The Ticker Quick Views on Politics, Economics and Finance
John Podesta, one of the most influential policy advisers in the Democratic Party, has leveled a blistering attack on President Barack Obama for his refusal to provide the legal rationale for drone strikes. The criticism is sure to rattle the White House and congressional Democrats.
“In refusing to release to Congress the rules and justification governing a program that has conducted nearly 400 unmanned drone strikes and killed at least three Americans in the past four years, President Obama is ignoring the system of checks and balances that has governed our country from its earliest days,” Podesta writes in an op-ed in the Washington Post. “In keeping this information from the American people, he is undermining the nation’s ability to be a leader on the world stage and is acting in opposition to the democratic principles we hold most important.”READ MORE
With Pope Francis, we have someone completely new, if not completely different.
There are many firsts: Cardinal Jorge Mario Bergoglio, the former archbishop of Buenos Aires, is the first non-European in modern times to become the bishop of Rome, the first South American, the first Jesuit and the first to take the name Francis, after the sainted shepherd of the poor from Assisi.READ MORE
Prime Minister Viktor Orban of Hungary seems to have a predilection for periodic antics that leave his neighbors in the European Union slack-jawed -- and nervous.
His latest -- and most serious -- attention-getting stunt took the form of a vote in the Parliament this week that essentially does away with the separation of powers, a basic building block of democratic governance. Orban's nationalist Fidesz party, which holds a two-thirds majority in the legislature, pushed through changes to the constitution that chip away at fundamental checks and balances and further consolidate the prime minister's power.READ MORE
The idea that the largest global banks have become too unwieldy and threatening -- and that taxpayers should stop encouraging them with billions of dollars in subsidies -- is gaining traction in the political arena. Democrats and Republicans alike are beginning to recognize that paying banks to put the broader economy in danger is bad policy.
In a number of editorials and blog posts in recent weeks, Bloomberg View has sought to explain the too-big-to-fail issue. Some of the points we've addressed: how much of a subsidy the largest financial institutions receive, why the subsidy makes our economy more vulnerable to crises, and how requiring banks to have more equity could go a long way toward solving the problem.READ MORE
Remember when Wal-Mart Stores Inc. executives were bemoaning the fact that February sales represented the worst start to a month since God knows when, and all the Negative Nellies said, see, I told you so! I told you the economy was going to implode because the temporary payroll tax cut was reversed at the start of the year. I told you businesses would stop hiring because income tax rates went up for top earners. I told you (actually President Barack Obama did) the $42 billion of automatic spending cuts in fiscal 2013 were going to permeate every aspect of our lives and leave death and destruction in their wake?
Guess what? Wrong script. Companies added 236,000 people to the payroll in February, beating expectations. Retail sales rose 1.1 percent, a strong showing in the face of delayed income tax refunds this year. And so far, the cancellation of White House tours seems to be the biggest inconvenience from sequestration -- something the president could have avoided by sacrificing two hours of operating Air Force One.READ MORE
Matthew C. Klein
My colleagues Justin Wolfers and Betsey Stevenson provocatively argue that Representative Paul Ryan, the Republican Party's de facto spokesman on economic policy, is "an inflation nutter" because he is concerned that future budget deficits may lead to rapid price inflation.
Wolfers and Stevenson contrast Ryan's fears with the market's expectations of inflation, as expressed by the difference in yields between normal government bonds and inflation-indexed equivalents. This "breakeven" represents the average annualized inflation rate investors would be willing to tolerate to be indifferent between the two types of bonds.READ MORE
Mayors Against Illegal Guns, the pro-regulation group cofounded by Bloomberg LP founder Michael R. Bloomberg, is at it again. In addition to lobbying, the group has been systematically producing information, which is kryptonite to the National Rifle Association.
In a map released today, the mayors show that more than 98 percent of Americans live within 10 miles of a gun dealer. How can that be? Because there are 58,344 federally licensed gun dealers -- about four times the number of McDonald's -- in the U.S. That's right, it's easier find a Smith & Wesson than to locate a Big Mac.READ MORE
I'll be at home in Washington this weekend, but my mind will wander to New York's Madison Square Garden and memories of Patrick Ewing, "The Pearl," Yul Brynner, Rollie Massimino and Howard Cosell.
This is the final Big East basketball tournament, a casualty of the insatiable money chase in college athletics. The 30 previous matchups in the Garden produced some of the fabulous moments of the game.READ MORE
Think you can predict the next pope? Want to bet?
