Written by Econintersect
Early Bird Headlines 06 May 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.
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Global
U.S. Productivity May Be Hiding Overseas (The Washington Post) Companies’ shifting of profits overseas to avoid U.S. taxes may have artificially lowered U.S. productivity statistics.
U.S.
Betrayal, carelessness, hypocrisy: The GOP health-care bill has it all (The Washington Post) Econintersect: (Paraphrasing a facetious question imagined for Mrs. Lincoln after the president was shot in Ford’s Theater) Other than that, WaPo, how did you like the bill?
Senate ACA Replacers May Tap Medicare Surtax and Net Investment Tax (ThinkAdvisor) With the Senate now having jurisdiction over efforts to change and de-fund the Affordable Care Act, what will happen to the ACA Medicare surtax and the ACA net investment tax?
Sen. Lamar Alexander, R-Tenn., and the other Republican Senate leaders could use part or all of the revenue from the two taxes to pay for other ACA changes. Negotiators could use the revenue to reduce the effect of ACA changes on the federal budget deficit, or to soften ACA benefits cuts.
Members of the House passed their ACA change package, H.R. 1628, the American Health Care Act bill, by a 217-213 vote Thursday. Alexander, the chairman of the Senate Health, Education, Labor and Pensions Committee, said in a statement that he and colleagues are working on their own bill.
Where US Manufacturing Jobs Really Went (Project Syndicate) In the two decades from 1979 to 1999, the number of manufacturing jobs in the United States drifted downward, from 19 million to 17 million. But over the next decade, between 1999 and 2009, the number plummeted to 12 million. That more dramatic decline has given rise to the idea that the US economy suddenly stopped working – at least for blue-collar males – at the turn of the century. The author (Brad DeLong) blames the economic policy shifts of the late 1970s and 1980s fpr much of the drop:
Much of the decline … is attributable to dysfunctional macroeconomic policies, which, since Ronald Reagan’s presidency, have turned the US into a savings-deficit country, rather than a savings-surplus country.
Self-Sabotage: What Are US Oil Producers Thinking? (Wolf Street) Wolf Richter wonders what idiocy prompts U.S. oil producers to increase production in the face of falling prices.
EU
Euro Net Shorts Collapse (Twitter)
UK
The EU’s Brexit Position: What You Missed While May Fought Back (Bloomberg) Five hours before Theresa May accused European Union officials of interfering with the upcoming U.K. election, the EU produced its most detailed Brexit negotiating plans yet. Overtaken by Wednesday’s events in London, EU chief Brexit negotiator Michel Barnier’s provisional mandate nevertheless spells out the bloc’s red lines as the clock ticks down to the formal launch of talks soon after the British head to the polls on June 8. Here are the key points:
Financial settlement is not yet determined
A deal on citizens’ rights isn’t going to be easy
Separation from European courts may not happen
Future trade agreements are not on the table at this stage
It is mutually agreed that a transition is necessary
Some EU niclear waste will become UK nuclear waste
France
Obama backs Macron in last-minute intervention in French election (The Guardian) Barack Obama has made a last-minute intervention in the French presidential election in support of Emmanuel Macron, saying “the success of France matters to the entire world“. Macron, a centrist, faces Marine Le Pen of the far-right Front National in a runoff vote on Sunday. Polls put him 20 points ahead. The former US president said he had chosen to declare his support, in a video tweeted by Macron on Thursday afternoon, because of the importance of the election.
Emmanuel Macron’s campaign hacked on eve of French election (The Guardian) The campaign of the French presidential frontrunner, Emmanuel Macron, has said it has been the target of a “massive and coordinated” hacking attack after tens of thousands of internal emails and other documents were released online. Less than 48 hours before polling day, around nine gigabytes of data was posted by a user called EMLEAKS to the document-sharing site Pastebin that allows anonymous posting. It was not immediately clear who was responsible.
North Korea
North Korea accuses CIA of biochemical plot to kill Kim Jong-un (The Guardian) North Korea has accused the CIA of attempting to assassinate its leader, Kim Jong-un, using unspecified biochemical substances during a public ceremonial event in the capital, Pyongyang. The ministry of state security issued a statement claiming the US intelligence agency had bribed a North Korean citizen, named only as Kim, to carry out the plot.
China
China can deflate the world’s largest credit bubble in an orderly fashion (South China Morning Post) China’s authorities are committed to orchestrating an orderly unwind of US$3 trillion worth of excess credit and the resultant distressed debt on banks’ balance sheets by employing a multi-pronged, market-based approach. This commentary says there are three alternative paths:
A government bailout
Extend and pretend
Market based approach similar to the one used by the US in 2008 to 2010
