Thursday, June 23, 2011

JEC Hearing 6-22-11 "Manufacturing in the USA"



"The U.S. manufacturing sector has changed dramatically over the last several decades. Manufacturing productivity in America has soared, what took 1,000 workers to produce in 1950 now takes only 184. U.S. manufacturers produce 65 percent of what our country consumes, down from 80 percent three decades ago.

Many consumer goods that were manufactured here are now imported. In the 1960s, U.S. manufacturers made 98 percent of America’s shoes, but today 90 percent of shoes are imported. During the same time, entirely new manufacturing industries have arisen in America - such as in computer chips. Chemical products, food, computers & electronics, fabricated metal products and machinery are the top five manufactured products in America today.

While technology and productivity has shrunk the American manufacturing workforce over the past 40 years, manufacturing remains an important part of our economy. U.S. manufacturers produce about 12.5 percent of our gross domestic product and employ about 9 percent of our workers – that translates into 12 million manufacturing jobs and nearly seven million related jobs, many of them in small businesses......."

Vice Chairman
Kevin Brady
Joint Economic Committee

See Vice Chairman Brady's Full Opening Statement

General Economics

News                                                                                                                             
Bloomberg | Crude Declines on Demand Concerns After Fed Lowers U.S. Economic Forecast
Oil declined for the first time in four days in New York as investors speculated U.S. fuel demand may weaken after the Federal Reserve lowered its economic growth outlook for the world’s biggest crude-consuming nation.
WSJ | Fed Darkens Its Outlook but Plans No Changes
The central bank's policy makers substantially downgraded their projections for U.S. economic growth and unemployment, which they released Wednesday after a two-day meeting. "We don't have a precise read on why this slower pace of growth is persisting," Federal Reserve chairman Ben Bernanke said in a dreary press conference following the policy meeting.
WSJ | Leisure Trumps Learning in Time-Use Survey
Americans Opt for TV in Spare Hours, Not Workouts or Classes, Poll Finds.
National Journal | U.S. Releases 30 Million Barrels of Oil From Petroleum Reserve
Energy Secretary Steven Chu announced Thursday that the U.S. and its partners in the International Energy Agency will release 60 million barrels of oil onto the world market over the next 30 days to offset the disruption in the oil supply caused by unrest in the Middle East. The U.S. will release 30 million barrels of oil from the nation’s Strategic Petroleum Reserve.
WSJ | Most Euro-Zone Economies Contract
Germany and France were the only members of the euro zone to register an expansion of private-sector activity in June, with most of the other 15 members experiencing a contraction for the first time since November 2009.

Econ Comments                                                                                                             
Daily Caller | How the stimulus robbed states of their sovereignty
Obama’s so-called “stimulus bill” did not do much good for our economy. On the contrary, numbers provided by recovery.gov show that whatever jobs the bill “created” have come at astronomical costs. One very telling example: as of the first quarter of 2011, each “stimulus” job in Wyoming had cost taxpayers $477,000.
Washington Times | FEULNER: Put free trade to work
Congress spurns jobs that new pacts would create.
WSJ | The Food-Stamp Crime Wave
The number of food-stamp recipients has soared to 44 million from 26 million in 2007. Not surprisingly, fraud and abuse are rampant.
Cato Institute | Good-Bye Recession, Hello Slump
The U.S. recession officially ended in June 2009. With that, a normal post-recession boom failed to materialize. Instead, an unwelcomed slump ensued. Since the recession bowed out, the average annual GDP growth rate has been a paltry 1.6% — well below the long-run trend growth rate of 3.1%.

Blogs                                                                                                                             
Heritage Foundation | Belize: Lights Dimming on Economic Freedom
On June 20, the government of Belize expropriated the 70 percent ownership interest in the Belize Electric Company (BEL) held by the shareholder-owned, Canada-based energy giant Fortis. Belize Electric Company Limited (BECOL), a hydroelectric business that Fortis also owns, has not been expropriated—yet. Fortis has invested more than $400 million in Belize.
Heritage Foundation | Increasing Access to Alaska’s Oil
Although the pipeline collects oil from several fields, falling production in those fields could eventually cause the pipeline to shut down. If the flow falls below a certain level—estimates vary from 350,000 barrels per day to 200,000 barrels per day—cold temperatures can cause ice buildup and corrosion. The real question, though, is how to meet America’s energy needs. One way to prevent this is to increase access to the vast amount of reserves Alaska holds.

Reports                                                                                                                         
RCM: Wells Fargo | An Economic Framework for Financial Services*
Here we focus on economic changes with particular emphasis on those that suggest a structural challenge to decision making as it was done in the past.
NBER | Disability, Pension Reform and Early Retirement in Germany
The aim of this paper is to describe for (West) Germany the historical relationship between health and disability on the one hand and old-age labor force participation or early retirement on the other hand. We explore how both are linked with various pension reforms. To put the historical developments into context, the paper first describes the most salient features and reforms of the pension system since the 1960s.

