Monday, May 14, 2012

General Economics

News                                                                                                                             
Politico | Nation's potholes need a big fix
The nation’s population is growing at a steady pace, yet infrastructure investments lag. The lifelines of commerce — roads, bridges, runways, ports — are showing their age, and in this era of fiscal austerity it may be a long time before they get rebuilt
National Journal | A Lovers’ Quarrel Between GOP and Big Oil
President Obama and the oil and natural-gas industry are getting along better than ever, and that’s infuriating Republicans on Capitol Hill.
CNN Money | Are megabanks too big to manage?
JPMorgan Chase's $2 billion hedging blunder is adding fuel to those who think the megabanks are just too big.
Bloomberg | Spark in Sales of Cars and Trucks Drives U.S. Economy
Car sales that are running at the fastest pace in four years are poised to reverberate through the world’s largest economy as a spillover into production, profits and jobs for Americans may be starting.
WSJ | Euro-Zone Industrial Output Stokes Recession Fears
Industrial production in the 17 countries that use the euro fell unexpectedly in March, leaving little doubt the region contracted for a second straight quarter in the first three months of the year and returned to recession, data by Eurostat showed Monday.

Econ Comments & Analysis                                                                                            
Politico | Fix our roads to help the economy
We face stark choices regarding the role of government in our nation’s transportation and infrastructure programs. Because of cumbersome federal regulations, red tape and bureaucratic malaise, it can take up to 15 years on average to take a major construction project from inception to completion.
Mercatus | How Well Do Federal Regulations Actually Work? The Role of Retrospective Review
With the volume of federal regulations exceeding some 165,000 pages, a reliable practice of review is critical to judge how well or poorly existing regulations actually work and to revise regulations accordingly.
Washington Post | The boom on the farm
Sitting in the cab of a $350,000 John Deere tractor pulling a $150,000 Deere corn planter, Greg Carson embodies modern American agriculture. It’s capital-intensive, high-tech, efficient — and now immensely profitable. Looking for a bright spot in the U.S. economy? The farm belt is it.
Washington Times | J.P. Morgan mess: Bust up the big banks
J.P. Morgan’s $2 billion loss from betting on corporate bonds will embolden advocates of the Volcker Rule - a provision of the 2010 Dodd-Frank law that will prohibit banks from trading on their own account. Unfortunately for federal regulators, trading in securities is essential to modern banking, and busting up the big Wall Street financial houses may be the only way to better ensure financial stability.
WSJ | Economists Forecast Subdued Growth in 2012
Forecasters surveyed by The Wall Street Journal expect the economy to grow at such a subdued pace this year that unemployment will barely budge.

Blogs                                                                                                                             
Calculated Risk | Unofficial Problem Bank list declines to 924 Institutions
Here is the unofficial problem bank list for May 11, 2012.
Atlantic | The 1% Conundrum: How Much Income Inequality Is There, Really?
My last post provided an initial look at the inequality figures focusing on "the top one percent," which show sharply rising income concentration over the past 30 years.  But those figures rely entirely or heavily on tax return data from the IRS.  This creates some issues that warrant skepticism about the magnitude of the increase I described.
WSJ | NY Fed Releases Latest View on Economy
The latest update of the official New York Fed staff economic forecasts predicts trend-like growth, largely stable inflation and a slow grind lower in the unemployment rate.
Economist | The unwinding
Today is a bloody day on markets, on the heels of what was a very bloody week on markets. Euro-area equities are plunging and sovereign-debt yields are soaring. The Spanish 10-year yield is up to 6.3%, a level not seen since late last year. Awful news from the real economy is partly to blame; industrial production dropped sharply in May across the euro zone. But the possibility of and potential fall-out from a Greek exit seems to loom largest.
WSJ | Secondary Sources: Euro Crisis, Long-Term Unemployment, Greek Exit
A roundup of economic news from around the Web.
Carpe Diem | North Dakota's Amazing Economic Success; It's Not Just About Oil, A Pro-Business Climate Gets Credit. Let's Call it the "Dakota Model" of Job Creation
It's been widely reported here and elsewhere that North Dakota's economy is booming, thanks largely to the energy-related prosperity in the western part of the state.

