Wednesday, January 18, 2012

General Economics

CNN: Money | Has Obama's housing policy failed?
The president's efforts to revive the housing market have largely failed. But is that entirely Obama's fault?
Bloomberg | World Bank Cuts Global Growth Forecast as Euro Region Contracts: Economy
The World Bank cut its global growth forecast by the most in three years, saying that a recession in the euro region threatens to exacerbate a slowdown in emerging markets such as India and Mexico.
Market Watch | U.S. wholesale prices decline in December
U.S. wholesale prices fell in December for the second time in three months, as the cost of gas and food declined.
Bloomberg | Germany Cuts 2012 Economic Growth Forecast as Crisis Dims Export Outlook
The German government cut its forecast for economic expansion this year as the debt crisis dims the outlook for sustaining record exports, leaving domestic demand as the main motor for growth.
Market Watch | Inflation seen easing, housing improving
In a rear-view look at the economy, reports this week on inflation, housing and manufacturing are likely to show the U.S. remained on a modest upward track at the end of 2011.
USA Today | Our cars are getting older, too: Average age now 10.8 years
The cars and trucks in America's driveways have reached a record old age, but there are signs that people are growing confident enough in the economy to want a whiff of that new-car scent.

Econ Comments and Analysis                                                                                          
WSJ | A Short (Sometimes Profitable) History of Private Equity
The industry may only date back a half-century, but purchases of distressed assets and leveraged buyouts are as old as capitalism.
Washington Times | LUFT: Market-based future for ethanol
Domestic product is critical insurance policy against oil shocks.
WSJ | A Tale of Two Pipelines
Canada and the U.S. trade economic places.
Politico | How Congress can hurt the economy
Economists at the University of Chicago and Stanford University developed an index to track policy uncertainty, finding that recent spikes have foreshadowed the loss of as many as 2.5 million jobs and a peak decline of 2.2 percent in gross domestic product.
Washington Times | KATZ & HUFBAUER: Don’t give up on world trade talks
New ideas can reboot negotiations and global economy.
Aol Energy | Chamber Chief Says Energy Can Lead Economy Revival
The US "is on the cusp of an energy boom that is already creating hundreds of thousands of jobs, revitalizing entire communities, and reinvigorating American manufacturing. | There's A Disparity In Wealth Creation, Too
People who are preoccupied, or even obsessed, with disparities in income are seldom interested much, or at all, in the disparities in the ability to create wealth, which are often the reasons for the disparities in income.

Heritage Foundation | Barron’s Roundtable Blames Economic Malaise on Government Policies
The U.S. doesn’t have the same financial flexibility today that it had in 1979 and 1980. Government debt is 100% of GDP, compared with 32.6% then. The huge debt overhang is a ticking time bomb.… As Margaret Thatcher said, socialism is great until you run out of other people’s money.
Cato @ Liberty | Is California High-Speed Rail Dead?
When the authority was insisting that the rail line could be built for $43 billion, its highway-airport alternative was estimated to cost $100 billion. When the rail cost jumped to nearly $100 billion, the highway-airport cost mysteriously increased to $171 billion.
Daily Capitalist | Bank Data Supports Austrian Theory For Rapid Recovery
It is an axiom of Austrian economic theory that the quickest road to recovery is to liquidate malinvestments as soon as possible. That is, sell off or bankrupt those failed projects invested in on the way up the boom phase of the business cycle.
Marginal Revolution | Is the middle class shrinking?
That’s right, the share of households with income that puts them in the middle class or higher was 76 percent in 1970 and 75 percent in 2010—two figures that are statistically indistinguishable.
Atlantic: Megan McArdle | What Would New York Look Like With a Smaller Financial Sector?
After a disappointing year, the big banks are pulling back on their bonus pools.
Econlog | Econlog Saving and Investment: My (Keynesian) Take
When workers want to save more, they buy fewer consumer goods and more raw materials. They invest these raw materials with entrepreneurs, who allocate them between cheap construction and expensive construction.

Health Care

Politico | Supreme Court holds the fate of Medicaid
Two cases before the Supreme Court have the potential to effectively do what Republican lawmakers have tried and failed: transform Medicaid into a block grant program for states with few enforceable federal rules about how they provide health coverage for the poor.
National Journal | QUICK TAKE: Hospitals Already Lobbying Congress Against Cuts
The House isn’t back for votes until 6:30 p.m. on Tuesday, but hospital lobbying groups are already asking members to vocally oppose having hospitals cover the cost of putting off a 27 percent cut to Medicare doctors’ pay.

