News
CNN Money | U.S. growth expected to slow
U.S. economic growth at the end of last year was as strong as everyone thought, but most economists expect things to slow in the next couple of years.
USA Today | Feb. consumer spending up, income lags
U.S. consumers boosted their spending in February by the most in seven months. But Americans' income barely grew and the saving rate fell to its lowest point in more than two years.
Econ Comments & Analysis
Forbes | The Failed Stimulus Zombie: It's Baaaackkkk!
This year’s John Maynard Keynes award for the most valiant attempt to prove the patently untrue goes to J. Bradford DeLong and Lawrence H. Summers for their paper “Fiscal Policy in a Depressed Economy”, published in draft form on March 20, 2012.
Blogs
WSJ | Fed’s Plosser: Additional Stimulus Would Be Bad Idea
The current and likely future path of the economy means the Federal Reserve shouldn’t provide any fresh stimulus to the economy, and monetary policy may even have to be tightened earlier than many expect, a central bank official said Thursday.
The American | America’s missing $845 billion in income—updated
Yes, I know the amount of missing income, $845 billion, almost perfectly matches the cost of President Obama’s stimulus, $831 billion. Just a coincidence, though an amusing one. (Of course, the failure of the stimulus to stimulate a return to prosperity does link it to the weak income numbers.)
Daily Capitalist | No Change GDP Q4 2011: Are The Numbers Believable?
In their “final” revision of their estimate of the fourth quarter 2011 GDP, the Bureau of Economic Analysis (BEA) found that the annualized rate of U.S. domestic economic growth was 2.97%, down a mere 0.01 percent from their last estimate for the fourth quarter and still more than a percent higher than their “final” estimate of 1.81% for the third quarter of 2011.
WSJ | GDI: An Alternate Measure Showing Stronger U.S. Growth
The GDP gets all the attention (partly because it comes out earlier), but some economists argue that the GDI may be a more meaningful measure, particularly at turning points in the economy.
Friday, March 30, 2012
Health Care
Econ Comments & Analysis
WSJ | ObamaCare Will Punish State Budgets
Two years after ObamaCare was signed into law the American people are more opposed to it than ever. It is now clear that the law will impose heavy burdens on state and family budgets and increasingly possible that its mandate that all Americans purchase health insurance or face penalties will be ruled unconstitutional.
WSJ | ObamaCare Will Punish State Budgets
Two years after ObamaCare was signed into law the American people are more opposed to it than ever. It is now clear that the law will impose heavy burdens on state and family budgets and increasingly possible that its mandate that all Americans purchase health insurance or face penalties will be ruled unconstitutional.
Monetary
Econ Comments & Analysis
Real Clear Markets | Ben Bernanke: The Economy and Stock Market Myth
In a recent interview with ABC's Diane Sawyer, Fed Chairman Ben Bernanke, the walking, talking embodiment of systemic risk, proclaimed about the U.S. economy he's done so much to destabilize that "It's far too early to declare victory." Translated, Bernanke stands ready to flood the banks with even more dollars if and when he deems the economic outlook shaky.
Forbes | Gold, Money Creation, and the Monetization of Debt
Having noticed that although gold did fall to the top end of my expected value range using money metrics, I wondered why it did not fall at least to the middle range.
CNBC | Roubini: Euro Must Come Down to Dollar’s Level
The euro needs to sink to parity with the US dollar in order to restore Europe’s peripheral economies to growth, Nouriel Roubini, the economist known as “Dr. Doom” for his bearish predictions, told CNBC Friday.
Real Clear Markets | Monetary Malfunction Blunts the Recovery
The year 1865 was profound for the United States in so many ways that lost in the euphoria of the end of the Civil War was a dramatic movement that laid the foundation for our current monetarist system, and thus our current economic predicament.
Real Clear Markets | Ben Bernanke: The Economy and Stock Market Myth
In a recent interview with ABC's Diane Sawyer, Fed Chairman Ben Bernanke, the walking, talking embodiment of systemic risk, proclaimed about the U.S. economy he's done so much to destabilize that "It's far too early to declare victory." Translated, Bernanke stands ready to flood the banks with even more dollars if and when he deems the economic outlook shaky.
Forbes | Gold, Money Creation, and the Monetization of Debt
Having noticed that although gold did fall to the top end of my expected value range using money metrics, I wondered why it did not fall at least to the middle range.
CNBC | Roubini: Euro Must Come Down to Dollar’s Level
The euro needs to sink to parity with the US dollar in order to restore Europe’s peripheral economies to growth, Nouriel Roubini, the economist known as “Dr. Doom” for his bearish predictions, told CNBC Friday.
Real Clear Markets | Monetary Malfunction Blunts the Recovery
The year 1865 was profound for the United States in so many ways that lost in the euphoria of the end of the Civil War was a dramatic movement that laid the foundation for our current monetarist system, and thus our current economic predicament.
Taxes
Econ Comments & Analysis
Washington Times | Sticker shock at the pump
Americans today are paying an average $3.92 for a gallon of regular gas. The pain of watching the number at the pump tick ever higher doesn’t seem to be shared by President Obama or his allies on Capitol Hill.
Blogs
Tax Foundation | Small Business Tax Cuts: How Small?
The two parties have found something to agree on: taxes on small business are too high and they are set to go much higher by the end of the year unless Congress acts.
Washington Times | Sticker shock at the pump
Americans today are paying an average $3.92 for a gallon of regular gas. The pain of watching the number at the pump tick ever higher doesn’t seem to be shared by President Obama or his allies on Capitol Hill.
Blogs
Tax Foundation | Small Business Tax Cuts: How Small?
The two parties have found something to agree on: taxes on small business are too high and they are set to go much higher by the end of the year unless Congress acts.
Employment
News
WSJ | Mild Winter's Minimal Effect on Recovery
America's warmest winter in 12 years has helped the U.S. job market, but most economists see weather as a relatively minor factor in explaining recent strides in employment.
WSJ | Mild Winter's Minimal Effect on Recovery
America's warmest winter in 12 years has helped the U.S. job market, but most economists see weather as a relatively minor factor in explaining recent strides in employment.
Budget
News
CNBC | Euro Zone Boosts Bailout Firewall to $1.06 Trillion
The euro zone raised the combined lending ceiling for their two bailout funds to 700 billion euros on Friday from 500 billion, euro zone finance ministers said in a statement.
Econ Comments & Analysis
WSJ | Calling the Budget Roll
Who says bipartisanship is dead in Washington? House Republicans played the dastardly trick of putting President Obama's budget proposal to a floor vote on Wednesday, and the verdict was a unanimous defeat—414-0.
Washington Times | Consequences of budget gridlock
Let’s take a break from guessing who the Republican presidential nominee will be (it’ll be Mitt Romney) and consider something that is knowable and measurably consequential.
Motley Fool | A Decade of Debt and Default
The last few years seem like a lifetime in and of themselves. Unlike previous economic downturns, most of which spanned a year or two at most, we're still slogging through the mess left by a decade of excesses in the financial and housing sectors.
WSJ | Why I'm Optimistic About Cutting the Deficit
With Washington mired in partisan gridlock, presidential candidates promising tax cuts with no specific revenue offsets, and no agreement on reforms and reductions in entitlement spending, Americans are understandably worried about the nation's rising debt. Yet I'm still hopeful we'll address the nation's long-term fiscal problems.
Blogs
The American | One budget to rule them all: Paul Ryan’s debt plan outcuts rival plans
Rep. Paul Ryan’s Path to Prosperity budget would reduce debt as a share of GDP more than all the rest. And that actually understates the PTP’s superiority. Plug in faster growth numbers from Ryan’s tax reform plan, and debt/GDP would dip into the 50% range.
Economics One | A Little Dynamic Scoring of the House Budget
In a recently released report the Congressional Budget Office calculated how debt reduction with the House Budget Resolution (which just passed the House today), would affect GNP in the United States.
CNBC | Euro Zone Boosts Bailout Firewall to $1.06 Trillion
The euro zone raised the combined lending ceiling for their two bailout funds to 700 billion euros on Friday from 500 billion, euro zone finance ministers said in a statement.
Econ Comments & Analysis
WSJ | Calling the Budget Roll
Who says bipartisanship is dead in Washington? House Republicans played the dastardly trick of putting President Obama's budget proposal to a floor vote on Wednesday, and the verdict was a unanimous defeat—414-0.
Washington Times | Consequences of budget gridlock
Let’s take a break from guessing who the Republican presidential nominee will be (it’ll be Mitt Romney) and consider something that is knowable and measurably consequential.
Motley Fool | A Decade of Debt and Default
The last few years seem like a lifetime in and of themselves. Unlike previous economic downturns, most of which spanned a year or two at most, we're still slogging through the mess left by a decade of excesses in the financial and housing sectors.
WSJ | Why I'm Optimistic About Cutting the Deficit
With Washington mired in partisan gridlock, presidential candidates promising tax cuts with no specific revenue offsets, and no agreement on reforms and reductions in entitlement spending, Americans are understandably worried about the nation's rising debt. Yet I'm still hopeful we'll address the nation's long-term fiscal problems.
