Thursday, February 7, 2013

General Economics

Bloomberg | Worker Productivity in U.S. Declines, Pushing Up Labor Costs
The productivity of U.S. workers fell more than projected in the fourth quarter as the economy shrank, pushing labor expenses up and showing companies are approaching the limit of how much efficiency they can wring from employees.
Bloomberg | U.S. Consumer Confidence Rises for First Time in Five Weeks
Confidence among American consumers rose last week for the first time this year, a sign the strain on households from a higher payroll tax is easing.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Cut Deficits Without Killing the Recovery?
At the core of Washington's exasperating budget debate lies a confusing disconnect. On the one hand, we're urged to reduce huge and endless budget deficits, which are said to threaten a future financial crisis.
Daily Caller | Overregulation, not phantom spending cuts, caused economy to shrink in fourth quarter
The schizophrenia of progressive economic thought was on full display last week in the wake of some bad economic news. On the one hand, progressives believe the U.S. economy is so fragile that even the mere threat of cuts in government spending would be disastrous. On the other hand, they believe this same economy is so resilient that billions upon billions of dollars in regulatory costs have no effect on growth at all.
Fortune | This year's biggest economic losers
Who's going to feel the biggest squeeze? Though they get plenty of attention, it's not the wealthy or the middle class.
CBO | Economic Growth Is Likely to Be Slow in 2013 and Pick Up in Later Years
On Tuesday CBO published a new economic forecast in The Budget and Economic Outlook: Fiscal Years 2013-2023. The forecast—reflecting current law—takes into account the recent passage of the American Taxpayer Relief Act of 2012 (Public Law 112-240), which removed a significant amount of the fiscal tightening that had been scheduled to take effect in January 2013.
AEI | Wall Street heads for the exits
“As the titans of Wall Street banks gathered…one common worry emerged: who is going to take over when we leave?” says a recent Reuters report on the self-important Davos meetings. Such a worry is a remarkable example of the illusion of one’s own inexpendability.

Health Care

Politico | Medicare pay formula may finally get fixed
Efforts to finally get rid of that dreaded Medicare payment formula could see smoother sailing now that the Congressional Budget Office has sliced the price tag nearly in half.

Heritage Foundation | Obamacare Hassle: A 127-Million-Hour Paperwork Burden
Three House committees have added up the total hours of burden that Obamacare’s regulations will cost Americans: over 127 million hours per year of paperwork.


Bloomberg | ECB Holds Rates as Stronger Euro Threatens Economic Recovery
The European Central Bank left interest rates unchanged even as a stronger currency threatens the euro area’s recovery from recession.
CNN Money | Hackers access Federal Reserve website, data
The Federal Reserve has acknowledged that an outside party gained access to its website and a limited amount of data, raising questions about the central bank's cyber-security measures.
Market Watch | Fed's Stein: Rate policy a tool to stem bubbles
The Federal Reserve may have to adjust monetary policy in the future to combat asset bubbles, said Federal Reserve Governor Jeremy Stein on Thursday.

Econ Comments & Analysis                                                                                            
WSJ | The Fed's Asset-Inflation Machine
In a 1996 speech to the American Enterprise Institute, Federal Reserve Chairman Alan Greenspan famously warned about the dangers when "irrational exuberance" fueled asset inflation. By that he meant that rising values of stocks and real estate might reflect only a cheapened dollar, not an increase in their real worth. Since he was the man in charge of the dollar, his remark caused quite a stir.

WSJ | Fed’s Stein: Signs of Overheating in Some Credit Markets
A top Federal Reserve official in a speech Thursday said he sees some signs that credit markets may be overheating, although he said there is not an imminent threat to the wider financial system.


Econ Comments & Analysis                                                                                            
Investors | Government's False Prophets Often Create Taxpayer Losses
People on both sides of tax issues often speak of such things as a "$300 billion tax increase" or a "$500 billion tax decrease."


CNN Money | Jobless claims point to slow hiring
Claims for unemployment benefits fell slightly last week, but overall, they point to the same slow hiring in the U.S. economy that's persisted for nearly two years.
CNN Money | Home Depot to hire 80,000 for spring
Home Depot is making its yearly hiring push, aiming to fill more than 80,000 jobs for its busiest season.
CNN Money | Black workers' unemployment gap
Though blacks' job prospects have improved from the depths of the Great Recession, they still suffer from disproportionately high unemployment.

Econ Comments & Analysis                                                                                            
CNBC | Jobless Rate Won't Fall to 6.5% Until Mid-2015: Fed's Evans
The Federal Reserve has the appropriate policies in place right now and will remain accommodative until the economy improves, Chicago Fed President Charles Evans told CNBC in an interview on Thursday.
AEI | Public cuts lead to more private employment
It is undeniable that the unemployment rate would be lower, and the recovery more pronounced, if fewer government jobs had been cut. But if the private sector is "doing fine," as President Obama famously said, could one reason be those losses in state and local jobs? The answer is yes.


CNN Money | Big taxes + big spending cuts = California budget surplus
After multi-billion dollar shortfalls in recent years, the state's budget has finally straightened out. California expects to take in $2.4 billion more in revenue than it will spend this fiscal year, which ends June 30. After paying off a shortfall from last year and setting aside funds for upcoming obligations, it's on track to end the year with a $36 million surplus.

Econ Comments & Analysis                                                                                            
Washington Times | Forcing Obama to live within our means
Budgeting has never been at the top of President Obama’s list of priorities. For the fourth time in five years, the White House missed the statutory deadline Monday for submitting its annual spending blueprint to Congress. Mr. Obama isn’t in a rush to let the world know that his intention is to keep spending the country into the red.
CRS | The American Taxpayer Relief Act of 2012: Modifications to the Budget Enforcement Procedures in the Budget Control Act
The Budget Control Act of 2011 (BCA; P.L. 112-25) established, among other things, statutory limits on discretionary spending and an automatic process of spending reductions if Congress and the President did not enact deficit reduction legislation by January 15, 2012.
Washington Times | Uncle Sam gets an F in money management
Twelve years ago today, when I was comptroller general of the United States and head of the Government Accountability Office, I presented testimony to the Senate Finance Committee, “Moving From Balancing the Budget to Balancing Fiscal Risk.”

Economist | How scary is the sequester?
America managed, more or less, to avoid tumbling over (running into?) the fiscal cliff, but there is still an awful lot of fiscal tightening programmed for 2013. The tax deal struck to start the year extended most of the Bush tax cuts and delayed the sequester, but the stimulative payroll tax cut was allowed to expire, and is now taking a hefty bite out of paychecks.
CATO | If Spending Is Capped So It Grows at the Rate of Inflation, the Budget Is Balanced in 2018
New 10-year budget projections have been released by the Congressional Budget Office, so it’s time once again for me to show how easy it is to balance the budget with modest spending restraint (though never forget that our goal should be smaller government, not fiscal balance).