Health Care News Dec. 13 - 17

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News
FRIDAY
More Americans Without Employer-Provided Coverage
Approximately 44.8 percent of adults reported having employer-based insurance in November, a new low in a general decline from 50 percent in January 2008.
Young People Can Be Enticed to Buy Health Insurance
Contrary to popular belief, many of the healthier, typically younger Americans who shun insurance do so because of cost concerns, not because they think they will avoid illness or injury.

THURSDAY
Health care reform: Battleground shifts to Florida courtroom
The legal battle over health care reform is destined for the Supreme Court, analysts say. On Thursday a US district judge in Florida hears arguments in a case brought by 20 States.

WEDNESDAY
New Rule Requires Hospitals to Report Infections
Hospitals are set to begin reporting bloodstream infections to the federal government starting January 1 in an effort to reduce preventable infections and death; by 2012, hospitals will begin reporting surgical site infections.
U.S. to Appeal Health Ruling
Move Advances Constitutional Struggle Likely to Reach Supreme Court by 2012.
Baby Boomers Will Benefit Most from Health Reform
Baby boomers will likely reap the most benefits from health care reform according to a new report from the Commonwealth Fund. According to the report, 6.8 million of the 8.6 million uninsured Americans aged 50-64 will gain insurance through the expansion of Medicaid in 2014.

TUESDAY
Despite conservative victory Monday, experts say Obamacare debate ultimately headed to Supreme Court
President Obama's health care reform law was dealt a serious blow Monday when the part of the law that requires Americans to purchase health insurance was deemed unconstitutional by a federal court in Virginia. But analysts largely agree that the final battle over the law will ultimately be waged at the Supreme Court.
What health care ruling means
A Virginia judge found a key part of the health care legislation unconstitutional; namely, the part that says Americans without health coverage must purchase their own, starting in 2014. Here's what that means for you:
Medicaid cuts: teeth pulled, transplant called off
Across the country, state lawmakers have taken harsh actions to try to rein in the budget-busting costs of the health care program that serves 58 million poor and disabled Americans. Some states have cut payments to doctors, paid bills late and trimmed benefits such as insulin pumps, obesity surgery and hospice care.

MONDAY
Va. Judge to Rule on Health Care Legislation
Judge Considers Constitutionality of 'Individual Mandate' in Health Care Law.
Firms Feel Pain From Health Law
Big employers faced with incorporating the first round of health-care changes next month are grappling with how to comply with the long list of new rules.
Voter Support for Generic Medicaid Drugs
With state legislators facing another tough year of budget gaps, Medicaid has once again become a target for cost cutting. But at least one interest group is using the recent focus on slashing Medicaid’s costs to generate momentum to change how the government plan does business, saving money without reducing benefits.
Republicans say nix to Democrats' health law fix
Republicans rebuffed a Democratic effort to repeal health reform’s universally panned 1099 IRS reporting requirements as a piggyback in the tax cut deal. The move leaves 1099 rollback in play for the next Congress, giving Republicans an easy target in an otherwise challenged landscape for health reform repeal.

Economist Comments
FRIDAY
Why social sharing of medical data is a good idea
Concerns over digital privacy, especially of medical records, have never been higher. Yet startup PatientsLikeMe says there's much to be gained from the crowdsourcing of ailments -- and treatments.
Obamacare will hurt low-skill workers
Come 2014, the health care law will make it more costly for employers to hire low-skill workers. And, as workplaces around the country prepare to implement the new law, employers are considering how best to comply.
Can Congress Force You to Be Healthy?
Judge Hudson explained that whatever else Congress might be able to do, it cannot force people to engage in a commercial activity, in this case buying an insurance policy.

THURSDAY
When the Supreme Court takes up the Obama health-care law 'mandate'
Justice Kennedy will probably be the swing vote on a case concerning the individual mandate. Here is what he may well say against this linchpin of the Obama health-care law.
Enforcement and the health care law
Conservative promises to thwart “Obamacare” by cutting off funds needed for implementation sets up a dangerous precedent that Americans — Republican and Democrat - -should be wary of.
On Health Law, Check Back in a Generation
Whether or not the Supreme Court ultimately upholds or rejects the idea of a government mandate to buy health insurance, the various facets of the new law will be subject to myriad challenges over the next several years — not only in the courts, but on the floor of Congress and inside the agencies that will establish a truckload of new regulations.
Mr. President, tear down this law
Mr. President, the centerpiece of your domestic agenda, the health care overhaul that bears your name, has just been declared unconstitutional. I celebrate this victory for freedom and for limited government, and I invite you to consider the opportunity it offers you.

WEDNESDAY
Romney Agrees Health Care Law Is Unconstitutional
“The court ruling supports Mitt Romney’s view that 'Obamacare' is an unconstitutional power grab by Washington,’’ said Romney spokesman Eric Fehrnstrom. “We should repeal the law and return to the states the power to determine their own health care solutions."
Obamacare oblivion
Fast-track needed for Supreme Court review.

TUESDAY
Why the Health-Care Law Got Slammed
Early versions of the health reform law specifically called the individual mandate payment a "tax" but the final version of the law specifically changed this terminology to "penalty" not "tax".

MONDAY
Graham: U.S. competitive without medical monopoly
The November election made a bull's-eye out of Obamacare, which some Republicans want to repeal. Obamacare is a worthy target because it is a significant lurch toward so-called "universal" health care.
Kicking the Medicare Can -- Again
Since 2003, as health-care costs have skyrocketed and Medicare's finances grown worse, the SGR has dictated reimbursement cuts every year. And every year, Congress intervened to postpone those cuts.
Obamacare must be repealed
The American people have spoken, and the message they sent to Washington is clear: Americans want Obamacare ripped out of the U.S. Code by the roots. With their actions, America's voters have shown that they want the 112th Congress to make Obamacare repeal a reality.
Following the Money, Doctors Ration Care
Unequal access to health care is hardly a new phenomenon in the United States, but the country is moving toward rationing on a scale that is unprecedented here.

Blogs
FRIDAY
It's a Penalty ... It's a Tax ... No, It's SUPERMANDATE!
So the latest talking point I'm seeing is that the individual mandate is no big deal--just a tax dodge like we've always had.  The government is raising taxes, and then giving a deduction of equal size to those who buy health insurance.
ObamaCare Challenges Gain Steam
Today’s hearing in Pensacola built on Monday’s ruling out of Richmond: Judge Roger Vinson is likely to hold the individual mandate unconstitutional.
Government Arguing That Health Insurance Premiums Are Really Taxes?
The arguments on the health care mandate in Florida went forward today, with the government trying to clarify how the mandate is a tax, and not an attempt to grossly exceed the enumerated powers of the legislature.
NYT got it wrong on the health care big picture
With regard to health care, the major reason for the high prices and dislocations are government restrictions, programs, and interventions of all sorts. This is the reason for the existing problems. More government intervention will do nothing to correct them but instead will lead to ever more rationing, technological stagnation, and deprivations of all kinds.
Will National Health Care Improve Our Economic Health?
During the latter half of the debate over the health care bill, you started to hear an intriguing argument about the effects of the bill.  Where conservatives claimed that it would stifle the economy, liberals countered that in fact, it would unleash the entrepreneurial power of people "locked into" their jobs by fear of losing their health coverage.

THURSDAY
Medicare Entitlement Crowd Out: We Told You So
Any time Congress creates a health care entitlement, it “crowds out” (i.e., displaces) private coverage, replacing private sector spending with increased taxpayer spending. The end result: Private spending and coverage contract while government entitlements, dependency, and spending grow.
Breaking Health Care Research
Deficit reduction is in vogue right now thanks to the recent efforts of the National Commission on Fiscal Responsibility and Reform, but Representative Paul Ryan’s (R–WI) “Roadmap for America’s Future Act” started it all as the first proposal to offer comprehensive solutions to the nation’s pending fiscal crisis, balancing the budget and eliminating national debt while also fixing the health care system.

