Wednesday, January 29, 2014

General Economics

National Journal | Full Text: President Obama's 2014 State of the Union Address
A transcript of President Obama's 2014 State of the Union address
CNN Money | Obama's soft sell on income inequality
President Obama's State of the Union speech was billed as focusing on income inequality, an issue he's promised to devote himself to addressing in 2014.
Bloomberg | Obama Seeks Trade Deals in Backing U.S. Companies’ Goals
President Barack Obama urged Congress to back two of the top priorities of U.S. multinational corporations: broader authority for his administration to negotiate trade deals along with changes to immigration laws.
WSJ | Obama Seeks to Borrow More from Poor, Middle Class
As the Federal Reserve begins to wind down its Quantitative Easing program, which lends money to the U.S. Treasury among others, President Obama on Tuesday night unveiled a new way to finance the federal government's rising debt. In his State of the Union address, Mr. Obama pitched a new product aimed at workers who do not have 401(k) plans.

Econ Comments & Analysis                                                                                            
Politico | State of the Union 2014: Obama touts ‘MyRA’ retirement savings proposal
President Barack Obama on Wednesday plans to direct the Treasury Department to create a new retirement investment product called a “MyRA,” which the administration described as a “starter savings account” backed by the U.S. government.
Forbes | White House Income Equality Agenda Makes War On Progress
In tonight’s State of the Union Address, Mr. Obama will attempt to shake off the most disastrous year of his presidency by doubling down on his fight to equalize our incomes. Apparently, his advisors convinced him he can breathe fresh life into tax and welfare programs by hijacking the word “opportunity” from the other side of the aisle without bothering to understand what it means.
Washington Times | Obama is wrong that raising minimum wage will fix income inequality
There has been much discussion about income inequality recently. President Obama seems to think that we can make significant progress in eliminating poverty by raising the minimum wage, as his State of the Union address highlighted.
WSJ | Emerging Markets Take Largest Share of International Investment in 2013
Developing economies claimed the largest share of international investments made by businesses for the second consecutive year in 2013 and are likely to do so again in 2014 despite slower growth, political uncertainty and turbulence in their financial markets, according to figures issued Tuesday by the United Nations Conference on Trade and Development.
Real Clear Markets | 3 Key Policy Areas That Will Affect the Global Economy In 2014
2014 will be another year in which it is manifest that government decisions are critically important for economies and markets around the globe. There was a period of a decade or more leading up to the financial crisis in which markets stopped focusing so much on governments, because the business cycle was apparently permanently muted by wise central bank policies and the governments of most leading economies were pursuing increasingly laissez faire policies that involved minimal intervention in the economy.

WSJ | Vital Signs: The 15%ers Are Feeling Better — and That’s Good for Economy
U.S. consumers are more upbeat about the economy in January. The Conference Board said Tuesday its confidence index increased 3.2 points to 80.7 in January, besting the 77.6 expected by economists.
Heritage Foundation | How Obamanomics Promotes Inequality
The great Obama contradiction on the economy is this: he takes credit for the improved economy, but openly admits that in this recovery almost all of the gains have gone to the very rich.
CATO | Farm Bill Spending Up 49 Percent
Under cover of SOTU media coverage, Congress is set to sneak through the first big farm bill since 2008. The Congressional Budget Office released its estimate of the bill’s cost: $956 billion over 2014-2023. It would thus mean almost $1 trillion more borrowed from U.S. and foreign creditors, adding more weight to the anchor pulling down the living standards of our children and grandchildren.
Calculated Risk | Completed Foreclosures Down 24% in 2013
According to CoreLogic, there were 620,111 completed foreclosures across the country in 2013 compared to 820,498 in 2012, a decrease of 24 percent.

Health Care

CNN Money | Obama: 9 million covered by health reform. Well maybe.
In his first State of the Union since a major provision of his signature health care reform act took effect, President Obama took time out to praise the achievements of Obamacare.
CNN Money | How Obamacare affects your bottom line
When the Affordable Care Act, a.k.a. Obamacare, passed four years ago, Jan. 1, 2014, was the law's D-day.


Bloomberg | Fed Decision Day Guide From Emerging Markets to FOMC Voter Shift
Here’s what to look for when the Federal Open Market Committee releases a statement today at 2 p.m. after a two-day meeting in Washington. It will be the last meeting for Chairman Ben S. Bernanke, who isn’t scheduled to give a press conference.

