Wednesday, December 19, 2012

General Economics

CNN Money | Home building slows, but still going strong
The pace of home building slowed slightly in November but remained near the four-year high reached the previous month, according to a government report released Tuesday.
Bloomberg | German Business Confidence Rises for a Second Month
German business confidence increased for a second month in December, signaling Europe’s largest economy may support a euro-area recovery next year.
CNN Money | Port strike looms as talks break down
A strike at container ports from Boston to Houston appears more likely after talks broke down Tuesday, leaving businesses worried about a crippling shutdown set to start in less than two weeks.
WSJ | U.S. Economy Will Face Drag Next Year
Deal or no deal, the U.S. economy will face a drag of some kind from Washington budget policy next year. The White House and GOP are just negotiating how much.
Bloomberg | An Economics Masterpiece You Should Be Reading Now
The most valuable new book I’ve read this year is Justin Yifu Lin’s “The Quest for Prosperity.” George Akerlof, a Nobel laureate in economics and a man not given to reckless overstatement, calls it “a masterpiece.” I’d say that’s right.
CNN Money | S&P boosts Greece's credit rating
Standard and Poor's boosted Greece's credit rating by several notches Tuesday, citing the broad commitment to keep Greece in the eurozone.

Econ Comments & Analysis                                                                                            
Washington Times | The choices: raise taxes, go over the cliff or kick the can
Kicking the can may be the least-repugnant remaining resolution to the “fiscal cliff.” The only alternatives appear to be simply going over the cliff, or a Republican cave-in on income tax rates in exchange for mostly cosmetic spending reductions.
Market Watch | Fitch: Fiscal cliff is top threat to world economy
The U.S. fiscal cliff -- the combination of massive spending cuts and tax hikes set to begin taking effect Jan. 1 unless politicians reach a budget deal -- is the "single biggest near-term threat to the world economy, given its potential to tip the U.S. into an unnecessary and avoidable recession," Fitch Ratings said Wednesday in its biannual sovereign review and outlook report.
Washington Times | Staying prosperous
The world’s becoming a more prosperous place. That’s good news for many countries — just not the United States.
Mercatus | The American Recovery and Reinvestment Act of 2009 Didn't Work
In early 2009, President Obama predicted that his American Recovery and Reinvestment Act would "jump-start our economy," "create new jobs," and provide "many years of economic growth."
AEI | How to restructure Social Security
Washington is abuzz with talk of entitlement reform. In his latest offer on the fiscal cliff negotiations, President Obama has proposed slowing the growth of entitlement spending. More generally, both parties recognize that returning these entitlement programs to solvency will entail politically painful cuts to promised benefits, increases in tax revenues, or both.
Washington Times | Federal rules cost $10,000 per employee
What do the Progressive Policy Institute, former Sen. Phil Gramm of Texas, former presidential candidate Herman Cain and the Competitive Enterprise Institute have in common? An idea for rolling back overregulation.

WSJ | Secondary Sources: U.S. vs. World, Mortgages, Keynesianism
A roundup of economic news from around the Web.
Café Hayek | Cataloging Our Progress: Basic Lawn Care
Using my Sears Fall/Winter 1956 catalog, I searched for the lowest-priced basic lawn-care items available at Sears in 1956, constrained only by the requirement that the ‘big’ items – lawn mower and lawn edger – be gasoline- or electric-powered rather than fully manual.
Market Watch | Why a recession may be coming no matter what fiscal-cliff deal is reached
Spoiler alert: We could already be in a recession. This is not the conventional wisdom. The common narrative goes some like talks look ugly, but in the end things will get resolved either before Jan. 1 or later in the month and the economy gets a new lease on life
WSJ | Fed’s Fisher: U.S. Companies Not Able to Perform
U.S. companies “have the resources they need to do what we want them to do–in this case, invest in job creation,” Federal Reserve Bank of Dallas President Richard Fisher said. “But as long as that fence of uncertainty is in place, they will not be able to perform,” the policy maker said.
Heritage Foundation | Beware! Regulations Incoming!
The problem, of course, is not simply the number and cost of new regulations. The larger concern is about the way these regulations are actually being made and enforced. The process is often unconstitutional and empowers bureaucrats instead of American citizens.

Health Care

Roll Call | Health Exchanges: Can They Be Ready by 2014?
The idea of a health insurance exchange as laid out in President Barack Obama’s signature law seems straightforward: an online marketplace where people will shop for private health insurance, like buying an airline ticket or a hotel room.

Econ Comments & Analysis                                                                                            
CRS | Medicaid Disproportionate Share Hospital Payments
The Medicaid statute requires states to make disproportionate share hospital (DSH) payments to hospitals treating large numbers of low-income patients. This provision is intended to recognize the disadvantaged financial situation of those hospitals because low-income patients are more likely to be uninsured or Medicaid enrollees.

