Archive for the ‘Economics’ Category
Three of the Republican tax plans would balloon the national debt — Ron Paul would just take us all back into the 19th Century
The U.S. national debt will swell further under tax-cut plans floated by three of the top four Republican presidential candidates, according to an independent analysis of their fiscal policy proposals released on Thursday.
Plans put forth by Newt Gingrich and Rick Santorum would pile up the largest increases in debt, while Mitt Romney’s initial plan, since revised with bigger proposed tax cuts, would increase it by a smaller amount over the next decade.
Only Ron Paul’s plan to drastically shrink government and cut taxes would produce a reduction in debt levels through 2021…He just destroys federal agencies.
Romney’s new tax plan, which matches the 28 percent top rate proposed by Santorum, promises to be revenue neutral, but does not offer any specifics on how to make up for lost revenues…
“Are they making proposals that risk making the debt problem worse?” said Alice Rivlin, a former head of the Congressional Budget Office and Federal Reserve vice chairman who now serves on the group’s board. “On that score, all of these candidates fail. They all reduce the revenue that is available to the government over time…”
The group said the middle path for Gingrich would add $7 trillion to the national debt by 2021 versus the baseline, largely because he has proposed deep tax cuts for individuals and corporations, including an alternative 15 percent “flat tax.”
This would boost debt as a share of the overall economy to 114 percent in 2021 from the current level of about 70 percent, compared with an anticipated 2021 baseline level of 85 percent.
The middle scenario for Santorum’s plan would add $4.5 trillion to the debt, also due to tax cuts…The debt-to-gross domestic product ratio would rise to 104 percent under Santorum’s plan…
The middle scenario for Paul was the only one to reduce debt below the baseline – by $2.2 trillion – largely due to spending cuts on healthcare programs and Social Security and elimination of five federal departments and many State Department programs. This would cut debt to 76 percent of GDP by 2021. And Ron Paul doesn’t need Social Security or healthcare or foreign policy to live in his accustomed style.
In other words – besides being liars – the Republican candidates don’t know diddly-squat about economics. And hope you never learn.
China’s Great Wall Motors opens first European plant
Carlos Sousa driving a Great Wall Haval to 7th overall in Dakar 2012
Great Wall Motor has become the first Chinese carmaker to open an assembly plant in Europe as it aims to lift sales in the region.
The factory, in the northern village of Bahovitsa in Bulgaria, will eventually produce 50,000 vehicles a year.
The facility was built together with Great Wall’s Bulgarian partner Litex Motors. It will manufacture Great Wall’s Hover SUV, Steed pick-up and Voleex city car models.
The plant will initially employ 150 workers capable of making 4,000 vehicles per year, rising to 2,000 employees when at full capacity in 2013.
“Great Wall’s plans to build a plant in Bulgaria and produce automobiles here are aimed at boosting our production capacity and exporting these automobiles for the European market,” company president and chief executive Feng Ying Wang said. “We estimate that in three to five years we will have a wide range of models made here and that these cars will be sold in all European countries.”
The sort of enterprise following on economic growth and market penetration by the Asian countries preceding China into Western markets. I expect this will continue with sensible entry and growth models – in Europe. It’s all part of sensible, interconnected globalising of economies. That doesn’t require ideology, prayer or xenophobia.
I think Cold War conservatism will continue to get in the way of similar job creation in the United States. A ship of fools.
For women under 30, most births have nothing to do with marriage
And baby makes two…
It used to be called illegitimacy. Now it is the new normal. After steadily rising for five decades, the share of children born to unmarried women has crossed a threshold: more than half of births to American women under 30 occur outside marriage.
Once largely limited to poor women and minorities, motherhood without marriage has settled deeply into middle America. The fastest growth in the last two decades has occurred among white women in their 20s who have some college education but no four-year degree, according to Child Trends, a Washington research group that analyzed government data.
Among mothers of all ages, a majority — 59 percent in 2009 — are married when they have children. But the surge of births outside marriage among younger women — nearly two-thirds of children in the United States are born to mothers under 30 — is both a symbol of the transforming family and a hint of coming generational change.
One group still largely resists the trend: college graduates, who overwhelmingly marry before having children. That is turning family structure into a new class divide, with the economic and social rewards of marriage increasingly reserved for people with the most education…
The forces rearranging the family are as diverse as globalization and the pill. Liberal analysts argue that shrinking paychecks have thinned the ranks of marriageable men, while conservatives often say that the sexual revolution reduced the incentive to wed and that safety net programs discourage marriage…
Which gives an idea how dim and out-of-date conservatives can be. Sad. Life really is more complex than black-and-white B movies.
Xi confident on Chinese economy – discounts Bears and book peddlers
Xi Jinping with Joe Biden, LA Mayor Antonio Villaraigosa
Daylife/Reuters Pictures used by permission
Chinese Vice President Xi Jinping said on Friday the Chinese economy would experience stable growth and avoid a hard landing this year, discounting a scenario economists fear may upset the global economy.
