We were warned.
We were warned.
The Federal Housing Administration is heading toward a taxpayer bailout, yet the president’s latest mortgage modification plan would further increase the agency’s exposure to risky mortgages.
Moody’s has announced that it will change its methods for rating debt issued by state and local governments. Politicians have argued that its current ratings ignore the historically low default rate of municipal bonds, resulting in higher interest rates being paid on muni debt, or so argue the politicians.
This morning the Obama Administration officially released its proposal for reauthorizing the Elementary and Secondary Education Act (aka, No Child Left Behind). The proposal is a mixed bag, and still one with a gaping hole in the bottom.
1. Additional federal spending transfers resources from the more productive private sector to the less productive public sector of the economy. The bulk of federal spending goes toward subsidies and benefit payments, which generally do not enhance economic productivity. With lower productivity, average American incomes will fall.
Fiscal crises have a predictable pattern.
Step 1 occurs when the economy is prospering and tax revenues are growing faster than forecast.
Step 2 is when politicians use the additional money to increase government spending.
As part of his ill-considered credentialing-to-compete initiative, President Obama wants to greatly increase both the size and availablity of Pell Grants. Under his proposed FY 2011 budget, the total pot of Pell aid would rise from $28.2 billion in 2009 to $34.8 billion in 2011; the maximum award would go from $5,350 to $5,710; and the number of students served would rise by around 1 million.
During his SOTU address last week, the president declared it a national goal to double our exports over the next five years. As my colleague Dan Griswold argues (a point that is echoed by others in this NYT article), such growth is probably unrealistic. But with incomes rising in China, India and throughout the developing world, and with huge amounts of savings accumulated in Asia, strong U.S.
Cato experts put some of President Obama’s core State of the Union claims to the test. Here’s what they found.
Yesterday’s bombshell announcement that Google is prepared to pull out of China rather than continuing to cooperate with government Web censorship was precipitated by a series of attacks on Google servers seeking information about the accoun