Tuesday, September 20, 2011

General Economics

Market Watch | IMF slashes world economic growth outlook
The International Monetary Fund on Tuesday slashed its economic forecast, responding to slow private-sector demand, sovereign debt and bank troubles, the Japanese earthquake and Middle East unrest.
Market Watch | Construction of new U.S. homes falls 5%
Builders started construction on fewer new homes in August, underscoring how the depressed U.S. real estate market shows little sign of recovering.
CNN: Money | U.S. to challenge Chinese tariffs on chickens
U.S. trade officials say that the tariffs have hit the U.S. poultry industry to the tune of between $500 million and $1 billion, with 90% of poultry sales to China wiped out.

Econ Comments                                                                                                             
NY Times | Our Hidden Government Benefits
Americans often fail to recognize government’s role in society, even if they have experienced it in their own lives. That is because so much of what government does today is largely invisible.
Washington Times | BLANKLEY: Double-dip learning curve
Obama about-face on tax hikes flummoxes both left and right.
WSJ | Why Greece Won't Reform
Over the past year the government hasn't laid off a single civil servant.
Daily Caller | How Obama’s last stimulus bill became a comedy of errors
In 2009, his $825 billion extravaganza, touted as an emergency measure, targeted sectors of the economy with the lowest unemployment rates — namely, government employees (2.3 percent unemployed), in particular those in schooling and health care (3.8 percent unemployed). By contrast, unemployment rates in manufacturing and construction were 8.3 percent and 15.2 percent respectively.
WSJ | Defusing a Savings Bomb
Labor's new financial advisory rule gets pulled.
RCM | Three Years After the Bailouts, A Weaker Banking System
The U.S. economy continues to struggle, and the bailouts are a significant reason why. That's the case because recessions, as painful as they are, are in fact a beautiful economic signal that tell us the economy is on the mend.

The Economist | A sorry story of American trade
America’s share of world exports has slipped more than that of most developed countries over the last decade while its share of direct investment has plummeted precipitously.
Cato @ Liberty | The Decline in Global Economic Freedom
After having risen for decades, global economic freedom has fallen for a second year in a row. That’s according to Economic Freedom of the World: 2011 Annual Report co-published today with the Fraser Institute. The average global economic freedom score rose from 5.53 (out of 10) in 1980 to 6.74 in 2007 and has fallen to 6.64 in 2009, the last year for which data is available.
Heritage Foundation | Does Supply Create Demand?
Which comes first: supply or demand? This question has serious policy implications, especially as President Barack Obama proposes $447 billion in additional stimulus spending in order to try to spur job growth in America.

Health Care

National Journal | HHS Awards State Grants for Insurance-Rate Review
Federal officials have awarded $109 million in grants to 28 states and the District of Columbia to beef up their ability to review health-insurance premium increases.
Washington Times | Obama ties Medicare cuts to tax hikes on the rich
Seeking to put his stamp on deficit-reduction talks, President Obama on Monday said he will veto any debt plan that cuts Medicare benefits without also imposing higher taxes on the wealthy, and he embraced a broad call that all millionaires be made to pay an effective higher tax rate on income than middle-class families do.
National Journal | Urban Institute: Save on Health Care by Spending More on Staffing
President Obama has proposed $248 billion in savings from Medicare, much of it from obvious sources, such as asking patients to pay a little more and asking pharmaceutical companies to take a pay cut. But a report from the Urban Institute suggests a counterintuitive move that could also help save money -- spending a little more in administrative costs.`

Econ Comments                                                                                                             
NY Times | Preventing Sickness, With Plenty of Red Tape
Prevention has never been the cornerstone of American medicine. In this country, we tend to go to the doctor only when something is wrong, a habit long bemoaned by researchers and medical groups.
AEI | Designed to Fail
The President's Medicare plan contains nothing innovative or new, and does not change the structure of the program. Instead, it focuses on providers, adjusting payments and adding utilization hurdles without changing financial incentives. Most of the ideas were swept up from the CBO budget options book, so they score as savings.


Fox Business | Actions the Fed may consider at meeting this week
When the Federal Reserve holds a policy meeting Tuesday and Wednesday, it's widely expected to adopt some new step to boost the economy. The question is what it will be.

