News
Market Watch | U.S. house prices slide 1.3% in November
U.S. house prices dropped sharply in November to mark the third straight drop, according to a closely followed index released Tuesday.
National Journal | Senate GOP Introduces Keystone XL Bill
Forty-three GOP senators—along with one Democrat, Joe Manchin of West Virginia—introduced legislation on Monday mandating that Congress approve the controversial oil-sands pipeline.
Bloomberg | Foreclosures Draw Private Equity as U.S. Selling 200,000 Homes: Mortgages
Private equity firms are jumping into distressed housing as the U.S. government plans to market 200,000 foreclosed homes as rentals to speed up the economic recovery.
WSJ | Rising Income Is Saved, Not Spent
Incomes ticked up in December but consumers chose to save instead of spend, suggesting a still-cautious outlook that likely has carried into 2012.
Market Watch | Consumer-confidence gauge falls to 61.1 in January
A gauge of U.S. consumer confidence fell to 61.1 in January, partly reversing substantial gains in the prior two months, as views on current business conditions and employment declined, the Conference Board reported Tuesday.
Econ Comments & Analysis
CNN Money | The housing recovery that wasn't
The evidence for a recovery is compelling, but optimists should actually be watching rising interest rates.
WSJ | Keystone Can Help the Gulf—and the Northeast
Former House speaker and current Democratic Minority Leader Nancy Pelosi suggested at a press briefing this month that the pipeline would have no value to the U.S
Forbes | President Obama's Blueprint For Expanding Government Power
The President’s vision of the path forward for America is to imagine ourselves as members of a military organization with the American people selflessly following the orders of their superior officers no matter the personal cost up through the chain of command to the President as Commander in Chief.
Washington Times | Obama’s frack attack
Unless the president sticks to his promise of an “all-out, all-of-the-above” energy strategy and keeps the carbon haters at bay, America's energy future will be at risk.
Politico | Making room for new, old economies
The announcements by Sens. Ben Nelson (D-Neb.) and Kent Conrad (D-N.D.) that they would not run for reelection reflects what may be the last gasps of the Great Plains Democrats
Blogs
Calculated Risk | A few policies I expect soon
Housing, payroll tax extension, a Greek deal and more ...
Atlantic | Federal Worker Pay: How Much is Too Much?
The disparity in benefits is even larger; the CBO estimates it at 48% higher than comparable civilian employment.
The American | Is it unfair to compare the Obama and Reagan economic recoveries? No
Subtract the housing rebound from the Reagan Recovery and GDP still grows twice as fast as during the Obama Recovery.
Tuesday, January 31, 2012
Health Care
News
National Journal | US Joins Groups Against Tropical Diseases
The World Health Organization says 1 billion people worldwide — one person in seven — suffer from such tropical diseases, spread by worms, flies, mosquitoes, bacteria and parasites.
National Journal | New Rules on Military Caregiver Leave Move Forward
The U.S. Labor Department issued proposed rules on Monday that would make it easier for military caregivers to take time off.
Econ Comments & Analysis
Politico | CBO makes it official: Federal workers get better benefits
Federal workers enjoy much better benefits — including health insurance, retirement and paid vacation — than private sector workers, according to a new report from the Congressional Budget Office.
National Journal | US Joins Groups Against Tropical Diseases
The World Health Organization says 1 billion people worldwide — one person in seven — suffer from such tropical diseases, spread by worms, flies, mosquitoes, bacteria and parasites.
National Journal | New Rules on Military Caregiver Leave Move Forward
The U.S. Labor Department issued proposed rules on Monday that would make it easier for military caregivers to take time off.
Econ Comments & Analysis
Politico | CBO makes it official: Federal workers get better benefits
Federal workers enjoy much better benefits — including health insurance, retirement and paid vacation — than private sector workers, according to a new report from the Congressional Budget Office.
Monetary
Econ Comments & Analysis
Real Clear Markets | The Bernanke Fed Is Killing the Economic Patient
The members of the Federal Reserve Board led by a doctor of different stripes, Ben Bernanke, could learn more from House of God than all the economics books they devour on the way to grandiose visions of fixing what ails us economically.
CNBC | Rates May Need to Rise Sooner: Philly Fed's Plosser
If the U.S. economy keeps improving, interest rates should be raised this year or in the middle of next year at the latest, Philadelphia Federal Reserve President Charles Plosser told CNBC Monday.
Blogs
CATO | Chinese Currency and the U.S. Financial Crisis
China was eager to buy our debt, both Treasury bonds and Fannie and Freddie’s debt. But it was Congress that ran the deficits, and the Fed that kept interest rates artificially low.
Minyanville | What the Fed Is Doing to Gold
The price action in the S&P 500 Thursday was certainly bearish short term, but a back test of 1,300 or possibly even 1,280 could give rise to a Phoenix.
Real Clear Markets | The Bernanke Fed Is Killing the Economic Patient
The members of the Federal Reserve Board led by a doctor of different stripes, Ben Bernanke, could learn more from House of God than all the economics books they devour on the way to grandiose visions of fixing what ails us economically.
CNBC | Rates May Need to Rise Sooner: Philly Fed's Plosser
If the U.S. economy keeps improving, interest rates should be raised this year or in the middle of next year at the latest, Philadelphia Federal Reserve President Charles Plosser told CNBC Monday.
Blogs
CATO | Chinese Currency and the U.S. Financial Crisis
China was eager to buy our debt, both Treasury bonds and Fannie and Freddie’s debt. But it was Congress that ran the deficits, and the Fed that kept interest rates artificially low.
Minyanville | What the Fed Is Doing to Gold
The price action in the S&P 500 Thursday was certainly bearish short term, but a back test of 1,300 or possibly even 1,280 could give rise to a Phoenix.
Taxes
News
CNN Money | Obama's tax record
Republicans portray President Obama as the tax-hiker-in-chief. Obama portrays himself as a tax cutter for the masses but not the rich. The truth isn't so cut and dry.
Econ Comments & Analysis
Washington Times | Obama’s odd sense of fairness
In his State of Union address, President Obama said millionaires should pay a minimum of 30 percent of their income in taxes. The 30 percent number seems to have come from divine inspiration rather than an exercise in logic.
Blogs
Greg Mankiw | How much would a Buffett Tax raise?
Obama’s still-vague Buffett Tax would apparently impose a minimum 30 percent tax rate on incomes exceeding $1 million. With economic growth, the 10-year total might optimistically be $600 billion to $700 billion. It would be a tiny help; that’s all.
Atlantic | Differences in Work and Leisure Across Countries
An apparent paradox that frequently puzzles journalists is that Europeans work fewer hours than workers in the United States, while in some countries, hourly productivity appears to be the same, or even higher, than that of American workers.
CATO | Lower Tax Rates Are the Best Way to Reduce Tax Evasion
Simply stated, people respond to incentives. When tax rates are punitive, folks earn and report less taxable income, and vice-versa.
CNN Money | Obama's tax record
Republicans portray President Obama as the tax-hiker-in-chief. Obama portrays himself as a tax cutter for the masses but not the rich. The truth isn't so cut and dry.
Econ Comments & Analysis
Washington Times | Obama’s odd sense of fairness
In his State of Union address, President Obama said millionaires should pay a minimum of 30 percent of their income in taxes. The 30 percent number seems to have come from divine inspiration rather than an exercise in logic.
Blogs
Greg Mankiw | How much would a Buffett Tax raise?
Obama’s still-vague Buffett Tax would apparently impose a minimum 30 percent tax rate on incomes exceeding $1 million. With economic growth, the 10-year total might optimistically be $600 billion to $700 billion. It would be a tiny help; that’s all.
Atlantic | Differences in Work and Leisure Across Countries
An apparent paradox that frequently puzzles journalists is that Europeans work fewer hours than workers in the United States, while in some countries, hourly productivity appears to be the same, or even higher, than that of American workers.
CATO | Lower Tax Rates Are the Best Way to Reduce Tax Evasion
Simply stated, people respond to incentives. When tax rates are punitive, folks earn and report less taxable income, and vice-versa.
Employment
News
Bloomberg | German Unemployment Fell in January
The number of people out of work fell a seasonally adjusted 34,000 to 2.85 million, the Nuremberg-based Federal Labor Agency said today.
National Journal | CBO Sees Unemployment Above 7 Percent Until 2015
In an election year centered on dueling themes of high unemployment and a massive federal deficit, the outlook contains several calculations both Democrats and Republicans will be sure to pounce on.
Econ Comments & Analysis
Politico | CBO makes it official: Federal workers get better benefits
The federal government spent an average of 48 percent more on benefits for its employees than private employers spent between 2005 and 2010.