Blogs
The American | One budget to rule them all: Paul Ryan’s debt plan outcuts rival plans
Rep. Paul Ryan’s Path to Prosperity budget would reduce debt as a share of GDP more than all the rest. And that actually understates the PTP’s superiority. Plug in faster growth numbers from Ryan’s tax reform plan, and debt/GDP would dip into the 50% range.
Economics One | A Little Dynamic Scoring of the House Budget
In a recently released report the Congressional Budget Office calculated how debt reduction with the House Budget Resolution (which just passed the House today), would affect GNP in the United States.
Thursday, March 29, 2012
General Economics
News
National Journal | Coal’s Future Hinges on Unproven Technology
Climate-change regulations announced by the Obama administration on Tuesday put the future of coal-fired electricity in some doubt because the only way plants could meet the new standard is through a very expensive technology that is not yet commercially viable.
CNN Money | Energy prices seen rising if speculation is limited
One of the most influential consultants in the oil industry said Wednesday that limiting speculation in oil markets will lead to less energy production, fewer jobs and increased prices for consumers.
Market Watch | OECD sees strong U.S. growth, Europe to lag
The Paris-based Organization for Economic Cooperation and Development on Thursday said economic growth in the Group of Seven industrial economies will pick up speed in the first half of 2012, but warned that the recovery remains fragile and that North America is likely to outpace a lagging Europe.
Bloomberg | Economy in U.S. Grew at 3% Annual Rate in Fourth Quarter
The economy in the U.S. grew at a 3 percent annual rate in the last three months of 2011, the same as previously estimated, while corporate profits climbed at the slowest pace in three years, raising the risk that business investment and hiring will cool.
Politico | Senators push Export-Import Bank renewal
A solid bloc of Senate Republicans, led by South Carolina’s Lindsey Graham, began a renewed push Thursday for action on Export-Import Bank legislation that fell victim to partisan maneuvering last week when the GOP denied Democrats the votes needed to cut off debate.
WSJ | OECD Sees Europe, U.S. Drifting Apart
The economies of Europe and North America will diverge in the first half of this year, with European budget cuts dragging on demand while the U.S. economic recovery picking up steam, the Organization for Economic Cooperation and Development said in a report published Thursday.
USA Today | Economy grew 3% in 4Q 2011, jobless claims still falling
The U.S. economy grew at a solid 3% pace in the final three months of 2011 but that growth likely slowed in the first three months of this year as businesses cut back on restocking their shelves.
Econ Comments & Analysis
CATO | Rapid GDP Growth--Best Antidote for Poverty
Rapid GDP growth is the best antidote for poverty. That is the big message that comes blaring out of the poverty data for 2009-10. Record GDP growth of 8.5% per year between 2004-05 and 2009-10 has reduced poverty at a record rate of 1.5 percentage points per year, double the 0.7 percentage points per year in the preceding 11 years.
CRS | Federal Pell Grant Program of the Higher Education Act: How the Program Works, Recent Legislative Changes, and Current Issues
The federal Pell Grant program, authorized by Title IV of the Higher Education Act of 1965, as amended (HEA; P.L. 89-329), is the single largest source of federal grant aid supporting postsecondary education students.
WSJ | Federal Budgets and Class Warfare
A cardinal rule of American campaigns is that candidates must appeal to the party base during primary elections and then move to the center to win moderates and independents in November. This year, on the issues of taxes and spending, that shift can't come soon enough—and not just for the Republican nominee.
Washington Times | Level playing field for American mining
Earlier this month, President Obama announced the United States is filing a challenge with the World Trade Organization (WTO) against China’s export restrictions on rare earth minerals. This marks the second time since 2009 our nation has brought a WTO case against China over mineral export restrictions
WSJ | We're Not France, Yet
Maybe the United States dodged a bullet this week. Make that a deep-penetration bunker buster into the original idea of America. On Tuesday, the justices of the Supreme Court sounded, on balance, to be disposed against affirming the Obama health-care law's mandate.
Forbes | Friedrich von Hayek Predicted the Limp Obama Economy
Warning that the results of government attempts to tinker with the economy can be foreseen only in terms of broad patterns rather than precise results, Friedrich von Hayek noted that trying to pin down outcomes is doomed: “This way,” he said in his Nobel prize lecture of 1974, “lies charlatanism and worse.”
Blogs
WSJ | States Post Uneven Gains in Income
Many Americans saw their incomes rise faster in 2011 than the year before, but a lot depended on which state you lived in.
Café Hayek | Cronyism and Mercantilism are Siblings
Robert Rubin’s and Vin Weber’s defense of the Export-Import Bank features all of the sophistry and economic naivete that have forever marked mercantilist apologies for interest-group privileges
National Journal | Coal’s Future Hinges on Unproven Technology
Climate-change regulations announced by the Obama administration on Tuesday put the future of coal-fired electricity in some doubt because the only way plants could meet the new standard is through a very expensive technology that is not yet commercially viable.
CNN Money | Energy prices seen rising if speculation is limited
One of the most influential consultants in the oil industry said Wednesday that limiting speculation in oil markets will lead to less energy production, fewer jobs and increased prices for consumers.
Market Watch | OECD sees strong U.S. growth, Europe to lag
The Paris-based Organization for Economic Cooperation and Development on Thursday said economic growth in the Group of Seven industrial economies will pick up speed in the first half of 2012, but warned that the recovery remains fragile and that North America is likely to outpace a lagging Europe.
Bloomberg | Economy in U.S. Grew at 3% Annual Rate in Fourth Quarter
The economy in the U.S. grew at a 3 percent annual rate in the last three months of 2011, the same as previously estimated, while corporate profits climbed at the slowest pace in three years, raising the risk that business investment and hiring will cool.
Politico | Senators push Export-Import Bank renewal
A solid bloc of Senate Republicans, led by South Carolina’s Lindsey Graham, began a renewed push Thursday for action on Export-Import Bank legislation that fell victim to partisan maneuvering last week when the GOP denied Democrats the votes needed to cut off debate.
WSJ | OECD Sees Europe, U.S. Drifting Apart
The economies of Europe and North America will diverge in the first half of this year, with European budget cuts dragging on demand while the U.S. economic recovery picking up steam, the Organization for Economic Cooperation and Development said in a report published Thursday.
USA Today | Economy grew 3% in 4Q 2011, jobless claims still falling
The U.S. economy grew at a solid 3% pace in the final three months of 2011 but that growth likely slowed in the first three months of this year as businesses cut back on restocking their shelves.
Econ Comments & Analysis
CATO | Rapid GDP Growth--Best Antidote for Poverty
Rapid GDP growth is the best antidote for poverty. That is the big message that comes blaring out of the poverty data for 2009-10. Record GDP growth of 8.5% per year between 2004-05 and 2009-10 has reduced poverty at a record rate of 1.5 percentage points per year, double the 0.7 percentage points per year in the preceding 11 years.
CRS | Federal Pell Grant Program of the Higher Education Act: How the Program Works, Recent Legislative Changes, and Current Issues
The federal Pell Grant program, authorized by Title IV of the Higher Education Act of 1965, as amended (HEA; P.L. 89-329), is the single largest source of federal grant aid supporting postsecondary education students.
WSJ | Federal Budgets and Class Warfare
A cardinal rule of American campaigns is that candidates must appeal to the party base during primary elections and then move to the center to win moderates and independents in November. This year, on the issues of taxes and spending, that shift can't come soon enough—and not just for the Republican nominee.
Washington Times | Level playing field for American mining
Earlier this month, President Obama announced the United States is filing a challenge with the World Trade Organization (WTO) against China’s export restrictions on rare earth minerals. This marks the second time since 2009 our nation has brought a WTO case against China over mineral export restrictions
WSJ | We're Not France, Yet
Maybe the United States dodged a bullet this week. Make that a deep-penetration bunker buster into the original idea of America. On Tuesday, the justices of the Supreme Court sounded, on balance, to be disposed against affirming the Obama health-care law's mandate.
Forbes | Friedrich von Hayek Predicted the Limp Obama Economy
Warning that the results of government attempts to tinker with the economy can be foreseen only in terms of broad patterns rather than precise results, Friedrich von Hayek noted that trying to pin down outcomes is doomed: “This way,” he said in his Nobel prize lecture of 1974, “lies charlatanism and worse.”
Blogs
WSJ | States Post Uneven Gains in Income
Many Americans saw their incomes rise faster in 2011 than the year before, but a lot depended on which state you lived in.
Café Hayek | Cronyism and Mercantilism are Siblings
Robert Rubin’s and Vin Weber’s defense of the Export-Import Bank features all of the sophistry and economic naivete that have forever marked mercantilist apologies for interest-group privileges
Health Care
News
Market Watch | Justices consider scuttling health-care law
Supreme Court justices finished debate Wednesday afternoon on whether to scuttle the Affordable Care Act entirely or keep parts of the legislation, should they decide that requiring individuals to buy insurance is unconstitutional.
Bloomberg | Medicare Budget Debate Comes Down to Who Does Trimming
Both political parties are proposing to cut the $500 billion-a-year health-care program for the elderly. They disagree as to how.
CNN Money | Family health care costs to exceed $20,000 this year
Three days of Supreme Court arguments have left the fate of the 2010 health care reform law uncertain. What is certain, however, is that health care costs are continuing to eat away at consumers' budgets.
