The Great Debate

–- Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute. The views expressed are her own. –-

Health reform season kicked off this week with a meeting between President Obama and 24 Senate Democrats at the White House in preparation for congressional hearings and debate on health care in the weeks ahead.

Obama declared: “So we can’t afford to put this off, and the dedicated public servants who are gathered here today understand that and they are ready to get going, and this window between now and the August recess I think is going to be the make-or-break period. ”

At issue is how best to use the $250 billion plus pot of money that could result from taxing the value of employer-provided health insurance. Currently, health insurance provided by the employer to workers is free of income tax. When Senator McCain suggested eliminating tax-free employer-provided health insurance and replacing it with an individual tax credit to be used for health insurance purchases from any company, Obama accused him of raising taxes.

Now, according to Senate Finance Committee Chairman Max Baucus, one of the attendees at the White House meeting, President Obama is open to ending the tax break—without substituting an alternative individual tax credit—in order to finance health care reform. Removal of the tax exclusion would break Obama’s campaign promise not to raise taxes on Americans making less than $250,000 per year.

— Wei Gu is a Reuters columnist. The opinions expressed are her own. —

When U.S. Treasury Secretary Timothy Geithner told students at Peking University that China’s holdings of U.S. Treasury bonds were safe, his answer drew loud laughter from the audience.

Even economist and columnist Paul Krugman, who is often critical of U.S. economic policy, found himself defending America when he was repeatedly asked the same questions in China recently: Will you (U.S.) underwrite the value of China’s holdings of U.S. government debt? Will you be prepared to pay a much higher rate of interest against the risk of high inflation and dollar depreciation?

– Eric Auchard is a Reuters columnist. The opinions expressed are his own –

Microsoft Corp’s new Web search service Bing is a far cry from the general-purpose tool the company must build or buy to compete effectively with rival Google Inc.

Microsoft would do far better helping users find the emails, documents and Web pages that users of Outlook, Office and Internet Explorer rely on every day.

– Christopher Swann is a Reuters columnist. The views expressed are his own –

It’s not just California that threatens to sabotage the Obama stimulus. State and local governments across the nation are gradually unravelling federal efforts to revive growth.

The states have been inveterate stimulus eaters in the past. For most of the 1930s the expansionary policies of the federal government were just sufficient to offset the shrinking of state and local governments. Click here for PDF.

– James Pethokoukis is a Reuters columnist. The opinions expressed are his own –

Here’s why the U.S. government’s growing control over General Motors — Uncle Sam may soon own some 70 percent of the troubled U.S. automaker — is so vexing: This is supposed be the “no drama, no emotion” White House, a place where cool, calculating reason holds sway.

If George W. Bush was the presidential version of the impulsive Captain Kirk of “Star Trek”, then Barack Obama’s supposed counterpart is the superbrainy, hyperlogical Mr. Spock. (It’s a much-bandied about analogy here in Washington, one that the current president says he’s aware of. Indeed, he actually seems to dig it.)

– James Saft is a Reuters columnist. The opinions expressed are his own –

Come good news or bad, the U.S. treasury market is taking a sell now and wait for inflation later strategy.

Since May 21, Treasuries have been battered, sending the yield on 10-year bonds up by nearly 40 basis points to 3.53 percent, an enormous move in bond market terms.

–Bernd Debusmann is a Reuters columnist. The opinions expressed are his own–

Americans need to be afraid, very afraid. If President Barack Obama has his way, the country will soon be at serious risk of terrorist attacks coordinated by Muslim men held in maximum security prisons from where no-one has ever escaped.

These inmates possess superhuman strength and cunning. Even in solitary confinement, they might recruit fellow inmates to the cause of al Qaeda and incite riots. They might succeed where the worst of the worst American criminals failed – break out and disappear, seamlessly blending into the community. Next thing you know — a mushroom cloud.

–- Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute. The views expressed are her own. –

Good news for Americans with large families or who need to transport substantial amounts of gear: President Obama’s new vehicle emissions standards are not as tough as they seem. But this is bad news for environmentalists, who want to lower the use of gasoline.

When Obama, using authority granted to the president in the 2007 Energy Act, announced earlier this month that automakers will be required to achieve a higher fleet average, 35 miles a gallon, by 2016—four years earlier than Congress had mandated—Americans might have been forgiven for thinking that in 2016 the window stickers on the new cars would reflect this new standard.

– James Pethokoukis is a Reuters columnist. The opinions expressed are his own –

You can’t beat something with nothing” often passes for political wisdom in Washington. In 1994, Republicans defeated Bill and Hillary Clinton’s healthcare reform plan with pretty much nothing — well, at least with nothing positive.

Republican congressional solidarity, along with help from business group attack ads and the Clintons’ own political miscues, were enough to doom the landmark legislative effort. Back then, “No” was sufficient.

– Angel Gurría is Secretary-General of the Organization for Economic Cooperation and Development; Nancy Birdsall is President of the Center for Global Development. The views expressed are their own. —

All financial crises end. The question is not if we will recover, but how we can build a resilient global economy to speed and bolster that recovery. While many immediate dangers remain, now is the time to look beyond the exigencies of today.

We must take a hard look at weaknesses in the international system that might stand in our way as we rebuild. There are several, but we take this opportunity to highlight one weakness in our ability to build a resilient global economy for the future: the inadequate state of comparable data on international migration.