NBER | Family Proximity, Childcare, and Women's Labor Force Attachment
We show that close geographical proximity to mothers or mothers-in-law has a substantial positive effect on the labor supply of married women with young children.
Bloomberg | German Unemployment Fell in January
The number of people out of work fell a seasonally adjusted 34,000 to 2.85 million, the Nuremberg-based Federal Labor Agency said today.
National Journal | CBO Sees Unemployment Above 7 Percent Until 2015
In an election year centered on dueling themes of high unemployment and a massive federal deficit, the outlook contains several calculations both Democrats and Republicans will be sure to pounce on.
Econ Comments & Analysis
Politico | CBO makes it official: Federal workers get better benefits
The federal government spent an average of 48 percent more on benefits for its employees than private employers spent between 2005 and 2010.
NBER | Family Proximity, Childcare, and Women's Labor Force Attachment
We show that close geographical proximity to mothers or mothers-in-law has a substantial positive effect on the labor supply of married women with young children.
Budget
News
WSJ | U.S. Gets Tougher on Debt Collecting
The Federal Trade Commission intensified its crackdown on the booming debt-collection industry, announcing a $2.5 million settlement with a company for allegedly coercing borrowers into paying debts they no longer legally owed.
Econ Comments & Analysis
CBO | The Budget and Economic Outlook: Fiscal Years 2012 to 2022
Each January, CBO prepares “baseline” budget projections spanning the next 10 years. Those projections are not a forecast of future events; rather, they are intended to provide a benchmark against which potential policy changes can be measured.
Blogs
The American | The Obama stimulus: How Big Government screwed up the Big Spend
It was the Democrats’ Best and Brightest—but not one with a smidgen of executive experience in either the private or public sector. And into their hands was entrusted an $800 billion stimulus spending plan, a package whose details were fleshed out by Harry Reid and Nancy Pelosi. What could go wrong?
WSJ | U.S. Gets Tougher on Debt Collecting
The Federal Trade Commission intensified its crackdown on the booming debt-collection industry, announcing a $2.5 million settlement with a company for allegedly coercing borrowers into paying debts they no longer legally owed.
Econ Comments & Analysis
CBO | The Budget and Economic Outlook: Fiscal Years 2012 to 2022
Each January, CBO prepares “baseline” budget projections spanning the next 10 years. Those projections are not a forecast of future events; rather, they are intended to provide a benchmark against which potential policy changes can be measured.
Blogs
The American | The Obama stimulus: How Big Government screwed up the Big Spend
It was the Democrats’ Best and Brightest—but not one with a smidgen of executive experience in either the private or public sector. And into their hands was entrusted an $800 billion stimulus spending plan, a package whose details were fleshed out by Harry Reid and Nancy Pelosi. What could go wrong?
Monday, January 30, 2012
General Economics
News
Market Watch | Wages up 0.5% in December; spending ebbs
The Commerce Department said personal income jumped 0.5% last month, while personal spending fell less than 0.1%. Economists surveyed by MarketWatch forecast income to rise by 0.4% and spending by 0.1%.
Bloomberg | Obama Recovery Proves No Morning in America Yet
President Barack Obama presides over an economy that eluded the threat of a double-dip recession in mid-2011 and now is strengthening, with growth accelerating in the fourth quarter to a 2.8 percent rate, the fastest in 18 months, from 1.8 percent the previous quarter. Still, the pace remains well short of the recovery that helped propel the re-election of Reagan.
USA Today | December rise in incomes caps a dreadful year for consumers
Americans' incomes rose last month by the most in nine months, a hopeful sign for the economy after a year of weak wage gains. But consumer spending was flat.
WSJ | Fitch Downgrades Five Euro-Zone Members
Fitch Ratings downgraded Italy, Spain, Belgium, Cyprus and Slovenia's sovereign debt ratings Friday as it wrapped up a review of the region.
Bloomberg | Global Economy, Recession Risk Are Bankers’ Main Concern, Survey Reports
Macro-economic risk rose to become the number-one concern among bankers, the Centre for the Study of Financial Innovation, a forum for bankers and regulators funded by institutions including the Bank of England, reported in a survey today. The amount of debt some countries have, access to liquidity and a scarcity of capital were their next worries, it said.
FOX News | American economy not healthy yet, but it's healing
The 2.8 percent annual growth rate reported Friday for the fourth quarter was the fastest since spring 2010 and was the third straight quarter that growth has accelerated. Experts cautioned, however, that the pace was unlikely to last and that it's not enough to sharply drive down the unemployment rate.
WSJ | Spanish Economy Contracts
Two years after it clawed back from recession, the Spanish economy shrank in the last three months of 2011 as government austerity measures crimped spending and Europe's debt crisis drove up financing costs.
Econ Comments & Analysis
Atlantic | The Innovation Nation vs. the Warfare-Welfare State
We like to think of ourselves as an innovation nation, but our government is a warfare/welfare state. To build an economy for the 21st century we need to increase the rate of innovation and to do that we need to put innovation at the center of our national vision.
WSJ | The 1.7% Year
The U.S. economy continued its progress as a good news-bad news story, with yesterday's report that fourth quarter growth was 2.8%. That's an acceleration from the 1.2% average of the previous three quarters, but it's still well below cruising speed for 30 months into a recovery after a deep recession
Daily Finance | 5 Intriguing (and Less Painful) Fixes for Social Security
There's widespread worry about the long-term solvency of Social Security. The potential remedies we hear the most about aren't pretty
WSJ | The Solyndra Rule
President Obama keeps pushing the (Warren) Buffett rule that nobody making more than $1 million a year should pay less than 30% in taxes. He'd do better by the economy if he adopted a Solyndra Rule
Washington Times | Obama’s next bailout
On Jan. 23, U.S. Department of Housing and Urban Development Secretary Shaun L.S. Donovan met in Chicago with several Democratic state attorneys general (AGs) in an attempt to strong-arm them into signing up for an administration-backed agreement to settle the “robo-signing” scandal.
WSJ | The Coming Tech-led Boom
In January 1912, the United States emerged from a two-year recession. Nineteen more followed—along with a century of phenomenal economic growth. Americans in real terms are 700% wealthier today.
Blogs
Calculated Risk | Schedule for Week of Jan 29th
The key report is the January employment report to be released on Friday, Feb 3rd. Other key reports include the Case-Shiller house price index on Tuesday, the ISM manufacturing index on Wednesday, vehicle sales on Wednesday, and the ISM non-manufacturing (service) index on Friday.
WSJ | Economists React: GDP ‘Less Impressive Than It Looks’
Muddling through is the best term that can be applied to the current economic environment, even though the risks of a downturn have been reduced.
Atlantic | When Will Housing Hit Bottom?
The National Association of Realtors is (quelle surprise!) quite bullish on the future of the housing market. Not so fast, says Lance Roberts of StreetTalk Advisors:
Daily Capitalist | The Meaning Behind Q4 GDP Numbers
While there were some positive signs in the report, the report was obscured by a potential negative indicator, inventory build, which signals trouble for Q1 2012. And there are other things.
WSJ | Outsized Impact of Inventories on GDP Growth
For U.S. gross domestic product growth, the disappointment devil is in the details
Calculated Risk | Unofficial Problem Bank list declines to 958 Institutions
Here is the unofficial problem bank list for Jan 27, 2012.
Keith Hennessey | The President’s economic policy priorities
There is nothing wrong with prioritizing long-term economic problems and challenges; in fact, quite the opposite. Washington usually focuses only on problems and challenges that will bite before the next election.
Market Watch | Wages up 0.5% in December; spending ebbs
The Commerce Department said personal income jumped 0.5% last month, while personal spending fell less than 0.1%. Economists surveyed by MarketWatch forecast income to rise by 0.4% and spending by 0.1%.
Bloomberg | Obama Recovery Proves No Morning in America Yet
President Barack Obama presides over an economy that eluded the threat of a double-dip recession in mid-2011 and now is strengthening, with growth accelerating in the fourth quarter to a 2.8 percent rate, the fastest in 18 months, from 1.8 percent the previous quarter. Still, the pace remains well short of the recovery that helped propel the re-election of Reagan.
USA Today | December rise in incomes caps a dreadful year for consumers
Americans' incomes rose last month by the most in nine months, a hopeful sign for the economy after a year of weak wage gains. But consumer spending was flat.
WSJ | Fitch Downgrades Five Euro-Zone Members
Fitch Ratings downgraded Italy, Spain, Belgium, Cyprus and Slovenia's sovereign debt ratings Friday as it wrapped up a review of the region.