Econ Comments & Analysis
WSJ | The ObamaCare Reckoning
After the third and final day of Supreme Court scrutiny of the Affordable Care Act, the bravado of the legal establishment has turned to uncertainty and in some cases outright panic.
Real Clear Markets | The Economic Costs of Obamacare
The nine justices consider only legal arguments. But what are the economic costs of the new law? Below, I list ten separate costs.
Blogs
Heritage Foundation | Seven of Obamacare’s Biggest Failures from the Last Two Years
As detailed in Heritage’s “The Obamacare Two-Year Checkup: More Reasons for Repeal,” the law is already proving ineffective in some cases and harmful in others. Here are some of the biggest failures of Obamacare highlighted by the paper
Market Watch | Justices consider scuttling health-care law
Supreme Court justices finished debate Wednesday afternoon on whether to scuttle the Affordable Care Act entirely or keep parts of the legislation, should they decide that requiring individuals to buy insurance is unconstitutional.
Bloomberg | Medicare Budget Debate Comes Down to Who Does Trimming
Both political parties are proposing to cut the $500 billion-a-year health-care program for the elderly. They disagree as to how.
CNN Money | Family health care costs to exceed $20,000 this year
Three days of Supreme Court arguments have left the fate of the 2010 health care reform law uncertain. What is certain, however, is that health care costs are continuing to eat away at consumers' budgets.
Econ Comments & Analysis
WSJ | The ObamaCare Reckoning
After the third and final day of Supreme Court scrutiny of the Affordable Care Act, the bravado of the legal establishment has turned to uncertainty and in some cases outright panic.
Real Clear Markets | The Economic Costs of Obamacare
The nine justices consider only legal arguments. But what are the economic costs of the new law? Below, I list ten separate costs.
Blogs
Heritage Foundation | Seven of Obamacare’s Biggest Failures from the Last Two Years
As detailed in Heritage’s “The Obamacare Two-Year Checkup: More Reasons for Repeal,” the law is already proving ineffective in some cases and harmful in others. Here are some of the biggest failures of Obamacare highlighted by the paper
Monetary
News
Economist | The cycle turns
Equities may be enjoying a bull run but the government-bond market has turned sour. Having bottomed at 1.67% in September, the yield on the ten-year Treasury bond has risen to 2.38%, with the sell-off accelerating in the past two weeks.
Econ Comments & Analysis
WSJ | The Dangers of an Interventionist Fed
America has now had nearly a century of decision-making experience under the Federal Reserve Act, first passed in 1913. Thanks to careful empirical research by Milton Friedman, Anna Schwartz and Allan Meltzer, we have plenty of evidence that rules-based monetary policies work and unpredictable discretionary policies don't. Now is the time to act on that evidence.
Blogs
Free Banking | Problems facing every monetary system
Every monetary system faces a number of major problems to solve or fail at. Here I will discuss how a free banking system, assumed for the sake of concreteness to operate on a fixed exchange rate with gold or on what George Selgin termed a quasi commodity standard (a frozen fiat monetary base), compares with a central banking system, assumed to operate on a floating exchange rate, with inflation as the target.
NY Times | Who Captured the Fed?
As the American economy begins to improve, influential people in the financial sector will continue to talk about the need for a prolonged period of low interest rates. The Fed will listen.
Economist | The cycle turns
Equities may be enjoying a bull run but the government-bond market has turned sour. Having bottomed at 1.67% in September, the yield on the ten-year Treasury bond has risen to 2.38%, with the sell-off accelerating in the past two weeks.
Econ Comments & Analysis
WSJ | The Dangers of an Interventionist Fed
America has now had nearly a century of decision-making experience under the Federal Reserve Act, first passed in 1913. Thanks to careful empirical research by Milton Friedman, Anna Schwartz and Allan Meltzer, we have plenty of evidence that rules-based monetary policies work and unpredictable discretionary policies don't. Now is the time to act on that evidence.
Blogs
Free Banking | Problems facing every monetary system
Every monetary system faces a number of major problems to solve or fail at. Here I will discuss how a free banking system, assumed for the sake of concreteness to operate on a fixed exchange rate with gold or on what George Selgin termed a quasi commodity standard (a frozen fiat monetary base), compares with a central banking system, assumed to operate on a floating exchange rate, with inflation as the target.
NY Times | Who Captured the Fed?
As the American economy begins to improve, influential people in the financial sector will continue to talk about the need for a prolonged period of low interest rates. The Fed will listen.
Taxes
Blogs
Heritage Foundation | Cooper and LaTourette’s Budget Is a Major Tax Hike
The budget resolution sponsored by Representatives Jim Cooper (D–TN) and Steve LaTourette (R–OH) breaks this rule. In reality, it is a massive tax hike of nearly $2 trillion, according to Americans for Tax Reform.
Tax Foundation | Massachusetts Tax Carve-Outs Exceed Total Tax Revenues by $4 Billion
A preliminary draft report issued by the Massachusetts Tax Expenditure Commission shows that state tax expenditures are expected to reach $26 billion in 2013, a number $4 billion larger than the projected revenues of $22 billion. In short, as the Massachusetts Department of Revenue put it, "the Commonwealth collects less in revenue than it has chosen to forgo."
Heritage Foundation | Cooper and LaTourette’s Budget Is a Major Tax Hike
The budget resolution sponsored by Representatives Jim Cooper (D–TN) and Steve LaTourette (R–OH) breaks this rule. In reality, it is a massive tax hike of nearly $2 trillion, according to Americans for Tax Reform.
Tax Foundation | Massachusetts Tax Carve-Outs Exceed Total Tax Revenues by $4 Billion
A preliminary draft report issued by the Massachusetts Tax Expenditure Commission shows that state tax expenditures are expected to reach $26 billion in 2013, a number $4 billion larger than the projected revenues of $22 billion. In short, as the Massachusetts Department of Revenue put it, "the Commonwealth collects less in revenue than it has chosen to forgo."
Employment
News
Bloomberg | Jobless Claims in U.S. Decline to Lowest Since April 2008
The number of Americans seeking unemployment benefits dropped last week to the lowest level in almost four years, adding to evidence of an improving U.S. labor market.
CNN Money | 3.1 million 'green jobs' number casts a wide net
The 3.1 million "green jobs" the government reported last week was a large number -- it's nearly five times the number of people that work making cars and trucks and over half the amount employed in the construction industry.
Bloomberg | German Jobless Fell in March as Economy Showed Resilience
German unemployment fell more than forecast in March, adding to evidence that growth in Europe’s biggest economy is gaining traction as the debt crisis recedes.
Econ Comments & Analysis
CRS | Emergency Unemployment Compensation (EUC08): Current Status of Benefits
The temporary Emergency Unemployment Compensation (EUC08) program may provide additional federal unemployment insurance benefits to eligible individuals who have exhausted all available benefits from their state Unemployment Compensation (UC) programs. Congress created the EUC08 program in 2008 and has amended the original, authorizing law (P.L. 110-252) 10 times.
Blogs
Calculated Risk | The long term impact of unemployment
Our economic malaise has spurred a wave of research about the impact of unemployment on individuals and the broader economy. The findings are disheartening. The consequences are both devastating and enduring.
Bloomberg | Jobless Claims in U.S. Decline to Lowest Since April 2008
The number of Americans seeking unemployment benefits dropped last week to the lowest level in almost four years, adding to evidence of an improving U.S. labor market.
CNN Money | 3.1 million 'green jobs' number casts a wide net
The 3.1 million "green jobs" the government reported last week was a large number -- it's nearly five times the number of people that work making cars and trucks and over half the amount employed in the construction industry.
Bloomberg | German Jobless Fell in March as Economy Showed Resilience
German unemployment fell more than forecast in March, adding to evidence that growth in Europe’s biggest economy is gaining traction as the debt crisis recedes.
Econ Comments & Analysis
CRS | Emergency Unemployment Compensation (EUC08): Current Status of Benefits
The temporary Emergency Unemployment Compensation (EUC08) program may provide additional federal unemployment insurance benefits to eligible individuals who have exhausted all available benefits from their state Unemployment Compensation (UC) programs. Congress created the EUC08 program in 2008 and has amended the original, authorizing law (P.L. 110-252) 10 times.
Blogs
Calculated Risk | The long term impact of unemployment
Our economic malaise has spurred a wave of research about the impact of unemployment on individuals and the broader economy. The findings are disheartening. The consequences are both devastating and enduring.
Budget
News
Bloomberg | EU Nears One-Year Boost in Rescue Fund to $1.3 Trillion
European governments are preparing for a one-year increase in the ceiling on rescue aid to 940 billion euros ($1.3 trillion) to keep the debt crisis at bay, according to a draft statement written for finance ministers.
WSJ | Australia Plans Deeper Spending Cuts
Australian Treasurer Wayne Swan said Thursday the budget in May will contain still more cuts to spending as the government faces an increasingly uphill battle to move its fiscal accounts from deep deficit back into surplus by next year.
Politico | House crushes budget compromise
Republicans pushed toward House passage on Thursday of their new budget plan after crushing a bipartisan alternative Wednesday night and smoothing out internal GOP differences over the handling for future funding for disasters.
WSJ | For Portugal, Moment of Truth Nears
The European Central Bank's injection of money into the Continent's banking system has, for now, pulled Italy and Spain away from the edge of the sovereign-debt crisis. But that medicine hasn't soothed Portugal.
