Thursday, April 21, 2011

General Economics

CNN Money | Global crises? Don't panic
Who's right? Not a third of the way through 2011, we're dealing with three enormous stories: the Arab Spring, the aftermath of the earthquake and tsunami in Japan, and Europe's deepening debt crisis. Let's look at the economic impact of each in turn.
Bloomberg | Home Prices Slid 5.7% in February From Year Earlier, FHFA Says
U.S. home prices fell 5.7 percent in February from a year earlier as distressed properties weighed down values, according to the Federal Housing Finance Agency.

Econ Comments                                                                                                            
Fortune | In developing economies, equity beats microfinance
In developing economies, equity beats microfinance
WSJ | Searching for Hayek in Cairo
To make democracy stick, the Arab Spring now needs an economic revolution.
Politico | Families still need safety net
The recession did great damage to the middle class. Families lost homes. Professionals lost jobs. Savings and retirement funds plummeted.
WSJ | Government Mortgage Guarantees Are Unnecessary
Many predict calamity for the housing markets without them. Federal Reserve data tell a different story.
Washington Examiner | U.S. taxpayers guarantee $2.1b loan to German firms
A federal subsidy program with consistently poor marks on transparency and accountability has just announced its largest ever award: a $2.1 billion loan guarantee to a German-owned solar power company.
Washington Times | Red tape recession
Government rules are stifling economic growth.

The Economist | More on China's looming(?) growth slowdown
If I had to guess, I would say that by mid-decade China's growth rates are likely to slow from over 9% a year to something like 6% a year. And I would further say that what happens to China's economy after that will depend a great deal on how its financial and political systems handle that slowdown.


Econ Comments                                                                                                             
Cato Institute | Higher Taxes or Smaller Entitlements: What Should Voters Choose?
The bottom line is that both entitlement benefits and payroll taxes used to fund them have negative economic effects.
NRO | Taxing the Rich Won’t Increase Revenues
...the government’s total revenues from capital gains have tended to rise when the capital-gains tax rate is lowered.

Big Questions | The Man Who Can’t Be Taxed
...when Mr. Kendrick withdraws $84 million from the bank to make his tax payment, the bank makes fewer loans, interest rates rise, and someone cancels a vacations, or postpones a car purchase, or abandons a half-built factory.
Atlantic: McArdle | Just A Little Tax Hike . . .
Tax revenues exceeded 20% of GDP for exactly one year: 2000. The average tax take under Clinton was 19%.

Health Care

CNN | Idaho governor blocks federal health care reform law
Gov. C.L. "Butch" Otter, a Republican, issued an executive order Wednesday prohibiting state agencies from implementing the controversial law, which is widely viewed as President Barack Obama's top domestic accomplishment.
NationalJournal | FCC Chief: No Health Risks from Cell Phones
Federal Communications Commission Chairman Julius Genachowski said on Wednesday that cell phones do not pose health risks to users, even when held close to their ears during conversations.

Heritage Foundation | HHS Initiatives Fail to Offer States Meaningful Flexibility
Last week, the Department of Health and Human Services (HHS) announced new initiatives intended to provide states with increased flexibility to better manage their Medicaid programs. However, these initiatives do not seriously address states’ mounting Medicaid crises.
Political Calculations | Top 10 Corporate Welfare Recipients By "ObamaCare" Waivers
There is a lot to not like about the Patient Protection and Affordable Care Act, but now that the federal government is spending money allocated by the health care reform law, there's perhaps even more to not like about it.
NYT: Economix | What Health Insurance Does Cover, and Doesn’t
As required by last year’s health reform legislation, the Labor Department has put together a report on employer-sponsored health insurance coverage that shows what benefits are typically covered by these plans. The results, in one chart:


CNN: Money | Dollar hits 15-month low against euro
The dollar took a beating Wednesday, losing ground to a range of currencies, and falling to its lowest level against the euro in 15 months.
Bloomberg | Bernanke Bond Market Signals No Shift With Obama Deficit Cutting
The Federal Reserve can be counted on to keep its balance sheet big and interest rates low if President Barack Obama and Republican lawmakers agree on a multi-year deal to slash the $1.4 trillion budget deficit.