Bloomberg | Global Economy, Recession Risk Are Bankers’ Main Concern, Survey Reports
Macro-economic risk rose to become the number-one concern among bankers, the Centre for the Study of Financial Innovation, a forum for bankers and regulators funded by institutions including the Bank of England, reported in a survey today. The amount of debt some countries have, access to liquidity and a scarcity of capital were their next worries, it said.
FOX News | American economy not healthy yet, but it's healing
The 2.8 percent annual growth rate reported Friday for the fourth quarter was the fastest since spring 2010 and was the third straight quarter that growth has accelerated. Experts cautioned, however, that the pace was unlikely to last and that it's not enough to sharply drive down the unemployment rate.
WSJ | Spanish Economy Contracts
Two years after it clawed back from recession, the Spanish economy shrank in the last three months of 2011 as government austerity measures crimped spending and Europe's debt crisis drove up financing costs.
Econ Comments & Analysis
Atlantic | The Innovation Nation vs. the Warfare-Welfare State
We like to think of ourselves as an innovation nation, but our government is a warfare/welfare state. To build an economy for the 21st century we need to increase the rate of innovation and to do that we need to put innovation at the center of our national vision.
WSJ | The 1.7% Year
The U.S. economy continued its progress as a good news-bad news story, with yesterday's report that fourth quarter growth was 2.8%. That's an acceleration from the 1.2% average of the previous three quarters, but it's still well below cruising speed for 30 months into a recovery after a deep recession
Daily Finance | 5 Intriguing (and Less Painful) Fixes for Social Security
There's widespread worry about the long-term solvency of Social Security. The potential remedies we hear the most about aren't pretty
WSJ | The Solyndra Rule
President Obama keeps pushing the (Warren) Buffett rule that nobody making more than $1 million a year should pay less than 30% in taxes. He'd do better by the economy if he adopted a Solyndra Rule
Washington Times | Obama’s next bailout
On Jan. 23, U.S. Department of Housing and Urban Development Secretary Shaun L.S. Donovan met in Chicago with several Democratic state attorneys general (AGs) in an attempt to strong-arm them into signing up for an administration-backed agreement to settle the “robo-signing” scandal.
WSJ | The Coming Tech-led Boom
In January 1912, the United States emerged from a two-year recession. Nineteen more followed—along with a century of phenomenal economic growth. Americans in real terms are 700% wealthier today.
Blogs
Calculated Risk | Schedule for Week of Jan 29th
The key report is the January employment report to be released on Friday, Feb 3rd. Other key reports include the Case-Shiller house price index on Tuesday, the ISM manufacturing index on Wednesday, vehicle sales on Wednesday, and the ISM non-manufacturing (service) index on Friday.
WSJ | Economists React: GDP ‘Less Impressive Than It Looks’
Muddling through is the best term that can be applied to the current economic environment, even though the risks of a downturn have been reduced.
Atlantic | When Will Housing Hit Bottom?
The National Association of Realtors is (quelle surprise!) quite bullish on the future of the housing market. Not so fast, says Lance Roberts of StreetTalk Advisors:
Daily Capitalist | The Meaning Behind Q4 GDP Numbers
While there were some positive signs in the report, the report was obscured by a potential negative indicator, inventory build, which signals trouble for Q1 2012. And there are other things.
WSJ | Outsized Impact of Inventories on GDP Growth
For U.S. gross domestic product growth, the disappointment devil is in the details
Calculated Risk | Unofficial Problem Bank list declines to 958 Institutions
Here is the unofficial problem bank list for Jan 27, 2012.
Keith Hennessey | The President’s economic policy priorities
There is nothing wrong with prioritizing long-term economic problems and challenges; in fact, quite the opposite. Washington usually focuses only on problems and challenges that will bite before the next election.
Health Care
News
National Journal | Bipartisan Task Force's Report Agrees on Health-IT Problems, but Not Much Else
Everyone in Washington loves to love bipartisanship. It’s a lofty goal that is rarely achieved inside the Beltway, but perhaps sometimes that’s a good thing, because being bipartisan can mean you don’t get much done.
National Journal | Government Tells Supreme Court It Can Split Up Health Care Reform Law
The Supreme Court should uphold the individual mandate to buy insurance at the heart of the health care reform law, but if it strikes it down, it need not invalidate the law's many unrelated provisions, the government says.
Blogs
Volokh Conspiracy | Most Americans Want Mandate Struck Down
The Kaiser Family Foundation’s latest poll (toplines here) finds that two-thirds of Americans oppose the individual mandate and a clear majority — 54 percent — want the Supreme Court to invalidate the provision.
National Journal | Bipartisan Task Force's Report Agrees on Health-IT Problems, but Not Much Else
Everyone in Washington loves to love bipartisanship. It’s a lofty goal that is rarely achieved inside the Beltway, but perhaps sometimes that’s a good thing, because being bipartisan can mean you don’t get much done.
National Journal | Government Tells Supreme Court It Can Split Up Health Care Reform Law
The Supreme Court should uphold the individual mandate to buy insurance at the heart of the health care reform law, but if it strikes it down, it need not invalidate the law's many unrelated provisions, the government says.
Blogs
Volokh Conspiracy | Most Americans Want Mandate Struck Down
The Kaiser Family Foundation’s latest poll (toplines here) finds that two-thirds of Americans oppose the individual mandate and a clear majority — 54 percent — want the Supreme Court to invalidate the provision.
Monetary
Econ Comments & Analysis
Washington Times | Fleeced by the Fed
The Federal Reserve Board announced plans last Tuesday to keep short-term interest rates at near zero for another three years and said it might embark upon another bond-buying program to drive down long-term interest rates.
Blogs
WSJ | Richmond Fed’s Lacker Explains His Dissent
U.S. Federal Reserve Bank of Richmond President Jeffrey Lacker, explaining an earlier dissent, on Friday said he doesn’t believe economic conditions are likely to warrant an exceptionally low federal funds rate through late 2014.
Washington Times | Fleeced by the Fed
The Federal Reserve Board announced plans last Tuesday to keep short-term interest rates at near zero for another three years and said it might embark upon another bond-buying program to drive down long-term interest rates.
Blogs
WSJ | Richmond Fed’s Lacker Explains His Dissent
U.S. Federal Reserve Bank of Richmond President Jeffrey Lacker, explaining an earlier dissent, on Friday said he doesn’t believe economic conditions are likely to warrant an exceptionally low federal funds rate through late 2014.
Taxes
Econ Comments & Analysis
Washington Post | ‘Buffett Tax’ and truth in numbers
Obama thinks he can ride resentment against the rich into the White House for a second term; and Republican Romney’s fortune, estimated at $190 million or more, qualifies him as super-rich.
Daily Caller | Obama’s recovery plan: tax investment
You would think that with one of the weakest economic recoveries on record, President Obama would be desperately searching for ways to promote economic growth. But instead, Obama used his State of the Union speech to rail on about fairness, inequality and redistribution.
Politico | McConnell declines to write off tax increase
As he vowed to extend the payroll tax holiday through the end of the year, Senate Minority Leader Mitch McConnell (R-Ky.) on Sunday declined to definitively write off the possibility of paying for it at least partially with a tax increase.
Washington Times | Tax the ‘rich’
Each presidential candidate’s position on investment tax rates is a critical issue. The current rates, set by President George W. Bush, will expire at the end of this year, so whoever sits behind the desk in the Oval Office next January will have the power to stop the capital-gains tax rate from jumping to 20 percent and qualified dividends rising to 39.6 percent.
WSJ | Will Buffett Avoid the Buffett Rule?
In the current debate, President Obama is pushing the "Buffett Rule" to ensure that high-income earners pay higher tax rates. But even if it's enacted, don't expect the Buffett Rule to have much impact on Mr. Buffett.
Blogs
AEI | Tax Analysts exclusive: a conversation with Alex Brill
Tax reform is a two-front war. On one side there is the battle of dollars and cents: special interests using every trick in the book to preserve their tax breaks. On the other side there is the ideological battle: liberals versus conservatives
Heritage Foundation | Chart of the Week: Top 1 Percent Paid 38 Percent of Taxes
This week’s chart reveals the top 10 percent of income earners paid 70 percent of all federal income taxes in 2008, while the bottom 50 percent paid only 3 percent. Remarkably, 49 percent of U.S. households paid no federal income tax at all.
