Monday, February 13, 2012

General Economics

Market Watch | Japan's economy shrinks more than expected in Q4
Japan's economy shrank by more than expected in the October-December quarter, as a strong yen and collateral economic damage from flooding in Thailand took their toll.
CNN Money | Bernanke: Housing problems hold back recovery
Lingering problems in the housing market continue to restrain America's economic recovery and limit the effectiveness of Federal Reserve policies, Ben Bernanke said Friday.
WSJ | Rosier View Has Familiar Ring
As optimism mounts that the U.S. economic recovery is at last gaining steam, it is worth remembering that things looked pretty good a year ago, too.
Politico | Three years since meltdown, banks are shackled but stronger
In this evolving era of financial reform, the nation’s too-big-to-fail banks are either at death’s door or destined to become bigger and badder than ever.
WSJ | U.S. Trade Gap Widened in 2011
The U.S. trade deficit widened in December as rising consumer spending and restocking by U.S. businesses led imports to grow faster than exports.
Market Watch | U.K. to avoid recession, growth seen ‘subdued’
Britain will avoid recession in 2012, but economic growth will remain subdued as problems in Europe dampen prospects for recovery, a leading business organization said Monday.
Washington Times | Weak housing has hurt consumer spending
Ben Bernanke says declines in home prices have forced many Americans to cut back sharply on spending and warns that the trend could continue to weigh on the economy for years.

Econ Comments & Analysis                                                                                            
AEI | Shrink the eurozone to save it
With each passing day, Greece's economic and political malaise deepens despite one massive International Monetary Fund-European Union bailout package after another to keep that country afloat.
WSJ | Memo to Mitt: The Safety Net Needs Fixing
In this space last month, I suggested enacting some modest tax cuts and spending increases, sharply targeted at job creation, and coupling that with substantial future deficit reduction—enough to pay the bill many times over.
WSJ | China and America: A Profitable Partnership
Forty years ago this week, leaders from the United States and China broke decades of estrangement and ushered in a new era of relations between the two countries.
Real Clear Markets | Orwellian Doublespeak Dominates Economic Policy
It was the progressive destruction of the English language that prompted coffee to come out of my nose. Without a common understanding of precisely what words mean, rational discourse becomes futile.
CATO | Still a Better Deal: Private Investment vs. Social Security
Opponents of allowing younger workers to privately invest a portion of their Social Security taxes through personal accounts have long pointed to the supposed riskiness of private investment.
WSJ | In Praise of 'Enviropreneurs'
Entrepreneurs are my heroes because of their optimism. Instead of seeing problems, they see opportunities.
WSJ | How Government Coddles the 1%
There's class warfare in the U.S. all right. Good examples can be found at the nation's airports and on its highways.
NY Times | Break Up the Banks? Here’s an Alternative
Bailing out financial institutions deemed “too big to fail” has become wildly unpopular, as people across the political spectrum are now talking about splitting up America’s large banks. 

Coordination Problem | What the Austrian Business Cycle Theory Can and Cannot Explain
Lars Christensen's post on Rothbard's America's Great Depression over at Market Monetarist serves as a useful reminder about what the Austrian cycle theory can and cannot do. 
Political Calculations | China Enters Into Recession
We base that observation upon our analysis of international trade data collected by the U.S. Census Bureau, where we have calculated the year-over-year growth rate in the value of goods and services that the United States has both exported to China and which the U.S. has imported from China.
Calculated Risk | Economic Analysis and Inaccurate Numbers
According to Zillow, 28.6 percent of all single-family homes with mortgages had negative equity in Q3 2011. And according to CoreLogic, "10.7 million, or 22.1 percent, of all residential properties with a mortgage were in negative equity at the end of the third quarter of 2011".
The American | Has Obama lost control of economic expectations—again?
Americans felt worse about their personal finances in early February, even as they saw a light at the end of the tunnel for the jobs market, a survey released on Friday showed. 
Library of Economics | Wealth and the Output Gap
Suppose that a foreign government confiscates some of our citizens' assets. Then domestic potential output is not affected. There may be less domestic consumption. But the that would make the output gap larger, not smaller.
Calculated Risk | Unofficial Problem Bank list unchanged at 958 Institutions
This is an unofficial list of Problem Banks compiled only from public sources.
WSJ | Bank Business Loans Rose $6.9 Billion in Latest Week
U.S. banks’ commercial and industrial loans increased $6.9 billion to about $1.360 trillion in the week ended Feb. 1, the latest week for which data are available, the Federal Reserve said Friday.
The American | Occupy Time Machine: Income inequality now back to where it was 15 years ago
The Great Recession dramatically reduced U.S. income inequality, according to a new analysis from the Tax Foundation. In fact, income inequality—at least as measured by the income share of the top 1 percent of earners—is back to where it was in 1996-1997.

