Tuesday, March 8, 2011

General Economics

CNN Money | Guess what? Dollar bills are made of cotton
Sure, packs of T-shirts and socks are getting expensive because of skyrocketing cotton prices. Guess what else is made of cotton? The dollar bill in your wallet.
Breitbart | N. Korea asking poor Africa nations for food
North Korea is pleading for food aid even from some of the world's poorest nations such as Zimbabwe, a report has said, amid suspicion the aid may be used to boost the regime's political standing.
CNN Money | Oil and gold: Rally won't last
Oil above $100! Gold hitting new records! Don't fear the headlines. Most market experts think oil and gold prices will settle down as the unrest in North Africa and the Middle East region subsides.
CNN Money | China's 'insatiable' demand brings inflation risk
China's massive building boom shows little signs of slowing, bringing with it a huge appetite for raw materials -- and the threat of inflation
MSNBC | Yes, the world still has plenty of oil, but ...
Market fears of an unstable Middle East and a growing futures market mean the cost will keep rising
CNN Money | States: Let's make a deal to help homeowners
State attorneys general have launched talks with big banks accused of illegally foreclosing on homeowners with the hopes of reaching a deal that could result in more mortgage modifications, a top negotiator said Monday.

Econ Comments                                                                                                             
Cato Institute | Is India an Economic Superpower in the Making?
Globalization has been an extraordinary force for good. China and India are its greatest success stories.
Youtube | Top 3 Policy Reforms to Grow the Economy
Economist Jeffrey Miron of Harvard University outlines three policy reforms
Washington Times | Incorrigible Keynesians
Theory’s founder would denounce policies associated with his name
Fiscal Times | Social Security: 5 Enduring Myths that Must Go
A handful of misconceptions tend to crop up repeatedly — often having to do with that fiscal fun-house mirror, the Social Security trust fund. And despite the efforts of writers like Allan Sloan and experts like the Urban Institute’s Eugene Steuerle, the myths won’t die. This column won’t kill them either, but that doesn’t mean we shouldn’t take a whack.

CSM: Green Economics | Will high food prices have a long-term effect?
In the Wall Street Journal, Scott Kilman tells a "triple witching" hour tale about the prospects of even higher food prices. Soaring world demand is one fundamental trend. On the supply side, he talks of ethanol subsidies attracting U.S corn production and weather shocks disrupting production.
WSJ: Real Time Economics | Consumer Debt Rises, but Credit-Card Use Falls
U.S. consumer credit increased at an annual rate of 2.5% in January as federal government lending rose, though credit-card debt fell to a six-year low.
CalculatedRisk | CoreLogic: 11.1 Million U.S. Properties with Negative Equity in Q4
CoreLogic released the Q4 2010 negative equity report today.
Fiscal Times | ECON 101: Protectionism For Dummies
The deadweight losses from protectionism mean that the economy is worse off on net, or that there has been a reduction in total economic welfare, the total number of jobs, wealth, prosperity, and/or national income.
EconLog | Energy Subsidies
Energy policy is a triumph of faith over experience.
Atlantic | America's 401(k)s Are Disasters, but Are Pensions Any Better?
We're all going to be paying for this delusion for a long, long time.
National Review: The Corner | Fannie, Freddie, and the Mortgage Market
The Obama administration last month issued a white paper with proposals for gradually phasing out the two housing giants, Freddie Mac and Fannie Mae. Critics of the plan have argued that handing mortgage financing over to the private sector will lead to further “market” failures — by which many people mean that it would become harder to secure a loan to buy a house because down payments would be higher and interest rates would go up.
CSM: Adam Smith Institute | Does India need more supermarkets?
Bringing British-style supermarkets to India could increase the country's food supply.

Heritage Foundation | Jumpstarting the Visa Waiver Program to Increase Security and Economic Prosperity
Representatives Mike Quigley (D–IL) and Dan Lipinski (D–IL) and Senator Mark Kirk (R–IL) announced plans today to introduce the Secure Travel and Counterterrorism Partnership Act in both the House and the Senate. This act would introduce several reforms to modernize the Visa Waiver Program (VWP), including a switch from visa refusal rates to overstay rates as a standard for admission.
Cato Institute | Fannie, Freddie and the Subprime Mortgage Market
In order to protect both the taxpayer and our broader economy, Fannie Mae and Freddie Mac should be abolished, along with other policies that transfer the risk of mortgage default from the lender to the taxpayer.

Health Care

Fox News | GOP Lawmakers Target $105B in Spending Found in Health Care Law
Republican lawmakers are up in arms over what they say was $105 billion in unannounced spending tucked into Democrats' legislation overhauling the nation's health care system.
NationalJournal | As Nation Ages, Public Shows a Willingness to Address End-of-Life Care
Roughly 3 out of 4 Americans, 78 percent, said that palliative care and end-of-life treatment should be part of the public discourse, and 93 percent said they believe such decisions should be a top priority for the U.S. health care system.

Econ Comments                                                                                                             
Fox News | ObamaCare One Year Later -- Broken Promises and Unhappy Americans
Americans want the health care they need, from the doctor they want, at a price they can afford. The new law fails this test.