The Chinese leader-in-waiting, turning to courting American companies and governors hungry for a slice of his nation’s growth, told a business forum in Los Angeles that the world’s No. 2 economy will continue to push domestic demand while directing investment toward the United States.
Xi said “2012 will be a crucial year in driving the 12th five-year plan. China’s economy will maintain stable growth … there will be no so-called hard landing.”
“We will encourage more consumption, imports, and outward investment,” he told a business forum in Los Angeles on the final leg of his five-day U.S. visit, drawing light applause…
Xi is poised to become China’s next leader after a decade in which it has grown to become the world’s second-largest economy, while the United States has endured the deepest recession since the Great Depression of the 1930s…
Scores of executives from major U.S. and Chinese companies, from Intel to Microsoft, lined up to sign a plethora of deals after Xi’s address at the economic forum on Friday. Those included “Kung Fu Panda” studio Dreamworks Animation’s venture to make films from Shanghai, and Chinese telecoms giant Huawei’s pledge to award $6 billion of contracts over three years to Qualcomm, Broadcom and Avago.
The Chinese trade delegation this week also inked deals to buy a record 13.4 million tonnes of U.S. soybeans, valued at $6.7 billion. Before Los Angeles, Xi visited the heartland farm state of Iowa, where Chinese soybean buyers announced they would buy more than $4 billion in U.S. soybeans this year…
“China has become the United States’ fastest growing export market,” Xi told an audience of business executives and policymakers on Wednesday. “Speaking frankly, an important aspect of addressing the imbalance in Chinese-U.S. trade is the United States’ own economic policies and structural adjustment…”
“A prosperous and stable China will not be a threat to any country,” he said.
None of this differs especially from the analyses of most economists and analysts doing business on the global stage. Of all the information strolling across the electronic stage – all week – the majority reflects this theme.
Professional bears, trying to influence their short-selling egos try to counter reality. And a couple times a week some minstrel show mug will get five minutes interview time trying to sell the latest book on the imminent collapse of China. With or without a secret cabal of lizard people [and a wink to Eddy Elfenbein].
Appreciation in China’s currency unnoticed – especially by politicians
With little fanfare, China’s currency has appreciated significantly in the last year and a half, leading many economists to question whether the exchange rate is still the most important economic issue for the United States to press with China’s leaders.
The rise of the renminbi — up 12 percent since June 2010 on an inflation-adjusted basis and 40 percent since 2005 — has helped American companies by effectively reducing the cost of their products in China. In the last two years, American exports to China have risen sharply…
In his Oval Office meeting on Tuesday with Xi Jinping, China’s vice president and likely next leader, President Obama discussed the currency as one of the trade practices that concerned the United States. That meeting — and tough public comments by Vice President Joseph R. Biden Jr. — continued a three-year campaign by the administration to convince Chinese leaders that a stronger currency is in their interest…
Administration officials and members of Congress have chosen not to emphasize the appreciation publicly, partly to keep pressure on China. Widespread discussion of the change could reduce support in Congress for a bill that would impose sanctions on Chinese imports to the United States and that Beijing strongly opposes…Passing legislation based on a lie doesn’t upset Congress or the White House at all.
Italian government plans to tax commercial property belonging to the Catholic Church. Overdue.
Bed & Breakfast hotel run by a convent in Rome
Over the years, the Italian government has quietly passed scores of laws that benefit the Roman Catholic Church, but it is rare for it to issue a public statement announcing it intends to strip the church of privileges. The government of Prime Minister Mario Monti took that step on Wednesday, telling the European Commission that it intends to change Italian law to ensure the church pays property tax on the parts of its buildings used for commercial ends.
The church owns vast amounts of property in Italy, and the move is aimed at making sure that convents that offer bed and breakfast or church buildings that rent space to shops pay their full share of taxes.
The change — once it is formally drafted and approved by Parliament — could result in revenues of $650 million to $2.6 billion annually, according to municipal government associations. It could also set an example for other debt-strapped European countries — most notably Greece and Spain — where there is growing popular resentment over tax breaks for the church.
It would set an example for the United States – not only for Old World religions but the all-American bible belt crowd.
Even in Catholic Italy, the proposal shows the churchgoing Mr. Monti’s ability to read the national mood. Faced with their own belt-tightening and tax increases, Italians are increasingly fed up with what they see as unfair privileges — be it of the political class or the church. After new austerity measures were passed in December, 130,000 people signed an online petition calling on the government to revoke the church’s tax-exempt status…
Today, many church buildings fall into a gray area, taking advantage of a tax exemption for religious organization’s buildings even if they are largely commercial in use…
Overdue? It’s all overdue.
The only exemptions religions should have from taxation are those befitting non-profit charitable works. Period. End of discussion.
Take the time to discuss this with most folks and even the most thoroughly brainwashed True Believer will generally understand the sense of fairness that should discipline the funding of necessary government. It’s an all-in proposition. Certain work – like charity – might be exempt. Not individuals or organizations just by definition of their belief system.
