12:00 AM, Sep 7, 2013 • By IRWIN M. STELZER
It’s not that anyone here in Washington begrudges Britain, and to some extent Spain, their fledgling recoveries. But President Obama and other proponents of more government spending aren’t delighted that those nations’ austerity programs seem to be paying off in renewed growth rather than in the perpetual recession the Keynesian try-another-stimulus-crowd in the White House has been predicting. Conservatives are saying that the austerity sauce for the British roast beef would be just as tasty on the U.S. hot dog.
On Monday the House and Senate reconvene, with Syria dominating the agenda. But key components of economic policy will also have to be addressed this month: funding the government’s operations; defunding the unpopular Obamacare health care “reform”—or not; raising the debt ceiling—or not; approving another Obama stimulus program—or not. For good measure Obama will be sending his choice of Ben Bernanke’s successor as chairman of the Federal Reserve board to the Senate for confirmation. So in the next 30-60 days most congressmen might have to take time from fundraising, photo ops, and posturing before television cameras to earn their salaries.
These debates between the president’s team and conservative Republicans, between those who want to launch a new stimulus program and those who want to keep the deficit declining relative to GDP, will play out against a background that includes a strengthening economy; a job market that remains less-than-satisfactory; a Federal Reserve Board that is considering whether to reduce its purchases of bonds and mortgages, to “taper” in the jargon of the trade; and a battle over the selection of chairman Ben Bernanke successor. Consider those in turn.
The Economy: The U.S. economy continues to grow at a “modest to moderate pace” concludes the latest Fed survey of the economy. Most of the bank’s 12 districts report rises in consumer spending, with autos and housing-related goods leading the way. Auto sales in August were up by 17 percent, with Ford reporting its best sales month in seven years, and Chrysler and GM racking up record sales for several of their brands. Ford is doing so well that rumors—denied at the company—have surfaced that its highly regarded CEO, Alan Mulally might be looking for a new challenge just when Microsoft is looking for a new chief executive. And the auto industry is doing so well that supplies of new vehicles are tight, allowing it to cut back on special deals and discounts, and prompting auto makers to expand capacity, by about 7 percent in the case of Ford.
The housing sector continues to show strength, with sales and prices of homes and of the stuff with which to furnish them showing no sign of slowing significantly—I am ignoring short-term blips—in response to higher mortgage rates. Several retailers responding to my questions whenever I pop into their establishments around the country tell me that August was their best month ever, and experts in the field say that the outlook for Christmas sales is better than fair, with the exception of shops specializing in teen apparel. It seems that in the battle for dollars between parents who want new couches and carpets, and teens lusting after still another trendy jacket, the grown-ups are winning.
Add that the service sector grew in August at the fastest rate in almost eight years, and I am unworried about losing my bet with several colleagues—if the economy is not growing at an annual rate of 3 percent by year-end, I am to host a rather lavish dinner. My guess is that Societe General economists Aneta Markowska and Mary Beth Fisher have it right, “The U.S. economy will break above trend growth” beginning in the second half of the year. But it is less clear just how this growth will affect the labour market.
It’s policy that counts, not personalities. Aug 12, 2013, Vol. 18, No. 45 • By JUDY SHELTON
At first, it was fun—this parlor game of guessing who the Obama administration will appoint as the next chairman of the Federal Reserve. We all assumed it would be Janet Yellen, because she’s a woman. And then suddenly we had Larry Summers all over the leading financial newspapers receiving multiple endorsements from respected economists. There were sly references to his intellectual prowess and invaluable experience, not to mention (but they always did) his connections with Obama’s closest advisers on economic and financial matters.
No, no, and no.12:31 PM, Jul 31, 2013 • By ETHAN EPSTEIN
Have you heard the news? Janet Yellen is positively clairvoyant!
Yellen, vice chairman of the Federal Reserve and, evidently, a front-runner to replace Ben Bernanke as chairman in several months, “was one of the first members of the Federal Open Market Committee . . . to realize that the [housing market’s troubles] could cause a major recession.” (Alan Blinder, Wall Street Journal, July 29.)