WEDNESDAY
Medicare Variation Revisited
Health economists and policy analysts have long known that Medicare spends much more, per patient, in some parts of the country than in others.
Breast cancer drug offers glimpse of death panels
OnFriday, the Food and Drug Administration could doom thousands of breast cancer victims. The FDA will be considering the unprecedented step of revoking approval for Avastin, a drug that represents the last hope for women with late-stage breast cancer.

TUESDAY
Judge Rules Health Reform Mandate Unconstitutional
This has naturally attracted a lot of electrons, and ink, but it's not a surprise--his earlier comments on the mandate, when he ruled against the government's motion to dismiss, seemed to indicate that this was coming.  This is going all the way to the Supreme Court, and ultimately, it will depend on whether our swing justice wants to make history by affirming the law, or by overturning it.
Judge Rules Obamacare Mandate Goes Beyond Letter and Spirit of the Constitution
After declaring the individual mandate and the alleged tax (really a penalty) unconstitutional, the judge had to confront two remedial issues.
Breaking Health Care Research: A New Way Forward in Medicare Reform
The Patient Protection and Affordable Care Act (aka Obamacare) will impact every corner of the health care system, especially Medicare. Unfortunately, the new law speeds the program’s travel in the wrong direction by building upon existing problems and creating new ones.
Another Victory on the Road to Repeal
Obamacare simply may not survive that long. It is already collapsing under its own financial and bureaucratic weight.

MONDAY
Follow the reimbursement rates

A large number of doctors, for instance, do not accept Medicaid patients and that is because the Medicaid reimbursement rate is lower than Medicare or private insurance.  It's a key question how the queueing of Medicaid patients (and to some extent Medicare patients) will proceed as the demand for health care rises.
Number of Waivers Grows As a Result of Obamacare Authors’ Sloppy Handiwork
Jamie Dupree recently reported for the Atlanta Journal-Constitution that the number of waivers granted by the Obama Administration for a certain provision in the new health care law has now reached 222. That’s double the amount of just three weeks ago.

Reports
TUESDAY
How to Fix Medicare: A New Vision for a Better Program
Medicare is an entitlement program intended to secure health care for senior and disabled citizens. But its current design, based on government central planning and price controls, falls far short of guaranteeing access to high-quality care for current and future retirees. With no budgetary limit, program costs have soared and will become unaffordable for future taxpayers. The Patient Protection and Affordable Care Act (PPACA) reinforces bureaucratic micromanagement and price regulation and makes the program’s current problems even worse.

General Economic News Dec. 13 - 17

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News
FRIDAY
White House has stake in Internet vote
Next week’s Federal Communications Commission vote on net neutrality could hand President Barack Obama a much-needed policy victory — or another fistful of frustration on a stubborn issue that’s been lingering since the start of his presidency.
Approval of Internet traffic rules likely-analysts
Contentious Internet traffic rules facing a vote next week are likely to be adopted without radically veering from a proposal unveiled earlier in the month, telecommunications policy analysts said on Wednesday.
Latest Airline Fee: $9 to Lock in Airfare
Continental Airlines Introduces New Fee to Hold Airfare
Another bubble?
Some tech start-ups look over-valued
Strong week for economy raises optimism for 2011
Buoyed by a string of hopeful government reports on layoffs, factory production and consumer spending, economists are predicting that hiring and even housing will pick up in 2011 and make it a better year after all.
McDonnell: State workers should pay for retirement
Virginia Gov. Bob McDonnell proposed Thursday that all state employees begin paying into the state's retirement system starting in July 2011, the first time workers would be required to do so since 1983.
Implosion at the Financial Crisis Inquiry Commission
GOP members fire a torpedo at its report before it's published.
Pay freeze could heat things up at the exits
Actions have consequences. One unintended consequence of the two-year pay freeze President Obama asked Congress to impose on federal workers is the impact it may have on higher income employees and those eligible to retire.

THURSDAY
Mapping America: Every City, Every Block
Browse local data from the Census Bureau's American Community Survey, based on samples from 2005 to 2009.
10 Best Data Visualization Projects of the Year – 2010
So here are the top 10 visualization projects of the year, listed from bottom to top.
Housing bust? So what? We still want to own
The American Dream is still alive and kicking, including within immigrant and minority communities, according to a survey from mortgage giant Fannie Mae.
U.S. Economic Confidence Declines in Early December
Confidence declines equally across upper-income and middle- and lower-income Americans
American Airlines starts a trend: Higher airfares
Airfares kept low by the weak economy may now be a thing of the past.
Average 30-year fixed mortgage rises to 4.83 pct.
Rates on fixed mortgages surged for the fifth straight week, reflecting higher yields on long-term Treasurys.
Not Really 'Made in China'
The iPhone's Complex Supply Chain Highlights Problems With Trade Statistics
Record plunge in foreclosures, thanks to robo-signers
The number of foreclosure notices filed in November plunged 21%, the biggest month-over-month drop ever recorded by RealtyTrac, the online foreclosure marketer. Filings fell 14% compared with November 2009.

WEDNESDAY
Factory output up; inflation tame; housing still depressed
Factory output grew for a fifth month in November, adding to evidence that manufacturing remains an engine of economic growth, while inflation remained tame. But home builders are still mired in a depression.
Violent protests as Greeks strike over austerity cuts
Huge crowds of protesters, upset about stringent Greek economic reforms, marched past the Greek Parliament in Athens Wednesday as police in white helmets tried to keep them from getting any closer.
Obama brainstorming with 20 CEOs
President Obama said Wednesday that a meeting with 20 CEOs will help "find new ways to spur hiring, put Americans back to work and move our economy forward."
U.S. Industrial Production Rises More Than Forecast
Industrial production in the U.S. increased more than forecast in November and consumer prices slowed, indicating the recovery is gaining momentum without generating inflation.
U.S. Consumer Prices Rose 0.1% in November, Below Forecast
The cost of living in the U.S. rose less than forecast in November, indicating higher prices for commodities such as fuel aren’t filtering through into other goods and services.
$4.3B haul spurs calls for airlines to disclose 'hidden' fees
A New Jersey senator said Tuesday that much of the record $4.3 billion U.S. airlines took in for checking bags and changing tickets the first nine months of the year were "hidden" fees that caught passengers by surprise.
Deal may unleash corporate cash
Beneath the surface of Wednesday’s White House summit with corporate America lies an increasingly pointed dispute about how to unlock the record high $1.9 trillion in cash that businesses have piled up recently.

TUESDAY
U.S. retail sales in November rise 0.8%
Consumers spent more money on gas, clothes, hobby items and online goods to boost U.S. retail sales in November for the fifth straight month, government data showed Tuesday.
Confidence at U.S. Small Companies Increases to Three-Year High
Confidence among U.S. small businesses rose in November to the highest level since the recession began three years ago as more companies projected the economy and sales will improve, a private survey found.
Oct. business inventories up 0.7%, below forecasts
Inventories at U.S. businesses rose 0.7% in October, below expectations and slower than the 1.4% increase in sales. The inventory-to-sales ratio, an indication of demand, slipped to 1.27 in October from 1.28 in September.
Producer Prices in U.S. Rose 0.8% in November; Core Up 0.3%
Wholesale costs in the U.S. rose in November by the most in eight months, led by higher prices for gasoline, heating oil and fruit.
Effort to help troubled borrowers largely failed
A $30 billion Obama administration program set up to help troubled homeowners modify mortgages has failed to help the vast majority of homeowners facing foreclosure.
Obama and CEOs: The great thaw
Last week, the administration said that 20 CEOs will meet with President Obama on Wednesday for a discussion that will cover trade, clean energy, the deficit and tax code reform.
Fewer Homes 'Underwater' as Foreclosures Increase
The number of U.S. homeowners who owe more on their mortgages than their homes are worth fell in the third quarter, but the decline stemmed from banks getting more aggressive on foreclosures, not from home values going up.
Americans' Wellbeing Remains at 2010 Low
Drop in healthy behaviors are principle source of decline since May.

