American Action Forum (AAF) research finds that the labor market costs of raising the minimum wage far outweigh any budgetary benefits. Some argue that increasing the federal minimum wage would be an effective way to reduce dependence on federal government safety net programs such as the Earned Income Tax Credit (EITC) or Temporary Assistance for Needy Families (TANF). The evidence suggests, however, that the fiscal savings are minimal when compared to the labor market consequences. While other research finds that raising the minimum wage to $10.10 per hour would reduce safety net spending by $7.6 billion, AAF finds that it would also reduce job creation by 2.2 million jobs per year. For those who are unable to find work, this means a loss of $19.8 billion in earnings per year.
The Wall Street Journal featured an optimistic view of the outlook for consumer spending during the holidays. Recent data from the Bureau of Economic Analysis shows that the personal saving rate has held steady at roughly five percent during 2014, in contrast to a previously-reported rise to as high as 5.6 percent earlier in the year. The steady saving rate, the argument goes, combined with lower unemployment and faster — though still tepid — wage increases portends a financially healthy household sector that will open its pocketbook during the crucial end-of-the-year sales season.
The New York Times was out with its review of the ACA to date yesterday. I think a fair reading of the article suggests that we, the readers, are supposed to answer: “On balance, yes.” I’m not so sure.
Among the numerous putative causes of last week’s equity market convulsions is the potential for European deflation. Deflation is the persistent widespread decline in prices (as opposed to a drop in the price of a particular product or service).
Equity markets swooned yesterday, with the bellwether Dow dropping at the open, quickly losing over 300 points, bottoming out 460 points down, and ultimately recovering to close “only” 173 points down. This raises the natural question: why?
During a speech at Northwestern University, President Obama offered a stale laundry list of policy proposals enacted or sought during his administration.
Speaker of the House John Boehner laid out his agenda for restoring the U.S. economy to greatness.
The Federal Open Market Committee (FOMC) — the policymaking arm of the Federal Reserve — wound up a two-day meeting yesterday.
As the end of August recess quickly approaches, all eyes turn to the loaded September agenda. Included on the to-do list is the reauthorization of America’s official export credit agency (ECA), the Export-Import Bank. This year its renewal has attracted outsized political attention in comparison to the limited, albeit important, role the agency plays in helping American companies export their goods and services.
In a speech in Austin, Texas last month, President Obama said, “You know, it is lonely, me just doing stuff. I'd love it if the Republicans did stuff too.” But on the border crisis, House Republicans are the lonely ones.