Econ Comments & Analysis                                                                                            
Real Clear Markets | The Federal Reserve's 'Too-Big-To-Fail' Paternalism
The Federal Reserve on January 24 issued guidance for "eight domestic bank holding companies that may pose elevated risk to U.S. financial stability." The guidance, which is part of Dodd-Frank resolution planning, is intended to "clarify" expectations for these companies and guide the Federal Reserve staff charged with supervising them. But the fact that such guidance is necessary illustrates what is wrong with our financial system and its regulatory framework.
Fortune | Why low inflation hurts the 99%
Instead of just looking at inflation, the Fed should consider the gap between income and inflation. And the gap is wide.
WSJ | IMF Official Says Emerging Markets Must Act to Tame Inflation
A top International Monetary Fund official on Tuesday said emerging markets must act quickly to tame rampant inflation, but said there is no need to worry yet about a global market selloff.

WSJ | What to Watch for From Fed Meeting
The Federal Reserve’s policy committee on Wednesday wraps up its latest meeting, Ben Bernanke’s last as chairman. The Fed’s policy statement comes out at 2 p.m. EST. Mr. Bernanke won’t hold a news conference after the meeting and Fed officials won’t release new economic projections. Here’s what to watch for:


Politico | Puff, puff: Pass the tax break
Pot shops are banned from writing off labor, rent, health insurance, advertising costs or other expenses that most companies deduct to lower their tax bills. The result is a tax rate as high as 80 percent, according to the industry, for those in the 20 states with legal medical marijuana and the two states with recreational pot.

Econ Comments & Analysis                                                                                            
CATO | Tax Revolt! It’s Time to Learn from Past Success
For about 15 years now, the federal government, in all its myriad activities, has been in major expansion mode. The Federal Reserve, the regulatory apparatus, the tax code, the police and surveillance machinery of the state — all of these extensions of the government have broadened their reach, power, and ambition in significant fashion since the late 1990s.

Library of Economics | Marginal Tax Rates: Singing Taxman to My Class
Often, when I teach my classes about marginal tax rates, I give them a little history about such rates. They're shocked when I tell them that the top U.S. federal marginal tax rate on individual income in the 1950s and early 1960s was 91 percent.


Market Watch | Real unemployment rate is still too high for the Fed
For investors, the biggest risk right now is that the Federal Reserve will lose its nerve and raise interest rates too soon. A premature tightening of policy could undermine the still-fragile economic growth, crash the market and keep millions of people out of work.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Obama's Federal Pay Hike Will Lay a Wet Blanket On Small Business
President Obama's State of the Union announcement that he'll sign an executive order increasing the minimum worker wage for federal contracts from $7.25/hour to $10.10 drew warm applause. This was interesting considering an earlier applause line from the President in which he said "Let's do more to help the entrepreneurs and small business owners who create most new jobs in America."
AEI | On unemployment, Obama's small ball won't cut it
When asked which of four phrases best describes how they feel about the remainder of President Obama’s second term, a combined 59 percent of Americans say they are “pessimistic and worried” or “uncertain and wondering,” versus only 40 percent who say they are “optimistic and confident” or “satisfied and hopeful.”

WSJ | Who Has a Higher Minimum Wage Than the Federal Rate?
President Barack Obama plans to act unilaterally to raise the minimum wage for employees of federal contractors, while pressing Congress for a broader increase in the State of the Union address.
WSJ | Obama’s Minimum Wage Order: How Much Impact?
Republican lawmakers challenged President Barack Obama’s plan to raise the minimum wage for employees of federal contractors, suggesting it would have little impact on workers and could exacerbate partisan gridlock.
WSJ | State Unemployment Ranged From 2.6% to 9.1% in December
Thirty states added jobs in December and the unemployment rate fell in 39, signs of steady improvement in the labor market across much of the U.S.


Politico | GOP ready to surrender on debt ceiling
The most senior figures in the House Republican Conference are privately acknowledging that they will almost certainly have to pass what’s called a clean debt ceiling increase in the next few months, abandoning the central fight that has defined their three-year majority.

Econ Comments & Analysis                                                                                            
Mercatus | Updated: High Levels of Government Spending Become the Status Quo
This week’s charts show the amount of real (2005) federal dollars spent per capita over the past 68 years with updated data. After adjusting for population and inflation, the data show that federal outlays have, with a few exceptions, grown at a staggering pace since 1948. 
CBO | Final Sequestration Report for Fiscal Year 2014
After the end of a session of Congress, CBO is required by law to issue a report that provides estimates of the caps on discretionary budget authority in effect for each fiscal year through 2021.