MONDAY
Are Americans as Poor as They Feel?
It depends on what they buy. While some big-ticket expenditures have skyrocketed, the relative cost of many necessities has dropped.
Will rising mortgage rates spur home sales?
Historically low mortgage rates didn't encourage new home sales, but rising rates could finally push home-buying fence-sitters into the market.
Fewer Homes `Underwater' Last Quarter as Foreclosures Rose
The number of U.S. homes worth less than the debt owed on them dropped in the third quarter, largely because of mounting foreclosures rather than a rise in property values, according to CoreLogic Inc.
Economic Reports for the Week of Dec. 13
Data this week will include retail sales and the Producer Price Index for November and business inventories for October (Tuesday); Consumer Price Index and industrial production for November (Wednesday); weekly jobless claims, housing starts for November, current account deficit for the third quarter and the Philadelphia Fed’s manufacturing index for December (Thursday); and leading economic indicators for November (Friday).
Economists Predict Growth in 2011
Economists have grown more optimistic about the outlook for U.S. growth next year, predicting the expansion will accelerate as 2011 progresses, according to the latest Wall Street Journal forecasting survey.
Risky Borrowers Find Credit Available, At a Price
Credit card offers are surging again after a three-year slowdown, as banks seek to revive a business that brought them huge profits before the financial crisis wrecked the credit scores of so many Americans.
Child-Poverty Rate Expected to Grow Drastically
Report: Nearly 1 million more children will be classified as poor by 2010's end.

Economist Comments
FRIDAY
The Feds' Fat Factory
First, kill all the farm subsidies! That should have been President Obama's mantra if he truly wanted to curb the nation's child-obesity "epidemic." Instead, on Monday he signed into law the Healthy, Hunger-Free Kids Act.
The Coming College Education Bubble
Higher education's price-earnings ratio looks like Nevada housing circa 2007.
Obama's double bubble
Lax lending policy could blow up housing market again

THURSDAY
Too Much Attention Paid to Moody's Swing
The media are touting a rating agency's schizophrenic claim that keeping the Bush tax rates helps the economy, but hurts the country's credit standing. Are ratings firms even relevant anymore?

WEDNESDAY
Housing is the forgotten crisis
The U.S. economy has made a lot of progress since the dark days of September 2008 — investors are happy, bankers are secure, markets are functioning and businesses are flush. No depression here.
Unequal lesson for Social Security
The coming debate over Social Security may well be a preview of U.S. politics in the 21st century: 99 percent of Americans fighting over reduced benefits and increased taxes, while the richest 1 percent of them remain blissfully unaffected.
Silencing voices of Internet dissent
FCC's 'net neutrality' puts new Congress to the test
Forget the Great Recession; We're Facing the Next Great Depression
Bernanke's monetary policy will likely spike inflation high enough to collapse the economy again, and global stock markets will enter another devastating bear market.
Education payouts lack payoff
Redundant federal agencies create target-rich environment

TUESDAY
Austerity, Wall Street-Style
Booking Yachts Is Out, Carpooling on Private Jets Is In as Boffo Pay Ticks Lower.
Principles to Guide the Implementation of the Orderly Liquidation Authority Called for Under the Dodd-Frank Act
The Dodd-Frank Act recognizes that investor understandings about endgame rules influence a firm’s appetite for risk and that, without changing existing rules, higher capital requirements on systemically important financial institutions (SIFIs) cannot by themselves end creditor perceptions that in most circumstances SIFIs are economically, politically, and administratively too difficult to fail and unwind.
Why Do the Poor Stay Poor?
Prosperity is impossible without property rights.
The US Treasury Debt Trap
Once interest payments take 30% of tax revenues, a country has an out-of-control debt-trap issue.
Nine Reasons 2011 Could Be a Repeat of 2010
Many pundits in the business media are signaling that the economy will perform much better in the coming year. Here, a look at why that's unlikely.

MONDAY
Irish Sovereign Debt Default Would Be Far from Armageddon
The world's economic policy makers have talked up a zero-tolerance attitude toward sovereign-debt defaults. For every troubled national borrower, there seem to be a dozen central bankers ready to hand out cash, always to avoid Armageddon.
Human Nature and Capitalism
The model of human nature one embraces will guide and shape everything else, from the economic system one prefers to the political system one supports.
Let a vigorous economy fight the War on Poverty
Whatever its original nobility of purpose, government data demonstrates that LBJ's War on Poverty has been lost. Despite everything Washington has done, the official poverty rate stubbornly stays within a range of 11 percent to 15 percent of the national population, year in and year out.
Economic Growth Beginning to Materialize
The rise in interest rates, copper prices, and crude oil is suggestive of stronger economic strength than is currently envisioned.

Blogs
FRIDAY
Making commuters' lives easier
Early this month, a massive new railway tunnel opened for the first time. It was finished six months early and nearly 10% under budget. So by now you know this didn't happen in America (or Britain, for that matter.)
Lies, Damned Lies, and Trade Statistics
If you want to understand how global integration and cross-border investment have left U.S. trade policy in need of a new purpose, check out today’s Wall Street Journal article about the Apple iPhone’s complex production-supply chain.  (And then see this analysis for more depth and detail.) The story is both testament to the benefits of globalization and the latest indictment of a decrepit international trade flow accounting system that nourishes misleading trade skeptics and misinforms policy.
Google ngram: the word "liberty"
For the pointer I thank Kevin Edwards.  The link here allows you to see the full graph.
Banks Are Lending, but to Whom?
A recurring concern we have heard since the financial crisis erupted is that banks are simply not lending, and that this is holding back economic activity.  If only banks would lend, the economy would grow.  As usual, the truth is a little more complex. 
Mark Thoma and I see the world differently
Politicians of both parties move back and forth between Washington and Wall Street. Was that the intent? Or was it just a series of bad luck and mistakes?
‘Politicians’ Top 10 Promises Gone Wrong’
That’s the title of an upcoming FOX News Channel feature program with John Stossel, in which Cato Executive Vice President David Boaz and Director of Health Policy Studies Michael F. Cannon weigh in on some of the hidden, unforeseen, and unintended consequences of the attempts to deliver on promises our politicians make.
Mass prosperity
David Leonhardt on the philosophical debate over ObamaCare.
Has England eliminated the gender pay gap?
Women in their 20s earn more than men the same age, according to a new study from the UK, but women's earnings drop below men's in their 30s.
What is Happening with Income Mobility?
As far as I am concerned, the important thing is to have a dynamic and growing economy with plenty of opportunities for those who are the least well-off among us. We can debate about whether or not ours is that sort of economy—especially given the current economic climate—but a simplistic analysis of income groups gives us very little information on this score.
Recovery Risks, Financial Overhaul, Voodoo Economics
A roundup of economic news from around the Web.

THURSDAY
Bacon prices got you scared? Join the club.
Bacon of the month clubs let you lock in the price for a full year of gourmet breakfast meat. It's not exactly cheap, however.
IPhone Adds $1.9 Billion to U.S.-China Trade Deficit
One widely touted solution for current U.S. economic woes is for America to produce more of the high-tech gadgets that the rest of the world craves.
Worlds apart: a firsthand look at emerging market growth
Emerging markets have vigor and energy that the huge American market seems to lack.
EPA Regulations Killing Clean Energy
In sharp contrast to the pro-nuclear energy rhetoric of the Administration, some nuclear power plant owners are considering shutting down their facilities. Exelon, owner of the New Jersey Oyster Creek nuclear power plant, recently announced that it plans to close the plant 10 years early because of EPA regulations aimed at reducing the environmental impact of plants’ cooling water intake systems.
Lisa Jackson, Winner of the First Economic Darwin Award
We still need to designate an appropriate award for Ms. Jackson. Maybe a trophy depicting a shattered window (made from 100% recyclable materials of course)? 

