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Two things the Senate should ask President Obama's FHFA nominee, Representative Mel Watt . Ed Pinto: "The director of FHFA has immense power in the housing market. ... The Senate should focus on two key areas when considering Watt." Paulson's flawed plan to privatize Fannie and Freddie. Ed Pinto: "To do as the hedge-fund lobby suggests would merely once again privatize the gains, socialize the losses, and promote the crony capitalism." *In case you missed it -- AEI Event: Too big to tolerate? How to right-size America's banks More: Peter Wallison: Breaking up the big banks: Is anybody thinking?
*Must-see chart -- US fiscal balance as a percentage of GDP decreasing (2009-2018) As usual, Washington sabotaged itself. John Makin: "Congress and the president actually have managed to put US fiscal policy on a sustainable path. ... The bad news is that the economy may slow sharply enough to prevent any more agreements, such as on tax and entitlement reform." More: John Makin: "That's why I think we've done enough austerity for now." Bye-bye 4 percent GDP growth. Jim Pethokoukis: "In its recent budget proposal, Team Obama warned that in “the 21st century, real GDP growth in the United States is likely to be permanently slower." Higher inflation is only a matter of time. Adam Lerrick. "It's not a question of if inflation will creep into the U.S. economy, but a question of timing."
Europe's no good, very bad recession. Desmond Lachman: "Not only is the European economy sinking deeper into recession, the specter of deflation is raising its ugly head. Worst of all, the ECB has only one policy instrument to address the problem." Breakthrough: Big countries trust each other. Claude Barfield: "The real breakthrough here is that big economies--U.S., Japan, China, EU--are now negotiating with each other, breaking the older FTA model." Austerity backlash in Europe (Video). Desmond Lachman: "The Cypriot crisis is not playing out in isolation. Increases in unemployment are allowing a political backlash against austerity."
Online sales tax is anything but fair. Ben Zycher: “Because out-of-state sellers and their in-state customers demand fewer (or no) services from local governments ... it is appropriate that less tax be collected.” Opposing View: Online sales tax a good idea. Exposing the flaws of the foreign tax credit. Abby McCloskey: "On Monday, Alan Viard published a Tax Notes article on the foreign tax credit. For those of you who don’t have the bandwidth to read all 13 single-spaced pages, here’s the skinny..." Out with TurboTax? Jeff Eisenach: "Under so-called 'return-free' proposals, the government would prepare individuals' tax returns. ... We need to keep the government out of the tax-preparation business."
Outside the box
A new corporate responsibility. Tim Carney: "If the free market is worth protecting, conservatives must do a better job calling out corporations that participate in cronyism." Obamacare as Robin Hood. Stan Veuger: "The goal of these essential health benefits ... is to redistribute income from rich to poor." Why politicians don't curb government benefits. Sita Slavov: "A politician who tries to scale back public sector benefits will lose support from public sector voters (who are hurt by the benefit cut) without gaining much support from other voters ..."
Mark Your Calendar
5.03 Jobs numbers released 5.07 AEI Event: America's natural gas: Should exports be restricted? 5.07 AEI Hill Event: The impact of Dodd-Frank on community banks. New research will be presented. RSVP to firstname.lastname@example.org. 5.07 Consumer credit numbers released 5.09 AEI Event: Cronyism, competition, and finance: A discussion with Cliff Asness and AEI President Arthur Brooks 5.10 Treasury releases its monthly account of the government deficit
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