Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.
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Articles about events, conflicts and disease around the world
Greenland Is Melting Away (The New York Times) Stunning photography, videography and satellite images document rapid changes on the world's largest island.
Fed's Updated Model of Economy Suggests It's Time to Raise Rates (Bloomberg) The Federal Reserve Board released an updated version of its large-scale model on the U.S. economy that may hold clues into why policy makers pivoted at their meeting earlier this week toward a December interest-rate increase. The revised inputs and calculations on Friday suggest the economy will use up resource slack by the first quarter of 2016, according to an analysis by Barclays Plc, and that also indicates Fed staff lowered their near-term estimate for how fast the economy can grow without producing inflation -- a concept known as potential growth. See also Janet Yellen just got some pretty bad news (CNBC).
Wage growth lags despite falling unemployment rate (Al Jazeera) Despite some encouraging recent job numbers — unemployment is falling, and an average of 198,000 jobs per month were added to payrolls over the last year — wage growth in the United States is still sluggish, according to experts analyzing Labor Department statistics released Friday. The September 2015 Employment Cost Index shows labor costs — meaning the total cost to employers of wages, salaries and benefits — rose 2% over the past 12 months.
DB plan sponsors face higher PBGC premiums with budget bill (Employee Benefit News) The Bipartisan Budget Act of 2015, passed Wednesday by the House of Representatives, is causing concern in retirement circles after a pension provision was added that raises the amount of money employers must pay to the Pension Benefit Guaranty Corp. for pension insurance. A statement from James Klein, president of the American Benefits Council:
“For the third time in four years, Congress has hiked pension premiums to pay for unrelated spending priorities, without regard for what it means to employers, workers and retirees. Raising premiums every time Congress needs several billion dollars must stop, and stop now.”
Immigrants caught at border believe families can stay in US (Associated Press) Nearly a year after the Obama administration launched a massive public relations campaign to dispel rumors of a free pass for immigrant families crossing the border illegally, internal intelligence files from the Homeland Security Department suggest that effort is failing. Hundreds of immigrant families caught illegally crossing the Mexican border between July and September told U.S. immigration agents they made the dangerous trip in part because they believed they would be permitted to stay in the United States and collect public benefits.
Syria Talks Make a Mark at the Start by Bringing Rivals Together (Bloomberg) Diplomats meeting in Vienna to discuss ways to end Syria’s civil war agreed that the country must remain unified and independent, but remained at odds over whether President Bashar al-Assad or his opponents should lead a political transition. Russia, Iran, Saudia Arabia, Turkey and the U.S. are lead participants in this conference with a number of other countries also represented.
FDA Says Chinese Pfizer Plant Hid Failures, Used Old Ingredients (Bloomberg) A Pfizer Inc. plant in China that was being inspected by Food and Drug Administration regulators in order to ship drugs to the U.S. kept a second set of quality and manufacturing records that didn’t match official ones, according to an FDA review of the facility. During an April inspection of Pfizer’s plant in the northern Chinese city of Dalian, FDA inspectors said in their report that employees hid quality failures, used expired manufacturing materials or ones that hadn’t been recently checked, and retested failing products until they passed.
European Union sides with United States on South China Sea incident (Reuters) The European Union sided with Washington on Friday over a U.S.-Chinese patrolling incident in the South China Sea, in a move that may affect Brussels' discussions with Beijing at next week's Asia-Europe Meeting (ASEM) of foreign affairs ministers. On Tuesday, a U.S. warship sailed within 12 nautical miles of one of Beijing's man-made islands in the contested Spratly archipelago, triggering a sharp reaction from China.
Other Economics and Business Items of Note and Miscellanea
Bernie Sanders’ economics boils down to a vast conspiracy theory (New York Post) Bernie Sanders is the most prominent conspiracy theorist in America. He runs around the country alleging that the economy is “rigged” by what he calls “the billionaire class.” Sanders doesn’t mean this metaphorically. He’s dead serious. As he put it in his speech at Liberty University a couple of months ago, our economy is
“designed by the wealthiest people in this country to benefit the wealthiest people in this country at the expense of everybody else.”
A Truer Form of Capitalism (Democracy Journal) The left has increasingly criticized the advancemnt of crony capitalism, bu perhaps the most extensive argument against rentier capitalism has come from the right. In his 2012 book, A Capitalism for the People, University of Chicago economist Luigi Zingales makes the attention-grabbing argument that the United States is increasingly becoming like his native Italy, where success isn’t based on what you know but who you know. See Crony Capitalism: Unhealthy Relations Between Business and Government ( Committee for Economic Development of The Conference Board). And noted conservative Charles Koch has written Corporate Cronyism Harms America (The Wall Street Journal). This essay argues that without removal of the stranglehold of a rentier elite and the reemergence of a producing middle class "there are a billion middle-class Chinese, Indians, Brazilians, and others who will only be too glad to take over America’s lead".
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