WEDNESDAY
Transfer fees
The cost of sending money home.
Naughty and Nice
The only “nice” companies are those, like the PB@T Bank, that tried NOT to take the money.  The “naughty” are the government -- Bush and Obama officials -- who gave out your money.  Because even if every penny is paid back, the economy still lost.
Don’t Get Fooled By Accounting Conventions
In my latest column in the Pittsburgh Tribune-Review, I grapple again with the issue of America’s trade deficit – doing so in a way that addresses some of the (many) objections that I’ve encountered over the years.  Here are the opening few paragraphs:
A Short History of Social Security Retirement Ages
This year, Social Security paid out more money than it took in for the first time since 1983. If the economy rebounds, Social Security is expected to be in the black by 2012 and will stay that way until 2015. But starting in 2016 Social Security will be in the red for as long as the Social Security Trustees can see.

TUESDAY
Public Sector Inc.
Reform of public sector unionism is sure to be a major policy issue facing the states in the coming decade.
The Illustrated History of the U.S. Credit Collapse
The collapse in credit issuance/borrowing began in 2008 and would have been net negative without the Federal government. In 2009, for example, the Federal government was 141 percent of total net credit borrowings.
Credit Card Companies Seeking to Expand Lending?
The value of outstanding revolving credit balances (read credit card debt) is falling because people are actually paying down balances, which means that credit card issuers have gone from losing money on bad debt, to losing money on people who don't carry such large balances any more.
Unions That Won’t Take ‘No’ for an Answer
Part of living in a democracy involves accepting election results. Americans know to move on when their side loses. Someone should tell that to the union movement.

MONDAY
The ‘Consumer Spending’ Myth
Journalists talk endlessly these days about the need for more consumer spending to revive the economy, and for government programs to juice consumer spending. Economist Steven Horwitz takes on the assumption that spending is the key to economic activity:
Mortgage rates at highest level since July
Mortgage rates surged to 4.66 percent for 30-year fixed, the highest they've been since July 28, according to the Mortgage Bankers' Association.
Unofficial Problem Bank list at 919 Institutions
Here is the unofficial problem bank list for Dec 10, 2010.
People Produce (and Export) Only in Order to Consume (and Import)
Those who applaud Americans getting lots of money for their exports, but who then criticize Americans for importing, or who regard greater American imports as a detriment to America – that is, those who are critical of Americans for using their export earnings to improve their living standards – are inconsistent and confused.
Schedule for Week of December 12th
This will be a very busy week. The current plan is for the Senate to vote on the tax legislation on Monday at 3:00 pm. The House of Representatives is expected to vote later in the week, and then Congress plans to adjourn for the year on Friday.
What's Your U.S. Income Rating?
Did you ever wonder just where you fit in among all income-earning Americans?

Reports
THURSDAY
Foreign Purchases of U.S. Securities Slow in October
Net purchases of U.S. securities slowed noticeably in October. While private investors were net buyers of long-term securities, foreign official investors were net sellers. Less demand for Treasurys pushed yields up.
Congress Should Block Union Transparency Rollback
The Obama Administration recently rolled back union financial transparency reforms. New regulations will exempt many union trust funds, such as strike funds and apprenticeship programs, from financial disclosure laws. These regulations also end financial reporting for many government unions.

WEDNESDAY
Retail Sales Rose in November; Good Start to Holiday Season
Sales at the nation’s retailers rose 0.8 percent in November, largely due to increases in gasoline, clothing and sporting goods. “Core” sales, which exclude autos, gas and building materials, rose 0.9 percent.

TUESDAY
Export Controls and the Hard Case of China
It is clearly in the interests of the United States to maintain some degree of control over its exports, if only to safeguard security-related technologies and deny them to its potential adversaries, as well as to support other aims such as nonproliferation. However, the United States has an equally high interest in supporting a healthy U.S. economy and fostering international political links, which require sustaining a robust portfolio of exports.

MONDAY
Economics Group
Weekly Economic & Financial Commentary

Budget News Dec. 6 - 10

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News
FRIDAY
Treasury: Financial bailout income at $35 billion
The government's heavily criticized $700 billion financial rescue program has earned nearly $35 billion in income over the past two years, according to data obtained by The Associated Press.
Twenty Senators Step up Pressure for a Deficit Reduction Plan
Group includes Democrats Warner and Conrad, and Republican Grassley.
Boehner will cut Hill budgets by 5 percent
Incoming Speaker John Boehner said he will propose to cut nearly every office budget by five percent as one of Congress’ first measures next year.
Poll: Americans Much More Worried About Jobs Than the Debt
Republicans dislike the deficit panel's plan more than Democrats do.
State News Roundup
Here’s a look at some of this week’s most interesting, and consequential, budget- and economy-related issues in the 50 states…

THURSDAY
California Budget Gap May Reach $28.1 Billion Over 18 Months, Brown Says
The deficit estimate takes into account a $2.7 billion drop in projected estate-tax receipts, and compares with the most recent forecast of a $25 billion gap for the period, Brown said today at a public meeting of state officials.
UPDATE: CEOs Press Congress to Cut Spending, Overhaul Tax Code
A group of chief executives spelled out a plan on Wednesday to boost business growth, urging Congress to redesign the corporate tax system, cut government spending and pass pending free trade agreements.
Deficit hawks find tax-cut deal 'exasperating'
Last week was such a happy week for deficit hawks. This week, they're back to beating their heads against the wall.
Preparing for a Debt Ceiling Hike
Republican House leaders have months to prepare for a tough vote on increasing the debt limit.
House approves $1T budget bill
The House narrowly approved a stripped-down budget bill Wednesday evening, cutting nearly $46 billion from President Barack Obama’s requests in order to hold total governmentwide appropriations to no more than the current $1.09 trillion level.
Massive Budget Bill Faces Opposition in Senate
The 423-page measure, opposed by Republicans, conservative Democrats and some anti-war lawmakers, wraps a dozen unfinished spending bills into a single measure.

WEDNESDAY
States Face Budget Shortfalls of $26.7 Billion
Fifteen states are facing combined budget gaps midway through their 2011 fiscal year totaling $26.7 billion, according to a National Conference of State Legislatures report to be released Wednesday. The other 35 states say they are on target with their budgets. At this time last year, 36 states reported a combined $28.2 billion shortfall.
Italy's Parliament Tightens Budget Amid Tensions
The Italian parliament on Tuesday approved €25 billion ($33.3 billion) in budget cuts over the next two years, locking in austerity measures aimed at stabilizing public finances and reassuring jittery sovereign debt markets.

TUESDAY
Schwarzenegger Proposes $9.9B In Cuts
Gov. Arnold Schwarzenegger has declared a fiscal emergency and is asking lawmakers to meet in a special session to save the state $9.9 billion over the next two years.
White House Looking for Billions in Additional CR Spending for Next Year
The White House has asked lawmakers to add more than $11 billion to any long-term continuing resolution cleared by Congress before the end of the year, according to materials circulating on Capitol Hill Monday.
Kingston Has List of Ideas for Capitol Hill Cost Cuts
On the chopping block in a Kingston-led committee: Capitol Police security details, Capitol Visitor Center tour guides and maybe even an entire agency.

MONDAY
Deficit Spending Is Top Worry in New Poll
By 59% to 30%, Americans believe that Congress should cut federal spending rather than raise taxes.
Pension Woes Prompt GOP Move
The new Republican House leadership, whose party benefited in November from public antipathy toward the bailout of banks, is moving to avoid a federal bailout of state and local pension funds
A Whole New Name Game
Parks, Transit, Schools Consider Corporate Monikers in Bid to Plug Budget Gaps.
Senator says deficit needs White House involvement
The chairman of the Senate budget committee on Sunday called on the White House to hold a summit to tackle the federal deficit, saying it is the next logical step in getting the nation's financial house in order.
Flaherty Says Canada May Move Forward the Target Date for Balanced Budget
Canadian Finance Minister Jim Flaherty said he may consider bringing forward a goal of balancing the budget within five years after consulting with various groups over the next few months.

Economist Comments
FRIDAY
Opinion: Want to Balance the Budget? Get Out the Chainsaw
If you wanted to spread the pain around, that would mean cutting every agency budget by 45 percent.