Tax Foundation | “Buffett Rule” Will Boost Top Dividend Rate to Over 62%, Highest in OECD
Lost in the intense scrutiny of the 15 percent tax rate that Mitt Romney paid on his capital gains and dividend income is the fact that capital gains and dividend taxes are a second layer of tax on corporate profits.
Minyanville | Will Tax Breaks Bring Manufacturing Jobs Back to the US?
In his State of the Union address on January 24, President Obama spoke of a possible manufacturing renaissance popping up right here in the United States. With the right tax policies in place, over time, Mr. Obama believes that this potential renaissance could be a reality.
Washington Post | ‘Buffett Tax’ and truth in numbers
Obama thinks he can ride resentment against the rich into the White House for a second term; and Republican Romney’s fortune, estimated at $190 million or more, qualifies him as super-rich.
Daily Caller | Obama’s recovery plan: tax investment
You would think that with one of the weakest economic recoveries on record, President Obama would be desperately searching for ways to promote economic growth. But instead, Obama used his State of the Union speech to rail on about fairness, inequality and redistribution.
Politico | McConnell declines to write off tax increase
As he vowed to extend the payroll tax holiday through the end of the year, Senate Minority Leader Mitch McConnell (R-Ky.) on Sunday declined to definitively write off the possibility of paying for it at least partially with a tax increase.
Washington Times | Tax the ‘rich’
Each presidential candidate’s position on investment tax rates is a critical issue. The current rates, set by President George W. Bush, will expire at the end of this year, so whoever sits behind the desk in the Oval Office next January will have the power to stop the capital-gains tax rate from jumping to 20 percent and qualified dividends rising to 39.6 percent.
WSJ | Will Buffett Avoid the Buffett Rule?
In the current debate, President Obama is pushing the "Buffett Rule" to ensure that high-income earners pay higher tax rates. But even if it's enacted, don't expect the Buffett Rule to have much impact on Mr. Buffett.
Blogs
AEI | Tax Analysts exclusive: a conversation with Alex Brill
Tax reform is a two-front war. On one side there is the battle of dollars and cents: special interests using every trick in the book to preserve their tax breaks. On the other side there is the ideological battle: liberals versus conservatives
Heritage Foundation | Chart of the Week: Top 1 Percent Paid 38 Percent of Taxes
This week’s chart reveals the top 10 percent of income earners paid 70 percent of all federal income taxes in 2008, while the bottom 50 percent paid only 3 percent. Remarkably, 49 percent of U.S. households paid no federal income tax at all.
Tax Foundation | “Buffett Rule” Will Boost Top Dividend Rate to Over 62%, Highest in OECD
Lost in the intense scrutiny of the 15 percent tax rate that Mitt Romney paid on his capital gains and dividend income is the fact that capital gains and dividend taxes are a second layer of tax on corporate profits.
Minyanville | Will Tax Breaks Bring Manufacturing Jobs Back to the US?
In his State of the Union address on January 24, President Obama spoke of a possible manufacturing renaissance popping up right here in the United States. With the right tax policies in place, over time, Mr. Obama believes that this potential renaissance could be a reality.
Employment
Econ Comments & Analysis
FOX News | Private sector unions add members as jobs return
Union membership grew slightly last year, giving labor leaders hope that a period of steep declines has finally bottomed out.
Blogs
CNN Money | A German solution to an American jobs problem?
One common refrain heard at this year's World Economic Forum in Davos: "we need to create more jobs." The rub is that with high consumer and government debt levels in much of the developed world, no one seems to have any idea how to achieve this goal.
FOX News | Private sector unions add members as jobs return
Union membership grew slightly last year, giving labor leaders hope that a period of steep declines has finally bottomed out.
Blogs
CNN Money | A German solution to an American jobs problem?
One common refrain heard at this year's World Economic Forum in Davos: "we need to create more jobs." The rub is that with high consumer and government debt levels in much of the developed world, no one seems to have any idea how to achieve this goal.
Budget
News
Bloomberg | Greek Debt Talks Risk Derailing EU Summit
EU chiefs arrived in Brussels today to put the finishing touches on a German-led deficit-control treaty and to endorse the statutes of a 500 billion-euro ($656 billion) rescue fund to be set up this year.
Washington Times | Retiring later a tough sell in cutting deficit
The Congressional Budget Office recently found that gradually raising the retirement age by just three years for seniors to collect Social Security and Medicare benefits would go a long way toward curing the looming shortfalls in those programs
WSJ | Portuguese Borrowing Costs Hit New Record
Borrowing costs for Portugal pushed to euro-era highs for the second consecutive day Friday, while the cost of insuring that debt also hit fresh records, as market participants increasingly considered what a Greek restructuring deal could mean for those holding Portuguese debt.
Blogs
Neighborhood Effects | New Education Funding in Illinois Goes to Pensions
According to the state’s numbers, Illinois’s unfunded pension liabilities amount to roughly $85 billion but as Eileen Norcross and I have argued, the amount is actually closer to $173 billion.
Bloomberg | Greek Debt Talks Risk Derailing EU Summit
EU chiefs arrived in Brussels today to put the finishing touches on a German-led deficit-control treaty and to endorse the statutes of a 500 billion-euro ($656 billion) rescue fund to be set up this year.
Washington Times | Retiring later a tough sell in cutting deficit
The Congressional Budget Office recently found that gradually raising the retirement age by just three years for seniors to collect Social Security and Medicare benefits would go a long way toward curing the looming shortfalls in those programs
WSJ | Portuguese Borrowing Costs Hit New Record
Borrowing costs for Portugal pushed to euro-era highs for the second consecutive day Friday, while the cost of insuring that debt also hit fresh records, as market participants increasingly considered what a Greek restructuring deal could mean for those holding Portuguese debt.
Blogs
Neighborhood Effects | New Education Funding in Illinois Goes to Pensions
According to the state’s numbers, Illinois’s unfunded pension liabilities amount to roughly $85 billion but as Eileen Norcross and I have argued, the amount is actually closer to $173 billion.
Friday, January 27, 2012
General Economics
News
Investors | High Apartment Rents Seen Pushing People To Buy Homes
"There's no doubt rising rents will cause some potential homebuyers to think twice before renting. But we still look for only modest growth in home sales," said Paul Bishop, vice president of research at the National Association of Realtors.
Market Watch | Economy expands 2.8% in fourth quarter
The U.S. economy grew at the fastest rate in a year and a half in the fourth quarter, but a large chunk of the increase was fueled by an unexpected buildup in inventories, according to a preliminary government estimate.
WSJ | Recovery Doesn't Feature Typical Snapback in Growth
The U.S. economy has taken more than two years to claw its way back to producing the amount of goods and services it did just before the last recession.
Washington Times | Government-backed energy company files for bankruptcy
A company whose subsidiary won a $118 million grant from the Energy Department filed for bankruptcy Thursday, the third government-backed energy company to go broke in recent months.
WSJ | Obama Unveils Energy Plans
"We've got a supply of natural gas under our feet that can last America nearly a hundred years….It turns out we are the Saudi Arabia of natural gas," Mr. Obama said at a United Parcel Service Inc. facility that will serve as a refueling station for trucks that run on liquefied natural gas.
CNN Money | New-home sales hit a record low
Just 302,000 new homes were sold in 2011, 6.2% below 2010 and the lowest number of annual sales since the government started tracking home sales in 1963.
National Journal | Obama Announces Proposal to Push Colleges to Lower Tuition
"If you can't stop tuition from going up, then the funding you get from taxpayers each year will go down," Obama said, speaking of universities at-large, to students gathered at University of Michigan in Ann Arbor.
Econ Comments & Analysis
CATO | Reshaping Social Security And Our Society
It all started March 18, 2010, with the enactment of the Hiring Incentives to Restore Employment (HIRE) Act. Under this law, employers who hired new workers from Feb. 4 to Dec. 31, 2010, qualified for up to a 6.2 percent payroll-tax deduction for each new worker, essentially exempting the employer from the Social Security tax. The tax deduction had no effect on the new employee’s Social Security retirement benefits, effectively delinking the two
AEI | The right idea in the wrong place
If America wants true high-speed rail, we should first improve the Northeast Corridor between Washington and Boston. The proposed high-speed rail line between Los Angeles and San Francisco is unlikely to meet that test.
Washington Post | Angry about inequality? Don’t blame the rich.
The “rich” in America are not a monolithic, unchanging class. A study by Thomas A. Garrett, economist at the Federal Reserve Bank of St. Louis, found that less than half of people in the top 1 percent in 1996 were still there in 2005.
Washington Times | Obama’s crony capitalism
Never in modern history has the U.S. government been used so extensively as a vehicle for benefiting political cronies at the expense of the rest of us.