Health Care

News                                                                                                                             
National Journal | Study: Privately Insured Kids Get More Care In ED
Emergency departments are required to treat everyone who comes through the doors, but that doesn’t mean they treat everyone the same way.

Econ Comments & Analysis                                                                                            
Heritage Foundation | The Good News in the Medicare Trustees Report
The release of the annual Medicare trustees report in late April, containing as it did a vast array of very bad news, was immediately greeted with valid dire warnings of fiscal disaster. Little noticed, however, were three important bits of good news: the inevitability of imminent action; a simple key hidden in the report for understanding Medicare’s fiscal problem; and a proven bipartisan solution. 

Monetary

News                                                                                                                             
Bloomberg | Euro Officials Begin to Weigh Greek Exit as Euro Weakens (Update 1)
Greece’s possible exit from the euro moved to the center of Europe’s financial-crisis debate, rattling markets as authorities in Athens struggled to form a government.
CNN Money | China's central bank eases
The People's Bank of China is cutting the amount of money banks are required to hold on the sidelines, freeing up those funds instead to boost investment and growth.

Econ Comments & Analysis                                                                                            
Fortune | Why it's time for higher interest rates
Progressives, led by Paul Krugman, believe that we can fix our economic woes with more consumer debt and higher inflation. The reality is that near zero interest rates encourage speculation, discourage savings, weaken pension funds, and put millions of baby boomers at risk.

Taxes

Econ Comments & Analysis                                                                                            
AEI | Taxing state governments under a federal value added tax: Part 1
The federal government confronts a long-run fiscal imbalance arising from the rapid projected growth of Medicare, Medicaid, and Social Security spending compared with revenue. The enactment of a value added tax is often mentioned as a possible solution to this imbalance. This article is the first part of a two-part examination of the contentious issue of how state governments' provision of goods and services to the public should be taxed under a VAT.1
WSJ | 'Taxmaggedon' Is a Real Threat
Nine years ago this month Congress passed President George W. Bush's Jobs and Growth Tax Relief Reconciliation Act. That bill's lower rates on capital, as well as the continuity in tax policy it established, have helped make our economy far more resilient.

Employment

News                                                                                                                             
Bloomberg | Workers Lacking Skills Hinder More U.S. Factory Gains: Economy
Paul Bonin has no problem getting enough orders to keep his South Bend, Indiana, factory busy. What he can’t find are enough qualified employees to work on the assembly lines.

Econ Comments & Analysis                                                                                            
AEI | The human disaster of unemployment
In 2007, before the Great Recession, people who were looking for work for more than six months — the definition of long-term unemployment — accounted for just 0.8 percent of the labor force. The recession has radically changed this picture. In 2010, the long-term unemployed accounted for 4.2 percent of the work force.
Washington Times | A permanent underclass
The official unemployment rate is 8.1 percent, but the turmoil in the American labor market is worse than that number suggests. Bad policy and economic circumstances are combining to create a European-style permanent underclass on our shores.

Budget

News                                                                                                                             
FOX News | California facing higher $16 billion shortfall
California's budget deficit has swelled to a projected $16 billion — much larger than had been predicted just months ago — and will force severe cuts to schools and public safety if voters fail to approve tax increases in November, Gov. Jerry Brown said Saturday.

Econ Comments & Analysis                                                                                            
Mercatus | Two Kinds of Austerity
Austerity is destroying Europe, we are told. In fact, this "anti-austerity" slogan is supposedly an important reason for defeat of former French president Nicolas Sarkozy and for the victory of newly elected socialist Francois Hollande.

Blogs                                                                                                                             
Neighborhood Effects | Government Spending Has Shrunk…When You Ignore 44 Percent of Government Spending
Floyd Norris has made an astounding discovery. When you don’t count 44 percent of government spending, it appears that government spending has shrunk in recent years.