James Pethokoukis

America’s banana republic economy

October 20, 2009

Is the decline in the dollar merely a “return to normalcy” story, as many bulls contend, and not a harbinger of a coming currency crisis?

Stealing from Social Security to pay for healthcare reform

October 20, 2009

Does BaucusCare raid Social Security to pay for healthcare reform? Sure seems like, according to Andrew Biggs of AEI:

Healthcare math doesn’t work

October 20, 2009

Ed Yardeni runs the numbers:

Nominal GDP rose at a compounded rate of 4.2% from 1999-2009. It isn’t likely to grow any faster over the next 10-20 years. However, extrapolating the same growth rate of per capita retirement spending (5.1%) and adding the higher projected growth of the senior population (3.0%) suggests that social welfare outlays might grow by 8%. That’s significantly higher than the likely growth of nominal GDP (say 5%). Since the tax base can’t grow faster than nominal GDP on a sustainable basis, something has to give on the per capita spending side.

Closing the budget gap

October 19, 2009

TaxVox tells us why the budget deficit is much worse that what the government is projecting:

Healthcare reform effort stumbles over spending and taxes

October 16, 2009

The great Dan Clifton of Strategas Group nails the difficulties of paying for reform through spending cuts or tax hikes:

3 myths about ObamaCare, the Baucus bill and healthcare reform

October 16, 2009

I just wanted to highlight some items from a previous post on healthcare reform:

1) It costs $829 billion.

It accomplishes this financial feat, however, through budgetary trickery. The plan includes a start year of 2010, even though no money is spent that year and just $14 billion through 2013. Cost the plan out from 2011 through 2020 and it suddenly morphs into a trillion-dollar plan. Indeed, the average annual cost from 2015 through 2019 is $150 billion a year

That $250 check for seniors is a bad idea

October 15, 2009

The liberal Center on Budget and Policy Priorities comes out against that $250 payment to seniors:

Actually, you don’t have to raise taxes to pay for healthcare

October 15, 2009

Great piece of analysis from the Tax Foundation:

A new analysis by us finds that over a 20-year period, the health care bill written by Sen. Baucus and passed Tuesday by the Senate Finance Committee includes enough spending cuts in Medicare and other current government health programs to reduce the budget deficit over the long term, even without a proposed excise tax on “Cadillac” health plans.

Would Obama’s new regulator ban ObamaCare?

October 15, 2009

Would the Baucus healthcare reform plan pass muster with the Consumer Financial Protection Agency? That’s the new regulator the Obama White House wants to create to protect Americans from deceptive or confusing mortgages, loans and credit card agreements that contain hidden fees, costs, rates or other time bombs potentially harmful to one’s financial health.

VAT Attack! The perfect tax … or maybe perfectly awful

October 14, 2009

Greg Mankiw does a good explaining the value-added tax. But this is ominous:

From a strictly economic standpoint, a VAT is great. It is essentially a flat consumption tax, like the so-called FairTax, but implemented in a way to reduce compliance problems. Because it is collected in stages along the chain of production, rather than all at the retail level, tax evasion is more difficult. … My bottom line: If I could replace our current tax system (including the personal income tax, corporate income tax, payroll tax, and estate tax) with a VAT, I would gladly do it.