11:31 AM, Nov 5, 2012 • By GEOFFREY NORMAN
Larry Summers, President Obama's director of the National Economic Council, on Monday said it was "ridiculous" for Republicans to point out the 7.9 percent unemployment rate announced last Friday was higher than when the president assumed office.
1:02 PM, Mar 23, 2012 • By ELLIOTT ABRAMS
Today’s nomination of Dartmouth president Jim Yong Kim to be president of the World Bank was a narrow escape. There was a chance that President Obama might select a really qualified person: Lawrence Summers, who was often viewed as the lead candidate. But he was obviously unfit: He is a former secretary of the Treasury Department and an award-winning economist. Thus he was of course disqualified.
8:38 AM, Sep 27, 2011 • By MARK HEMINGWAY
Despite the repeated attempts to wish away the Solyndra scandal, it appears to be getting bigger. Today, the Los Angeles Times informs us key White House personnel raised concerns the Department of Energy loan program that gave Solyndra $535 million was poorly conceived and managed long before the solar panel manufacturer's bankruptcy:
3:09 PM, Mar 16, 2011 • By FRED BARNES
Larry Summers, the just-departed White House economic adviser, says today’s credit crunch has a new culprit. “In the early days of the crisis, there was clearly a problem with lenders being unable to lend even to creditworthy borrowers,” he says in an interview in The International Economy magazine. But no more.
Economic uncertainty hurts.12:00 AM, Sep 25, 2010 • By IRWIN M. STELZER
It’s the policies, stupid. That should be the guiding light for everyone trying to figure out the course of the U.S. economy for the rest of the year.
Summers and Geithner leaving?10:34 PM, Sep 20, 2010 • By WILLIAM KRISTOL
At Monday's town hall in Washington, President Obama was asked whether his top economic adviser, Larry Summers, and his Treasury secretary, Tim Geithner, would be staying through the end of this term. Obama's answer makes one think the answer is no:
Is Nancy Pelosi insulted?1:56 PM, Jul 8, 2010 • By PEYTON R. MILLER
In a press conference late last week, Speaker Nancy Pelosi addressed legislation before the House to extend unemployment benefits until November 30. Asked if the extension would serve as a "disincentive for people to look for work," Pelosi dismissed the argument as a “misrepresentation of the motivation for people to be on unemployment insurance” and an “insult to the working people of our country.”
First a Coaster, then a falconer/central banker.Mar 22, 2010, Vol. 15, No. 26 • By JOE QUEENAN
Ever since I read George Plimpton’s Paper Lion in high school, I’ve been a huge fan of “stunt journalism.” This is the type of feisty reportage where a writer tries out for a professional football team, or takes a crack at conducting a symphony orchestra, and then writes a lighthearted article about his experiences.
Did the blizzard affect unemployment?4:58 PM, Mar 4, 2010 • By MATTHEW CONTINETTI
A new jobs report comes out tomorrow morning. The White House is already trying to spin the numbers. Economic adviser Larry Summers says the employment situation may have worsened in February because of the weather. Hudson Institute economist Diana Furchtgott-Roth says that's baloney:
On March 5, we might find that jobs were lost and the unemployment rate rose in February. But that will be because of the continued uncertain direction of economic policy—including the possibility of tax increases, high deficits, environmental regulation, and expensive healthcare reform—and not because of the weather.
Whatever the February report shows, though, there is also some good economic news.
And criticism of the president's budget mounts.5:26 PM, Feb 2, 2010 • By MATTHEW CONTINETTI
How serious a document is the president's budget proposal? The establishment media do not seem to like it. The budget's long-term projections are enough to drive you to drink. No political faction is satisfied with the administration's proposals. Liberals do not like the freeze on their favorite part of the budget; conservatives do not like the budget's tax hikes and massive deficits. Even the White House has reason to be disappointed. According to its own budget, unemployment will be at 7.9 percent when Obama stands for reelection in 2012. Only a huge, unanticipated economic boom will produce enough tax revenues to delay the fiscal reckoning and improve Obama's political standing.
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