason for Bernanke to care what is going on in other nations. He will be judged “by history” by what happens here in the US.
Calculated Risk | When will the Fed raise rates?
Short answer: it is very unlikely that the Fed will increase the Fed funds rate this year. There are a series of steps the Fed will most likely take before raising rates:
WSJ | A Full Frontal View of the World’s Uneven Monetary Policy
Financial markets saw China’s central bank tighten margin requirements for the second time in this still-young year to cool its overheating economy, amid hawkish talk from some central bankers in Europe. Meanwhile, Federal Reserve chief Ben Bernanke went to Paris to tell the world’s central banks not to blame the U.S. central bank if their economies are overheating.
CSM: The Daily Reckoning | Government spending will perpetuate fiscal insanity
The economy is in a slump, but the Fed is printing up money to fix the problems. And what we see are a lot of mixed signals.

Employment

News                                                                                                                         
CNN Money | Unions under fire as states try to curtail benefits
Lots of state officials are pressing public employees to shoulder more of their health care and pension costs.
ABC News | Wage War: Government Employees vs. Everybody Else
Public Sector Protesters in Wisconsin Face a Backlash, But Are State Workers Really Overpaid?

Econ Comments                                                                                                             
Real Clear Markets | It's Time for Washington to Get Serious About Job Creation
In recent weeks Federal Reserve Board Chairman Ben Bernanke has repeatedly expressed worry about the state of the U.S. job market.  His concerns are well founded
The Fiscal Times | Unemployment Pay Deters Would-Be Entrepreneurs
During economic downturns, it’s not unusual for laid-off employees to remake themselves as entrepreneurs. Right now more than 9.8 percent of all workers are self-employed, and more than a quarter of people laid off in the first six months of 2010 who hadn’t found jobs considered starting their own businesses, according to a CareerBuilder survey.
Politico | Why everyone needs unions
It’s easy to see the big issues at stake in the battle between the public sector unions and the Republicans in Wisconsin and other states.
Minyanville | Why Unions Are Bad for the Economy
If Wisconsin protesters succeed in this time of state budget deficits, other states will try the same thing.

Blogs                                                                                                                         
EconLog | Job Losses vs. Unemployment
I think we will have to get a handle on adjustment costs, including the cost of firm formation, the cost of expanding enterprises, and the cost of integrating new labor and capital into an existing enterprise.
Marginal Revolution | What is the state employee union wage premium?
How much does collective bargaining matter?
EconLog | Scary Data on Private Investment
In any case, these numbers are scary, with or without wage flexibility. Regime uncertainty, anyone?

Reports                                                                                                                         
Heritage Foundation | Extended Unemployment Insurance Benefits
What Are Extended Unemployment Insurance Benefits?

Budget

News                                                                                                                             
Washington Post | Federal, state and local debt hits post-WWII levels
The daunting tower of national, state and local debt in the United States will reach a level this year unmatched just after World War II and already exceeds the size of the entire economy, according to government estimates.
Washington Times | Budget deadlock points to government shutdown
Members of both parties in Congress said they want to avoid a government shutdown but remained at an impasse Sunday...
CNN Money | House budget would increase defense spending
While the House Republicans' 2011 budget calls for less in defense spending than originally proposed by President Obama, it would actually increase defense spending relative to last year.

Econ Comments                                                                                                             
National Journal | What Would Happen if Obama's Growth Assumptions Prove Rosy?
Even slightly slower growth could add $2 trillion to debt by 2021.
Council on Foreign Relations | The U.S. Budget's Tightrope Act
Four CFR fellows evaluate how well the budget addresses its dual aims.
Washington Times | BLANKLEY: Debt doom refocuses politics
Crisis in Europe is driving demand for spending cuts here.
Cato Institute | Debt-Limit Remedy Gives Fiscal Hawks Leverage
...Democratic proponents of the status quo are in much stronger position to prevail because there are few ways for budget cutters to exert their will.
Bloomberg | Wisconsin's War With Union Represents Progress: Amity Shlaes
Teacher pensions do weigh down state budgets, both in Wisconsin and the other 49 states.
NRO | Reckless Spending
...without enough people packed into a given space, there will never be enough riders to repay the high cost of building and maintaining a high-speed rail system.
USA Today | Our view: Fix Social Security sooner, not later
[Americans have] repeatedly been told that while the program might have long-term problems, it's absolutely fine now and has nothing to do with the deficit.

Blogs                                                                                                                             
Cato @ Liberty | Spending Restraint Works: Examples from Around the World
Because of demographic changes and poorly designed entitlement programs, the federal budget is going to consume larger and larger shares of America's economic output in coming decades.
WSJ Real Time Economics | The Federal Fiscal Issue in One Chart
Instead of distinguishing between programs that are on auto-pilot like Medicare and programs that are subject to annual congressional spending bills, [Steuerle] put them on one chart.
Cato @ Liberty | Senator Toomey’s Legislation Would Protect Financial Markets During a Debt Limit Showdown
There will be several pivotal fiscal policy battles this year and the fight over the debt limit may be the most crucial.
Reason's Out of Control Policy Blog | Where Is the Money for Budget Reform Going to Come From?
Gleckman's question is a good one: where is the money for reform going to come from?
Heritage's The Foundry | State Spending Cuts Are Key Part of Brightening Our Fiscal Future
A recent study by The Heritage Foundation and The Wall Street Journal of economic recovery following the 2008 financial crisis has also found countries with bigger governments growing more slowly.