Cato @ Liberty | Obamacare’s Medicaid Expansion Violates Federalism
In short, if Obamacare does not cross the line from valid “inducement” to unconstitutional “coercion,” nothing ever will. Just as the Commerce Clause is not an open-ended grant of power, the Spending Clause too has limits that must be enforced.


Bloomberg | Fed Officials Open to Additional Easing as They Monitor Risks to Economy
Federal Reserve officials are staying open to further monetary easing this year as they monitor risks that threaten to move the economy further away from their mandate for stable prices and full employment.
Market Watch | Regulator: Volcker puts U.S. banks at disadvantage
U.S. banks will operate at a competitive disadvantage with foreign institutions because of new limitations on speculative trading being imposed on them by the Volcker Rule.
Bloomberg | IMF Seeks $500B Boost to Lending Resources
The International Monetary Fund is proposing to raise its lending capacity by $500 billion to insulate the global economy against any worsening of Europe’s debt crisis, according to a person familiar with the talks.

Econ Comments and Analysis                                                                                          
RCM | Ben Bernanke Is Finally Right For Being Wrong
Fed critics from the left and right will doubtless seek to use Bernanke's utterances as weaponry meant to further discredit a Fed Chairman who is expert at always being wrong, but they'd be unwise to do so.


Fox News | Congress revisiting bruising payroll tax cut fight
With television lights glaring, 20 lawmakers will gather next week to revisit the fight that consumed Congress before Christmas over renewing a Social Security payroll tax cut and unemployment benefits.
WSJ | Politics, Tax Code Said to Stymie U.S.
According to Harvard Business School graduates, political gridlock, faltering schools, and a convoluted tax code are making American companies less competitive in the global marketplace.
NY Times | Parties Confident of Extending Payroll Tax Cut
With both parties largely in agreement on a yearlong extension of President Obama’s payroll tax cut, the fight in Congress over the coming weeks will boil down to how to pay for it, and Democrats appeared to hold the advantage as members of the House returned to Washington on Tuesday.

Econ Comments & Analysis                                                                                            
Forbes | We Don't Want Washington Wasting Warren Buffett's Money
Higher taxes aren’t altruistic.
AEI | Needed: a new Laffer Curve
Today we need a new Laffer Curve—for regulation.


National Journal | QUICK TAKE: U.S. Lost One Quarter of High-Tech Manufacturing Jobs in a Decade
The United States has lost more than a quarter of high-tech manufacturing jobs to Asia over the past decade, as China and neighboring countries expand their science and engineering capabilities, according to a National Science Board publication issued Tuesday, The Washington Post reports.
WSJ | U.S. Loses High-Tech Jobs as R&D Shifts Toward Asia
The U.S. is rapidly losing high-technology jobs as American companies expand their research-and-development labs in China and elsewhere in Asia, the National Science Board said Tuesday.
NY Times | Few Cities Have Regained Jobs They Lost, Report Finds
Only 26 of the nation’s 363 metropolitan areas had recovered their lost jobs by the end of 2011, and only 26 more are projected to recover them by end of this year, according to the report, which was commissioned by the United States Conference of Mayors.
USA Today | Kraft Foods to cut up to 1,600 positions
Kraft Foods will cut 1,600 positions in North America as it prepares to split its business in two.


WSJ | U.S. Acts to Stay Below Debt Limit
The U.S. government curtailed its investment in a federal retirement fund Tuesday as it looks to stay under the legal debt limit while awaiting a congressional vote on raising the federal spending ceiling.
WSJ | Greece Talks to Resume, Issues Remain
Greece's government is set to resume talks with its private creditors late Wednesday over a plan to restructure the country's debt as it scrambles to secure a deal demanded by its European partners for a new bailout package.

Econ Comments & Analysis                                                                                            
RCM | Congress' Pension Math Doesn't Add Up
In few areas where public and private interests meet is the accounting as obscure, rigged and unrealistic as in the world of traditional defined benefit pensions, both public and private.

NRO: The Corner | The President’s Big Boost to Corporate Welfare
After all, we are talking about $300 million over ten years, which is 0.0081 percent of the government’s 2012 budget of $3,700,000,000,000.
Hill: Floor Action Blog | House approves rule allowing Wednesday vote on debt ceiling resolution
The House Rules Committee on Tuesday evening approved a rule that will let the House vote Wednesday on a Republican resolution disapproving of President Obama's request to increase the debt ceiling by $1.2 trillion.
Heritage Foundation | In Europe, Reducing Spending Necessary, but Not Sufficient, to Restore Economic Freedom
If the 2012 edition of Heritage’s Index of Economic Freedom has bad news for the United States, the news for Europe is not much better.