WSJ | Your Tax Dollars Not at Work
Last week, President Barack Obama refused to allow private citizens to spend $7 billion improving America's energy infrastructure. Three years ago, he insisted that taxpayers spend more than 100 times that amount on an outlay that also addressed the nation's energy needs, among other goals.
Forbes | 'Systemic Risk' Is Not Event Driven, It Is Character Driven
Why does everybody start talking about systemic risk, after a crisis has already started? If we define a systemic risk event as something large enough to affect the entire global financial and economic system, then you would think that the best time for investors to be told about these terrible events is before they occur.
Blogs
Think Markets | President Obama’s State of Regulation
Barack Obama sounded a number of themes in his 2012 State of the Union Address this week, all underpinned by the proposition that socioeconomic ills can be solved by interventionist government in general and his administration in particular.
Heritage Foundation | World War II: Economic Stimulant or Depressant?
Did World War II spending boost economic growth? Although some statistics appear to affirm this, wiser historical analysis demonstrates that artificial increases in output during the war masked a debilitated private economy. Meaningful growth increased after the war, when free-market mechanisms returned and marginal tax rates were reduced.
Investors | High Apartment Rents Seen Pushing People To Buy Homes
"There's no doubt rising rents will cause some potential homebuyers to think twice before renting. But we still look for only modest growth in home sales," said Paul Bishop, vice president of research at the National Association of Realtors.
Market Watch | Economy expands 2.8% in fourth quarter
The U.S. economy grew at the fastest rate in a year and a half in the fourth quarter, but a large chunk of the increase was fueled by an unexpected buildup in inventories, according to a preliminary government estimate.
WSJ | Recovery Doesn't Feature Typical Snapback in Growth
The U.S. economy has taken more than two years to claw its way back to producing the amount of goods and services it did just before the last recession.
Washington Times | Government-backed energy company files for bankruptcy
A company whose subsidiary won a $118 million grant from the Energy Department filed for bankruptcy Thursday, the third government-backed energy company to go broke in recent months.
WSJ | Obama Unveils Energy Plans
"We've got a supply of natural gas under our feet that can last America nearly a hundred years….It turns out we are the Saudi Arabia of natural gas," Mr. Obama said at a United Parcel Service Inc. facility that will serve as a refueling station for trucks that run on liquefied natural gas.
CNN Money | New-home sales hit a record low
Just 302,000 new homes were sold in 2011, 6.2% below 2010 and the lowest number of annual sales since the government started tracking home sales in 1963.
National Journal | Obama Announces Proposal to Push Colleges to Lower Tuition
"If you can't stop tuition from going up, then the funding you get from taxpayers each year will go down," Obama said, speaking of universities at-large, to students gathered at University of Michigan in Ann Arbor.
Econ Comments & Analysis
CATO | Reshaping Social Security And Our Society
It all started March 18, 2010, with the enactment of the Hiring Incentives to Restore Employment (HIRE) Act. Under this law, employers who hired new workers from Feb. 4 to Dec. 31, 2010, qualified for up to a 6.2 percent payroll-tax deduction for each new worker, essentially exempting the employer from the Social Security tax. The tax deduction had no effect on the new employee’s Social Security retirement benefits, effectively delinking the two
AEI | The right idea in the wrong place
If America wants true high-speed rail, we should first improve the Northeast Corridor between Washington and Boston. The proposed high-speed rail line between Los Angeles and San Francisco is unlikely to meet that test.
Washington Post | Angry about inequality? Don’t blame the rich.
The “rich” in America are not a monolithic, unchanging class. A study by Thomas A. Garrett, economist at the Federal Reserve Bank of St. Louis, found that less than half of people in the top 1 percent in 1996 were still there in 2005.
Washington Times | Obama’s crony capitalism
Never in modern history has the U.S. government been used so extensively as a vehicle for benefiting political cronies at the expense of the rest of us.
WSJ | Your Tax Dollars Not at Work
Last week, President Barack Obama refused to allow private citizens to spend $7 billion improving America's energy infrastructure. Three years ago, he insisted that taxpayers spend more than 100 times that amount on an outlay that also addressed the nation's energy needs, among other goals.
Forbes | 'Systemic Risk' Is Not Event Driven, It Is Character Driven
Why does everybody start talking about systemic risk, after a crisis has already started? If we define a systemic risk event as something large enough to affect the entire global financial and economic system, then you would think that the best time for investors to be told about these terrible events is before they occur.
Blogs
Think Markets | President Obama’s State of Regulation
Barack Obama sounded a number of themes in his 2012 State of the Union Address this week, all underpinned by the proposition that socioeconomic ills can be solved by interventionist government in general and his administration in particular.
Heritage Foundation | World War II: Economic Stimulant or Depressant?
Did World War II spending boost economic growth? Although some statistics appear to affirm this, wiser historical analysis demonstrates that artificial increases in output during the war masked a debilitated private economy. Meaningful growth increased after the war, when free-market mechanisms returned and marginal tax rates were reduced.
Health Care
News
National Journal | Physicians Oppose Budget Cuts
The American College of Physicians says looming budget cuts and political discord are likely to undermine successful programs that ensure people can get the medical care they need.
National Journal | Obama Administration Highlights Health Care Innovation in Private Sector
Initiatives that seek to improve diabetes care and coordinate care for people after they leave the hospital were highlighted by federal officials Thursday hoping to encourage the private sector to take on some responsibility for improving the overpriced and underperforming U.S. health care system.
Econ Comments & Analysis
Politico | 'Obamacare' shreds social safety net
“Republicans are undermining Social Security, Medicare and Medicaid. Vote Democratic to stop them.” This has become a staple of liberal Democratic campaigns. Count on the Obama ‘reelection express’ to pound this message home.
National Journal | Physicians Oppose Budget Cuts
The American College of Physicians says looming budget cuts and political discord are likely to undermine successful programs that ensure people can get the medical care they need.
National Journal | Obama Administration Highlights Health Care Innovation in Private Sector
Initiatives that seek to improve diabetes care and coordinate care for people after they leave the hospital were highlighted by federal officials Thursday hoping to encourage the private sector to take on some responsibility for improving the overpriced and underperforming U.S. health care system.
Econ Comments & Analysis
Politico | 'Obamacare' shreds social safety net
“Republicans are undermining Social Security, Medicare and Medicaid. Vote Democratic to stop them.” This has become a staple of liberal Democratic campaigns. Count on the Obama ‘reelection express’ to pound this message home.
Monetary
News
CNN Money | Why is the Fed still so nervous?
The Fed may now be too bearish. It is now pledging to keep interest rates near zero for nearly another three years, pushing out its expectations for its next rate hike from mid-2013 to late 2014.
Econ Comments & Analysis
Bloomberg | Fed Easing May Harm Long-Term Economic Growth, Warsh Says
“Recent policy activism -- measures that go beyond a central bank’s capacity or traditional remit -- threatens to forestall recovery and harms long-term growth,” Warsh said in a speech today in Stanford, California.
WSJ | The Zero Decade
The two most powerful men in Washington have a big disagreement. We mean Mr. Obama and Federal Reserve Chairman Ben Bernanke, who can't seem to agree on the health of the U.S. economy.
Washington Times | Making sense of Fed keeping interest rates low
Compared to the initial weeks of 2012, this week was chock-full of activity from a pickup in corporate earnings, Republican presidential candidate debates, the State of the Union address, economic forecast updates and, of course, the latest economic data.
CNN Money | Why is the Fed still so nervous?
The Fed may now be too bearish. It is now pledging to keep interest rates near zero for nearly another three years, pushing out its expectations for its next rate hike from mid-2013 to late 2014.
Econ Comments & Analysis
Bloomberg | Fed Easing May Harm Long-Term Economic Growth, Warsh Says
“Recent policy activism -- measures that go beyond a central bank’s capacity or traditional remit -- threatens to forestall recovery and harms long-term growth,” Warsh said in a speech today in Stanford, California.
WSJ | The Zero Decade
The two most powerful men in Washington have a big disagreement. We mean Mr. Obama and Federal Reserve Chairman Ben Bernanke, who can't seem to agree on the health of the U.S. economy.
Washington Times | Making sense of Fed keeping interest rates low
Compared to the initial weeks of 2012, this week was chock-full of activity from a pickup in corporate earnings, Republican presidential candidate debates, the State of the Union address, economic forecast updates and, of course, the latest economic data.
Taxes
News
Washington Times | Taxpayers still owed $132.9B from bailout
Some bailout programs, such as the effort to help homeowners avoid foreclosure by reducing mortgage payments, will last as late as 2017, costing the government an additional $51 billion or so.