Econ Comments & Analysis
Washington Times | The five-year budget itch
The House will vote Thursday on a spending blueprint for 2013. Members will choose from among five options this week, but only House Budget Committee Chairman Paul Ryan’s plan has enough support to pass.
The American | What Does ‘Fiscal Responsibility’ Mean?
In short, everybody is for it, nobody is against it. Every politician who has an interest in getting elected or reelected must stake a claim to the virtuous mantle of “fiscal responsibility.” But despite the near-universal popularity of the catch-phrase, there lingers a nagging question: What, exactly, does “fiscal responsibility” mean?
CBO | Report on the Troubled Asset Relief Program—March 2012
In October 2008, the Emergency Economic Stabilization Act of 2008 (Division A of Public Law 110-343) established the Troubled Asset Relief Program (TARP) to enable the Department of the Treasury to promote stability in financial markets through the purchase and guarantee of "troubled assets."
Blogs
CATO | Conservative House Republicans’ Budget Proposal
The Republican Study Committee released its fiscal 2013 budget proposal this week and it’s not horrible. That’s probably a compliment given that the bar is so low on Capitol Hill that one would trip on it.
National Review | The RSC Budget
The Republican Study Committee (RSC) recently unveiled its FY 2013 budget. As the document provided shows, the plan offers some interesting features.
Political Calculations | The Next Scary Hockey Stick Chart
Here, we find that the federal government has sharply increased the amount of money it borrows for the sake of loaning it right back out to college students since 2008.
The Hill | 0-414 vote: House clobbers budget proposal based on Obama's 2013 plan
The House on Wednesday night unanimously rejected an alternative budget proposal based on President Obama's 2013 budget plan, dispatching it in a 0-414 rout.
Political Calculations | Spring 2012 Edition: Who Really Owns the U.S. National Debt?
The U.S. Treasury has revised its data indicating which nation's institutions through the end of the U.S. government's 2011 Fiscal Year, which ended on 30 September 2011. With that revision, we've updated our chart revealing who the biggest holders of all the U.S. government's public debt outstanding were as of 30 September 2011
Bloomberg | EU Nears One-Year Boost in Rescue Fund to $1.3 Trillion
European governments are preparing for a one-year increase in the ceiling on rescue aid to 940 billion euros ($1.3 trillion) to keep the debt crisis at bay, according to a draft statement written for finance ministers.
WSJ | Australia Plans Deeper Spending Cuts
Australian Treasurer Wayne Swan said Thursday the budget in May will contain still more cuts to spending as the government faces an increasingly uphill battle to move its fiscal accounts from deep deficit back into surplus by next year.
Politico | House crushes budget compromise
Republicans pushed toward House passage on Thursday of their new budget plan after crushing a bipartisan alternative Wednesday night and smoothing out internal GOP differences over the handling for future funding for disasters.
WSJ | For Portugal, Moment of Truth Nears
The European Central Bank's injection of money into the Continent's banking system has, for now, pulled Italy and Spain away from the edge of the sovereign-debt crisis. But that medicine hasn't soothed Portugal.
Econ Comments & Analysis
Washington Times | The five-year budget itch
The House will vote Thursday on a spending blueprint for 2013. Members will choose from among five options this week, but only House Budget Committee Chairman Paul Ryan’s plan has enough support to pass.
The American | What Does ‘Fiscal Responsibility’ Mean?
In short, everybody is for it, nobody is against it. Every politician who has an interest in getting elected or reelected must stake a claim to the virtuous mantle of “fiscal responsibility.” But despite the near-universal popularity of the catch-phrase, there lingers a nagging question: What, exactly, does “fiscal responsibility” mean?
CBO | Report on the Troubled Asset Relief Program—March 2012
In October 2008, the Emergency Economic Stabilization Act of 2008 (Division A of Public Law 110-343) established the Troubled Asset Relief Program (TARP) to enable the Department of the Treasury to promote stability in financial markets through the purchase and guarantee of "troubled assets."
Blogs
CATO | Conservative House Republicans’ Budget Proposal
The Republican Study Committee released its fiscal 2013 budget proposal this week and it’s not horrible. That’s probably a compliment given that the bar is so low on Capitol Hill that one would trip on it.
National Review | The RSC Budget
The Republican Study Committee (RSC) recently unveiled its FY 2013 budget. As the document provided shows, the plan offers some interesting features.
Political Calculations | The Next Scary Hockey Stick Chart
Here, we find that the federal government has sharply increased the amount of money it borrows for the sake of loaning it right back out to college students since 2008.
The Hill | 0-414 vote: House clobbers budget proposal based on Obama's 2013 plan
The House on Wednesday night unanimously rejected an alternative budget proposal based on President Obama's 2013 budget plan, dispatching it in a 0-414 rout.
Political Calculations | Spring 2012 Edition: Who Really Owns the U.S. National Debt?
The U.S. Treasury has revised its data indicating which nation's institutions through the end of the U.S. government's 2011 Fiscal Year, which ended on 30 September 2011. With that revision, we've updated our chart revealing who the biggest holders of all the U.S. government's public debt outstanding were as of 30 September 2011
Wednesday, March 28, 2012
General Economics
News
WSJ | New Rules Limit Coal Plants
The Obama administration on Tuesday announced long-awaited rules to limit carbon-dioxide emissions from new power plants that will effectively block the construction of new coal-burning plants and make natural gas even more attractive as a fuel for generating electricity.
CNN Money | Home prices fall to 2002 levels
The housing market started the new year with a thud. Home prices dropped for the fifth consecutive month in January, reaching their lowest point since the end of 2002.
Bloomberg | Europeans See Crisis Near End, Bernanke Warns on Recovery
European leaders signaled rising confidence that their region’s crisis is near an end, while Federal Reserve Chairman Ben S. Bernanke warned that a U.S. recovery isn’t assured.
CNN Money | Small biz bill goes to Obama after House OK
The House on Tuesday passed a bill making it easier for more companies to become publicly traded by bypassing audits and disclosures now required for investors.
National Journal | Analysts Fear Impact of Volcker Rule on Oil and Gas Development, Prices
The Volcker rule, a financial regulation set to be implemented as part the 2010 Wall Street reform law, could have the inadvertent effects of reducing U.S. oil and gas production, raising electricity rates and gasoline prices, and contributing to a future of volatile energy price spikes
Econ Comments & Analysis
Investors | Success In America A Matter Of Hard Work, Not Luck
The fact is that, except for those very few whose wealth is overwhelmingly or entirely inherited, the more affluent have usually worked harder than the less affluent.
Politico | Streamline the federal government
We are living and competing in a 21st-century economy, while struggling with a 20th-century bureaucracy. Over many years and several administrations, the federal government has added new programs, offices and agencies. Rarely have we seen departments or agencies downsized, much less eliminated.
NBER | Does Shareholder Proxy Access Improve Firm Value? Evidence from the Business Roundtable Challenge
We use the Business Roundtable’s challenge to the SEC’s 2010 proxy access rule as a natural experiment to measure the value of shareholder proxy access.
Blogs
Think Markets | Too Big to Fail – Again
The issue of banks viewed as too big to fail has been taken up several times on this site. In its Annual Report, the Federal Reserve Bank of Dallas has weighed in on the topic
WSJ | Bernanke Tells ABC Economic Recovery Has ‘Long Way To Go’
“It’s far too early to declare victory,” Bernanke said in an interview with ABC’s Diane Sawyer, according to a transcript of the interview to be aired Tuesday night on “World News.”
CATO | Obama’s Energy Repackaging: Not the Problem but Not the Solution Either
A too little-noted aspect of Obama rhetoric is the incessant repetition of outlandish claims. Energy is a major example. He repeats so often that reiteration of the defects is desirable.
WSJ | New Rules Limit Coal Plants
The Obama administration on Tuesday announced long-awaited rules to limit carbon-dioxide emissions from new power plants that will effectively block the construction of new coal-burning plants and make natural gas even more attractive as a fuel for generating electricity.
CNN Money | Home prices fall to 2002 levels
The housing market started the new year with a thud. Home prices dropped for the fifth consecutive month in January, reaching their lowest point since the end of 2002.
Bloomberg | Europeans See Crisis Near End, Bernanke Warns on Recovery
European leaders signaled rising confidence that their region’s crisis is near an end, while Federal Reserve Chairman Ben S. Bernanke warned that a U.S. recovery isn’t assured.
CNN Money | Small biz bill goes to Obama after House OK
The House on Tuesday passed a bill making it easier for more companies to become publicly traded by bypassing audits and disclosures now required for investors.
National Journal | Analysts Fear Impact of Volcker Rule on Oil and Gas Development, Prices
The Volcker rule, a financial regulation set to be implemented as part the 2010 Wall Street reform law, could have the inadvertent effects of reducing U.S. oil and gas production, raising electricity rates and gasoline prices, and contributing to a future of volatile energy price spikes
Econ Comments & Analysis
Investors | Success In America A Matter Of Hard Work, Not Luck
The fact is that, except for those very few whose wealth is overwhelmingly or entirely inherited, the more affluent have usually worked harder than the less affluent.
Politico | Streamline the federal government
We are living and competing in a 21st-century economy, while struggling with a 20th-century bureaucracy. Over many years and several administrations, the federal government has added new programs, offices and agencies. Rarely have we seen departments or agencies downsized, much less eliminated.