Heritage Foundation | Defund Obamacare’s Secret Stash
While Obamacare is rightly notorious as a fiscal nightmare, less well known is just how massively it transferred power from Congress to the executive branch. In fact, the full scope of Congress’s abdication is still unknown. What is now known, however, is that deeply buried within Obamacare was a $105 billion slush fund that assures its implementation into the future, no matter what future voters think or want.


Econ Comments                                                                                                             
RCM | To Fix the Corporate Tax, Tax Gross Receipts
A change in direction in this area could potentially free up a lot of capital, all the while reducing a great deal of waste.
Investors | Budget Balance Shouldn't Mean A Hike In Taxes
Estimated federal tax revenue for 2011 is $2.2 trillion and federal spending is $3.8 trillion, leaving us with a $1.6 trillion deficit.
WSJ | As Budget Battle Rages On, a Quiet Cancer Grows
This year the U.S. will spend more than $200 billion—roughly the gross domestic product of Chile—merely paying off that interest [on national debt].


MSNBC | Most economists say Fed’s stimulus plan is helping
Most economists believe the Federal Reserve's bond-purchase program is helping to support U.S. growth, though many remain skeptical, a survey released on Monday found.
Fiscal Times | Greece Raises $2.3 Billion After Rating Cut
Greece raised euro1.625 billion ($2.28 billion) in an auction of treasury bills Tuesday, though the higher interest rate it has to pay revealed investor unease a day after the country's credit rating was downgraded sharply.

Econ Comments                                                                                                             
CNN Money | Dollar doom bets hit new high
Dollar doomsaying is at record levels. Is it time to stray from this unhappy flock?

WSJ: Real Time Economics | Oil Jump Presents Conundrum for Fed
Two top Federal Reserve officials on Monday offered conflicting views on the right response to higher oil prices, kicking off what’s likely to be a lively debate within the central bank.


CQ | More Stopgap Funding in the Works
With rival Democratic and Republican spending plans making little headway in the Senate, House appropriators are already working on another stopgap funding measure to keep the government running past March 18.
Washington Times | U.S. sets $223B deficit record
That one-month figure, which came in a preliminary report from the Congressional Budget Office, dwarfs even the most robust cuts being talked about on the Hill…

Econ Comments                                                                                                             
NY Times | It’s Time to Face the Fiscal Illusion
James M. Buchanan, a Nobel laureate in economics — and my former colleague and now professor emeritus at George Mason University — argued that deficit spending would evolve into a permanent disconnect between spending and revenue, precisely because it brings short-term gains.

The Economist: Daily Chart | The elephant in the room
America's fiscal problem cannot be solved unless entitlements are tackled
Bankrupting America | Did you get your money’s worth from Congress last week?
...while that bill cuts $4 billion in spending from current levels, it means Congress is still mired in fiscal year 2011 budget fights – even as debate on the fiscal year 2012 budget is just a few weeks away.
NRO: The Corner | More Reasons to Be Skeptical of State-Bankruptcy Legislation
A few years ago, a bankruptcy judge gave [Vajello, CA] leaders the authority to void existing union contracts as part of the city’s effort to reorganize. Nothing happened.
Heritage Foundation | Rep. Renee Ellmers: We’ve Only Just Begun to Cut Spending
Budget Chairman Paul Ryan (R-Wis.) has begun to unveil his yet-to-be-released entitlement reform plan in this manner, Ellmers said, commending that plan as a “good, solid solution” that especially took on the problem of Medicare.
CSM: Donald Marron | The long term keeps getting shorter
The language to describe long-term and short-term budgets in the US is confusing.

CBO | Monthly Budget Review
Based on the Monthly Treasury Statement for January and the Daily Treasury Statements for February.
Mercatus Center | The "Other" Pension Crisis
Options for Avoiding a Taxpayer Bailout of the PBGC.


CNBC | Anger Brews Over Government Workers' Benefits
A USA Today/Gallup poll last month found show that Americans largely side with the employees, though about two in five that want government pay and benefits reined in.

Econ Comments                                                                                                             
National Review | Union Myths
Private-sector workers haven't been immune to unions' deleterious effects as government workers have.

CSM: Robert Reich's Blog | Job numbers don't tell the whole story
There are jobs being created, but they aren't the right kind of jobs
Political Calculations | An Actual Improvement in the U.S. Employment Situation
For the first time since April 2010, the employment situation in the United States showed an actual improvement in February 2011, as the number of employed Americans rose to its highest level since that time.
CSM: Paper Economy | 'Total unemployment' declines to 16 percent
Traditional unemployment rate declined to 9 percent in February.
Reason Foundation: Out of Control Policy Blog | Are Discouraged Workers Done Leaving the Labor Force?
One of the big stories in the labor market over the past two months has been to what extent dips in the unemployment rate over the last few months can be credited to people simply exiting the labor market. That's because as people stop looking for work, they stop getting counted on the rolls of the unemployed, having left the labor force. This means that society loses out on the productive abilities of people who give up on the job search because they can't find an acceptable position. Thus, a fall in the unemployment rate -- theoretically good news -- can actually disguise a negative trend..