Thursday, January 30, 2014

General Economics

Bloomberg | Consumer Confidence in U.S. Fell Last Week to Two-Month Low
Consumer confidence dropped last week to the lowest level in two months as more Americans said it was not a good time to shop.
Politico | Why the rich are freaking out
The co-founder of one the nation’s oldest venture capital firms fears a possible genocide against the wealthy. Residents of Manhattan’s tony Upper East Side say the progressive mayor didn’t plow their streets as a form of frosty revenge. And the co-founder of Home Depot recently warned the Pope to pipe down about economic inequality.
CNN Money | Economy grew solidly in fourth quarter
The U.S. economy ended the year with solid growth, driven by stronger consumer spending and exports.
Bloomberg | Euro-Area Economic Confidence Increases for Ninth Month
Euro-area economic confidence increased for a ninth month in January, led by the services industry, adding to evidence that the 18-nation currency bloc’s recovery is gaining traction.
Market Watch | Pending-home-sales index drops 8.7% in December
A gauge of pending home sales dropped in December to the lowest level in more than two years, signaling that upcoming activity may slow down, the National Association of Realtors reported Thursday.

Econ Comments & Analysis                                                                                            
CNBC | The myth of wage stagnation
Income inequality topped the agenda at the World Economic Forum's annual meeting in Davos, Switzerland last week. The issue is equally prominent here in the U.S., as was evident in President Obama's State of the Union address on Tuesday.
WSJ | Economies on Steroids Try to Play Without Them
Tuesday night was the State of the Union address, but an announcement this morning from the Commerce Department may be the most important news from Washington this week.

WSJ | Economists React: Fourth Quarter GDP ‘Pretty Impressive’
Economists and others weigh in on the 3.2% growth in gross domestic product at a seasonally adjusted annual rate.
Café Hayek | Real prosperity
This week’s EconTalk is one of my favorite episodes in a long time–Nina Munk talking about her book, The Idealist, the story of Jeffrey Sachs’s attempts to end poverty.
Library of Economics | Keynesian confirmation bias
When you read Keynesian blogs you get the impression that Keynesians think their model has been somehow confirmed by the events of the last few years. And yet figuring out what their model actually predicts can be maddeningly difficult, like nailing jello to the wall. Today I'll use some examples from Paul Krugman, who is the leader of blogosphere Keynesians. But as far as I can see most of the others are just as hard to pin down.
WSJ | Japan Sees Trouble Ahead as Trade Pact Stalls
Until earlier this month, Japan had been under strong pressure from the U.S. to open its market as part of the highly contentious Trans-Pacific Partnership free trade negotiations. On Thursday, Japan appeared to be suddenly let off the hook.

Health Care

National Journal | Inside House Leadership's 2014 Obamacare Strategy
Conservatives want a replacement bill, but GOP sources say Boehner's looking for a small package of poll-tested health provisions for the election-year agenda.

Econ Comments & Analysis                                                                                            
Washington Times | Obamacare rationing coming to health care near you
Many Americans began this month with new health coverage purchased through Obamacare’s exchanges. At least, they thought they did — scores did not receive insurance cards or other confirmation that they actually had coverage.
CBO | CBO’s Analysis of Health Care Policy
Presentation by Doug Elmendorf, CBO Director, to the Healthcare Leadership Council

Heritage Foundation | Q&A: What Is This “myRA” Retirement Account Obama Announced?
In his State of the Union address, President Obama announced a new type of retirement savings account he wanted the Treasury to create. He signed the executive order today. We asked Romina Boccia, Heritage’s Grover M. Hermann Fellow in Federal Budgetary Affairs, what this is all about. — Amy Payne
Heritage Foundation | Obama Silent on Reforming Medicare Payments
In his optimistic State of the Union assessment of health care challenges last night, President Obama failed to mention one dire prospect: the 24-percent pay cut Medicare physicians will face March 31 if Congress doesn’t act.  The sharp decrease in reimbursement is set to be imposed by a complicated formula called the Sustainable Growth Rate (SGR) as part of a decades-long effort to control Medicare’s exploding costs.