NBER | Does Shareholder Proxy Access Improve Firm Value? Evidence from the Business Roundtable Challenge
We use the Business Roundtable’s challenge to the SEC’s 2010 proxy access rule as a natural experiment to measure the value of shareholder proxy access.
Blogs
Think Markets | Too Big to Fail – Again
The issue of banks viewed as too big to fail has been taken up several times on this site. In its Annual Report, the Federal Reserve Bank of Dallas has weighed in on the topic
WSJ | Bernanke Tells ABC Economic Recovery Has ‘Long Way To Go’
“It’s far too early to declare victory,” Bernanke said in an interview with ABC’s Diane Sawyer, according to a transcript of the interview to be aired Tuesday night on “World News.”
CATO | Obama’s Energy Repackaging: Not the Problem but Not the Solution Either
A too little-noted aspect of Obama rhetoric is the incessant repetition of outlandish claims. Energy is a major example. He repeats so often that reiteration of the defects is desirable.
Health Care
News
NY Times | In Massachusetts, Insurance Mandate Stirs Some Dissent
Wayde Lodor is part of the 2 percent: the roughly 120,000 residents of Massachusetts who lack health insurance despite the state’s landmark 2006 law requiring almost every adult in the state to have it. He is likely to face a penalty this year, having made enough money under the state’s guidelines to afford a health plan.
Politico | 5 takeaways on health law arguments
This much is clear after Tuesday’s Supreme Court arguments: The centerpiece of President Barack Obama’s signature health care law stands in real danger of being struck down.
National Journal | The Health Care Argument That Could Make Brand-New Law
Don’t be distracted by the individual mandate: The part of the health care case with the most potential to shape constitutional law will come up on Wednesday afternoon after much of the mandate hoopla has faded.
Econ Comments & Analysis
Washington Times | Obamacare: Costs double in two years
Two years ago, President Obama signed into law his massive 2,700-page takeover of our health care system. Those thousands of pages are full of mandates controlling exactly how patients, doctors and employers must handle health care decisions.
WSJ | A Constitutional Awakening
Tuesday's two hours of Supreme Court oral arguments on ObamaCare's individual mandate were rough-going for the government and its assertions of unlimited federal power. Several Justices are clearly taking seriously the Constitution's structural checks and balances that are intended to protect individual liberty.
Washington Times | Obamacare not an enumerated power
As the unaffordable costs of Obamacare become undeniable and government control over every aspect of American life becomes unbearable, it’s hard to find anyone willing to celebrate the law as it enters the terrible twos. Even President Obama is passing on the opportunity to use his soaring rhetoric to extoll the virtues of the law.
Washington Times | Obamacare carries too high a price in liberty
In October 2009, a reporter asked then-House Speaker Nancy Pelosi, “Where specifically does the Constitution grant Congress the authority to enact an individual health insurance mandate?” She responded, “Are you serious?”
CATO | Obamacare's Second Day at the Court Features Brilliant Advocacy, Cautious Optimism
Tuesday’s Supreme Court oral arguments, which focused on the individual health insurance mandate, began with pomp and ended with circumstantial evidence that the individual mandate is in constitutional jeopardy.
Blogs
Tax Foundation | Thoughts on the Health Care Case Thus Far
I've just read through the transcript of the first two days of oral argument in the health care case. Below are my impressions of each justice's questions, followed by all references to the tax power argument so far.
The American | Scalia quickly punctures the entire premise of Obamacare
Whatever the constitutionality of Obamacare’s individual mandate, today’s Supreme Court arguments immediately highlighted the policy problem with the landmark healthcare reform law.
NY Times | In Massachusetts, Insurance Mandate Stirs Some Dissent
Wayde Lodor is part of the 2 percent: the roughly 120,000 residents of Massachusetts who lack health insurance despite the state’s landmark 2006 law requiring almost every adult in the state to have it. He is likely to face a penalty this year, having made enough money under the state’s guidelines to afford a health plan.
Politico | 5 takeaways on health law arguments
This much is clear after Tuesday’s Supreme Court arguments: The centerpiece of President Barack Obama’s signature health care law stands in real danger of being struck down.
National Journal | The Health Care Argument That Could Make Brand-New Law
Don’t be distracted by the individual mandate: The part of the health care case with the most potential to shape constitutional law will come up on Wednesday afternoon after much of the mandate hoopla has faded.
Econ Comments & Analysis
Washington Times | Obamacare: Costs double in two years
Two years ago, President Obama signed into law his massive 2,700-page takeover of our health care system. Those thousands of pages are full of mandates controlling exactly how patients, doctors and employers must handle health care decisions.
WSJ | A Constitutional Awakening
Tuesday's two hours of Supreme Court oral arguments on ObamaCare's individual mandate were rough-going for the government and its assertions of unlimited federal power. Several Justices are clearly taking seriously the Constitution's structural checks and balances that are intended to protect individual liberty.
Washington Times | Obamacare not an enumerated power
As the unaffordable costs of Obamacare become undeniable and government control over every aspect of American life becomes unbearable, it’s hard to find anyone willing to celebrate the law as it enters the terrible twos. Even President Obama is passing on the opportunity to use his soaring rhetoric to extoll the virtues of the law.
Washington Times | Obamacare carries too high a price in liberty
In October 2009, a reporter asked then-House Speaker Nancy Pelosi, “Where specifically does the Constitution grant Congress the authority to enact an individual health insurance mandate?” She responded, “Are you serious?”
CATO | Obamacare's Second Day at the Court Features Brilliant Advocacy, Cautious Optimism
Tuesday’s Supreme Court oral arguments, which focused on the individual health insurance mandate, began with pomp and ended with circumstantial evidence that the individual mandate is in constitutional jeopardy.
Blogs
Tax Foundation | Thoughts on the Health Care Case Thus Far
I've just read through the transcript of the first two days of oral argument in the health care case. Below are my impressions of each justice's questions, followed by all references to the tax power argument so far.
The American | Scalia quickly punctures the entire premise of Obamacare
Whatever the constitutionality of Obamacare’s individual mandate, today’s Supreme Court arguments immediately highlighted the policy problem with the landmark healthcare reform law.
Monetary
News
WSJ | Fresh Warnings on Money Policies
Three global central-bank leaders warned that decision makers needed to be on alert for an array of risks associated with their easy-money policies.
Econ Comments & Analysis
CNN Money | Bernanke: Fed was 'helpless' in Lehman failure
The bailouts of Bear Stearns and AIG were "distasteful" but still necessary, Federal Reserve Chairman Ben Bernanke told students at George Washington University on Tuesday.
Blogs
Minyanville | Stop Blaming the Gold Standard for the Financial Crisis!
Some conventional and well-known economists have expressed the idea that a gold standard is a bad idea and that the gold standard was a major (and possibly the major) catalyst for the Great Depression. One well-known fellow surmises that an equivalent of the gold standard is the reason why today’s European financial crisis is going on.
WSJ | Fresh Warnings on Money Policies
Three global central-bank leaders warned that decision makers needed to be on alert for an array of risks associated with their easy-money policies.
Econ Comments & Analysis
CNN Money | Bernanke: Fed was 'helpless' in Lehman failure
The bailouts of Bear Stearns and AIG were "distasteful" but still necessary, Federal Reserve Chairman Ben Bernanke told students at George Washington University on Tuesday.
Blogs
Minyanville | Stop Blaming the Gold Standard for the Financial Crisis!
Some conventional and well-known economists have expressed the idea that a gold standard is a bad idea and that the gold standard was a major (and possibly the major) catalyst for the Great Depression. One well-known fellow surmises that an equivalent of the gold standard is the reason why today’s European financial crisis is going on.
Taxes
News
WSJ | U.S. Airlines Seek Action on EU Carbon Tax
The trade group representing the largest U.S. airlines has called on the Obama administration to take action against the European Union in a bid to end the bloc's carbon-trading market.
CNN Money | U.S. corporate tax rate: No. 1 in the world
Japan, which currently has the highest rate in the world -- a 39.8% rate on business income between national and local taxes -- cuts its rate to 36.8% as of April 1. The U.S. rate stands at 39.2% when both federal and state rates are included.
Blogs
The American | Obama’s 2nd-term agenda? House Dems propose raising taxes by 40%, including on middle class
Just what would President Barack Obama do in a second term if had maximum “flexibility”?
WSJ | U.S. Airlines Seek Action on EU Carbon Tax
The trade group representing the largest U.S. airlines has called on the Obama administration to take action against the European Union in a bid to end the bloc's carbon-trading market.
CNN Money | U.S. corporate tax rate: No. 1 in the world
Japan, which currently has the highest rate in the world -- a 39.8% rate on business income between national and local taxes -- cuts its rate to 36.8% as of April 1. The U.S. rate stands at 39.2% when both federal and state rates are included.
Blogs
The American | Obama’s 2nd-term agenda? House Dems propose raising taxes by 40%, including on middle class
Just what would President Barack Obama do in a second term if had maximum “flexibility”?
Employment
News
USA Today | Job growth expected from cheap natural gas
The nation's fast-growing supply of cheap natural gas is setting off a manufacturing revival that's expected to create hundreds of thousands of jobs as companies build or expand plants to take advantage of the low prices.