THURSDAY
BACON: Thinking the unthinkable about the national debt
Americans need to know the financial endgame they're trying to avoid.
The Cuts That Weren't
"[T]he commission report doesn't go nearly far enough in reducing the size, cost, and intrusiveness of government."
EDITORIAL: Exposed: TSA's X-rated scanner fraud
Firms hawking this dubious technology have their eyes on the $2.4 billion the Obama administration has allocated for the scanning program. It's not surprising they would leave out mention of its limitations.
The Obama Stimulus Impact? Zero
Liberals are still arguing that the federal spending stimulus wasn't large enough. How many multiples of nothing—its result according to new evidence—would they like?

WEDNESDAY
$200 Billion in Obsolete, Ineffective Federal Programs
Despite all the tough talk by the Tea Party about shrinking the size of government, federal programs usually take on a life of their own and are very hard to kill off.
The end of big government?
One difference between now and the mid-’90s is the magnitude of the numbers. The federal deficit is projected to exceed $1 trillion in 2011, compared with the relatively paltry $152 billion deficit in fiscal 1995.

TUESDAY
This Budget Would Never Pass
A five-part plan to cut the deficit, narrow inequality, and strengthen the economy—and why special interests would block it.
The Deficit Commission: The Good and the Bad
The answer here is to follow the Bowles-Simpson proposals on tax rates and tax subsidies, while ignoring the call for more federal revenues that history shows won't fix the deficit anyway.
FEULNER: Reversing the trend to spend
Debt commission's proposal is a good start.
Enough Talk About Deficit-Cutting; Just Do It
Many of the proposals the Obama commission put forth have been heard before. It's time for action, not more discussion.
How to Balance the Budget Without Raising Taxes
The 19 Percent Solution.

MONDAY
US Budget Experts: Early Next Year Critical For Fiscal Policy
...in the wake of the release of three sweeping reports in the last month about the impending fiscal crisis in the U.S., many budget experts are willing to make this prediction: it will be clear by early next spring if the U.S.'s fiscal debate has turned a corner and is focusing on finding solutions to the nation's increasingly serious fiscal outlook or if a decade-long budget stalemate will continue.
Unions limit state's budget-cutting options
Some say Legislature gave up too much power in 2002.
What the Simpson-Bowles Plan Left Out
They performed an accounting exercise to shrink the deficit without trying to define what government should do and why.
The fiscal commission's omission
A critical element is the question: “What is the proper role of the federal government?”

Blogs
FRIDAY
Cut the deficit, but not my programs
The majority of Americans think the federal deficit needs to be reduced, according to a new poll from the Pew Research Center for the People & the Press. They just don’t like many of the ways of doing it.
How Can States Limit Spending?
What can states do to arrest the rapid growth in state spending? What tools do state legislators have to limit the growth of their budgets?
Social Security Doesn’t Contribute to the Deficit? That Was Then…
The $116 billion 10-year cost of the payroll tax cut is effectively added to the deficit and the debt, although it remains to be seen if the credit will survive.

THURSDAY
Policymakers Needn’t Fear Spending Cuts
A recent study by economists Alberto Alesina, Dorian Carloni, and Giampaolo Leece looked at 19 OECD countries from 1975 to 2008 and found no evidence that “governments which quickly reduce budget deficits are systematically voted out office.” Therefore, the authors conclude that governments can “decisively” reduce deficits and be returned to office by voters.
False Choice
This thesis rests on several dubious assumptions, but none more questionable than the one that equates higher government spending on education with better education.
A Leaner Leviathan
Unfortunately, balancing the federal budget won't require radical change.
Where’s the Tax Bill?
A developing problem with this secret compromise among leaders in the House, Senate and White House with regard to extending tax cuts for all is the fact that nobody has seen the agreement.

TUESDAY
Crisis in the States
We have a triple-whammy of rising health care costs, a demographic bulge, and the historical legacy of a major expansion of government.
The Deficit Commission’s Plan and Balancing the Budget
Also, the commission’s plan increases spending by $1.6 trillion between today and 2020.
How Much Federal Spending Can Americans Afford?
...the median household income in the U.S. would have to rise to be $70,097 in order for this level of government spending to not produce a significant budget deficit. That's about 41% higher than the actual median household income in 2009 of $49,777!
Fiscal Fitness
And as far as I can tell, the only thing it tells us about fiscal policy is that tax revenues are really remarkably stable outside of recessions, even though we've had many different tax regimes over the years.
Morning Bell: Freeze Taxes, Freeze Spending, and Go Home
Then after the 111th lame duck has frozen taxes and frozen spending, they should just go home. They have done enough damage already.

MONDAY
The Zero Deficit Line
if we assume the median household income in 2011 will be $49,000, that means that any federal spending over $20,592.91 per household will only add to the national debt and make the nation's fiscal situation worse. How much worse will depend upon how much over that figure the spending figure will work out to be.
The hidden truth about the deficit
What nobody wants to say: the real looming deficit problems are medical. Health costs must be controlled. The rest is peanuts.
VIDEO: Congress Must Cut Spending
...while this issue has garnered increased scrutiny, some continue to ignore the real cause of our debt and deficit problems—rampant spending—focusing instead on raising taxes.

Reports
TUESDAY
TEL It Like It Is: Do State Tax and Expenditure Limits Actually Limit Spending?
This study combines the two approaches described above to evaluate TELs based on where they are applied (high- vs. low-income states) and based on how they are structured.

Employment News Dec. 6 - 10

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News
FRIDAY
You don't want to be unemployed in Vermont
Jobless Americans everywhere are running out of federal unemployment benefits as Congress debates whether to extend the safety net as part of a Bush tax cut compromise.
TJX to Cut 4,400 Jobs, Shutter Stores
T.J. Maxx and Marshalls parent TJX Cos. (TJX) announced plans on Friday to slash more than 4,000 jobs and shut down its A.J. Wright division.

THURSDAY
U.S. Initial Jobless Claims Fell 17,000 to 421,000 Last Week
The number of workers filing first- time claims for unemployment insurance payments fell last week in the U.S., showing the labor market continues to improve.
How states fared on jobless claims, at a glance
Unemployment claims fell for the second time in three weeks last week to their second-lowest level this year. That's an encouraging sign that companies are cutting fewer workers and may be ready to accelerate hiring.
Job openings rise in October to most in 2 years
Businesses and government advertised nearly 3.4 million jobs at the end of October, up about 12 percent from the previous month, the Labor Department said Tuesday. That reverses two months of declines and is the highest total since August 2008, just before the financial crisis intensified.

WEDNESDAY
Unemployment benefits: Extension won't help '99ers'
Unemployment benefits in Nevada, which leads the US in unemployment, won't be extended for those at are near the 99-week cutoff for benefits.

TUESDAY
Hiring Intentions at U.S. Employers Improving, Manpower Says
The U.S. labor market outlook is improving, with more employers planning to boost payrolls at the start of 2011 and fewer expecting to cut headcounts compared with the same time this year, a private survey showed today.
Type the Title You Want People to See
Unemployment also falling among women, 30- to 49-year-olds, those with no college education.

MONDAY
Obama to Push Unemployment Benefits as Condition of Extending Tax Rates
Visiting a technical college in North Carolina, President Obama is set to speak Monday on the need for private-public cooperation to make the U.S. more competitive while also laying down conditions on expiring tax rates, even as a deal between the White House and Congress is said to be in the works.
Jobs Setback Clouds Recovery
Hiring Slows Down, Stirring Doubt on Economy's Strength
Gop, Dems Nearing Deal on Taxes and Jobless Benefits
An outline of a bipartisan economic package is emerging that would temporarily extend the Bush-era tax rates for all taxpayers, while extending jobless benefits for millions of Americans.
Why employers won't hire
The problem with bringing down the stubbornly high unemployment rate is that employers are learning to do more with less.

Economists Comments
FRIDAY
Tale Of Two Recoveries
A mainstream media guru says the president is channeling Ronald Reagan but risks becoming Jimmy Carter. Reagan's policies worked, Carter's didn't and Obama's haven't. Wake up and smell the tax cuts.