As Xi Jinping visits, China’s appetite for American crops deserves a bit more than Cold War politics
John Weber on his farm in Dysart, Iowa
Daylife/Reuters Pictures used by permission
China is half a world away from the 2,300-acre family farm in east-central Iowa where John Weber and his son plant corn and soybeans. But 62-year-old Weber is among a number of Iowa farmers who are benefiting as rising incomes in China lead to demand for billions of dollars of American farm goods.
“There are huge opportunities,” said Weber, who in addition to his corn and soybean business, markets more than 14,000 hogs a year with a partner. “Absolutely huge.”
This week, a visit by Chinese Vice President Xi Jinping to the farm state will underscore the possibilities of the deepening agricultural trade relationship between China and the United States.
Xi, who is expected to replace Hu Jintao as Communist Party chief late this year and then become China’s new president in early 2013, will spend two days in Iowa after meeting President Barack Obama in Washington.
China last year bought $20 billion, or 14 percent, of record U.S. agricultural exports and it is now the largest buyer of U.S. soybeans, while becoming an increasingly important importer of U.S. corn and pork. The farm exports, up from $18.6 billion in 2010, now represent about one fifth of American sales of goods to China and U.S. officials are hoping for a lot more.
Beijing is not only buying food that will go directly to feed its 1.3 billion people but also for feedstuff that is going to the animals raised to meet increasing demand for meat and dairy produce that more Chinese can now afford…
RTFA if you feel you need to be reminded of all the crap reasons raised by xenophobes who would rather choose war over competitive commerce any year.
“There’s an App for that” = 500,000 jobs
It’s no secret that the rise of smartphones, tablets and social networking has fostered an entirely new market for app developers, but a freshly released study has now attempted to quantify this impact, in terms of real jobs.
According to TechNet, a bipartisan network of tech execs, the so-called “App Economy” has created an estimated 466,000 jobs since 2007, when the iPhone was first unveiled.
The report specifies that this estimate includes all jobs at Facebook-focused companies like Zynga, as well as dev gigs at Amazon, AT&T and Electronic Arts, in addition to the obvious heavyweights, Apple and Google.
As far as geography goes, California leads the way as the most app-friendly state, though New York City tops the list of metropolitan areas. It’s not an entirely bi-coastal affair, though, with some two-thirds of all app-related jobs located outside of California and New York.
TechNet acknowledges that the App Economy “is only four years old and extremely fluid,” so it’s likely that these numbers will fluctuate in the years to come, though the organization says these numbers underscore a fundamental principle: “Innovation creates jobs, and in this case, lots of them.”
You can read the full report at technet.org.
And don’t get your shorts bunched figuring the numbers are going to diminish or decline. When it comes to the predominance of the mobile web – you ain’t seen nuthin’ yet.
Brazil aids Cuba’s move into a market economy
Dilma Rousseff and Raul Castro
Daylife/Reuters Pictures used by permission
Brazil is easing Cuba into the free market economy with a generous package of aid in cash and kind and joint projects that give the Latin American country a pre-eminent position in Havana’s heady mix of communism and experimental capitalism.
Brazilian President Dilma Rousseff appeared to be in the right place at the right time when she flew into Havana in a spirit of revolutionary camaraderie and clinched deals that secured Brazil’s status as the senior partner in a long-term, multifaceted relationship…
Rousseff followed in the footsteps of populist former President Luiz Inacio Lula da Silva…The “excellent” ties secure Brazil an advantageous position in Cuba’s hugely porous economy, hungry for basic consumer goods, investment and modernization. Economic upgrading in all sectors and a phased end to Cuba’s international isolation offer lucrative opportunities for Brazil’s state and private sectors.
Brazil will invest $640 million in a $900 million modernization of the Mariel container port, west of Havana, led by the Brazilian firm Odebrecht.
Brazil is also giving Cuba $400 million in credits for food imports and investing $200 million in modernizing Cuban agriculture. Rousseff pledged Cuba a long-term commitment to help its economic regeneration…
Brazilian interest in the modernization of Cuban sugar industry is linked to Brazilian plans to promote its pioneering production of cane-derived ethanol, which has led to most new cars in Brazil being fitted with flex-fuel technology to run on ethanol or gasoline or a mixture of both.
The port modernization program also fits in with Brazil’s plan to forge fruitful partnerships that will benefit its aim of making its exports of both commodities and manufactured goods more competitive in the international markets.
Cubans say they need the Mariel port to be ready for expanded trade with the United States, whenever the U.S. embargo is lifted. The embargo, begun in 1960, is the longest on record.
Bravo!
Now, which will provide long-lasting trade and commercial relationships? Efforts like this from Brazil or the usual capitulation to Gusano voters in Florida by Congressional politicians?
How coffee changed America
Always good for what ails you.
Click twice on the graphic to seriously enlarge