USA Today | Job growth expected from cheap natural gas
The nation's fast-growing supply of cheap natural gas is setting off a manufacturing revival that's expected to create hundreds of thousands of jobs as companies build or expand plants to take advantage of the low prices.
Budget
News
WSJ | Group Backs Simpson-Bowles Plan
A small bipartisan group of House lawmakers, bucking their Democratic and Republican leaders, is advancing a plan to reduce the federal budget deficit by more than $4 trillion over 10 years through a combination of spending cuts and tax increases.
National Journal | Republican Study Committee Budget Pushes More Cuts Than Ryan Plan
The conservative Republican Study Committee on Tuesday proposed a budget that would cap spending at $931 billion, lower than the House Republicans' plan, underscoring fissures within the GOP over spending.
Econ Comments & Analysis
Roll Call | Ryan’s Budget Matters, Even If It Goes Nowhere
Rep. Paul Ryan’s budget is a big story in Congress, even though it barely made it through the House Budget Committee, will take a battle to pass on the House floor and has zero chance of being embraced as is, or in any facsimile, in the Senate.
WSJ | Demand for U.S. Debt Is Not Limitless
The conventional wisdom that nearly infinite demand exists for U.S. Treasury debt is flawed and especially dangerous at a time of record U.S. sovereign debt issuance.
Blogs
Neighborhood Effects | Red ink flows in state-run prepaid tuition programs
In three years the Prepaid Alabama Tuition Program (PACT) will run dry. The State Treasurer reports PACT which pays $100 million in tuition a year, has $347 million in investments remaining.
Heritage Foundation | The RSC Budget: A Preliminary Look
It launches decisive entitlement reforms, cuts spending sharply and quickly, avoids tax hikes, includes pro-growth tax reform, provides for a strong national defense, and moves aggressively—within five years—to a balanced budget.
WSJ | Group Backs Simpson-Bowles Plan
A small bipartisan group of House lawmakers, bucking their Democratic and Republican leaders, is advancing a plan to reduce the federal budget deficit by more than $4 trillion over 10 years through a combination of spending cuts and tax increases.
National Journal | Republican Study Committee Budget Pushes More Cuts Than Ryan Plan
The conservative Republican Study Committee on Tuesday proposed a budget that would cap spending at $931 billion, lower than the House Republicans' plan, underscoring fissures within the GOP over spending.
Econ Comments & Analysis
Roll Call | Ryan’s Budget Matters, Even If It Goes Nowhere
Rep. Paul Ryan’s budget is a big story in Congress, even though it barely made it through the House Budget Committee, will take a battle to pass on the House floor and has zero chance of being embraced as is, or in any facsimile, in the Senate.
WSJ | Demand for U.S. Debt Is Not Limitless
The conventional wisdom that nearly infinite demand exists for U.S. Treasury debt is flawed and especially dangerous at a time of record U.S. sovereign debt issuance.
Blogs
Neighborhood Effects | Red ink flows in state-run prepaid tuition programs
In three years the Prepaid Alabama Tuition Program (PACT) will run dry. The State Treasurer reports PACT which pays $100 million in tuition a year, has $347 million in investments remaining.
Heritage Foundation | The RSC Budget: A Preliminary Look
It launches decisive entitlement reforms, cuts spending sharply and quickly, avoids tax hikes, includes pro-growth tax reform, provides for a strong national defense, and moves aggressively—within five years—to a balanced budget.
Tuesday, March 27, 2012
General Economics
News
Market Watch | Case-Shiller: Home prices fall in January
U.S. home prices fell for the fifth month in a row in January to the lowest level since early 2003, according to a closely followed index.
CNN Money | Congress ready to tackle postal reform
The Senate could start debating a bipartisan bill that offers buyouts to senior employees, cuts worker compensation benefits and makes it possible to end Saturday service in two years.
Bloomberg | China’s Industrial Company Profits Fall 5.2% on Exports
Net income dropped 5.2 percent from a year earlier to 606 billion yuan ($96 billion), the National Bureau of Statistics said on its website today. That compared with a 34.3 percent gain in the first two months of 2011.
Market Watch | Euro-zone needs 1 trilllion euro firewall: OECD
Euro-zone finance ministers meeting at the end of this week need to boost the firepower of the region's rescue funds to at least 1 trillion euros ($1.34 trillion) in order to restore market confidence, Angel Gurria, secretary-general of the Paris-based Organization for Economic Cooperation and Development, said Tuesday.
Politico | Highway bill: House GOP delays vote
House Republican plans to pass a three-month extension of the surface transportation law fell apart Monday as it became clear that the leadership didn't have the votes to move the bill.
Econ Comments & Analysis
FOX Business | OECD: Eurozone Not Out of the Woods Yet
The euro zone's public debt crisis is not over despite calmer financial markets this year, the OECD said on Tuesday, with a warning that the bloc's banks remain weak, debt levels are still rising and fiscal targets are far from assured.
WSJ | Monti Pulls a Thatcher
Italian Prime Minister Mario Monti has walked away from negotiations with Italy's labor unions and announced that he is going to move ahead with reforming the country's notorious employment laws—with or without union consent. If Rome is spared the fate that recently befell Athens, mark this as the week the turnaround began.
Washington Times | No more GOP whining about overregulation
The Supreme Court last week ruled against the Environmental Protection Agency (EPA) in a unanimous decision. The EPA had charged a couple with violating the Clean Water Act. It claimed their property was a “wetland” and said it would fine them up to $75,000 per day - but there was no water on the property and there had been no judicial review of the charge.
NBER | Why are Some Regions More Innovative than Others? The Role of Firm Size Diversity
Large labs may spawn spin-outs caused by innovations deemed unrelated to the firm's overall business. Small labs generate demand for specialized services that lower entry costs for others. We develop a theoretical framework to study the interplay of these two localized externalities and their impact on regional innovation.
Market Watch | Case-Shiller: Home prices fall in January
U.S. home prices fell for the fifth month in a row in January to the lowest level since early 2003, according to a closely followed index.
CNN Money | Congress ready to tackle postal reform
The Senate could start debating a bipartisan bill that offers buyouts to senior employees, cuts worker compensation benefits and makes it possible to end Saturday service in two years.
Bloomberg | China’s Industrial Company Profits Fall 5.2% on Exports
Net income dropped 5.2 percent from a year earlier to 606 billion yuan ($96 billion), the National Bureau of Statistics said on its website today. That compared with a 34.3 percent gain in the first two months of 2011.
Market Watch | Euro-zone needs 1 trilllion euro firewall: OECD
Euro-zone finance ministers meeting at the end of this week need to boost the firepower of the region's rescue funds to at least 1 trillion euros ($1.34 trillion) in order to restore market confidence, Angel Gurria, secretary-general of the Paris-based Organization for Economic Cooperation and Development, said Tuesday.
Politico | Highway bill: House GOP delays vote
House Republican plans to pass a three-month extension of the surface transportation law fell apart Monday as it became clear that the leadership didn't have the votes to move the bill.
Econ Comments & Analysis
FOX Business | OECD: Eurozone Not Out of the Woods Yet
The euro zone's public debt crisis is not over despite calmer financial markets this year, the OECD said on Tuesday, with a warning that the bloc's banks remain weak, debt levels are still rising and fiscal targets are far from assured.
WSJ | Monti Pulls a Thatcher
Italian Prime Minister Mario Monti has walked away from negotiations with Italy's labor unions and announced that he is going to move ahead with reforming the country's notorious employment laws—with or without union consent. If Rome is spared the fate that recently befell Athens, mark this as the week the turnaround began.
Washington Times | No more GOP whining about overregulation
The Supreme Court last week ruled against the Environmental Protection Agency (EPA) in a unanimous decision. The EPA had charged a couple with violating the Clean Water Act. It claimed their property was a “wetland” and said it would fine them up to $75,000 per day - but there was no water on the property and there had been no judicial review of the charge.
NBER | Why are Some Regions More Innovative than Others? The Role of Firm Size Diversity
Large labs may spawn spin-outs caused by innovations deemed unrelated to the firm's overall business. Small labs generate demand for specialized services that lower entry costs for others. We develop a theoretical framework to study the interplay of these two localized externalities and their impact on regional innovation.
Health Care
Econ Comments & Analysis
WSJ | ObamaCare Opening Day
The Supreme Court's epic oral arguments on the constitutionality of the Affordable Care Act began Monday with a kind of tease.
Politico | Medicare’s billion-dollar headache
It’s not easy to get lawmakers interested in an obscure and complex part of the Medicare law, especially when their minds are clearly on other topics, like the upcoming election.
CATO | Obamacare Both Unnecessary And Improper
Congress exercised unprecedented and unbounded power in passing Obamacare. Although Congress has the power to regulate commerce between states, it does not have the power to order commerce into existence so it can regulate it. By compelling Americans to purchase health insurance, this is precisely what the individual mandate does.
Blogs
CATO | ObamaCare Oral Arguments Day 1 – Giving the People What They Want: An Actual Decision
Like nearly everyone who is commenting on the first round of oral arguments in the ObamaCare case, it seems highly likely that the Supreme Court will decide the case on the merits—that is, they will decide if the individual mandate is constitutional rather than pushing the issue back for another day.
The American | Do we really need healthcare reform at all?
