Tuesday, August 28, 2012

General Economics

News                                                                                                                             
USA Today | Gas prices likely to rise after Isaac
"We're definitely going to see a bump," says Brian Milne of energy tracker Telvent DTN. "We're going to get into the $3.80s at minimum and it could go higher, depending on how quickly things are resolved."
Bloomberg | Consumer Confidence in U.S. Declines by Most Since October
Confidence among U.S. consumers fell in August by the most in 10 months as households grew more pessimistic about their employment prospects and the economic outlook.
CNN Money | Home prices signal recovery may be here
A sharp boost in home prices during the spring could signal a recovery in the long-suffering U.S. housing market, according to an industry report issued Tuesday.
Fox Business | Crop Insurance Losses From Drought Could Reach $20B
The drought that left farmland in the U.S. barren and ravaged crop production may add up to total crop insurance losses of more than $13 billion, disaster modeler AIR Worldwide said on Tuesday.

Econ Comments & Analysis                                                                                            
WSJ | The Return of Welfare as We Used to Know It
There are many ways to aid the poor. Ending work rules isn't one of them.
Cato Institute | The Impact of Charter Schools on Public and Private School Enrollments
The flow of private-school students into charters has important fiscal implications for districts and states. When charters draw students from private schools, demands for tax revenue increase.
Washington Times | FEULNER: Teachers unions’ pressure is failing
School choice is passing the test.

Blogs                                                                                                                             
Marginal Revolution | A look at U.S. income growth
“A provocative “exercise in subtraction” suggests that future growth in consumption per capita for the bottom 99 percent of the income distribution could fall below 0.5 percent per year for an extended period of decades.”
Heritage Foundation | Want Cheaper Gasoline? Waive Regulations
Even as the summer travel season is winding down, drivers have certainly noticed that gas prices are marching back up. Since the law of supply and demand hasn’t yet been repealed (or even suspended by executive order) the answer seems simple enough: increase the amount of gasoline available.
Cato @ Liberty | One of Many Ways the SEC Contributed to the Financial Crisis
I was recently reminded that in its infinite wisdom, the Securities and Exchange Commission (SEC) actually sued banks as the housing bubble was building for putting aside too much money to coverage potential loan losses.
WSJ: Real Time Economics | GDP Per Capita Unlikely to Get Back to Pre-Recession Level Until 2013
What has happened to the economy over the past five years is grim enough. When you look at it in the context of a growing population, it is even grimmer.

Health Care

Econ Comments & Analysis                                                                                            
RCM | The U.S. Needs a Vigorous Medicare Debate
Medicare is in trouble. The nonpartisan Congressional Budget Office's new cost estimates for Medicare, released last week in its new update to its Budget and Economic Outlook, raise projected Medicare spending by $136 billion over the next decade due to lower than expected productivity and higher than expected costs for goods and services.

Blogs                                                                                                                             
Heritage Foundation | How Obamacare Robs Medicare and Hurts Seniors
Obamacare cuts $716 billion from Medicare over the next 10 years, according to the Congressional Budget Office (CBO), and uses these “savings” from Medicare to fund other entitlement expansions mandated by Obamacare.

Monetary

News                                                                                                                             
Bloomberg | ECB Said to Urge Weaker Basel Liquidity Rule on Crisis Risks
The European Central Bank is pushing global banking regulators to relax a draft liquidity rule so that lenders can use some asset-backed securities and loans to businesses in a buffer they must hold against a possible credit squeeze, according to three people familiar with the talks.
Market Watch | Euro-zone money-supply growth accelerates in July
Money supply across the 17 nations that share the euro grew faster than expected in July, data from the European Central Bank showed Tuesday. M3, the broadest measure of money supply, expanded at an annual rate of 3.8% in July, accelerating from 3.2% in June. Economists had forecast a 3.3% annual increase.

Econ Comments & Analysis                                                                                            
Forbes | The Top Ten Reasons That You Should Support the "Gold Commission"
What has gone largely unreported are ten reasons the American people should support the creation of a “gold commission.”

Blogs                                                                                                                             
WSJ: Real Time Economics | Fed Economists Play Down Effect of Cutting Interest on Excess Reserves
Lowering the interest rate the Federal Reserve pays on excess reserves wouldn’t have a meaningful effect on the overall money supply, two economists argued in a Federal Reserve Bank of New York blog post Monday.
Economics One | Which Simple Rule for Monetary Policy?
The discussion of "Simple Rules for Monetary Policy" at last week’s FOMC meeting is a promising sign of a desire by some to return to a more rules-based policy.

Taxes

News                                                                                                                             
WSJ | Industry Seeks Tax Fix
Lower and Simpler Rates Should Be Washington's Priority, Manufacturers Say.

Blogs                                                                                                                             
Tax Foundation | Monday Map: State and Local Tax Deductions
Today's Monday Map focuses on the deduction of state and local income or sales taxes from federal taxable income.

Employment

Econ Comments & Analysis                                                                                            
Heritage Foundation | Unelected Unions: Why Workers Should Be Allowed to Choose Their Representatives
Unions negotiate workers’ terms of pay, promotion, layoff, and retirement; union members may not bargain for themselves. However, very few union members voted for this representation.

Blogs                                                                                                                             
AEIdeas | 4 charts that show the U.S. labor market is a long, long way from being back to normal
"U.S. labor markets have recovered 4 million of the nearly 9 million net job losses from the early 2008 peak. …"

Budget

News                                                                                                                             
WSJ | Catalonia to Seek Aid From Madrid
The regional government in Catalonia said Tuesday it will ask for around €5 billion ($6.27 billion) in financial assistance from the central government, as the country's economic recession deepened in the second quarter and outflows from bank deposits hit a record high.
Bloomberg | Spanish Recession Deepens as Austerity Damps Outlook: Economy
Spain’s recession worsened in the second quarter as the government’s austerity push to reduce the euro area’s third-biggest budget deficit and a slump in consumer spending offset growth in exports.
Politico | $8 billion surprise grist for new spending fight
...to the surprise of many, the agency now says it represents an $8 billion increase from what it calculates the current rate of discretionary spending, $1.039 trillion.

Econ Comments & Analysis                                                                                            
Bloomberg | Social Security’s Woes Are Worse Than You Think
On both left and right, the politicians and the experts are saying the U.S. needs to fix Medicare -- and have made fixing Social Security an afterthought.
Heritage Foundation | How Arms Controllers Would Reach a Budget Agreement
America is never going to fix its structural fiscal problems until we recognize that we face a political science problem more than an economic policy problem.
CNN Money | Where's all that government spending really going?
So where are the new trillions in spending really going? To find out, let's start with the total increase in outlays.

Blogs                                                                                                                             
Political Calculations | The Recession And Social Security Disability
Picking up on recent comments by Russ Roberts on the changes in the disability rolls over time, we thought we might revisit Social Security's data on the number of disabled workers collecting disability benefits for the years corresponding to the Great Recession.
NRO: The Corner | More Evidence That Spending Cuts Are the Best Way to Shrink Our Debt
As I have explained in the past, increasing taxes on rich people is unlikely to address concerns about income inequality.
Keith Hennessey | The “insufficient detail” critique of the Ryan budget
Dr. Orszag’s principal critique is that the Ryan budget is short on details.