THURSDAY
Jobless Benefits' Effect on Unemployment
A likely rise in the U.S. jobless rate is the unfortunate reality of the government's move to fund extended unemployment benefits for another 13 months.
Are We Subsidizing Unemployment?
The stimulus plan may have actually worsened unemployment. New data suggest a large share of those without jobs remain on the sideline because of increasingly generous jobless benefits.
Do Jobless Benefits Raise Unemployment?
Extending benefits, a key to the tax deal, may keep some at home, but it will also boost growth

WEDNESDAY
Many jobs are gone forever: What now?
The issue is complicated, to be sure. Millions of Americans are exhausting their 99 weeks of unemployment insurance while, in the fight for talent in Silicon Valley, Google has decided to raise salaries by 10 percent across the board. But if the economists and politicians can work together, we can benefit from the effort and innovation of highly productive workers while supporting the adjustment of the rest.

MONDAY
Jobless Report Is Death of Keynesianism
President Obama may have pulled "the car out of the ditch," but he left the jobs engine behind, judging from November's weak jobs report. Yet he remains wedded to a job-killing tax hike?

Blogs
FRIDAY
Is There an Inflation-Unemployment Trade-off?
Much of what drives the policy choices of Ben Bernanke and the Federal Reserve is a belief in the ability to trade higher inflation for lower unemployment, known within the economics profession as the “Phillips curve.” But does this trade-off actually exist?

THURSDAY
Worth more than a thousand words
One reason Keynesian stimulus is so ineffective is the aggregation problem. Boosting “aggregate demand” hides the complexity of the economy and the fact that parts of the economy are fine and parts are sick.
About 6 Million Didn’t Work at All Last Year
Nearly 6 million Americans looked for work but weren’t able to find employment at all last year, a new report shows.
Payroll Tax Increase and Iowa Jobs
Iowa Job-seekers and wage-earners will feel the sting of the longest running unemployment benefits extension in U.S. history.
Secondary Sources: Unemployment Extension, Tax Deal, Job Openings
A roundup of economic news from around the Web.
"Why work?"
A one-parent family of three making $14,500 a year (minimum wage) has more disposable income than a family making $60,000 a year.
Do Tax Cuts for the Wealthy Create Jobs?
Over at The Economist's Democracy in America blog, Matt Steinglass is pondering the differential stimulus effect of tax cuts for the wealthy, and tax cuts for everyone else.
Oldest Workers Hardest Hit in November 2010
In the now three years since the total level of employment peaked in the U.S., some 7,595,000 fewer people were employed in November 2010 than had jobs in November 2007, as the latest data suggests that the U.S. job market has seen no sustained improvement since March 2010.

MONDAY
Where the jobs are
THE Bureau of Labour Statistics released two interesting reports this morning that shed a little more light on the state of the American recovery. The first updated metropolitan-level employment data through October, providing a sense of exactly where things are improving, and where they aren't.
Job creation remains near-stagnant: New hires barely exceed job separations
Job hires (3.6 percent) only barely exceed total job separations (3.5 percent, including firings, resignations, and layoffs).
What costs $919 Billion but Isn't Likely to Create Many Jobs?
Could the answer to this question be the just announced tax deal and the so-called "doc fix"?
Unemployment benefits and tax cuts: 'compromise' as usual
Unemployment benefits extended, payroll taxes cut, and all Bush tax cuts extended: an all-too-typical Washington 'compromise' where everybody gets what they want – while the deficit deepens.

TUESDAY
Taxpayer Calculator: Extending Unemployment Benefits
There are two schools of thought when it comes to extending unemployment benefits: one is economic and the other is emotional. If Congress does not prolong the payments, two million Americans will lose their benefits right away, and the Obama administration estimates seven million Americans will be affected if a year-long extension isn't passed.
BLS: Job Openings increase sharply in October, Labor Turnover still Low
From the BLS: Job Openings and Labor Turnover Summary
Secondary Sources: Underwater Homeowners, Austerity Alternatives, Job Creation
A roundup of economic news from around the Web.
How the Weak Jobs Report Can Actually Help the Economy
Congress might now see that the Bush tax cuts and unemployment benefits need to be extended.

MONDAY
Economists React: ‘Painful Reality Check’ on Jobs
Economists and others weigh in the disappointing employment report.
Participation Rate of 25 to 54 Age Men at Record Low
The collapse in the labor force participation rate has been one of the key stories of the great recession. The participation rate is the percentage of the working age population in the labor force.
The Jobs at Stake in the Tax Cut Fight
Last Friday the Labor Department reported that private sector employers added an anemic 50,000 net jobs to the U.S. economy in November. That is far fewer than what is needed to absorb discouraged workers reentering the workforce or population growth. As a result, unemployment rose to 9.8 percent, marking the 19th consecutive month that our nation’s unemployment rate topped 9 percent, a post–World War II record.

Reports
MONDAY
How Many Jobs Will Congress Choose to Lose? The Economic Effects of Various Legislative Options for Addressing Expiring 2001 and 2003 Tax Policy
There is near-universal agreement among economists that raising marginal tax rates during slow economic times only makes the economy weaker. Higher tax rates reduce employment, cut investment activity, and soften household demand for goods and services. Even so, Congress is considering right now a number of tax proposals, most of which raise tax rates starting on January 1, 2011. All but one of these legislative options would result in higher unemployment.
Heritage Employment Report: Little Cause for Thanksgiving in November Jobs Report
The November employment report threw a bucket of cold water on hopes for an accelerating recovery. The Bureau of Labor Statistics reported that private sector employers added only 50,000 net jobs. Unemployment rose to 9.8 percent and has remained above 9 percent for 19 consecutive months. This ties the record for the longest such stretch since World War II. Weekly hours were flat in November, and average wages increased by just one cent.

Monetary News Dec. 6 - 10

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News
FRIDAY
Ron Paul, Author of `End the Fed,' to Lead Panel Overseeing Central Bank
Paul, in an interview last week, said he plans a slate of hearings on U.S. monetary policy and will restart his push for a full audit of the Fed’s functions.

THURSDAY
Bond Prices Plunge for 2nd Day on Deficit Fears
U.S. Treasurys plunged Wednesday, extending Tuesday's sharp losses and pushing benchmark yields to a six-month high, after a deal in Washington to extend tax cuts fueled fears of inflation and a swelling budget deficit.
More Than Half of Americans Want Fed Reined In or Abolished
A majority of Americans are dissatisfied with the nation’s independent central bank, saying the U.S. Federal Reserve should either be brought under tighter political control or abolished outright, a poll shows.

WEDNESDAY
Bernanke: US 'close to border' of recession, Federal Reserve may intervene
Federal Reserve Chairman Ben Bernanke says that the US economic recovery is 'not far' from losing momentum. If the recovery slips further, the Federal Reserve is prepared to act again.

TUESDAY
Everybody hates the Fed
The Fed is taking heat from just about everyone lately. But it's not just conservatives joining together to criticize the Fed and its boss. Some on the left are also starting to show disdain for the Fed's controversial plans to spend an additional $600 billion on long-term Treasuries, known as quantitative easing.

MONDAY
US could need third dose of quantitative easing, says Ben Bernanke
The chairman of the Federal Reserve defended his decision to launch a second $600bn (£382bn) stimulus program – dubbed QE2 – last month. Appearing on CBS News's 60 Minutes, Bernanke said it was "certainly possible" that the Fed would open the QE floodgates again, if the US recovery does not pick up pace.
Bernanke defends bond buys, citing at-risk economy
Critics, from Republicans in Congress to some officials within the Fed, say they fear the Fed's intervention could spur inflation and speculative buying on Wall Street while doing little to aid the economy.

Economists Comments
FRIDAY
Why Are the Fed's Actions Surprising Anyone?
Bernanke is often inaccurate, but propping stock prices was never something the Fed overtly lied about.
A European Economic Tsunami?
In 2007, the chairman of the Federal Reserve, Ben Bernanke, spent most of the year assuring markets that the U.S. sub-prime mortgage loan problem would be contained. In an all-too-similar manner, the European Central Bank president, Jean-Claude Trichet, now keeps asserting that Europe's sovereign debt crisis does not pose a significant threat to the overall European economy, let alone to the global economy.

