Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
Reality Versus Rhetoric in Conservative "Anti-Government" Philosophy (Washington Monthly) It is generally accepted that a major difference between Republicans and Democrats is their views about the size of the public sector. But ironically enough, data show that the states that tend to vote Republican in presidential elections are also the ones that tend to benefit most from federal spending. Bigger, richer states on the coasts and in the upper Mid-West have been subsidizing smaller, poorer states with lower state GDP per person in the South, South-West, and Mountain regions for decades by paying more in federal taxes than the amount of benefits they receive in return. In 2012, the 15 biggest "giver" states had 42% of the population, GDP per person of $53,700 (in 2009 dollars), and accounted for 46.9% of the country's overall GDP. In contrast, the 15 states that received the greatest share of benefits from the federal government relative to what they paid in had 13.3% of the population, GDP per person of $42,800, and accounted for just 11.9% of the country's GDP. For state-by-state data see Federal Taxes Paid vs. Federal Spending Received by State, 1981-2005 (Tax Foundation).
Econintersect: It is hard to rationalize the political behavior here. Is it simple ignorance among politicians and those who elect them? We doubt that. Is it false flag hypocrisy to deflect attention from the flow of funds? That also is not an easy case to defend. Perhaps it is some combination of ignorance and deliberate manipulation laced with a fervent ideological belief that, if things were to change, the dependency status of the "taker" states could be diminished? At this point that is the least cynical possibility we can come up with. The data, though is quite clear: In 2012 68% of the states that voted for Obama were "givers" while 96% of the states for Romney were "takers".
Productivity in the UK vs the US - can we play catch up again? (Bank Underground) Productivity growth in the UK has been puzzlingly weak in recent years. By contrast, US productivity growth has been relatively robust at higher levels. There is a macroeconomic literature, however, that suggests that countries with lower levels of productivity should grow more quickly than high productivity countries. I argue that there is evidence of the UK catching up with the US in the past, but this relationship appears to have broken down after the financial crisis. If the past relationship between US and UK productivity returns, the prospects for UK productivity could be bright.
London Mansion Prices Fall 11.5% as Home `Bubble' May Have Burst (Bloomberg) London's most expensive homes and apartments have slumped in value as the government's stamp duty sales tax damps demand. Prices of homes valued at 5 million pounds ($7.6 million) or more fell 11.5% on a per square foot basis in the third quarter from a year earlier
120 dead in Paris attacks, worst since WWII (Associated Press) A series of attacks targeting young concert-goers, soccer fans and Parisians enjoying a Friday night out at popular nightspots killed at least 120 people in the deadliest violence to strike France since World War II. President Francois Hollande condemned it as terrorism and pledged that France would stand firm against its foes. The worst carnage was at a concert hall hosting an American rock band, where scores of people were held hostage and attackers ended the standoff by detonating explosive belts. Police who stormed the building encountered a bloody scene of horror inside. Paris Prosecutor Francois Molins said as many as five attackers were killed, though it was not clear how many there were altogether and how many, if any, were still at large. Other officials said seven attackers had been killed and that police were searching for other possible accomplices. Authorities said the death toll could exceed 120 for at least six sites, including the national stadium and a tight circle of popular nightspots. For what the ongoing consequences of these attacks might be see What To Expect After The November 13 Paris Attacks (Stratfor, GEI Opinion).
The Latest: Merkel still not prepared to set refugee limit (Associated Press) Chancellor Angela Merkel is making clear that she still isn't prepared to name an upper limit to the number of refugees who can come to Germany, even as domestic political pressure to reduce the migrant flow mounts. Merkel told ZDF television Friday that the only way to reduce the number of refugees who arrive is tackling the reasons why people are fleeing to Europe, "and they are outside Germany."
Half of Russia's Richest People Are Planning to Cash Out (Bloomberg) It's been a quarter century since the fall of the Soviet empire triggered one of history's greatest wealth transfers. Now bankers are preparing for another as Russia's first generation of capitalists makes way for the next. Confidential surveys of dozens of millionaires and billionaires conducted since European and U.S. economic sanctions began last year show Russia's wealthy are finding little support within the country's legal framework to pass down businesses. A majority say they're taking the issue of succession seriously for the first time.
I.M.F. Officials Back Inclusion of Renminbi in Fund's Currency (The New York Times) International Monetary Fund (IMF) staff members recommended Friday that China's renminbi be included in the fund's benchmark basket of currencies, a big step forward for the country's long campaign to turn its currency into one of the pillars of international finance. Christine Lagarde, the managing director of the I.M.F., said that the fund's executive board would decide on Nov. 30 whether to add the renminbi to the fund's unit of accounting, which would clear the way for central banks to hold more of it in their reserves.
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