Written by Econintersect
Early Bird Headlines 27 March 2017
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.
Global
Asian markets drop, led by Tokyo, as dollar weakens following Trump health-care failure (CNBC) Asia markets were mostly lower amid rising doubts over U.S. President Donald Trump’s ability to pass legislative reforms after Republican leaders pulled a bill to overhaul the U.S. health care system. The dollar weakened from a high of 100.00 seen last Friday to around 99.295 against a basket of currencies, at a near two-month low. Spot gold, viewed as a safe-haven asset, was trading higher at $1,258.35 an ounce, at a multi-month high. Brent crude futures eased $0.22 cents, or 0.4%, from their last close to $50.58 per barrel by 0527 GMT. In the United States, West Texas Intermediate (WTI) crude futures were down $0.32 cents, or 0.7%, at $47.65 a barrel.
U.S.
Trump’s border-wall proposal faces many obstacles (Associated Press) The list of obstacles is short but substantial:
Money
Geography
Legal Challenges by Landowners
Trump taps Kushner to lead a SWAT team to fix government with business ideas (The Washington Post) President Trump plans to unveil a new White House office on Monday with sweeping authority to overhaul the federal bureaucracy and fulfill key campaign promises – such as reforming care for veterans and fighting opioid addiction – by harvesting ideas from the business world and, potentially, privatizing some government functions. The White House Office of American Innovation, to be led by Jared Kushner, the president’s son-in-law and senior adviser, will operate as its own nimble power center within the West Wing and will report directly to Trump. Viewed internally as a SWAT team of strategic consultants, the office will be staffed by former business executives and is designed to infuse fresh thinking into Washington, float above the daily political grind and create a lasting legacy for a president still searching for signature achievements. Econintersect: While personnel management practices and efficiency of organization structures can transfer well from business to the federal government, business objectives do not. Business has the core objective of making a profit and the government does not. In fact, if the federal government succeeds in making a profit, the private sector goes into recession unless the government profit is more than offset with a positive balance of payments (which includes trade balance). This basic fact is not understood by the citizenry, and even worse by the politicians they elect to national office.
Gov. Jerry Brown to Trump: ‘You Don’t Want to Mess with California’ (NBC News) California overwhelmingly voted against Trump, delivering the state to Hillary Clinton by 30 points in November, and the president hasn’t had the kindest words to say about the state since then – last month he called California “out of control“. Despite some recent threats from the president to try to use federal funding as a “weapon” against the state if it voted to become a sanctuary state, the Democratic Governor Jerry Brown ushered a tough rebuttal in an interview with NBC‘s “Meet The Press” this week from the nation’s capital. Brown noted that California was 12% of the national economy and “taking down” the state would take the country into recession.
Obamacare’s Not In A ‘Death Spiral’ (The Daily Beast) Republican leaders say they will table health care talks following the defeat of the House GOP to replace Obamacare. As House Speaker Paul Ryan put it, “Obamacare is the law of the land.” But some conservatives say that President Barack Obama’s signature piece of legislation can’t last much longer, regardless of whether Congress finds a legislative compromise. A death spiral occurs when shrinking enrollment leads to a deteriorating risk pool (or when healthy people leave the plan due to the cost). That leads to higher premiums for the people remaining in the insurance pools, which causes enrollment to shrink even further, continuing the cycle until the entire system fails.
The latest government figures show enrollment in the Affordable Care Act is slightly down from last year. Through Jan. 31, 2017, some 12.2 million people were signed up for coverage through a federal or state marketplace, which is a decrease of 500,000, or 4 percent, from the same point last year.
Experts noted that marketplace sign-ups were running in line with their 2016 pace as of the middle of January, which experts said might suggest the decline in sign-ups was somehow related to the Trump administration, not an impending death spiral.
For example, the Trump administration decided to at least partially halt marketing and outreach encouraging people to sign up for health coverage.
… premiums are increasing. But that isn’t affecting the cost for most consumers, due to built-in subsidies under the Affordable Care Act. The subsidies cap premium prices at a certain percentage of income for anyone below 400 percent of the federal poverty level (in 2016 that would be $47,520 for a single person).
Among the people who have signed up so far for 2017, 81 percent will receive a subsidy.
Data also shows no uptick in healthy people leaving the health insurance market.
The U.S. Centers for Medicare and Medicaid Services reports the share of people signing up for health care in the low-risk demographic – ages 18-34 – remains about the same in 2017 as it was in 2016, at 26 percent of enrollees.
Two months out of office, Barack Obama is having a post-presidency like no other (The Washington Post) This article recounts how the former president is staying involved in political issues and activities.
Republican quits House Freedom Caucus (The Hill) Rep. Ted Poe (R, TX) resigned Sunday from the House Freedom Caucus, indicating he did so because he wanted to vote for the Republican healthcare proposal the right-wing caucus so adamantly opposed.
U.S. Commercial & Industrial Lending Collapsing (Twitter) This situation last occurred in the second half of 2008 during the Great Financial Crisis.
EU
A Radical Proposal After Brexit: End the European Union and Begin Destructive Creation (Evonomics) The EU, which has been compared to the old empire of Charlemagne (see map below). And like that Carolingian entity, the author sees the EU, as organized, destined to collapse from imperial overreach driven by neoliberalism that has evolved political power to the elites. He suggests that the current EU should fall and be replaced by a political structure that may be smaller than the current 28 nation conglomerate.
Germany
Merkel’s conservative party wins regional elections in early test for general elections (Reuters) Chancellor Angela Merkel’s conservatives won a regional election in the western state of Saarland on Sunday, dealing a setback to their Social Democrat rivals and boosting her prospects of winning a fourth term in Germany’s Sept. 24 national election. Merkel’s Christian Democrats (CDU) strengthened their position as the largest party in the state despite expectations ahead of the vote that the Social Democrats (SPD) would be boosted by their new national leader, Martin Schulz. The CDU won 40.1% of the vote, up from 35.2% in the last election in Saarland in 2012, an exit poll for broadcaster ARD showed. The SPD slipped to 30.1%, down from 30.6%.
Trump handed £300B NATO ‘invoice’ to German chancellor: report (The Hill) President Trump gave German Chancellor Angela Merkel a staff-created bill for NATO defenses estimated at £300 billion ($375 billion), The Times of London reported on Sunday. Trump reportedly handed Merkel the invoice during her trip to Washington, D.C. earlier this month. A German minister told The Times.
“The concept behind putting out such demands is to intimidate the other side, but the chancellor took it calmly and will not respond to such provocations.”
Iraq
Rescue workers find 101 bodies in Mosul building destroyed in alleged U.S.-led strike (The Washington Post) Rescue workers said Sunday they had finished extracting more than 100 bodies from the ruins of a house in Mosul where the U.S.-led coalition is alleged to have carried out an airstrike.
The remains of 101 people had been recovered from the rubble by the end of the day, said Col. Safaa Saadi, a civil defense official on the scene. Families may have also removed “a few” bodies from the wrecked building themselves without registering them, he said.
The civil defense teams are still working to clear other houses in the decimated neighborhood, where residents say some families were wiped out during a heavy bombardment involving coalition airstrikes and artillery as Iraqi forces advanced.
The U.S.-led coalition has acknowledged that it carried out an airstrike against Islamic State fighters at the location corresponding to the allegations of civilian casualties, but it is still investigating the incident. The militants positioned snipers on rooftops and forced civilians to stay in the area as they battled advancing forces, residents said.
Russia
The future of Russian-US diplomatic relations (Russian Foreign Ministry) The following was said in a Russian Foreign Ministry briefing in Moscow 23 March 2017 (hat tip to @MollyMcKew):