Blogs
Tax Foundation | The Buffett Rule: Lessons from the Recession on Taxing Millionaires
Comparing the 2009 data to the pre-recession data for 2007 shows that not only did the number of millionaires fall by 40 percent, but the overall income of millionaires fell by 50 percent. The result for the U.S. Treasury was that 54 percent of the total drop in tax revenues during this period was due to the falling tax collections from millionaires.
Library of Economics | One-Sentence Tax Reform
If A and B earn the same income, but A saves and B spends more, then A should not have to pay higher lifetime taxes.
Marginal Revolution | Cell phone taxes and the tragedy of the anticommons
In the United States we tax cell phones more than beer. The usual explanations for high taxes, negative externalities and low elasticity of demand don’t seem to apply to cell phones.
The American | Look at just how progressive the U.S. tax system is
Great, great table from the Tax Foundation looking at the average real income tax rate for various income groups.
Reason | The Tax Foundation Releases 2012 State Business Tax Climate Index
The states of interest include: Illinois, which raised taxes that have gone into effect; Connecticut, which raised taxes that are going into effect; Colorado, which had a tax increase ballot initiative defeated by voters; and finally New Jersey, which is exploring cutting taxes.
Washington Times | Taxpayers still owed $132.9B from bailout
Some bailout programs, such as the effort to help homeowners avoid foreclosure by reducing mortgage payments, will last as late as 2017, costing the government an additional $51 billion or so.
Blogs
Tax Foundation | The Buffett Rule: Lessons from the Recession on Taxing Millionaires
Comparing the 2009 data to the pre-recession data for 2007 shows that not only did the number of millionaires fall by 40 percent, but the overall income of millionaires fell by 50 percent. The result for the U.S. Treasury was that 54 percent of the total drop in tax revenues during this period was due to the falling tax collections from millionaires.
Library of Economics | One-Sentence Tax Reform
If A and B earn the same income, but A saves and B spends more, then A should not have to pay higher lifetime taxes.
Marginal Revolution | Cell phone taxes and the tragedy of the anticommons
In the United States we tax cell phones more than beer. The usual explanations for high taxes, negative externalities and low elasticity of demand don’t seem to apply to cell phones.
The American | Look at just how progressive the U.S. tax system is
Great, great table from the Tax Foundation looking at the average real income tax rate for various income groups.
Reason | The Tax Foundation Releases 2012 State Business Tax Climate Index
The states of interest include: Illinois, which raised taxes that have gone into effect; Connecticut, which raised taxes that are going into effect; Colorado, which had a tax increase ballot initiative defeated by voters; and finally New Jersey, which is exploring cutting taxes.
Employment
News
WSJ | NEC Forecasts a Loss
NEC Corp. plans to cut 10,000 jobs and warned that a combination of asset write-downs and restructuring costs will result in a net loss of more than $1 billion for this fiscal year.
WSJ | Spain Unemployment Rate Hits 22%
The number of jobless Spaniards rose by 295,300 in the fourth quarter from the third, to 5.27 million.
Econ Comments & Analysis
Washington Times | Help the unemployed off the rolls
When it comes to job creation, President Obama has no clue. Under his leadership, the average amount of time spent in the unemployment lines more than doubled from four to nine months.
Blogs
Political Calculations | New Jobless Claims: Still on Track, But Increasingly Volatile
The rate of improvement in the number of new jobless claims filed each week is leveling off between 370,000 and 380,000.
Tax Foundation | Unemployment Drops in 46 States: Exceptions are Hawaii, Illinois, Mississippi, North Carolina
Unemployment rates have dropped in 46 states from January 2011 to January 2012. There were four exceptions:
WSJ | NEC Forecasts a Loss
NEC Corp. plans to cut 10,000 jobs and warned that a combination of asset write-downs and restructuring costs will result in a net loss of more than $1 billion for this fiscal year.
WSJ | Spain Unemployment Rate Hits 22%
The number of jobless Spaniards rose by 295,300 in the fourth quarter from the third, to 5.27 million.
Econ Comments & Analysis
Washington Times | Help the unemployed off the rolls
When it comes to job creation, President Obama has no clue. Under his leadership, the average amount of time spent in the unemployment lines more than doubled from four to nine months.
Blogs
Political Calculations | New Jobless Claims: Still on Track, But Increasingly Volatile
The rate of improvement in the number of new jobless claims filed each week is leveling off between 370,000 and 380,000.
Tax Foundation | Unemployment Drops in 46 States: Exceptions are Hawaii, Illinois, Mississippi, North Carolina
Unemployment rates have dropped in 46 states from January 2011 to January 2012. There were four exceptions:
Budget
News
Washington Times | Senate paves way for final debt increase
Thursday the Senate voted to clear the way for President Obama to raise the federal government’s borrowing limit by another $1.2 trillion to $16.4 trillion, which he hopes will last past the November election.
WSJ | Greece Edges Towards Debt Deal
Talks between Greece and its private sector creditors over a €100 billion ($131 billion) debt write-down edged towards an agreement
Politico | Debt ceiling increase allowed by Senate
The Senate on Thursday voted to allow President Barack Obama to increase the debt ceiling by $1.2 trillion, an amount large enough to ensure the federal government can pay its bills through the November elections.
Blogs
CATO | Biennial Budgeting: Baloney Budget Reform
I don’t recall ever agreeing with the left-liberal Center on Budget and Policy Priorities (CBPP), but their new paper on the drawbacks of the federal government switching to biennial budgeting is a good read.
Washington Times | Senate paves way for final debt increase
Thursday the Senate voted to clear the way for President Obama to raise the federal government’s borrowing limit by another $1.2 trillion to $16.4 trillion, which he hopes will last past the November election.
WSJ | Greece Edges Towards Debt Deal
Talks between Greece and its private sector creditors over a €100 billion ($131 billion) debt write-down edged towards an agreement
Politico | Debt ceiling increase allowed by Senate
The Senate on Thursday voted to allow President Barack Obama to increase the debt ceiling by $1.2 trillion, an amount large enough to ensure the federal government can pay its bills through the November elections.
Blogs
CATO | Biennial Budgeting: Baloney Budget Reform
I don’t recall ever agreeing with the left-liberal Center on Budget and Policy Priorities (CBPP), but their new paper on the drawbacks of the federal government switching to biennial budgeting is a good read.
Thursday, January 26, 2012
General Economics
News
FOX News | Foreclosures made up 20 pct. of home sales in 3Q
Despite the decline, foreclosures still represented 20 percent of all homes sold in the July-September period — about four times more than at the height of the housing boom, foreclosure listing firm RealtyTrac Inc. said Thursday.
CNN Money | Federal student loan rate set to double
Loans taken out for the current school year carried an interest rate of 3.4%, thanks to a 2007 law that phased in rate reductions for subsidized Stafford loans to undergraduate students. But the law did not specify the rate after this year. So unless something is done, rates on new loans will revert back to 6.8% -- where they were in 2007.
Politico | More Americans optimistic about economy, new poll finds
37 percent of Americans think the economy will improve in 2012, the highest level in more than a year, according to a new NBC-Wall Street Journal poll. Only 17 percent think that the economy will get worse.
FOX News | Taxpayers still owed $132.9B from bailout
Some bailout programs, such as the effort to help homeowners avoid foreclosure by reducing mortgage payments, will last as late as 2017, costing the government an additional $51 billion or so.
National Journal | Obama Proposes Legislation to Boost U.S. Manufacturing
Making good on his promise to announce new legislation targeting outsourced manufacturing jobs, President Obama announced six pieces of “insourcing” legislation on Wednesday.
Bloomberg | U.S. Durable Goods Orders Beat Forecasts
Bookings (DGNOCHNG) for goods meant to last at least three years climbed 3 percent after a revised 4.3 percent gain the prior month that was more than previously estimated, data from the Commerce Department showed today.
Econ Comments & Analysis
AEI | Common shock is the real cause of the financial crisis
It is certainly possible to find prime borrowers among people whose incomes are below the area median. But when more than half the mortgages Fannie and Freddie bought had to have that characteristic, the government-sponsored enterprises had to substantially reduce their underwriting standards in order to meet the affordable housing quotas.
Washington Times | Keystone Kops energy policy
Mr. Obama’s decision to kill the Keystone XL pipeline, which would carry oil from Alberta, Canada, to refineries on the U.S. Gulf Coast, is one more example of his administration’s ongoing war on fossil fuels - and the most recent example of how the president promises the exact opposite of what he is delivering.