Health Care

Econ Comments & Analysis                                                                                            
NBER | Airports, Air Pollution, and Contemporaneous Health
We demonstrate that daily airport runway congestion contributes significantly to local pollution levels and contemporaneous health of residents living nearby and downwind from airports.
CBO | The Veterans Health Administration's Treatment of PTSD and Traumatic Brain Injury Among Recent Combat Veterans
Through September 2011, about 740,000 veterans from overseas contingency operations in Iraq and Afghanistan had been treated by the Veterans Health Administration (VHA). That number is slightly more than half of all recent veterans eligible for care by VHA.

Atlantic | New Drugs Cost Even More Than You Think
The standard figure for drug discovery thrown around by the industry's most avid critics is the Light and Warburton estimate of roughly $43 million.
The American | Can Uncle Sam pay for his healthcare promises? Healthcare fact of the week
To pay for the increases in federal health spending promised 75 years from now, federal income taxes that year would have to be 175 percent higher than they are today.
Café Hayek | Words vs. Subsidies
Many of my friends wonder why I’m annoyed by Michelle Obama’s constant mother-henning insistence that Americans eat more veggies.  “She’s just encouraging people to voluntarily make healthier choices,” my mystified friends tell me.


WSJ | Fed Watchers See Risks in Rate Plan
Many economists believe the Federal Reserve risks making a big mistake if it sticks to its recent guidance about keeping interest rates super low for the next three years.

Econ Comments & Analysis                                                                                            
CATO | Fed Low Interest Rate Policy Distorts the Economy
Investors in stocks and longer-term bonds can thank Federal Reserve Chairman Ben Bernanke for his new policy of providing information on the probable path of the federal funds target rate over the next several years.
Washington Times | Twisting long-term bond markets
The Federal Reserve is keeping short-term interest rates absurdly low through late 2014, and that choice is going to cause long-term damage to our economy.
WSJ | Money Fund Make-Over
It appears that a federal financial regulator is about to propose taxpayer-friendly reform despite fierce industry lobbying.
Investors | Fed Low Interest Rate Policy Distorts The Economy
Investors in stocks and longer-term bonds can thank Federal Reserve Chairman Ben Bernanke for his new policy of providing information on the probable path of the federal funds target rate over the next several years.

Heritage Foundation | Is the U.S. Economy in a “Liquidity Trap”?
Popular economics suggests that economic activity results from a circular flow of money in the economy: One person’s spending is a second person’s income, and the second person’s spending is a third person’s income, and so on.
WSJ | Fed Valentines Take the Web by Storm
There’s nothing like the Federal Reserve and Valentine’s Day to bring people together, on Twitter at least. #FedValentines hit the microblogging service early this morning, the brainchild of economist Justin Wolfers, who presents some of his favorites here.
Free Banking | More on the gold standard, with regret
I regret taxing readers’ patience with another post on the gold standard. As I and other bloggers here have made clear, a free banking system need not be a gold standard system.