THURSDAY
Teflon Bernanke?
Yes, yes, people hate the Fed. But believe it or not, they're sort of OK with Ben Bernanke.
The Farm Belt Boom
Land prices are soaring. Is this another Fed asset bubble?
Don't Be Fooled: Inflation Has the Upper Hand
Citing declining credit as proof we're in deflation is overly simplistic; base money creation, velocity, and the level of market participants' faith in monetary policy must also be considered.
Euro Falls Amid Fears of Sovereign Default
The ECB and several eurozone nations are urging Portugal to follow Ireland's lead by applying for a bailout.
Is Deflation on the Horizon?
Todd Harrison and Michael Pento discuss the ongoing inflation vs. deflation debate.

WEDNESDAY
Bernanke: 60 Minutes, 2 Big Lies
This past Sunday on the CBS program "60 Minutes", Americans received a massive dose of mendacity from our Fed Chairman. Mr. Bernanke's shaky delivery, and even shakier logic may cause faith in America's economic leadership to evaporate faster than the value of our dollar. In particular, Bernanke delivered two massive distortions:
What I Would Have Asked Bernanke
After 60 Minutes was gentle with Ben, here are some tougher questions for the Fed chief.
Great Expectations for Ben Bernanke
Forget legacies; world history hangs in the balance.
The Fed: From Central Banking to Central Planning
The American public takes a back seat to the banks; the Fed has gone from smoothing the business cycle to mircomanaging the markets.

TUESDAY
Knowing the Limits of Monetary Policy
U.S. monetary policy has become a tool of fiscal policy, and uncertainty characterizes both.
Folding the Fed
Central bank isn't equipped to save the economy.
The Federal Reserve: America's Fourth Branch of Government
The Fed alone determines how much money should be in the economy, yet its powers aren't defined by the Constitution, and neither the chairman nor the senior officials are elected by the people.
Why the Argument for Imminent Inflation Is Flawed
It is futile to expect inflation because of a liquidity rally within a larger deflationary wave.
U.S. Unloads Citi Stake for $12 Billion Profit
The U.S. Treasury sold the last of its Citigroup Inc. common shares in a $10.5 billion offering that capped the government's biggest bank bailout of the financial-market meltdown.

MONDAY
Bernanke 1, inflation hawks 0
Like it or not, history shows Ben Bernanke is right to say inflation isn't knocking at the door.
With Economy on the Brink, Bernanke Sees Path to Recovery
Federal Reserve Chairman Ben Bernanke said the United States is still four to five years away from a more normal unemployment rate, between 5 and 6 percent, and cautioned that a prolonged period of joblessness could result in a changed workforce.
Wasn't QE2 Supposed to Make Rates Lower?
That's what they told us. But it hasn't exactly worked out that way.

Blogs
FRIDAY
Inflation, Inflation Everywhere
Before conservatives give up on arguing against QE, there are a few things to note

THURSDAY
Jon Stewart Catches Bernanke’s Lie
You are going to love this. Even our favorite mugging slapstick news sources gets it that quantitative easing is the same as “printing money.”

WEDNESDAY
The Face of Qualitative Easing
The question isn't whether or not the Fed buys assets, but what kind of assets the Fed buys. Or in this case, what kind of assets the Fed accepts as collateral for its facilities.
Thinking the unthinkable: Let the euro-chips fall
French and German banks hold nearly a trillion euros worth of other European nations' debt: Ireland, Spain, Portugal, Italy, France, Greece. What would happen if they were allowed to collapse?

MONDAY
No Doubt Ben Bernanke is Sincere, But What If He is Sincerely Wrong?
I have increasingly come to the opinion that the data that individuals are pointing to as an example of the down-turn in 2008 is merely the manifestation of the market correcting for the previous distortions caused by the policy error of the manipulation of money and credit of the previous period.
Boehner to Protect the Fed?
With Republicans taking control of the House in January, long-time Federal Reserve critic Rep. Ron Paul is in line to take over chairmanship of the House Financial Service Committee’s Subcommittee on Domestic Monetary Policy and Technology.  This is the subcommittee with direct oversight of the Federal Reserve.

The public really hates inflation, probably due to money illusion, which is one of the reasons we are in the current situation. Circa 1996 Robert Shiller asked a group of 113 randomly chosen responders the following questions:
Japan Failed at Deflation Management
Not only did printing money fail to break deflationary expectations, it failed to keep the yen from rising.

Reports
MONDAY
The Great Recession and Its Aftermath From a Monetary Equilibrium Theory Perspective
We argue that the primary source of business fluctuation is monetary disequilibrium. Additionally, we claim that unnecessary intervention in the banking sector distorted incentives, nearly resulting in the collapse of the financial system, and that policies enacted to remedy the recession and financial instability have likely made things worse. Finally, we offer our own prescription to reduce the likelihood that such a scenario occurs again by better ensuring monetary equilibrium and eliminating moral hazard.

Tax News Dec. 6 - 10

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News
FRIDAY
Obama Weighs Multi-Year Effort to Overhaul Tax Code
President Obama has instructed his economic team to draft options to close loopholes and lower income-tax rates ahead of what would be a multi-year effort to overhaul and simplify the U.S. tax code, administration officials said Thursday.
Obama predicts success for tax deal
President Barack Obama said Friday he's confident that Congress will pass a compromise tax package despite the objections of House Democrats.

THURSDAY
Businesses racing against the tax clock
In December 2009, nearly 150 companies made extra payments. Experts expect this December to be a banner month and easily top those numbers.
Tax Plan Spurs Deal Making
The sweeping tax package negotiated by President Barack Obama and Republican lawmakers gained new momentum toward passage in the Senate, building pressure on balking House Democrats to accept the controversial deal.
Bush tax cuts 101: Would extension boost the economic recovery?
The short answer is yes. Forecasters anticipate that extending the Bush tax cuts, as well as other measures in the Obama-GOP deal, will breathe life into the economic recovery.
Yields Push Higher on Tax-Deal Fallout
Treasurys extended their slump on Wednesday, sending the 10-year yield to its highest since June, amid a steam of negative news for bonds.
Tax Deal Is Key to Avoid Recession, Obama Adviser Says
One of President Obama’s top economic advisers warned on Wednesday that the nation could slip back into recession if Congress did not pass the administration’s tax cut deal with Republicans, as the White House sought to press Democrats into backing the plan.
Estate-Tax Passage Is Likely
The plan put forward by Republicans and accepted by Mr. Obama would reinstate the estate tax at 35% for two years starting next year, with the first $5 million of a person's estate exempted.

WEDNESDAY
Tax cut deal and surprise stimulus - the cost
The compromise on the Bush tax cuts announced Monday night between President Obama and Republicans could cost between $700 billion and $800 billion if ultimately signed into law as is -- no sure thing given opposition from many Democrats.
Tax-Cut Deal Results in Turmoil for Bonds
The tax deal in Washington led investors to dump government bonds on Tuesday, with yields on Treasurys hitting their highest level in six months and municipal bonds getting hit by the sell-off and by the news that federal subsidies for local debt would not be extended.
Tax deal: Rich aren't the only ones who benefit
...other provisions in the $800 billion deal, including the payroll tax holiday and child tax credit, will greatly assist ordinary Americans. And those who are unemployed will benefit from an extension to file for federal jobless benefits through 2011.

TUESDAY
Payroll Tax Cut: A Short Primer
The proposed 2% rollback of individuals' payroll taxes used to fund Social Security is the latest iteration of an idea that's been kicked around for years as a way to supplement incomes and boost economic growth.
Debt Ceiling Enters Tax Debate
The outlines of a deal to prevent a walloping tax increase from taking effect on January 1 are becoming clearer and may also include a sooner-than-expected vote to raise the federal debt ceiling.

MONDAY
Tax Deal Within Reach
Cuts Could Be Temporarily Extended in Exchange for Unemployment Benefits.
Tax Fear May Move Bonuses Earlier
Congress is debating tax rates, and that has Wall Street nervously eyeing the calendar.
Obama Signals Openness to a Tax-Cut Deal
The U.S. Senate on Saturday defeated two attempts by Democrats to extend the Bush-era tax cuts for the middle class permanently.
In Interview, Bernanke Backs Tax Code Shift
The Federal Reserve chairman, Ben S. Bernanke, said in an interview broadcast on Sunday evening that rising inequality was eroding social cohesion and that Congress could help economic growth by making the tax code more efficient.