Econ Comments                                                                                                             
Market Watch | How much in bonds will the Fed buy?
The Federal Reserve is expected to announce after its policy meeting this week that it will shift the composition of the assets it’s holding toward longer-dated debt, with the goal of keeping down long-term yields that serve as benchmarks for corporate and consumer borrowing costs, including mortgage rates.
Minyanville | What Is the Fed Really Risking?
What in the wide world of monetary policy is the Fed doing, giving essentially unlimited funds to European banks? What are they seeing that we do not?

WSJ: Real Time Economics | Bernanke to Address Congressional Panel on Outlook Oct. 4
The most likely outcome is that the Fed will focus on unveiling “Operation Twist” on Wednesday, in which the central bank would extend the maturity of securities in its vast portfolio to keep long-term borrowing rates low for companies and households.
Minyanville | What Future US Monetary Policy Means for Gold Prices
The future for gold relies heavily on Ben Bernanke and the FOMC's rate decision.


WSJ | Obama Yokes Benefit Cuts to New Taxes
Mr. Obama's position, laid out as he announced a new plan to cut deficits by $3.6 trillion over 10 years, increases the challenges for a congressional supercommittee to reach a deficit-cutting deal by Thanksgiving because Republican leaders have ruled out tax increases.
CNN Money | Obama's federal worker 'tax'
Union groups for federal employees don't like a piece of President Obama's plan to cut $3 trillion from deficits over the next decade -- the one that has all federal workers contributing more to their pensions.

Econ Comments                                                                                                             
Washington Times | MILLER: The Buffett tax
Obama’s $1.5 trillion hike would wreak havoc on floundering economy.
WSJ | The Buffett Alternative Tax
The rich don't pay lower average tax rates.
Washington Times | RAHN: Stealth wealth tax
Lower interest rates and inflation are eroding Americans’ savings.
RCM | Only Class Warfare Explains Obama's Bizarre Tax Attack
Almost all of Warren Buffett's income comes from capital gains taxed at 15 percent. He only pays himself $100,000 a year, which would be taxed at the top rate. Most of his wealth is untaxed as unrealized capital gains. So his effective income-tax rate is lower than his secretary's.
AEI | Do Taxes Narrow the Wealth Gap?
Obama wants to tax the rich. Republicans say he's promoting class warfare. Can taxes bridge the income gap?

Political Calculations | The Itemized Tax Deductions of the Rich and Famous
What tax deductions do the rich and famous, as well as all other Americans who earn more than $200,000 per year, claim on their U.S. tax returns, and how much do they claim for each?
NRO: The Corner | Who Wants to Tax a Millionaire?
Obviously, Warren Buffett likes having spending at its current 25.3 percent level, which is why he is trying to find ways to pay for it.


Econ Comments                                                                                                             
CNN Money | Obama: Looking for jobs in all the wrong places
The president has a very clear vision of how to solve the jobs crisis. The problem is he's completely misguided.

WSJ: Real Time Economics | Only Advanced-Degree Holders See Wage Gains
Why do polls show Americans are so cranky these days? Well, maybe it has something to do with their paychecks.
Heritage Foundation | ‘Green Jobs’ Proponents Continue to Tout Solyndra Program as Success
...from an economic perspective, the Solyndra loan was a failure. But if the purpose of the loan guarantee program was to get more people to invest in green technology, then Solyndra’s failure has no bearing on the program’s success.


NY Times | Public Schools Face the Rising Costs of Serving Lunch
The federal government is making school meals more nutritious this year, but also more expensive.

Econ Comments                                                                                                             
WSJ | What Comes After 'Europe'?
The "fiscal union" that's being mooted will never come to pass: German voters won't stand for it, and neither will any other country that wants to retain fiscal independence—which is to say, the core attribute of democratic sovereignty.
Washington Times | EDITORIAL: Obama’s phony debt plan
Rosy growth projections contrast with grim reality.
Politico | Debt impedes job creation
Excessive debt threatens the economic future of the United States. Economists are increasingly sounding alarm bells that the escalating federal debt is reaching unsustainable levels.

CRS | Financial Services and General Government: FY2012 Appropriations
On February 14, 2011, President Obama issued his FY2012 budget request. The request included a total of $48.72 billion for agencies funded through the FSGG appropriations bill, including $308 million for the CFTC. The President's request would increase funding $4.03 billion above FY2011 enacted amounts.