Roll Call | Payroll Deal Deadline Looms
Despite a week of public grousing and finger-pointing, payroll tax cut conferees and staff still hope their ultimate deal will avoid both a tax increase and a reaffirmation of a do-nothing Congress.
National Journal | Obama to Release Corporate Tax Reform Plan at End of February
The president plans to release a proposal for corporate tax reform by the end of the month, according to senior administration officials on Friday, though details of the proposal remain murky.
Market Watch | Congress eyes retirement-plan tax benefits
You’d think a legislative bill to fund the nation’s highways and mass-transit systems would have no connection to your retirement savings. But that didn’t stop lawmakers from proposing an amendment to the bill that would have trimmed a valuable retirement-plan benefit.
Washington Times | Obama wants payroll-tax-cut action as deadline nears
President Barack Obama is pressuring Congress to extend a payroll tax cut for the rest of the year as another deadline nears for Congress to act or see taxes go up for millions of working people.
CNN Money | Obama budget: Tax plans aim at rich
When it comes to taxes, President Obama's 2013 budget proposal on Monday is expected to include a host of repeat performances. In fact, many of the proposals he'll make have appeared in every budget Obama has put out since taking office.

Econ Comments & Analysis                                                                                            
Washington Times | Obama’s war against success
Raising taxes on Americans is the centerpiece of his re-election campaign, a plan that respects no earthly or heavenly bounds. This became clear at the national prayer breakfast earlier this month where Mr. Obama oddly opined that tax hikes coincide with the teachings of Jesus Christ.
Real Clear Markets | A Swiss Response to American Fiscal Imperialism
Switzerland is in the unfortunate position of being bullied and harassed by the U.S. government. The crux of the problem is that the United States arguably has the world's worst tax system for international activity

Tax Foundation | Michigan Implements Positive Corporate Tax Reform
Michigan lawmakers approved significant corporate tax reform last year that went into effect at the beginning of 2012. Previously Michigan had a dual corporate tax system called the Michigan Business Tax (MBT).


USA Today | America's long-term jobless still struggling
J.R. Childress is up before the sun, bustling about in the French colonial brick house he built. He helps pack his wife's lunch, downs some eggs or cereal for breakfast, pores over online and newspaper job listings and hopes — even prays — this will be the day when his fortunes turn around.

Econ Comments & Analysis                                                                                            
WSJ | The States Are Leading a Pro-Growth Rebellion
After the 2008 election, Democrats controlled both houses of Congress and, of course, the presidency. They used that victory to push through an agenda as radical as any seen in this country since FDR—unprecedented deficit-financed stimulus spending, more regulations, a new health-care entitlement, etc.


Bloomberg | Obama’s 2013 Budget Projects $901 Billion Deficit in Proposal to Congress
President Barack Obama will revive proposals for $1.5 trillion in tax increases as well as spending to boost jobs as part of a 2013 budget request that projects the deficit shrinking next year to $901 billion.
FOX News | Gov't on pace for $1T deficit despite January dip
The federal deficit was lower through the first four months of the budget year than the same period last year. Still, the deficit is expected to top $1 trillion for the fourth year in a row, putting more pressure on Congress and President Barack Obama in an election year.
National Journal | Obama Budget Unlikely to Include New IMF Funds
The Obama administration has long insisted it will not ask Congress to send more money to the International Monetary Fund in order to prop up Europe’s troubled economies and financial system, a firewall that some analysts estimate could cost more than $1 trillion.
CNN Money | Obama budget: $901 billion deficit in 2013
President Obama will propose a budget on Monday that forecasts a $901 billion deficit in 2013, and includes plans to make targeted investments in areas like infrastructure while hiking taxes on the rich.

Econ Comments & Analysis                                                                                            
Washington Post | Budget quagmire revealed by Social Security disability program
The numbers are too big; the details, too complicated; and the choices, when faced, too wrenching. President Obama’s new budget, estimated at $3.5 trillion or more, will raise all these problems.

CATO | The Obama Budget — Some Day My Cuts Will Come
It’s being reported that in his 2013 budget President Obama will propose to increase spending now and reduce the deficit some day.  Isn’t that what every budget promises these days?
Daily Capitalist | Budget Travesty 2012
The budget, according to the documents, will forecast a $901 billion deficit for fiscal 2013, which would be equivalent to 5.5% of gross domestic product. That is up from the administration’s September forecast of a deficit of $833 billion, or 5.1% of GDP.