Econ Comments                                                                                                             
Minyanville | The Great Flattening of First Quarter 2011
The Fed calls it a credit crunch or liquidity freeze, but what they don't understand is that demand for credit is weak because of the uncertainty in the business environment.
WSJ | Fleeing the Dollar Flood
The world tries to protect itself from U.S. monetary policy.
Minyanville | Voodoo Economics: Dissecting Quantitative Easing as Monetary Policy
Advocates of QE believe it will lower interest rates promoting expenditure and growth, among other positives. The reality is much different.
Smart Money | What Happens When QE2 Ends?
As government agencies go, few have a bigger influence, of course, than the Federal Reserve, whose policies affect the prices of everything from a 30-year mortgage to a double skim latte, not to mention the outlook for economic growth, jobs and inflation. So when Federal Reserve Chairman Ben Bernanke signaled last year that the Fed would buy as much as $600 billion in Treasury bonds, it was bound to make waves—among Fed fans and critics alike.


CNN Money | Unemployment filings top 400,000 for 2nd week
First-time filings for unemployment claims declined in the most recent week, but were above the key 400,000 level for the second straight week, according to a government report issued Thursday.
Bloomberg | Initial Jobless Claims in U.S. Fell 13,000 Last Week to 403,000
New applications for unemployment benefits in the U.S. fell less than forecast last week, indicating the labor market will take time to improve.

WSJ: Real Time Economics | Foreign Firms Aren’t Hiring in U.S.
The latest data from the Commerce Department’s Bureau of Economic Analysis on U.S.-based multinational companies focused on their hiring: more workers abroad and fewer in the U.S. during the 2000s.


Politico | GOP escalates debt-limit demands
...House Majority Leader Eric Cantor fired off a stark warning to Democrats that the GOP “will not grant their request for a debt limit increase” without major spending cuts or budget process reforms.
CNS News | Federal Borrowing on Pace to Hit Debt Limit in Less Than Week
In a 31-day month, $125 billion in new debt works out to an average of $4.03 billion in new debt per day. At that pace, the $25.635 billion in legal borrowing authority the Treasury had left at the close of business on Tuesday would be exhausted in less than seven days.
Washington Post | Even in an era of budget cuts, these government programs won’t die
The programs sound innocuous enough: One spends federal money to store cotton bales. Another offers scholars a chance to study Asian-American relations. Two others pay to market U.S. oranges in Asia and clean up abandoned coal mines.
NRO | Ceil Us In?
Should Congress vote to raise the debt ceiling? If it does, what should Republicans get in exchange from the White House?
Washington Post | Report: Obama deficit plan falls short of fiscal commission, House GOP targets
...the plan Obama unveiled in a speech last week would require the nation to borrow another $7 trillion during the next decade, compared with about $5.4 trillion under the House Republican budget and about $5.3 trillion under the recommendations offered in December by Obama’s fiscal commission.

Econ Comments                                                                                                             
American Spectator | Why Are Spending Cuts So Hard? the rate we're going -- borrowing more than 40 cents on every dollar that Washington spends (mostly from China) -- we'll have to cut spending by 40 percent annually to balance the budget.
Washington Times | MURRAY: The midnight ride of Standard & Poor’s
We are now faced with a clear choice between a big-government, high-tax welfare state and a small-government, low-tax republic, such as the founders envisioned.

Cato@Liberty | Senator Corker Explains His Plan to Cap Spending and Reduce the Fiscal Burden of Government
America is in fiscal peril in the short run because of a 10-year spending binge by Bush and Obama and in the long run because of a toxic combination of entitlement programs and demographics.
Heritage Foundation | Morning Bell: Time to Make Cuts in the Department of Energy
...the Department of Energy (DOE), and in the last 10 years it has seen its budget grow by over $11 billion — a staggering 76 percent.
EconLog | The Long-term Debt Issue
The NYT Room for Debate on the S&P downgrade includes some posts that I think contain some really misleading statements.
NRO: The Corner | Sets the President Straight on the Ryan Plan
On Friday, the website looked at President Obama’s claims about the Ryan plan and concluded that many of them were at best misleading…