The Obama White House considered healthcare reform such a priority that it turned its attention to Obamacare about thirty seconds after getting the stimulus passed in 2009. Yet the pace of healthcare spending increases actually has been cooling since 2002.
WSJ | ObamaCare Opening Day
The Supreme Court's epic oral arguments on the constitutionality of the Affordable Care Act began Monday with a kind of tease.
Politico | Medicare’s billion-dollar headache
It’s not easy to get lawmakers interested in an obscure and complex part of the Medicare law, especially when their minds are clearly on other topics, like the upcoming election.
CATO | Obamacare Both Unnecessary And Improper
Congress exercised unprecedented and unbounded power in passing Obamacare. Although Congress has the power to regulate commerce between states, it does not have the power to order commerce into existence so it can regulate it. By compelling Americans to purchase health insurance, this is precisely what the individual mandate does.
Blogs
CATO | ObamaCare Oral Arguments Day 1 – Giving the People What They Want: An Actual Decision
Like nearly everyone who is commenting on the first round of oral arguments in the ObamaCare case, it seems highly likely that the Supreme Court will decide the case on the merits—that is, they will decide if the individual mandate is constitutional rather than pushing the issue back for another day.
The American | Do we really need healthcare reform at all?
The Obama White House considered healthcare reform such a priority that it turned its attention to Obamacare about thirty seconds after getting the stimulus passed in 2009. Yet the pace of healthcare spending increases actually has been cooling since 2002.
Monetary
News
WSJ | Fed Signals Resolve on Rates
Federal Reserve Chairman Ben Bernanke said the central bank's easy-money policies are still needed to confront deep problems in the labor market, moving to reinforce his plan to keep interest rates low for years.
Econ Comments & Analysis
Real Clear Markets | Ben Bernanke's Shocking Gold Standard Ignorance
America's monetary problems could be solved by implementing the right kind of gold standard. However, doing this would render the Fed Chairman no more important than the head of The National Institute of Standards and Technology.
Blogs
Minyanville | Has the Market Become Addicted to Quantitative Easing?
Minyanville's own Todd Harrison just sat on a panel for the Maxim Group Growth Conference in New York. Todd debated with Paul LaRosa, Maxim Group's chief market technician, and Ed Yardeni, president and chief investment strategist of Yardeni Research in a session titled "Perspectives on the Global Economic and Political Landscape."
Library of Economics | George Selgin on "The Bernank"
George Selgin has an excellent commentary on Ben Bernanke's maiden lecture on monetary policy at George Washington University. Not only does George dispel myths that most people believe, but also he dispels myths that I believed.
Daily Capitalist | Fed Policy: Bernanke Is Warming Up His Helicopter
Economists cling to statistical data like barnacles in order to have some kind of anchor to explain what is going on in the world. They will try to cram the square data peg into the round holes of economic ”laws” rather than abandon them when they are obviously wrong. Which is not a very satisfactory way to explain things.
WSJ | Economics Survey: Fed Should Hold Back From QE3 This Year
The Federal Reserve shouldn’t undertake a new round of bond buying this year, an overwhelming majority of a group polled by the National Association for Business Economics said in a survey released Monday.
WSJ | Fed Signals Resolve on Rates
Federal Reserve Chairman Ben Bernanke said the central bank's easy-money policies are still needed to confront deep problems in the labor market, moving to reinforce his plan to keep interest rates low for years.
Econ Comments & Analysis
Real Clear Markets | Ben Bernanke's Shocking Gold Standard Ignorance
America's monetary problems could be solved by implementing the right kind of gold standard. However, doing this would render the Fed Chairman no more important than the head of The National Institute of Standards and Technology.
Blogs
Minyanville | Has the Market Become Addicted to Quantitative Easing?
Minyanville's own Todd Harrison just sat on a panel for the Maxim Group Growth Conference in New York. Todd debated with Paul LaRosa, Maxim Group's chief market technician, and Ed Yardeni, president and chief investment strategist of Yardeni Research in a session titled "Perspectives on the Global Economic and Political Landscape."
Library of Economics | George Selgin on "The Bernank"
George Selgin has an excellent commentary on Ben Bernanke's maiden lecture on monetary policy at George Washington University. Not only does George dispel myths that most people believe, but also he dispels myths that I believed.
Daily Capitalist | Fed Policy: Bernanke Is Warming Up His Helicopter
Economists cling to statistical data like barnacles in order to have some kind of anchor to explain what is going on in the world. They will try to cram the square data peg into the round holes of economic ”laws” rather than abandon them when they are obviously wrong. Which is not a very satisfactory way to explain things.
WSJ | Economics Survey: Fed Should Hold Back From QE3 This Year
The Federal Reserve shouldn’t undertake a new round of bond buying this year, an overwhelming majority of a group polled by the National Association for Business Economics said in a survey released Monday.
Taxes
News
CNBC | Not-So-‘Mad’ Ideas About Taxes
This month, the Roosevelt Hotel, on East 45th Street, initiated a special offer in commemoration of “Mad Men,” whose return to television on Sunday night for a fifth season is something surely known now even to preschoolers of merely middling sophistication.
Politico | Senate votes to debate bill that would kill oil tax breaks
As promised, Senate Republicans gave the green light Monday to debating a Democratic bill that would repeal billions in oil industry tax incentives — the latest twist in the parties’ struggle to seize the high ground on gasoline prices.
CNBC | Economists See Higher Taxes as Way to Cut Deficit
Economists say a combination of higher taxes and lower spending is the best way to reduce the federal budget deficit.
Econ Comments & Analysis
CNN Money | Tax reform: Why it's so hard
Tax reform. Politicians tout it as fiscal nirvana. It will spur economic growth, curb deficits, reduce income inequality, you name it. But all the happy talk belies the truth about tax reform, which Bruce Bartlett knows a thing or two about, having worked as a senior policy analyst for President Reagan in 1986. That was the last time Washington embarked on a major overhaul of the tax code.
Blogs
The American | White House considered a $170 billion soda tax to pay for Obamacare
Back in April 2009, Nancy-Ann DeParle, the Obama White House healthcare czar, wrote a memo that suggested President Obama would have to reverse his campaign stance against an individual mandate to purchase health insurance. Blame the Congressional Budget Office, she said
CNBC | Not-So-‘Mad’ Ideas About Taxes
This month, the Roosevelt Hotel, on East 45th Street, initiated a special offer in commemoration of “Mad Men,” whose return to television on Sunday night for a fifth season is something surely known now even to preschoolers of merely middling sophistication.
Politico | Senate votes to debate bill that would kill oil tax breaks
As promised, Senate Republicans gave the green light Monday to debating a Democratic bill that would repeal billions in oil industry tax incentives — the latest twist in the parties’ struggle to seize the high ground on gasoline prices.
CNBC | Economists See Higher Taxes as Way to Cut Deficit
Economists say a combination of higher taxes and lower spending is the best way to reduce the federal budget deficit.
Econ Comments & Analysis
CNN Money | Tax reform: Why it's so hard
Tax reform. Politicians tout it as fiscal nirvana. It will spur economic growth, curb deficits, reduce income inequality, you name it. But all the happy talk belies the truth about tax reform, which Bruce Bartlett knows a thing or two about, having worked as a senior policy analyst for President Reagan in 1986. That was the last time Washington embarked on a major overhaul of the tax code.
Blogs
The American | White House considered a $170 billion soda tax to pay for Obamacare
Back in April 2009, Nancy-Ann DeParle, the Obama White House healthcare czar, wrote a memo that suggested President Obama would have to reverse his campaign stance against an individual mandate to purchase health insurance. Blame the Congressional Budget Office, she said
Employment
News
CNN Money | White House: Jobs recovery isn't 'statistical fluke'
President Obama's chief economic adviser continued to defend the strength of the latest jobs data on Tuesday, even though other economists have suggested that the economy is still in a slow recovery despite job gains.
NY Times | Bernanke Says Faster Growth Is Needed to Bolster Job Market
In a speech that sought by turns to deflate optimism and pessimism about the labor market, the Federal Reserve chairman, Ben S. Bernanke, said Monday that the Fed’s efforts to stimulate growth were gradually reducing unemployment, but that the scale and duration of the problem could leave lasting scars on the economy.
Econ Comments & Analysis
Bloomberg | Fire Up America’s Jobs Factory With Aid for Startups
Last week, with broad support, the Senate passed an amended version of the Jumpstart Our Business Startups Act (or the JOBS Act). Because the bill had already been passed by the House on March 8, and is supported by the White House, it seems bound to become law.
National Journal | Fed Economists Pour Water on Positive Unemployment News
February may have capped the biggest six-month drop in unemployment in nearly 30 years, but there may be more to the sunny news than meets the eye, two Federal Reserve Bank of New York economists wrote in a Monday blog post that echoes Fed president Ben Bernanke's morning comments.
Blogs
Marginal Revolution | The hysteresis effect on unemployed labor, and unemployment scarring
Here is a good WSJ piece on labor market hysteresis, a topic also of recent interest to Bernanke, Summers, DeLong, and others. I’ve been trying to learn more about that literature, and here is what I came up with.
CNN Money | White House: Jobs recovery isn't 'statistical fluke'
President Obama's chief economic adviser continued to defend the strength of the latest jobs data on Tuesday, even though other economists have suggested that the economy is still in a slow recovery despite job gains.
