Thursday, March 29, 2012

General Economics

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.”

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

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.

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


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.

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.


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."


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.

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 | 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."

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