Thursday, May 26, 2011

General Economics

Bloomberg | White House Cuts Red Tape Tangling Car Fumes, Spilled Milk
The White House announced today that 30 U.S. agencies are seeking to repeal or modify regulations in an effort to reduce reporting requirements and save businesses and individuals billions of dollars in compliance costs.
WSJ | U.S. Regulators Aim to Extend Reach
Agencies Weigh Oversight of Certain Financial Transactions by Foreign Central Banks, Sovereign Funds.
Bloomberg | U.S. Economy Expanded 1.8% in First Quarter, Less Than Economists Forecast
The U.S. economy grew at a 1.8 percent annual rate in the first quarter, less than forecast, reflecting a smaller gain in consumer spending than previously calculated.
Market Watch | Orders for durable goods fall 3.6% in April
U.S. orders for durable goods fell sharply in April, mainly because of lower demand for aircraft and autos, the government reported Wednesday.
CNBC | Sales of Distressed US Homes Fall in First Quarter
Sales of homes owned by banks or in some stage of foreclosure totaled 158,434, down 16.5% from the fourth quarter and 35.8% from the first quarter of 2010.
WSJ | U.S. Falls Behind in Stock Listings
Executives from LinkedIn Corp., reveling in their enormously successful initial public offering last Thursday, rang the New York Stock Exchange's opening bell. Big money, big smiles, the kind of moment that made the NYSE the Big Board.
Washington Times | House members in the know score ‘abnormal’ stock profits, study says
It’s no secret that members of Congress qualify as political insiders, but a new report strongly suggests that they also may be insiders when it comes to trading stocks.

Econ Comments                                                                                                             
Market Watch | Ex-Fed insider: Oil runup partly bank’s fault
former high-ranking Federal Reserve official told Congress on Wednesday that higher oil prices and rising inflation are “partly a predictable byproduct” of the bank’s effort to goose the U.S. economy.
CNN: Money | End Big Oil's tax breaks now
It's time to truly level the playing field and give all forms of energy a chance to compete.
Market Watch | G-8 leaders to discuss economy, Arab spring
Obama to hold bilateral meetings with leaders of Japan, Russia.
Cato@Liberty | Transportation: From the Top Down or Bottom Up?
Should transportation be funded and planned from the top down or bottom up? Top-down advocates, such as the Brookings Institution's Robert Puentes argue that only central planners can have a "clear-cut vision for transportation" that will allow them to target spending "to make sure all those billions of dollars help achieve our economic and environmental goals."
National Journal | Alexander Says He'd Support Cutting Oil, Wind Subsidies
Senate GOP Conference Chairman Lamar Alexander of Tennessee would support cutting a variety of subsidies, ranging from wind to oil, while putting that money toward energy research and deficit reduction.
RCM | Let's Leave Our Roads to the States
As Americans take to the roads on Memorial Day weekend, almost all are blissfully ignorant that Congress must pass a highway bill by September 30, when authorization for the Highway Trust Fund expires.
Washington Times | FRANS: Too many rules could mean too few votes
Americans send White House warning about over regulation.

The Economist | BRICmanship
I must confess to feeling a bit disappointed with the BRICs this morning. Here I was thinking they were poised to run the world and it turns out they can’t even stop the French running the IMF. At this point, it’s no good them railing against unwritten conventions. It’s time to start rallying behind a flesh-and-blood candidate.
WSJ | The Generation Gap Widens in the South and West
New data out Thursday from the Census Bureau show that every state saw its population of individuals 45 and older grow during the past decade, as the baby boomers age.
Heritage Foundation | Americans Fear Government Regulations Are Choking The Economy
What’s the monster under the bed keeping Americans up at night? Government regulations. According to a new poll, most voters say that too many federal government regulations are more of an economic threat than too few.many federal government regulations are more of an economic threat than too few.
Calculated Risk | Vehicle Miles Driven decreased 1.4% in March compared to March 2010
The Department of Transportation (DOT) reported that vehicle miles driven in March were down 1.4% compared to March 2010:

CBO | Analysis of Amendment H.R. 1229
Your amendment to H.R. 1229 would change a portion of the liability scheme established by the Oil Pollution Act of 1990 (OPA) for the owners and operators of oil and gas drilling platforms that operate in the coastal waters of the United States. Specifically, the amendment would make those owners and operators subject to unlimited liability for any damages caused by an oil spill resulting from offshore platforms.
Mercatus Center | Transparency, Transition, and Taxpayer Protection: More Steps to End the GSE Bailout
Chairman Garrett, Ranking Member Waters, and distinguished members of the Subcommittee, thank you for inviting me to testify today. I have been asked to offer opinions on “Transparency, Transition and Taxpayer Protection: More Steps to End the GSE Bailout.”
CBO | Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output from January 2011 Through March 2011
The American Recovery and Reinvestment Act of 2009 (ARRA) contains provisions that are intended to boost economic activity and employment in the United States. Section 1512(e) of the law requires the Congressional Budget Office (CBO) to comment on reports filed by recipients of ARRA funding that detail the number of jobs funded through their activities. This CBO report fulfills that requirement.

Health Care

Politico | Is any Medicare reform plan political suicide?
Republicans recaptured the House last year running on a platform that accused Democrats of slashing Medicare in their health reform law. Then Tuesday's win by Democrat Kathy Hochul in a solidly Republican district was seen as a strong rebuke of the GOP budget that changes the basic structure of Medicare.
WSJ | No Retreat on Medicare
GOP Sticks With Controversial Revamp Plan After 'Wake-Up Call' of Election Upset.

