Friday, February 17, 2012

General Economics

Bloomberg | Federal Workers Face ‘Unprecedented Assault’ in U.S. Budget War
Congress is considering ways to cut U.S. federal workers’ pay, benefits and possibly their jobs even as a record number are borrowing against pensions.
CNN Money | Is China faking its economic growth?
Known for predicting the Enron collapse, the chief of Manhattan-based Kynikos Associates, has been betting on a Chinese slowdown for a few years now, and once famously remarked, the world's second largest economy is on a "treadmill to hell."
National Journal | Consumer Bureau Already Overreaching, Critics Say
Even in its infancy, the Consumer Financial Protection Bureau is facing scrutiny for every move it makes.
Politico | Re-imagining U.S. infrastructure
President Barack Obama took the first step toward re-imagining U.S. infrastructure when he promised an executive order to reduce the red tape that frequently delays or derails building projects.
CNBC | Mid-Atlantic Manufacturing Gains More Than Expected
The Federal Reserve Bank of Philadelphia said on Thursday its index of business conditions in the U.S. Mid-Atlantic region rose in February to 10.2 from 7.3 in January.

Econ Comments & Analysis                                                                                            
Washington Times | A sand-castle recovery
That 348,000 more people found themselves jobless in the last 30 days is being hailed as good news, but only because that number could have been worse.
Washington Post | Has the U.S. lost its will to compete in the global economy?
Starting with Sputnik in 1957, Americans have suffered periodic bouts of competitiveness anxiety.
NY Post | Consumers not fooled by gov’t. stats
Consumers, it turns out, were a lot less optimistic in early February, according to a University of Michigan survey. And they didn’t spend nearly as much during Christmas or in January as the geniuses who follow this stuff for a living thought.
Market Watch | Thursday's Personal Finance Stories
Still, halfway marks and four-year lows don’t get us back to a healthy economy. As RealtyTrac reports, the housing market is a real mess in some places
Politico | Obama clueless on transit funding
Transportation Secretary Ray LaHood last week told POLITICO that the House transportation bill is “the worst” measure he’s ever seen “during 35 years of public service.”
Real Clear Markets | If You Squint, You Can See the Recovery
There's been a running debate among economic commentators about whether we're in a genuine economic recovery (as opposed to another shallow, temporary reaction to the Fed's monetary "stimulus") and how strong the recovery is.
Minyanville | Is This the Economic Recovery?
There is a lot of good news to buoy the markets and give cheer to the public.

CATO | Dumb Government Intervention in the Housing Market of the Day
With the continuing bailout of Fannie Mae and Freddie Mac, along with the impending bailout of the Federal Housing Administration, it is easy to think that the federal government has a near monopoly on misguided and harmful housing policies.
Heritage Foundation | The United States of America: Land of Overregulation?
Indeed, this unfortunate drifting away from “free to choose” has been the prime culprit in America’s startling decline in economic freedom and overall competitiveness.
Café Hayek | Inequality and Stagnation
There is now a widely held view that the last 10 or 20 or even 40 years have been a time of great stagnation for the average American. Yes, the overall economy has grown, but all or most or nearly all of the gains have gone to the top 1% or top 10% or top 20%.
Marginal Revolution | Scott Winship summary on mobility and inequality
We have no more downward mobility from the middle than other nations, no less upward mobility from the middle, and no less downward mobility from the top

Health Care

National Journal | HHS Postpones New Super-Specific Billing Codes
Medicare will delay the launch of a new set of medical billing codes that will change the way doctors document their encounters with patients.

Econ Comments & Analysis                                                                                            
Politico | HHS mandate flouts religious freedom
There’s nothing more fundamental to American exceptionalism than our First Freedom — our freedom of religion.
WSJ | The Myth of Runaway Health Spending
New data show that health spending over the past several years has been normalizing toward the rate of general inflation, rather than growing higher and higher, as had been the case almost continuously since the 1970s.

Heritage Foundation | Building a Better Medicare Program: The Burr–Coburn Proposal
Senators Richard Burr (R–NC) and Tom Coburn (R–OK) have just unveiled a bold Medicare reform proposal based on the free-market forces of choice and competition. The Senators’ proposal adds further momentum to the effort to reform and improve America’s largest and most challenging entitlement program.


Market Watch | Bernanke defends low rates to community bankers
Federal Reserve Chairman Ben Bernanke on Thursday told community bankers that he recognizes that the central bank’s low interest rates hurts their profitability, but he added that the policy is necessary to drive the economic recovery.
Bloomberg | ECB Is Said to Swap Greek Bonds for New Debt to Avoid Any Enforced Losses
The European Central Bank is swapping its Greek bonds for new ones to ensure it isn’t forced to take losses in a debt restructuring, three euro-area officials said.

Econ Comments & Analysis                                                                                            
Washignton Times | Get the Fed out of the housing market
A stable dollar and prices are consistent with maximum sustainable job and wealth creation. However, the Fed’s dual mandate to pursue full employment and price stability has given it license to meddle in the economy to boost short-term employment, with disastrous consequences.
WSJ | The Volcker Diversion
Team Obama and Democrats in Congress couldn't figure out how to turn his sensible idea—prohibiting banks from gambling with taxpayer money—into law. Now Mr. Volcker seems to be acknowledging that federal regulators can't draft a Volcker Rule either, at least not without help from the same bankers who will be subject to it.
AEI | The pain of zero interest rates
The current economic environment of low—virtually zero—interest rates has hit savers hard, but the US Federal Reserve’s accommodative monetary policy is actually having a stabilizing effect on the economy.