Heritage Foundation | Medical Device Tax Is Latest Proof That Taxes Matter
The more time passes, the more we get to see in real life the consequences of Obamacare. We warned back when it passed that the 18 tax increases it contained would do serious damage to the economy. Only now that the damage is about to take hold do some in Congress take note.
Neighborhood Effects | New Research on West Virginia’s Medicaid Reforms
In 2007 the state enacted a Medicaid redesign with one objective being to reduce the rate at which Medicaid patients visited emergency rooms for non-emergencies. Additionally, the plan, called Mountain Health Choices, was intended to incentivize healthy behaviors among Medicaid recipients.
Heritage Foundation | 12 Days of Obamacare Surprises: Uninsured Americans
Not all surprises are good. When it comes to Obamacare, the original projections are turning into unfortunately different realities. For the next 8 days, Heritage is going to highlight one of the various changes in Obamacare projections (e.g., cost, enrollment, etc.) from when the law first passed until now.


CNN Money | What a new inflation measure would mean for your wallet
President Obama put a new offer on the table in the fiscal cliff negotiations, and it includes a wonky change that may raise your taxes and reduce your Social Security benefits ... a little.
Market Watch | UBS settles interest-rate-rigging charges
UBS AG became the second bank to settle accusations that it tried to rig benchmark interest rates, agreeing to pay roughly $1.5 billion in a deal with authorities in multiple countries that points to a broader manipulation scandal than previously known.

Econ Comments & Analysis                                                                                            
Washington Times | Millennials should support return to the gold standard
My generation, the so-called “millennials” between the ages of 18 and 29, is looking toward the future, and we don’t like what we see. Washington is bursting with chatter about debt and deficit, and Capitol Hill is overrun by progressive politicians ready to pillage the wallets of young people to atone for government’s shortcomings in payments to our parents and grandparents.


Econ Comments & Analysis                                                                                            
Politico | History’s lesson on the stimulus and tax increase
The narrative seems familiar: a president coming off a significant election victory with improving poll numbers; his allies on the left demanding an ambitious Big Government agenda; political pundits opining about how Republicans must bow to reality by abandoning their core principles; some Republican elected officials hinting about a new “bipartisan” approach and shaken congressional Republicans standing as the last line of defense.
Politico | Don’t tie tax extenders bill to fiscal cliff
Lost among the fiscal cliff debates on marginal tax rates and the sequester is a bipartisan package of important tax cuts that the House and the Senate should take up and pass immediately, regardless of whether Democrats and Republicans can reach a larger compromise.
Real Clear Markets | The Muni Bond Tax Break Is a Tempting Reform Target
Prominent mayors and municipal officials called the President last week to urge him to preserve tax breaks which benefit cities amidst talk of federal tax increases. The President listened but apparently gave them no assurances about one of their greatest concerns, allowing holders of municipal bonds to continue to receive their interest tax-free.
AEI | Review of 'The Benefit and the Burden: Tax Reform — Why We Need It and What It Will Take'
While experts will already be familiar with most of the material in the book, readers with less background will be able to obtain helpful guidance on many aspects of the current tax system and reform proposals. Unfortunately, those readers will need to proceed with caution,as the book contains a significant number of factual and economic errors.


Heritage Foundation | USDA’s Stimulus Jobs Data Plagued by Inaccuracies
Federal requirements for monitoring jobs data associated with President Obama’s stimulus package are insufficient to ensure that that the information is accurate, according to a review of that data compiled by the Inspector General of the U.S. Department of Agriculture.


CNN Money | Treasury to sell remaining GM shares
The Treasury Department announced plans on Wednesday to sell the 500 million shares of General Motors it still owns, closing the books on the $51 billion bailout that started four years ago.
National Journal | Obama, Boehner Not Far Apart on Fiscal-Cliff Numbers
If you stop listening to the political noise on Capitol Hill, you’ll realize the dirty secret about the current state of play of the fiscal-cliff negotiations: The Democrats and Republicans aren’t very far apart in their proposals to one another.

Econ Comments & Analysis                                                                                            
WSJ | A Bad Budget Deal
It's clear by now that the budget talks are drifting in a drearily familiar Washington direction: Tax and spending increases now, in return for the promise of spending cuts and tax and entitlement reform later. This is a bad deal for everyone except the politicians who want more money to spend.
Roll Call | A Budget Crystal Ball for 2013
For the third year in a row I am not writing a year-in-review column because, honestly, they’re boring and unnecessary. If you’ve been interested enough in the federal budget to read my column in 2012, you already know what happened and probably don’t want to be reminded. If you didn’t care during the year, you don’t need to know now.