Daily Finance | Is American Manufacturing on Track for a Comeback?
In December, Detroit's big-three automakers -- Ford (F), General Motors (GM), and Chrysler -- announced that they were going to hire 33,000 new workers.
NBER | Incentives and Adaptation: Evidence from Highway Procurement in Minnesota
We develop a theory of highway procurement in which contractors must modify their construction rate following a productivity shock. We model how time incentives affect the work rate and time taken, characterizing the efficient contract design.
Market Watch | Obama refi plan has bumpy road ahead
President Barack Obama’s State of the Union proposal to have Congress approve a sweeping mortgage-refinancing program funded by a bank tax has little or no chance of passage, analysts said.
Blogs
Heritage Foundation | State of the Housing Market: New Refinancing Promises?
So far, government interventions and the bailout of Fannie Mae and Freddie Mac have cost taxpayers $300 billion. The new plan may cost taxpayers hundreds of millions, perhaps billions, depending on how many families will be covered and what mortgage interest rate will be used for refinancing.
Marginal Revolution | What does the inequality-immobility link mean?
I see two big and very real problems: slow income growth for many income classes and a problem with excessively high returns to finance at the very top.
National Review | Claims and Contradictions in SOTU
Obviously, the whole speech last night was confused and self-contradicting. Here is some evidence of that, in the president’s own words
The American | Five energy errors from the State of the Union address
The Institute for Energy Research (IER) has a great post up today detailing the … let’s call them errors … regarding energy in President Obama’s State of the Union address last night.
FOX News | Foreclosures made up 20 pct. of home sales in 3Q
Despite the decline, foreclosures still represented 20 percent of all homes sold in the July-September period — about four times more than at the height of the housing boom, foreclosure listing firm RealtyTrac Inc. said Thursday.
CNN Money | Federal student loan rate set to double
Loans taken out for the current school year carried an interest rate of 3.4%, thanks to a 2007 law that phased in rate reductions for subsidized Stafford loans to undergraduate students. But the law did not specify the rate after this year. So unless something is done, rates on new loans will revert back to 6.8% -- where they were in 2007.
Politico | More Americans optimistic about economy, new poll finds
37 percent of Americans think the economy will improve in 2012, the highest level in more than a year, according to a new NBC-Wall Street Journal poll. Only 17 percent think that the economy will get worse.
FOX News | Taxpayers still owed $132.9B from bailout
Some bailout programs, such as the effort to help homeowners avoid foreclosure by reducing mortgage payments, will last as late as 2017, costing the government an additional $51 billion or so.
National Journal | Obama Proposes Legislation to Boost U.S. Manufacturing
Making good on his promise to announce new legislation targeting outsourced manufacturing jobs, President Obama announced six pieces of “insourcing” legislation on Wednesday.
Bloomberg | U.S. Durable Goods Orders Beat Forecasts
Bookings (DGNOCHNG) for goods meant to last at least three years climbed 3 percent after a revised 4.3 percent gain the prior month that was more than previously estimated, data from the Commerce Department showed today.
Econ Comments & Analysis
AEI | Common shock is the real cause of the financial crisis
It is certainly possible to find prime borrowers among people whose incomes are below the area median. But when more than half the mortgages Fannie and Freddie bought had to have that characteristic, the government-sponsored enterprises had to substantially reduce their underwriting standards in order to meet the affordable housing quotas.
Washington Times | Keystone Kops energy policy
Mr. Obama’s decision to kill the Keystone XL pipeline, which would carry oil from Alberta, Canada, to refineries on the U.S. Gulf Coast, is one more example of his administration’s ongoing war on fossil fuels - and the most recent example of how the president promises the exact opposite of what he is delivering.
Daily Finance | Is American Manufacturing on Track for a Comeback?
In December, Detroit's big-three automakers -- Ford (F), General Motors (GM), and Chrysler -- announced that they were going to hire 33,000 new workers.
NBER | Incentives and Adaptation: Evidence from Highway Procurement in Minnesota
We develop a theory of highway procurement in which contractors must modify their construction rate following a productivity shock. We model how time incentives affect the work rate and time taken, characterizing the efficient contract design.
Market Watch | Obama refi plan has bumpy road ahead
President Barack Obama’s State of the Union proposal to have Congress approve a sweeping mortgage-refinancing program funded by a bank tax has little or no chance of passage, analysts said.
Blogs
Heritage Foundation | State of the Housing Market: New Refinancing Promises?
So far, government interventions and the bailout of Fannie Mae and Freddie Mac have cost taxpayers $300 billion. The new plan may cost taxpayers hundreds of millions, perhaps billions, depending on how many families will be covered and what mortgage interest rate will be used for refinancing.
Marginal Revolution | What does the inequality-immobility link mean?
I see two big and very real problems: slow income growth for many income classes and a problem with excessively high returns to finance at the very top.
National Review | Claims and Contradictions in SOTU
Obviously, the whole speech last night was confused and self-contradicting. Here is some evidence of that, in the president’s own words
The American | Five energy errors from the State of the Union address
The Institute for Energy Research (IER) has a great post up today detailing the … let’s call them errors … regarding energy in President Obama’s State of the Union address last night.
Health Care
News
National Journal | Massachusetts Health Experience: What the Nation Can Expect?
Mitt Romney may not like to hear it, but if you want to know what health reform will look like for the United States, look to what’s happening in Massachusetts
National Journal | Republicans Getting Ready to Replace Health Reform Law
House Republicans plan to introduce a bill to replace Democrats’ landmark health reform law if the Supreme Court rules it unconstitutional.
Econ Comments & Analysis
Washington Times | Uncle Sam exacts penalty for quitting Medicare
Should people be allowed to leave Medicare? Even though Medicare is said to be highly popular, indispensable and a great boon to American seniors, some people really want out.
Blogs
The American | America’s humongous healthcare problem: Healthcare fact of the week
The president’s State of the Union address made no mention of what is purportedly his signature domestic policy achievement: the Affordable Care Act.
National Journal | Massachusetts Health Experience: What the Nation Can Expect?
Mitt Romney may not like to hear it, but if you want to know what health reform will look like for the United States, look to what’s happening in Massachusetts
National Journal | Republicans Getting Ready to Replace Health Reform Law
House Republicans plan to introduce a bill to replace Democrats’ landmark health reform law if the Supreme Court rules it unconstitutional.
Econ Comments & Analysis
Washington Times | Uncle Sam exacts penalty for quitting Medicare
Should people be allowed to leave Medicare? Even though Medicare is said to be highly popular, indispensable and a great boon to American seniors, some people really want out.
Blogs
The American | America’s humongous healthcare problem: Healthcare fact of the week
The president’s State of the Union address made no mention of what is purportedly his signature domestic policy achievement: the Affordable Care Act.
Monetary
News
Bloomberg | Bernanke Makes Case for More Bond Buying
The Federal Open Market Committee “recognizes the hardships imposed by high and persistent unemployment in an underperforming economy, and it is prepared to provide further monetary accommodation,” Bernanke said yesterday at a press conference in Washington.
Econ Comments & Analysis
WSJ | Ron Paul, the Fed and the Need for a Stable Dollar
On Wednesday the Federal Reserve shared its thoughts on the course of interest rates—but not on the implications for the value of the dollar. The two can't be disconnected.
Blogs
WSJ | The Lone Dissenter: Richmond Fed’s Lacker
Jeffrey Lacker came back with a bang. The president of the Federal Reserve Bank of Richmond today rejoined the Federal Open Market Committee‘s regular voting rotation for the first time since 2009. And he used the opportunity to dissent in the Fed’s 9-1 decision on interest-rate policy.
Calculated Risk | Bernanke paves the way for Q3
Although the FOMC might still wait until one of the two day meetings in April or June, the likelihood of QE3 being announced at the March 13th meeting has increased significantly.
WSJ | Fed Officials Detail Rate Projections
The Federal Reserve on Wednesday, in its first release of interest-rate projections by Fed officials, suggested interest rates could stay near zero for longer than previously indicated, a move that could aid the U.S. economy’s slow path to recovery.
Bloomberg | Bernanke Makes Case for More Bond Buying
The Federal Open Market Committee “recognizes the hardships imposed by high and persistent unemployment in an underperforming economy, and it is prepared to provide further monetary accommodation,” Bernanke said yesterday at a press conference in Washington.
Econ Comments & Analysis
WSJ | Ron Paul, the Fed and the Need for a Stable Dollar
On Wednesday the Federal Reserve shared its thoughts on the course of interest rates—but not on the implications for the value of the dollar. The two can't be disconnected.
