James Pethokoukis

Hawks and doves on the Fed

January 10, 2011

A handy chart from JPMorgan:

fed

Is America growing politically unstable?

January 10, 2011

Is America becoming less politically stable? A glance at some foreign newspapers would certainly give that impression. This is an important economic question. The global primacy of Treasury bonds and the dollar stems mostly from the nation’s massive economic might. But confidence in U.S. political stability also plays a role. The shooting of Arizona Congresswoman Gabrielle Giffords, though tragic, shouldn’t alter those perceptions — unless freedom of speech suffers.

GOP to spendthrift states: The check will never be in the mail

January 7, 2011

Exactly a month ago, I wrote a piece on a  “secret GOP plan” to nudge fiscally troubled states in bankruptcy, giving their governors a chance to rewrite existing public employee union contracts and take other drastic measure to restore solvency. Step 1: Eliminate the Build American Bond subsidy to make it hard for states to borrow.  [DONE] Step 2: Force states to reveal the true extent of their pension liabilities. [COMING SOON] Step 3. Rewrite the federal bankruptcy code [COMING SOON]. Two recent events give me further confidence in my call:

Is this the economic key to Obama’s reelection?

January 5, 2011

As a follow up to my post on how the tax deal might affect Obama’s reelection chances, here is a bit of insight from superanalyst Dan Clifton of Strategas Research:

Walking on the supply side with Obama

January 5, 2011

Larry Kudlow likes what he see so far:

The point is, if Team Obama is moving towards an entrepreneurial incentive model of growth, and away from the false consumption model of big-government spending, it’s very good news. Already we have seen a new free-trade initiative. And there’s even talk of broad-based, personal-income tax-rate flattening that could be part of a big-bang tax-reform package.

The tax deal and Obama’s reelection chances

January 5, 2011

It looks like Robert Gibbs will be leaving the White House to run his own consultancy and work on Obama’s 2012 campaign. Ruy Teixeira, a politics guys not an econ guy, thinks the Obama-Republican tax deal makes it far more likely that campaign will be a successful one:

What Paul Ryan hopes to do

January 5, 2011

In honor of the Congress, the good folks over at e21 have republished a column by Rep. Paul Ryan on what he wants to accomplish. This is good stuff:

Bill Daley to the White House? Business would love it

January 5, 2011

If President Barack Obama chooses JPMorgan executive William Daley as his next chief of staff he could at last build bridges with the disgruntled U.S. business community, both on Main Street and Wall Street. Daley’s pro-trade views are a big reason the buzz around his potential nomination is so loud. The pick would also bode well for reaching deals with Republicans on taxes and spending. A few observations (via my column for Reuters Breakingviews):

‘Cut and grow’ is really the only way forward

January 4, 2011

In theory, at least, the House GOP is exactly right:

The new House Republican majority will use the three weeks before President Obama’s State of the Union address to repeal the healthcare law, cut spending and scrap federal regulations, incoming Majority Leader Eric Cantor  (R-Va.) said Tuesday.

Of debt ceilings and budget deals

January 4, 2011

There’s a big budget deal coming, says NRO’s Daniel Foster:

My argument is dead simple.

P1) The debt ceiling won’t be raised without a ‘yea’ vote from Sen. Lindsey Graham (R., S.C.)