Economist Comments
FRIDAY
Pelosi and the Hostage Fakers
Republicans shouldn't make a single new tax concession.
Some Year-End Tax-Planning Tips
If President Obama's tax-cut compromise passes Congress, the investor class can breathe a sigh of relief, says Wall Street tax pro Bob Willens.

THURSDAY
Bond Vigilantes May Thwart Tax Deal
Higher interest rates could offset effect of proposed fiscal measures.
Cheers To Obama On Taxes
A permanent tax plan would have given consumers and businesses more confidence.

WEDNESDAY
Ireland's Low-Tax Path to Fiscal Health
Parliament has endorsed the 12.5% corporate rate as 'an indispensable tool' for job growth.
Tax cut deal: Why it isn't enough
Veronique de Rugy, senior research fellow at the Mercatus Center at George Mason University in Arlington, Va., argues that the biggest shortfall of the tax cut compromise is that there was nothing done to address the nation's mammoth budget deficit.
A Taxpayer Bonus
One undiluted piece of good news in the Obama-GOP tax deal is that an extension of the Obama Administration's Build America Bonds (BAB) program is not included.
DeMint Says He Will Filibuster Tax Compromise
In explaining his opposition, DeMint cited the lack of permanency in tax rates, as well as a provision to extend unemployment insurance.
The Bush Tax Cuts Never Went Far Enough
A permanent reduction in capital taxes would increase productivity and wages. Postwar Britain shows how higher capital tax rates reduce investment and damage economic growth.
While His Base Rages, Obama Faces Tax-Cut Reality
The tax deal is certainly better for the economy than political gridlock over extending the tax cuts. How much better is uncertain.
Obamanomics Takes a Holiday
A two-year tax reprieve is better than current law but far from ideal.
The Tax Deal: Budget and Tax Mavens React
Conservative analysts like it; many others don't.

TUESDAY
What will deal on Bush tax cuts mean for the federal deficit?
Extending the Bush tax cuts will prevent as much as $300 billion a year from going into federal coffers, continuing the current federal deficits.
Deal Adds to Uncertainty, Debt
The great uncertainty, bemoaned by Republicans and business groups, is if anything greater than ever.
Did you get your money’s worth from Congress last week?
Last week, taxpayers spent roughly $107 million on Congress.

MONDAY
3 reasons why the mortgage tax break isn't a break
The plan to eliminate the mortgage tax deduction was widely criticized, but the industry overreacted to the proposal. Turns out it's not that great for most of us.
Bush's tax cuts: How did they affect you?
For nearly a decade, the Bush tax cuts — including a second, $350 billion dose in 2003 — have fueled debate in Washington about the proper role of government.

Blogs
FRIDAY
Secondary Sources: Local Governments, Europe, Tax Calculator, Grinchonomics
The Tax Foundation has an interesting calculator that uses several inputs to determine your taxes under several scenarios, including the latest compromise plan.
Morning Bell: There is No Tax Deal
The deal originally cut by Republicans had some good economic policy in it, but it also had a lot of harmful provisions.

THURSDAY
Tax cuts for the rich
It’s also good to remember that payroll taxes are not personal investments and add to the tax burden.
Payroll Tax Cut is Poorly Structured
Greg Mankiw and Bryan Caplan make the same point about Obama's payroll tax: it might better have been done on the employer side.
The rich are harder to stimulate than the poor
...total spending by both low-income and high-income recipients increased more than total spending by average recipients. In other words, though it's not a statistically significant result, both poor people and rich people seem to have been more likely to spend their stimulus checks than average people were.
Taxes in the real world
"When your uncle’s name is Sam, you learn that life in a doghouse is preferable to life in a squirrel cage."

WEDNESDAY
A Good Deal for Democrats on Tax Cuts
Some of the tax cuts, especially the temporary cut in the payroll tax, might even be stimulative. Nonetheless, I would much rather they had expired entirely than that we re-fight this battle in two years, when most of the parties are up for re-election.
Tax Negotiations: No help for 99ers
Just to be clear, the "extension of the unemployment benefits" is an extension of the qualifying dates for the various tiers of benefits, and not additional weeks of benefits. There is no additional help for the so-called "99ers".
How to Think about the Tax Deal
While lamenting the fact that the agreement includes an extension of the 35 percent rate for married couples with incomes above $250,000 (singles above $200,000), the White House is spinning this as the “cost” for getting unemployment benefits extended and for extending certain smaller tax policies created in the stimulus bill.
Right Cut, Wrong Side: Obama Botches the Payroll Tax Holiday
Instead of giving the tax cut to employers, where it would do the maximum good, or splitting it evenly, where it would do intermediate good, he's giving all of it to employees, where it does the minimum good…
The Tax Deal
...the plans for short-run recovery are very definitely consumption-based.
Economists React: Pros, Cons of Tax Deal
Economists and others weigh in on the agreement between the White House and congressional Republicans on a broad tax package.
Tax cuts could hurt Moody's U.S. rating: report
Moody's lead analyst for U.S. sovereign debt, Steven Hess, told Reuters he is not concerned by an extension of the Bush tax cuts on the U.S.'s AAA rating over the next 18 months to two years, but he is worried about what happens after two years when the extensions are set to expire again.
Does Preserving the Bush Tax Rates Doom Us to Massive Deficits? Nope!
...it would be quite easy to balance the budget in 2020 if the government would start early with small, systematic cuts designed to get government outlays about equal to the historic average of government revenue.

TUESDAY
Taxpayer Calculator: Extending Unemployment Benefits
Forty percent of those unemployed right now have been out of work for six-plus months and unemployment has risen to 9.8 percent.
The Good, the Bad, and the Ugly of the Tax Deal
...grading this package depends on your benchmark. This is why reaction has been all over the map, featuring dour assessments from people like Pejman Yousefzadeh and cheerful analysis from folks such as Jennifer Rubin.
On the Tax Burden
In 2008, for the typical household in the top one-percent of income-earning households in America, the percent of its adjusted gross income that it paid in federal income taxes was 23.27. Middle-income households paid less. For households whose earnings put them in the top 50 percent, but below the top 25 percent, of income earners, the percent of their adjusted gross income paid in income taxes was, on average, 6.75.
Holiday Treat for the Bush Tax Cuts?
In exchange, the President got a 13 month extension of Unemployment Insurance benefits — without having to offset the cost – as well as a temporary 2 percentage point reduction in the payroll tax in lieu of an extension of Obama’s ghastly “Make-Work-Pay” tax credit left over from the failed stimulus bill.

MONDAY
The Obama Debt Commission: Too Much Taxes, Not Enough Cuts
While the commission deserves credit for addressing this problem, the report contains far too many tax hikes, and far too little spending cuts to be a workable solution.
The Mortgage Deduction Should Be Done Away With--But It Won't
The reason that we have a special deduction for mortgage interest is not that politicians sat down and calmly, reasonably, worked out a way to reach certain social goals they thought were desirable. The mortgage interest deduction is an artifact of changes to the tax code in the 1980s.
Eugene Robinson Thinks the Government Already Owns Your Entire Paycheck
When the government fails to raise taxes, no one “writes a check.” People who are not taxed don’t get a check from the government, they simply get to keep the money they have already earned.
Obama’s November Jobs Deficit One More Reason to Extend Bush Tax Cuts
President Obama promised during the 2008 campaign (and after) that under his policies the economy would create millions of new jobs by the end of 2010. Well, we’ve reached the end of 2010.

Reports
WEDNESDAY
RCM: Wells Fargo Economics Group: Tax Cut Deal Reduces Uncertainty
The extension of the Bush-era tax cuts has improved our U.S. outlook for next year. The result of this policy decision should be increased consumer spending, business investment, corporate profits and GDP growth.