Bloomberg | Fed Policy Makers Rally Behind Tapering QE as Yellen Era Begins
Federal Reserve policy makers trimmed bond buying for a second straight meeting, uniting behind a strategy of gradual withdrawal from Ben S. Bernanke’sunprecedented easing policy as Janet Yellen prepares to succeed him as chairman.

Econ Comments & Analysis                                                                                            
Heritage Foundation | The Fed at 100: A Primer on Monetary Policy
This paper provides a brief overview of the Fed’s structure, purpose, and operations and discusses the implications of its recent policies.


CNN Money | How to lower your tax bill
Every year Americans scramble to shave dollars off their federal tax bill in December -- then miss out on a huge opportunity come January. The beginning of the year is also a great time to strategize, since you can reap the benefits of any changes you make for a full 12 months ahead.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Obamacare Could Make Tax-Filing Season Devastating for Obama
Obamacare could make the coming tax filing season devastating for the administration. When W-2s start arriving, they are not only going to remind "the wealthy" of how much more they are paying to the government, but also those who saw their payroll taxes return to their full level. Together, these higher tax payments threaten to act like the hammer hitting the anvil that Obamacare has become for the White House.
FOX Business | Be Wary of this Season’s Tax Filing Scams
The 2013 tax filing season opens on Jan. 31, but it’s not just the IRS that is ready for your returns--so are scammers.

WSJ | Households Spend More on Healthy Foods When They Get Earned Income Tax Credit
The Earned Income Tax Credit was created in the 1970s as an incentive for low-income Americans to stay in the workforce. It may also help them eat healthier food, according to new research from the Federal Reserve Bank of Chicago.


National Journal | The Conservative Ideas That Could Solve Chronic Unemployment
If the president embraces some conservative solutions and Republicans want to do anything other than repeal Obamacare, they could agree on a jobs package.
Bloomberg | Jobless Claims in U.S. Climbed More Than Forecast Last Week
Applications for unemployment benefits in the U.S. rose more than forecast last week to the highest level in more than a month, partly reversing a post-holiday slump.

Econ Comments & Analysis                                                                                            
Real Clear Markets | Obama's Federal Wage Hike Will Hurt Taxpayers and the Poor
Just hours before delivering his annual State of the Union address, President Obama signed an executive order increasing the minimum wage paid by federal contractors from $7.25 to $10.10. The order affects wages paid under any new or renewed contracts.
Washington Times | Not ‘hope and change,’ but real jobs in oil patch
As a whole, America’s job numbers are appalling. At least 12.6 million people have dropped out of the work force. Millions of Americans who had a job when George W. Bush was president don’t have one now. Future job prospects look abysmal, clear across the demographics — men, women, teens, minorities, recent graduates and seniors.
Forbes | Whip Unemployment Now! Obama's New Gambit Worthy of President Ford
In his Jan. 28 State of the Union speech, President Obama proved again that his grasp of economics is on a par with that of a not-particularly attentive student taking his first course in the subject. Obama repeated the economic urban legend that women are underpaid, restated his idea to saw off the bottom rung of the economic ladder by raising the minimum wage, and tasked Joe Biden with fixing American job training.
AEI | An Obama policy the tea party should love
In Tuesday's State of the Union address, President Obama put forth at least one initiative that is useful, should arouse bipartisan support and deserves to be taken much further than he suggested. I am talking about his plan to force federal contractors to pay workers a minimum of $10.10 per hour, instead of the federal minimum wage of $7.25.

CATO | Minimum Wage Laws Kill Jobs
There are seven European Union (EU) countries with no minimum wage (Austria, Cyprus, Denmark, Finland, Germany, Italy, and Sweden). If we compare the levels of unemployment in these countries with EU countries that impose a minimum wage, the results are clear – a minimum wage leads to higher levels of unemployment.


Market Watch | Republicans don't want debt default, Boehner says
House Speaker John Boehner on Thursday said defaulting on the national debt is "the wrong thing." "We don't want to do that," Boehner told reporters at a House Republican retreat in Maryland.

Heritage Foundation | U.S. Debt Poses a Greater Barrier to Economic Opportunity Than Income Inequality
President Obama has made income inequality the forefront issue on his 2014 agenda. However, more government is not the solution to increasing economic opportunity in the United States.