CNN Money | Business tax breaks booted from payroll deal
The last legislative freight train is about to leave the station, and a set of expired business tax breaks that regularly get extended is being left on the platform.
Politico | CBO: Tax deal cost is $89 billion over decade
New Congressional Budget Office estimates show that the House-Senate payroll tax package will add $167.5 billion to the deficit over the next three years, but as offsets fully kick in, that will be reduced to about half, or $89.3 billion, over the decade.
NY Times | The Buffett Tax Rule Is Really More of a Guideline
President Obama has made the Buffett Rule, mandating that millionaires pay at least 30 percent of their incomes in taxes, the centerpiece of his campaign for “fairness.” But look for it among the myriad tax changes the White House detailed in the 2013 budget proposal it released this week, and you will not find it.

Econ Comments & Analysis                                                                                            
NBER | The Virtuous Tax: Lifesaving and Crime-Prevention Effects of the 1991 Federal Alcohol-Tax Increase
On January 1, 1991, the federal excise tax on beer doubled, and the tax rates on wine and liquor increased as well. These changes are larger than the typical state-level changes that have been used to study the effect of price on alcohol abuse and its consequences.
Fortune | Payroll tax cut, meet $4 gas
The payroll tax cut is more of a cushion than a stimulus for the U.S. economy. With higher fuel prices, that cushion may already be deflating.
CRS | Who Earns Pass-Through Business Income? An Analysis of Individual Tax Return Data
This report analyzes individual tax return data to determine who earns pass-through business income and bears the burden of taxes on that income. The analysis finds that over 82% of net pass-through income is earned by taxpayers with an adjusted gross income (AGI) over $100,000, although these taxpayers account for just 23% of returns filed.
Heritage Foundation | Tax Extenders and the AMT Patch: Time to Pull the Plug on Congress’s Annual Dance
A host of annual tax-reducing provisions expired on December 31, 2011. As it does each year, before restoring these policies, Congress is sure to argue about how to “pay for” extending these tax reducers, for some of which have been the law as long as 30 years.

Heritage Foundation | Targeted Tax Credits: Neither Conservative nor Free Market
As Congress hammers out the details of the payroll tax extension package, Members on the left and the right are making last-minute attempts to include a number of other provisions, including production tax credits for alternative energy sources.
WSJ | Payroll Tax Rate Should Rise Back to Normal in 2013
Treasury Secretary Timothy Geithner said Thursday he wouldn’t support another temporary payroll-tax cut extension next year.


CNN Money | Congress restructures unemployment benefits
Beginning later this year, the maximum number of weeks the jobless can collect unemployment benefits would be reduced to 73 weeks, under a new deal being hammered out in Congress.
WSJ | Portugal's Jobless Rate Jumps
Portugal's unemployment rate jumped to 14% in the final three months of last year, surprising economists and suggesting that austerity measures being implemented under the country's international bailout are creating a bigger-than-expected dent in the economy.
National Journal | Unemployment Rate Could Be Much Higher, CBO Finds
The unemployment rate last month would have been 15 percent—nearly twice as much as reported—if the official count included two groups dissatisfied with their employment status, the Congressional Budget Office found in a new report.
WSJ | Share of Workers in Scientific Fields Shrinks
The share of American workers in the science and engineering professions fell slightly in the past decade, ending what had been a steady upward trend in the proportion of workers in fields associated with technological innovation and economic growth.

Econ Comments & Analysis                                                                                            
CBO | Understanding and Responding to Persistently High Unemployment
The rate of unemployment in the United States has exceeded 8 percent since February 2009, and CBO projects that it will remain above 8 percent until 2014.
Heritage Foundation | Improving Labor Market Calls for Reducing Unemployment Insurance Duration
Congressional leaders have agreed to maintain extended unemployment insurance (UI) benefits while reducing maximum benefit duration to one-and-a-half years. The legislation moves in the right direction, but in an improving labor market, Congress should go further.

Café Hayek | Bronars on Rattner
Rattner claims that Detroit is coming back, pointing to the falling unemployment rate. Bronars shows that that’s not the real story.
The American | CBO: The U.S. is experiencing ‘longest stretch of high unemployment since the Great Depression’
The rate of unemployment in the United States has exceeded 8 percent since February 2009, making the past three years the longest stretch of high unemployment in this country since the Great Depression.


Econ Comments & Analysis                                                                                            
Motley Fool | Believe It: Consumers Are Shedding Debt
The only thing worse than a financial crisis is not learning anything from one. That sets us up to repeat the same mistakes.
Forbes | Obama's Budget: The Decline and Fall of the American Economy
President Obama’s budget released Monday embodies his policies for economic growth and recovery. 

The American | To infinity and beyond! This is the debt chart Obama and Geithner should be ashamed of
Testifying before the House Budget Committee today, U.S. Treasury Secretary Tim Geithner told Chairman Paul Ryan the following: “We’re not coming before you to say we have a definitive solution to that long-term problem. What we do know is we don’t like yours.”
National Review | Never Trust Budget Numbers
As we know, most of the spending cuts will never materialize. Also, I suspect that the president’s plan will have a hard time delivering on the promise to increase tax collection above 19 percent of GDP as soon as 2015 and grow revenue to 20.1 percent of GDP by 2022