Budget and Deficit
Further proof the sequester didn't harm the economy
The Next Battle
Okay, so the good guys lost this battle. On to the next one.
With “this battle,” of course, I’m referring to the government shutdown over . . . what was it over again? Defunding Obamacare? Delaying the individual mandate? It seems like it was over three or four things before it was . . . over.
Look, you don’t win every battle. This one, we lost. We tried to take a hill, and we failed. You pick yourself up, you address your wounds, you assimilate the lessons, and you move on.
Some argued that we should not have charged this hill—that we knew there was little to no chance of success, and that we should not lead our troops into a battle without at least a decent chance of winning. Others argued that the fight was a noble one, the cause a just one, and that it should be taken on regardless of the chances of success, which turned out to be a kamikaze strategy. Regardless, it was a debate over strategy and tactics, not principle. A tactic or two was tried, they failed, and now we hopefully learn from it and move on without shooting too many of our own in the process. Because they’ll be needed for the next battle. Read More >>
So Which Country Is in a Place to Laugh at the U.S. Shutdown?
The latest “wisdom” about the government shutdown is that the impasse is making the U.S. a laughing stock around the world. If there is any country laughing at the U.S., it’s either a hypocrite or it hasn’t looked at its own financial situation—or that of many other countries. Read More >>
The Cost of the Financial Crisis
The Dallas Fed put out a very interesting paper (PDF) in July in which they try to quantify the damage done by the 2007-09 financial crisis. Don’t go looking to this paper to find anything about the “cause” or “roots” of the crisis, or how to get out of it, or whether the right policies were followed, etc. No, they’re just trying to quantify the costs to the economy, which is valid and interesting in itself.
They come up with some astonishingly large numbers. Without going into enormous detail here (you can read the paper yourself if you have an appetite for enormous detail), they find that the cost of the financial crisis is at least 40-90% of a full year’s (2007) economic output for the United States. I say “at least” because, after they have figured in a few other factors they believe are valid, they conclude that “what the U.S. gave up as a result of the crisis is likely greater than the value of one year’s output.”
That’s between $6 trillion and $14 trillion lost, or the equivalent of $50,000 to $120,000 for every U.S. household. Now it seems big. Read More >>
Sequestration cuts deny Silicon Valley a patent office
Associated Press reporter Martha Mendoza writes how a promised satellite patent office for tech giant Silicon Valley—the top region in the world producing patents—is being denied thanks to sequestration cuts, despite the fact that patent offices are funded through patent fees, not taxpayer dollars. Read More >>
Told you so! (on the sequester)
So IPI went out on a limb on the sequester. We wrote a paper praising the sequester and explaining that the sequester represented the mildest down payment on the kind of spending restraint that is necessary if we have any hope of setting our fiscal house in order. We created charts to explain just how small the sequester restraints were. We blogged and gave speeches and did TV and went on the radio to sell the sequester. We got coverage in print media. We did our part--we more than did our part.
And we were right.
The $150 billion budget decline of 4% is the first time federal expenditures have fallen for two consecutive years since the end of the Korean War. Read More >>
How President Obama's 2013 Budget Affects Intellectual Property
We’re not fans of the Obama 2013 budget, as you can probably guess. And it’s going nowhere, thankfully. But it’s instructive to see the impact of the Obama administration’s budget vision as to how it would affect the creative and innovative industries.
On the Positive Side
There’s not much.
- The Intellectual Property Owners Association reports that the budget will allow USPTO to keep all of its user fees. We agree with this, and we’ve written about the problem of fee diversion in the past. This is actually an area where we found ourselves disagreeing with our usual ally, Rep. Paul Ryan.
- Additional funding for cybersecurity should, if successful, help reduce the threat of theft of intellectual property from American companies by overseas IP predators, most notably China. Some government agency estimates suggest that U.S. companies have lost more than $400 billion in intellectual property theft to cyberespionage. < Read More >>
Two Charts On the Sequester
Here are a couple of charts that hopefully will provide some perspective on the relative insignificance of the sequester cuts. First chart shows total federal spending for the next ten years. The blue bars are how much the federal government will continue to spend, and how much spending will continue to grow, even with the sequester cuts. All the other colors represent the sequester cuts. They're hard to see because they are INSIGNIFICANT. Read More >>
Can You Find the Savage Sequester Cuts?
Two charts related to spending cuts
I was honored to be the speaker tonight for the Flower Mound Area Republican Club's January meeting. The major topic was that it's relatively easy to balance the budget simply by getting spending modestly under control.
I had prepared two PowerPoint slides to help illustrate the points, but due to a miscommunication I wasn't able to slow the slides. So here they are. Read More >>
Jon Stewart ridicules Krugman's magic coin
Good for Jon Stewart to see the insanity in Paul Krugman's $1 trillion magic coin idea.
As we've written, the idea is terrible economics and terrible politics, but that's par for the course with Krugman.
Can't you just picture a scene in the movie "Idiocracy" where President Camacho fires his automatic rifle into the sky and announces "I have a new plan that's going to fix everything! We're going to mint up some $1 trillion coins and that's going to fix EVERYTHING!" Read More >>
Why Obama is Pushing Republicans Over the Fiscal Cliff
Ever since passage of the Budget Control Act of 2011, most people have assumed that, eventually, some sort of deal would get done. Both sides have something to lose, the thinking went, so both sides will eventually compromise to spare the country from going over the fiscal cliff.
And everyone also assumed that, while the outcome of the election would tilt the balance of power, still both sides had something to lose, so a deal would get done.
And that makes sense, if you assume both sides have something to lose.
But what if, even before the election, one side thought it did NOT have much to lose? What if, in fact, one side thought it had almost nothing to lose and much to gain, and the outcome of the election simply confirmed this calculation? What then? Read More >>
Those tax increases for spending cuts Jeb Bush advocates? His dad says it was a mistake
The Hollande disaster begins
You get what you elect, whether you're New York City electing a nanny and a scold for a mayor, or whether you're France, electing a Socialist instead of making necessary reforms to an already bloated government sector that promises greater benefits than the productive sector can possibly subsidize.
So the Hollande disaster is beginning for France. Today, Hollande decreed that they would LOWER the retirement age, from 62 down to 60.
“We committed to put this measure in place quickly for social justice for those who started working early,” said Social Affairs Minister Marisol Touraine.
The reforms will cost the state billions of euros a year but can be afforded through higher worker and employer contributions, according to the government.
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