NY Times | Bernanke Says Faster Growth Is Needed to Bolster Job Market
In a speech that sought by turns to deflate optimism and pessimism about the labor market, the Federal Reserve chairman, Ben S. Bernanke, said Monday that the Fed’s efforts to stimulate growth were gradually reducing unemployment, but that the scale and duration of the problem could leave lasting scars on the economy.
Econ Comments & Analysis
Bloomberg | Fire Up America’s Jobs Factory With Aid for Startups
Last week, with broad support, the Senate passed an amended version of the Jumpstart Our Business Startups Act (or the JOBS Act). Because the bill had already been passed by the House on March 8, and is supported by the White House, it seems bound to become law.
National Journal | Fed Economists Pour Water on Positive Unemployment News
February may have capped the biggest six-month drop in unemployment in nearly 30 years, but there may be more to the sunny news than meets the eye, two Federal Reserve Bank of New York economists wrote in a Monday blog post that echoes Fed president Ben Bernanke's morning comments.
Blogs
Marginal Revolution | The hysteresis effect on unemployed labor, and unemployment scarring
Here is a good WSJ piece on labor market hysteresis, a topic also of recent interest to Bernanke, Summers, DeLong, and others. I’ve been trying to learn more about that literature, and here is what I came up with.
Budget
Econ Comments & Analysis
Washington Times | Restoring budgetary sanity
“I place economy among the first and most important virtues, and public debt as the greatest of dangers to be feared,” Thomas Jefferson once wrote. “To preserve our independence, we must not let our rulers load us with perpetual debt.”
WSJ | Ryan and the Right
It's no surprise that the White House has denounced Paul Ryan's new House budget as the end of welfare-state civilization. The puzzle is why some conservatives are taking shots at the best chance in decades for serious government reform.
Blogs
National Review | The Ryan Plan vs. the President’s Budget
This week, I would like looks at the 10-year spending projections from the House Republican Budget and the White House budget for 2013.
WSJ | Should Central Banks Help Governments Run Bigger Deficits?
Paul McCulley, who drew attention for his provocative commentary when he was a senior partner at U.S. bond giant Pimco, is challenging one of the most deeply held principles of modern central banking: That central banks should always strive to be independent of fiscal authorities.
Washington Times | Restoring budgetary sanity
“I place economy among the first and most important virtues, and public debt as the greatest of dangers to be feared,” Thomas Jefferson once wrote. “To preserve our independence, we must not let our rulers load us with perpetual debt.”
WSJ | Ryan and the Right
It's no surprise that the White House has denounced Paul Ryan's new House budget as the end of welfare-state civilization. The puzzle is why some conservatives are taking shots at the best chance in decades for serious government reform.
Blogs
National Review | The Ryan Plan vs. the President’s Budget
This week, I would like looks at the 10-year spending projections from the House Republican Budget and the White House budget for 2013.
WSJ | Should Central Banks Help Governments Run Bigger Deficits?
Paul McCulley, who drew attention for his provocative commentary when he was a senior partner at U.S. bond giant Pimco, is challenging one of the most deeply held principles of modern central banking: That central banks should always strive to be independent of fiscal authorities.
Monday, March 26, 2012
General Economics
News
WSJ | Firms' Cash Hoarding Stunts Europe
Banks are struggling to rebuild capital and repair the damage wrought by poor lending and investment decisions they made before the financial crisis, and are wary about new lending.
Bloomberg | German Ifo Business Confidence Unexpectedly Increases
German business confidence unexpectedly rose to an eight-month high in March, suggesting Europe’s largest economy will return to growth even as the sovereign debt crisis curbs euro-area demand for its exports.
Econ Comments & Analysis
AEI | Caricature of how Republicans see the financial crisis
Sir, Edward Luce's description of the competing views in the US about both the financial crisis and a supposed "crisis of capitalism" was a caricature, particularly his discussion of the view he ascribed to the Republicans
Investors | Obama Creates a Nation of Food Stamp Dependents
Dependency: When New Gingrich called President Obama "the best food stamp president in American history," the media pooh-poohed it. But, in fact, Obama has aggressively pushed dependence on government for food.
Forbes | How to Contain a Financial Crisis Without Bailouts
Four years after the fall of Bear Stearns our fallback policy in a crisis is just as it was in 2008: rely on emergency, ad hoc lending by the Fed. We should not settle for this approach.
Daily Finance | The Complete Overhaul Social Security Needs to Survive
In this DailyFinance exclusive, two retirement experts propose dramatically different solutions to the Social Security crisis. Below, Chuck Saletta weighs in.
Blogs
Heritage Foundation | An Alternative Energy Efficiency Program
Adding to a long list of energy-efficiency legislation, two Members of Congress—David B. McKinley (R–WV) and Peter Welch (D–VT)—recently proposed a federal energy-efficiency bill that gives tax rebates to homeowners who make energy-saving improvements to their homes. This bill and its predecessors reward consumers for saving money.
CATO | Red Team, Blue Team, and Gas Prices
Pretty clear Red Team/Blue Team answers. Republicans in 2006 accepted that there wasn’t much the president could do to reduce gas prices, but most of them think Obama could.
Calculated Risk | Schedule for Week of March 25th
The key reports this week are the January Case-Shiller house price index, to be released on Tuesday, the February Durable Goods report on Wednesday, the February Personal Income and Outlays report on Friday, and the third estimate of Q4 GDP on Thursday.
Keith Hennessey | Subsidizing wind and solar because China and Germany are doing it
The President has picked three industries and is arguing for an industrial policy to subsidize them in part because other countries are subsidizing them.
CATO | Don’t Look to Government If You Want Equality
In a not so subtle brief for taxing the rich, Washington Post business and economics columnist Steven Pearlstein looks critically today at Rep. Paul Ryan’s latest House Republican budget proposal.
Calculated Risk | Unofficial Problem Bank list declines to 949 Institutions
Here is the unofficial problem bank list for March 23, 2012.
WSJ | What if Young Adults Don’t Want to Leave Home?
78%: Percent of 25-34 year olds who have lived with their parents and are satisfied with the arrangement.
CATO | Why Is the Recovery Slow?
Everyone wonders why the recovery is so slow and unemployment remains so high. Just read the papers — in detail.
WSJ | Firms' Cash Hoarding Stunts Europe
Banks are struggling to rebuild capital and repair the damage wrought by poor lending and investment decisions they made before the financial crisis, and are wary about new lending.
Bloomberg | German Ifo Business Confidence Unexpectedly Increases
German business confidence unexpectedly rose to an eight-month high in March, suggesting Europe’s largest economy will return to growth even as the sovereign debt crisis curbs euro-area demand for its exports.
Econ Comments & Analysis
AEI | Caricature of how Republicans see the financial crisis
Sir, Edward Luce's description of the competing views in the US about both the financial crisis and a supposed "crisis of capitalism" was a caricature, particularly his discussion of the view he ascribed to the Republicans
Investors | Obama Creates a Nation of Food Stamp Dependents
Dependency: When New Gingrich called President Obama "the best food stamp president in American history," the media pooh-poohed it. But, in fact, Obama has aggressively pushed dependence on government for food.
Forbes | How to Contain a Financial Crisis Without Bailouts
Four years after the fall of Bear Stearns our fallback policy in a crisis is just as it was in 2008: rely on emergency, ad hoc lending by the Fed. We should not settle for this approach.
Daily Finance | The Complete Overhaul Social Security Needs to Survive
In this DailyFinance exclusive, two retirement experts propose dramatically different solutions to the Social Security crisis. Below, Chuck Saletta weighs in.
Blogs
Heritage Foundation | An Alternative Energy Efficiency Program
Adding to a long list of energy-efficiency legislation, two Members of Congress—David B. McKinley (R–WV) and Peter Welch (D–VT)—recently proposed a federal energy-efficiency bill that gives tax rebates to homeowners who make energy-saving improvements to their homes. This bill and its predecessors reward consumers for saving money.
CATO | Red Team, Blue Team, and Gas Prices
Pretty clear Red Team/Blue Team answers. Republicans in 2006 accepted that there wasn’t much the president could do to reduce gas prices, but most of them think Obama could.
Calculated Risk | Schedule for Week of March 25th
The key reports this week are the January Case-Shiller house price index, to be released on Tuesday, the February Durable Goods report on Wednesday, the February Personal Income and Outlays report on Friday, and the third estimate of Q4 GDP on Thursday.
Keith Hennessey | Subsidizing wind and solar because China and Germany are doing it
The President has picked three industries and is arguing for an industrial policy to subsidize them in part because other countries are subsidizing them.
CATO | Don’t Look to Government If You Want Equality
In a not so subtle brief for taxing the rich, Washington Post business and economics columnist Steven Pearlstein looks critically today at Rep. Paul Ryan’s latest House Republican budget proposal.
Calculated Risk | Unofficial Problem Bank list declines to 949 Institutions
Here is the unofficial problem bank list for March 23, 2012.
WSJ | What if Young Adults Don’t Want to Leave Home?
78%: Percent of 25-34 year olds who have lived with their parents and are satisfied with the arrangement.
CATO | Why Is the Recovery Slow?
Everyone wonders why the recovery is so slow and unemployment remains so high. Just read the papers — in detail.
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