Blogs
WSJ | The Lone Dissenter: Richmond Fed’s Lacker
Jeffrey Lacker came back with a bang. The president of the Federal Reserve Bank of Richmond today rejoined the Federal Open Market Committee‘s regular voting rotation for the first time since 2009. And he used the opportunity to dissent in the Fed’s 9-1 decision on interest-rate policy.
Calculated Risk | Bernanke paves the way for Q3
Although the FOMC might still wait until one of the two day meetings in April or June, the likelihood of QE3 being announced at the March 13th meeting has increased significantly.
WSJ | Fed Officials Detail Rate Projections
The Federal Reserve on Wednesday, in its first release of interest-rate projections by Fed officials, suggested interest rates could stay near zero for longer than previously indicated, a move that could aid the U.S. economy’s slow path to recovery.
Taxes
News
WSJ | Corporate-Tax Revamp Faces Hurdle
Despite broad agreement that the corporate tax code is a flawed mélange, election-year skepticism from Republicans and strained relations between the White House and the business community complicate the Obama administration's plans to overhaul it.
NY Times | Talk of Taxing the Rich More Faces Political Realities
President Obama’s call for “tax fairness” and Mitt Romney’s tax returns have catapulted the debate over tax increases on the rich to the top of the political agenda.
CNN Money | Obama's 30% millionaire tax
President Obama this week defined what he believes should be the minimum "fair share" for millionaires and billionaires to pay in taxes. His answer: At least 30% of their income.
WSJ | Payroll-Tax Break Still Divides Lawmakers
Democratic and Republican negotiators plunged back into the debate at their first public meeting Tuesday, offering diverging ideas over how to pay for the extensions—estimated to cost about $160 billion in total
Econ Comments & Analysis
Washington Times | Tax cheats on the federal rolls
Figures released this week show 98,291 current civilian employees have a severe tax lien against them. When retirees and military personnel are included, the debt figure goes up to an astounding $3.4 billion.
Market Watch | Tax deductions: Enjoy them while you can
Two-thirds of U.S. taxpayers claim the standard deduction, but if ever there was a time to make the most of valuable tax deductions and credits, it might be now, before it’s too late.
WSJ | The Buffett Ruse
The U.S. economy is still hobbling out of recession, real family incomes are falling and 14 million Americans are unemployed, but Mr. Obama declared that his top priority is not to reform the tax code to promote growth and job creation.
Washington Times | Reshaping Social Security and our society
Social Security has fundamentally changed. This is because the historical, almost sacrosanct, linkage between Social Security taxes and benefits has been severed.
FOX Business | The Truth About the Federal Tax Burden
You wouldn’t be at fault if you thought President Barack Obama could make a rainbow sound defeatist if you listened to his State of the Union address last night.
Real Clear Markets | President Obama's Capital Gains Tax Envy
In his State of the Union Address Tuesday evening, President Obama repeated his call for tax increases on high income earners-even though some of these same tax increases failed to get through Congress in 2010 when the Democrats controlled both Houses.
Blogs
Tax Foundation | 2012 State Business Tax Climate Index Released
The 10 best states in this year's 2012 Index are Wyoming, South Dakota, Nevada, Alaska, Florida, New Hampshire, Washington, Montana, Texas, and Utah.
National Review | Poor Warren Buffett's Secretary
Buffett does pay more in taxes than his secretary, both in dollar amount and as share of income, when one properly takes the double taxation of corporate profit into consideration.
WSJ | Corporate-Tax Revamp Faces Hurdle
Despite broad agreement that the corporate tax code is a flawed mélange, election-year skepticism from Republicans and strained relations between the White House and the business community complicate the Obama administration's plans to overhaul it.
NY Times | Talk of Taxing the Rich More Faces Political Realities
President Obama’s call for “tax fairness” and Mitt Romney’s tax returns have catapulted the debate over tax increases on the rich to the top of the political agenda.
CNN Money | Obama's 30% millionaire tax
President Obama this week defined what he believes should be the minimum "fair share" for millionaires and billionaires to pay in taxes. His answer: At least 30% of their income.
WSJ | Payroll-Tax Break Still Divides Lawmakers
Democratic and Republican negotiators plunged back into the debate at their first public meeting Tuesday, offering diverging ideas over how to pay for the extensions—estimated to cost about $160 billion in total
Econ Comments & Analysis
Washington Times | Tax cheats on the federal rolls
Figures released this week show 98,291 current civilian employees have a severe tax lien against them. When retirees and military personnel are included, the debt figure goes up to an astounding $3.4 billion.
Market Watch | Tax deductions: Enjoy them while you can
Two-thirds of U.S. taxpayers claim the standard deduction, but if ever there was a time to make the most of valuable tax deductions and credits, it might be now, before it’s too late.
WSJ | The Buffett Ruse
The U.S. economy is still hobbling out of recession, real family incomes are falling and 14 million Americans are unemployed, but Mr. Obama declared that his top priority is not to reform the tax code to promote growth and job creation.
Washington Times | Reshaping Social Security and our society
Social Security has fundamentally changed. This is because the historical, almost sacrosanct, linkage between Social Security taxes and benefits has been severed.
FOX Business | The Truth About the Federal Tax Burden
You wouldn’t be at fault if you thought President Barack Obama could make a rainbow sound defeatist if you listened to his State of the Union address last night.
Real Clear Markets | President Obama's Capital Gains Tax Envy
In his State of the Union Address Tuesday evening, President Obama repeated his call for tax increases on high income earners-even though some of these same tax increases failed to get through Congress in 2010 when the Democrats controlled both Houses.
Blogs
Tax Foundation | 2012 State Business Tax Climate Index Released
The 10 best states in this year's 2012 Index are Wyoming, South Dakota, Nevada, Alaska, Florida, New Hampshire, Washington, Montana, Texas, and Utah.
National Review | Poor Warren Buffett's Secretary
Buffett does pay more in taxes than his secretary, both in dollar amount and as share of income, when one properly takes the double taxation of corporate profit into consideration.
Employment
News
Bloomberg | Factory Jobs Obama Wants for U.S. Probably Won’t Return in Large Numbers
Factory jobs, which have been shrinking as a share of total U.S. employment since the early 1950s, remain 2 million below their pre-recession level.
CNN Money | First-time unemployment claims climb
The Labor Department reported Thursday that 377,000 people filed for initial unemployment benefits in the week ended Jan. 21, up 21,000 from a revised reading of 356,000 claims the week before.
Econ Comments & Analysis
Real Clear Markets | How to Grow Jobs Without Growing the Deficit
Good news: economic activity is picking up. Not so good news: economic growth remains anemic and the pace of job creation too slow to make a meaningful dent in the unemployment rate.
Bloomberg | Factory Jobs Obama Wants for U.S. Probably Won’t Return in Large Numbers
Factory jobs, which have been shrinking as a share of total U.S. employment since the early 1950s, remain 2 million below their pre-recession level.
CNN Money | First-time unemployment claims climb
The Labor Department reported Thursday that 377,000 people filed for initial unemployment benefits in the week ended Jan. 21, up 21,000 from a revised reading of 356,000 claims the week before.
Econ Comments & Analysis
Real Clear Markets | How to Grow Jobs Without Growing the Deficit
Good news: economic activity is picking up. Not so good news: economic growth remains anemic and the pace of job creation too slow to make a meaningful dent in the unemployment rate.
Budget
News
Politico | TARP still owes $133B
Taxpayers are still owed $132.9 billion from the financial bailout initiated under President George W. Bush and continued by President Barack Obama, and some of those funds will never be repaid.
Econ Comments & Analysis
AEI | How and why a U.S. sovereign debt crisis could occur
A U.S. sovereign debt crisis is a remote possibility, but in our increasingly fragile system it could be triggered by a number of financial catastrophes
Blogs
Library of Economics | Gridlock vs. Compromise on the Deficit
Ordinarily, advocates of limited government say that gridlock is our friend. But four out of the five of us see it as our enemy right now.
Politico | TARP still owes $133B
Taxpayers are still owed $132.9 billion from the financial bailout initiated under President George W. Bush and continued by President Barack Obama, and some of those funds will never be repaid.
Econ Comments & Analysis
AEI | How and why a U.S. sovereign debt crisis could occur
A U.S. sovereign debt crisis is a remote possibility, but in our increasingly fragile system it could be triggered by a number of financial catastrophes
Blogs
Library of Economics | Gridlock vs. Compromise on the Deficit
Ordinarily, advocates of limited government say that gridlock is our friend. But four out of the five of us see it as our enemy right now.
Subscribe to:
Posts (Atom)