Econ Comments                                                                                                             
Washington Post | Wait! Paul Ryan has a point
Now that Paul Ryan’s Medicare plan has led Republicans off a political cliff, it’s time to expose the Achilles heel in the Democrats’ argument.
NY Times | Squandering Medicare’s Money
Much has been said about the growing gap between the program’s spending and revenues — a gap that will widen as baby boomers retire — but little attention has been focused on a problem staring us in the face: Medicare spends a fortune each year on procedures that have no proven benefit and should not be covered. Examples abound:
Washington Times | TURNER: White House waivers make a splash
Exemption for friends is crony capitalism at its worst.

The Economist | Medicare has a lemons problem
There are many problems with Paul Ryan’s budget and his plans for Medicare, but for Democrats, one is paramount: it is unpopular. His proposal initially put Democrats on the back foot, but within days they took heart as press commentary and polls turned negative.
Heritage Foundation | Rep. Ryan and the Truth About Medicare
When it comes to the budget, there’s fact and fiction, distortions and reality. And today, the left has been lobbing lies about Chairman Paul Ryan’s (R-WI) House-passed Fiscal Year 2012 Budget – The Path to Prosperity – alleging that it puts Medicare at risk.


National Journal | Tax-Credit Fraud Debate Opens Bigger Tax Fight
A House Ways and Means Committee panel debate on Wednesday over fraud and abuse of refundable tax credits like the first-time homebuyers and the earned-income tax credits further laid out evidence of the widening gap between House Democrats and Republicans over the future of the tax code.

Econ Comments                                                                                                             
WSJ | A 62% Top Tax Rate?
Democrats have said they only intend to restore the tax rates that existed during the Clinton years. In reality they're proposing rates like those under President Carter.

Heritage Foundation | The Graph That All Tax Hike Mystics Need to Grapple With
Growth in the first half of the decade following the Clinton tax hike was clearly subpar, and real wages actually fell.


Bloomberg | Dollar Tumbles Against Yen, Euro After Weaker-Than-Forecast Economic Data
The common currency snapped four days of losses against the Swiss franc, climbing from a record low, after European Central Bank President Jean-Claude Trichet said policy makers are “carefully” monitoring inflation. The statement fueled bets Europe’s economy is strong enough to withstand increased interest rates.

Econ Comments                                                                                                             
Minyanville | Will Germany Destroy the Euro?
Here's a trading strategy for those who think Germany will leave the Eurozone in the not-too-distant future.
AEI | Has the Financial Crisis Jeopardized the Fed's Independence?
Judging from the response to the Fed's three year battle against systemic financial collapse and the risk of deflation , it is difficult to escape the conclusion that financial crises and their aftermaths can pose greater challenges to central bank independence than the more traditional pain associated with combating inflation.

Reason Foundation | A Perspective on Stagflation 2011
The Fed says inflation is under control, but the price at the pump and grocery check out is indicating otherwise. Why? Stand IERP fellow Ronald McKinnon suggests that ZIRP-the zero interest rate policy the Fed has held for the past two years-has caused inflation in emerging markets, impacting food prices:


WSJ | Deficit Plans Show Wide Political Gap
The debate over how to reduce the deficit is truly a philosophical one about the size of government. There's more than one route to fiscal nirvana.
Bloomberg | Greece Is ‘Insolvent,’ Unlikely to Honor Debt, ECB Economist Issing Says
Greece will probably be unable to meet its obligations as the euro region’s most-indebted nation is insolvent, according to former European Central Bank Chief Economist Otmar Issing.

Econ Comments                                                                                                             
FT | Forget the debt ceiling and focus on debt
On May 15, the US hit its “debt ceiling” of $14,300bn, covering publicly owned debt held by the Federal Reserve and government trust funds...

Cato@Liberty | On the Politics of Deficits and Debt
What 2010 showed was that deficits and debt are dominating our politics like never before. Democrats haven’t come to grips with that.
WSJ: Real Time Economics | CBO Says Stimulus Boosted Growth, Will Add More to Deficit
The CBO report out Wednesday said the plan increased the number of people employed by between 1.2 million and 3.3 million, and lowered the unemployment rate by between 0.6 and 1.8 percentage points in the first quarter of 2011.
Political Calculations | The Hidden Cost of the United States' National Debt
At a sustained 40 point increase above the default-free risk level, we would estimate that the interest rate that investors require the U.S. government to pay on its 10-Year Treasury Bond is about 0.4% higher than it would otherwise be. Today's yields on a 10-Year Treasury of 3.15% would instead be about 2.75%, if not for the increased risk of default.

Heritage Foundation | The Heritage Foundation’s “Saving the American Dream” Plan Cuts Most Debt, Taxes & Federal Spending
Heritage’s report, “Saving the American Dream: Heritage’s Plan to Fix the Debt, Cut Spending, and Restore Prosperity,” lays out bold policy recommendations in Social Security, Medicare, Medicaid, health insurance, the tax code and federal spending.


WSJ: Real Time Economics | Comparing Wages Across the U.S.
Those working in the San Jose-San Francisco-Oakland, Calif., metro were the best paid. They earned 20% more than the average American worker last year.
Forbes: Unconventional Logic | The Sheer Idiocy of the Income Inequality Rhetoric
The Top 400 taxpayers are not the problem. Your own numbers show that they are paying more taxes, and a greater share of total taxes, than they were in what you consider to be “the good old days” of 91% tax rates.