James Pethokoukis

Dems/unions push new wave of investment taxes

August 31, 2009

American equity investors have suffered a lost decade of portfolio performance — the S&P 500 is about where it was back in 1998 — and trillions of dollars of lost net worth, so it may seem a terrible time to hit them with a $100 billion-a-year investment tax. And, of course, it is.

2012 Watch: Pawlenty the tax cutter

August 31, 2009

How much Tim Pawlenty pay Walter Mondale to say this:

He brings an almost Jack Kemp-like fervor to cutting marginal tax rates; an important predicate for any presidential run may be how Pawlenty handles a recommendation from a task force he appointed that the state replace some corporate and individual taxes with consumption levies. His emphasis on taxes rankles many Minnesota Democrats. “There is a long line of progressive Republican governors in Minnesota who are big supporters of education,” says Walter Mondale, the former vice president and U.S. senator. “He is much more interested in tax-cutting and has broken with that tradition.”

Do we need a Fiscal Fed for fiscal policy?

August 31, 2009

Long after the American economy returns to growth mode, the national debt will continue to soar. According to the Congressional Budget Office, the national debt — as low as 33 percent of GDP in 2001 — will reach 54 percent of GDP this year and grow to at least 68 percent by 2019. Beyond that, the increasing cost of mandatory social insurance spending will certainly push the U.S. debt-to-GDP ratio ever higher in the decades ahead.

Krugman: U.S. budget is fine if nothing goes wrong. What?

August 28, 2009

What a weird column from Paul Krugman. He says Americans shouldn’t worry about the ten-year budget forecasts ($9tr debt,  70 percent of GDP) because a) plenty of other nations have had far higher ratios, b) other countries continue to lend to the US, and c) it’s the longer-term liabilities that are the problem.

The U.S. debt trap: the odds on seven solutions

August 28, 2009

How will America escape its debt trap? The indispensable Arnold Kling puts some odds on various scenarios. An excerpt:

More business attacks on climate change bill

August 28, 2009

I don’t think cap-and-trade is going anywhere soon, but its opponents are not letting up on the pressure (via The Hill):

Where healthcare reform is heading

August 28, 2009

Karen Tumulty of Time opines:

The bill most likely would attempt to cover children who have not received coverage under other federal programs, and possibly their parents. It might also expand the Medicaid program to low-income people who do not currently qualify.  … If the Senate decides to pass the bill under parliamentary rules that prevent a filibuster, it may also have to get rid of other provisions that do not directly affect federal spending, such as those that attempt to encourage wellness programs and more preventive care.

Study: possible to predict stock market crashes

August 28, 2009

The most obvious way to predict a stock market crash is to find out when I go all in. But there may be another, says New Scientist:

How fast will the U.S. job market bounce back?

August 27, 2009

Economist Robert Brusca thinks he knows:

Right now the job losses in this cycle number 6.9mln, a drop of 5.9% from the peak. It has taken 19 months to get these losses in place. The metrics above suggest that the forecast of how long it will take to get them back should be about 19 months as well (we’ll use 20 months since jobs are still falling). And while that is a long time – nearly two years- it is not so long to restore 6.9mln jobs. If we get them back in 20 months it will take job gains averaging 345,000 per month. Right now that seems like an amazing number. Yet, that is what history says happens. So we’ll see.

Tobin taxes, again

August 27, 2009

If FDIC chief Sheila Bair really wants to cause a regulatory stir, she ought to take a look at what Lord Turner, chairman of the Financial Services Authority, is up to. He wants to trim down the size of the U.K. financial sector (via the Telegraph):