Taxes

News                                                                                                                             
Fox News | Framework' In Place For Property Tax Cap in New York
New York Senate Republican Leader Dean Skelos says there is "a framework" for a deal on a statewide property tax cap, New York City rent control and several other issues.

Blogs                                                                                                                             
WSJ: Real Time Economics | Lower Taxes, Higher Commodity Prices Drive Income in States
State personal income growth accelerated in the first quarter but varied greatly across the nation: Natural resource heavy states like North Dakota and Montana continued to outpace the nation, while victims of the housing bust — Sunbelt states like California, Arizona and Florida — remain laggards.

Health Care

News                                                                                                                             
National Journal | Feds Extend Insurance Appeal Deadline
The federal government is giving states more time to meet insurance-review requirements under the 2010 health reform law, Health and Human Services Department officials announced on Wednesday.

Blogs                                                                                                                             
Cato @ Liberty | Vouchers in Education and Health Care Reform
E.D. Kain has a post up here (and here) comparing and contrasting vouchers in education and health care. It’s an interesting post that manages both insight and remarkable oversights in a very short space. And the insight and oversights are bound up with each other:
Heritage Foundation | Obamacare Dumps Millions More into Failing Medicaid Program
Yet another newly revealed flaw of Obamacare promises to add billions to the cost of the new health law. Due to what was presumably an oversight in the drafting of the legislation, it could potentially unload 24.7 million additional Americans onto the Medicaid program.

Monetary

News                                                                                                                             
Market Watch | Bernanke signals uncertainty as Fed ends QE2
Federal Reserve Board Chairman Ben Bernanke said Wednesday he didn’t have all the answers as to why the economy has struggled recently as the U.S. central bank closed the doors on a controversial bond purchase program.
Market Watch | Five money moves one inflation hawk is making now
QE2 is steaming into port, and Capt. Bernanke is about to broadside the S.S. United States.
CNBC | China June Inflation Likely to Top May's 5.5 Percent
China's annual inflatin in June will be higher than May's 34- month high of 5.5 percent before moderating in the second half, the National Development and Reform Commission said on Wednesday.

Econ Comments                                                                                                             
Washington Times | PAUL: Time to end Federal Reserve secrecy
Central bankers don’t want us to know what happened during 2008 bailouts.
Washington Post | China’s currency of opportunity
The United States and China have a wonderful opportunity to do a deal over the ever-contentious issue of China’s undervalued currency — but will probably blow it. For years, American presidents and congressional leaders have urged a major revaluation of the renminbi (RMB), which contributes to massive Chinese trade surpluses with the United States and the world.
Minyanville | Despite Inflation, Bank of England May Buy Bonds; Is Bernanke to Follow?
With the unemployment level near 8*% and the economy struggling, the UK has implemented austerity measures, but with little to show for it.

Budget

News                                                                                                                             
WSJ | Bipartisan Debt Talks Grow More Contentious
The bipartisan deficit-reduction talks led by Vice President Joe Biden grew more contentious Wednesday as Democrats and Republicans became increasingly entrenched on key issues, people familiar with the matter said.
National Journal | Durbin Open to Cutting Deficit in Two Steps
Senate Majority Whip Dick Durbin, D-Ill., said on Wednesday that he is open to cutting the deficit in two steps, with a “down payment” tied to an increase in the $14.3 trillion debt ceiling followed by a second $4 trillion reduction.

Econ Comments                                                                                                             
Daily Caller | Cut, cap and balance: a line in the sand for fiscal conservatives
[Obama] has directed the largest, most reckless spending binge in the country’s existence, bringing America to the edge of bankruptcy.
Washington Times | MILLER: Conservatives’ spending pledge
The first day’s effort has been encouraging. Sen. Jim DeMint, South Carolina Republican, has 10 colleagues on board. He’ll need another 30 to block a bad deal.

Reports                                                                                                                         
Bankrupting America | Budget Briefing Book: Volume One
Our three part Budget Briefing Book provides a rundown of all the facts you need when it comes to how the government spends your money and the subsequent effects.

Employment

News                                                                                                                             
Bloomberg | Jobless Claims in U.S. Rise More Than Expected
More Americans than forecast filed first-time claims for unemployment insurance payments last week, showing companies are less confident about the expansion than they were earlier this year.
MarketWatch | U.S. still wasting billions on jobless aid
Billions of dollars are still being wasted by the U.S. government on improperly paid unemployment benefits despite a federal crackdown.

Econ Comments                                                                                                             
Politico | Government blocking jobs
We have heard plenty of talk about job creation — but the rhetoric simply does not match up with any action. The truth is the most significant step the federal government can take toward greater job growth is to get out of the way.

Blogs                                                                                                                             
WSJ: Real Time Economics | Bernanke’s Scary View of Employment
He said the U.S. economy is “still years away” from what is considered a level of full employment, meaning an unemployment rate somewhere in the range of 5%. It stands now at 9.1%.