Voting for the next pope began yesterday when 115 cardinals went behind the locked doors of the Vatican's papal conclave. They'll vote twice in the morning and twice in the afternoon until they reach a two-thirds majority of 77 votes. While the world's 1.2 billion Catholics wait for the white smoke signal from the Sistine Chapel indicating His Holiness has been chosen, the Internet's gamblers are weighing the odds.READ MORE
The Conservative Political Action Conference starts tomorrow, and the gay conservative group GOProud won't be present, after being banned from co-sponsoring in 2012. But one group that will be a co-sponsor is the press watchdog group Accuracy in Media. Its president, Cliff Kincaid, has some opinions about how the conference should go: He wrote a column last week arguing that “CPAC should be sponsoring a panel on the dangers of the homosexual movement and why some of its members seem prone to violence, terror, and treason.”
Kincaid argues that the U.S. made a mistake by decriminalizing sodomy, as this allowed gays to organize in public. As a result, “Today, this monster wants to impose itself on our children in the schools and even the Boy Scouts of America.” He also argues that homosexuality and Marxism are closely linked, and that the case of Bradley Manning, the Army private who gave classified material to WikiLeaks, demonstrates that gays are predisposed toward treason.READ MORE
(CORRECTION: This post originally compared Paul Ryan's statements in today's Wall Street Journal with the numbers in his 2013 budget proposal. When compared with Ryan's budget proposal for 2014, which he released today, Ryan's assertions in the Journal are correct. Bloomberg View regrets the error.)
Writing in today's Wall Street Journal, Representative Paul Ryan says his budget plan would eliminate federal deficits by 2023. His proposal, he says, would reduce federal spending and balance the budget without raising taxes.
Matthew C. Klein
Last summer, Mario Draghi, the president of the European Central Bank, declared that he would do "whatever it takes" to preserve the euro. We may soon find out just how much his word is worth.
On the surface, things have gone well since Draghi's speech at the end of July. Sovereign borrowing costs in Italy and Spain have plunged across the curve. After fleeing for more than a year, depositors have started returning to Spain, albeit tepidly. The IBEX 35 Index has soared by 44 percent, and Italy's benchmark index, the FTSE MIB, has gained more than 30 percent.READ MORE
History keeps catching up with Ben Affleck and "Argo," his Oscar-winning film about the 1979 Iranian hostage crisis. New Zealand's Parliament passed a resolution today "expressing regret" that the film engaged in what Winston Peters, leader of the New Zealand First party and a former foreign minister, called a "gross misrepresentation" of the role his country's diplomats played in the crisis.
At one point in the film, a CIA agent describing the getaway by six U.S. hostages says, "the Brits turned them away, Kiwis turned them away. The Canadians took them in."READ MORE
The U.S. federal government doesn't actually need to balance its budget. Ever. Really. We could run a budget deficit every year for the next century. We'd be just fine.
How do we know? Well, for one thing, we've basically always done that. Between 1929 and 2013, the average federal budget deficit as a percentage of gross domestic product has been 3.1 percent. Over those 84 years, we've run 70 budget deficits and 14 budget surpluses.READ MORE
The Senate Banking Committee's confirmation hearing for Mary Jo White has concluded after less than two hours. The senators didn't ask her any tough questions, showing great deference without probing too deeply.
It seems clear that White's nomination to lead the Securities and Exchange Commission will sail through the Senate. In addition to White, the committee also heard today from Richard Cordray, who has been renominated to lead the Consumer Financial Protection Bureau. That meant less time for questions for White. Even Democratic Senator Elizabeth Warren of Massachusetts -- who has become a YouTube sensation for her recent grillings of banking and securities regulators -- threw only softballs.READ MORE
It’s been half a year since news broke that 125 Harvard University students were implicated in a cheating scandal and over a month since it was reported that more than half of them were told to withdraw from school for as much as a year. But the controversy in Cambridge, Massachusetts, shows few signs of abating. Now it’s administrators, not students, whose integrity is being questioned.
Yesterday, the university issued a statement confirming what the Boston Globe and the New York Times reported over the weekend: that Harvard administrators searched the e-mail accounts of 16 resident deans last fall, seeking to pinpoint who among them had leaked a confidential message from the administration about how to advise students being investigated in the scandal. According to the statement from deans Michael D. Smith and Evelynn M. Hammonds, the concerns stretched beyond the e-mail to the fact that detailed information from an Administrative Board meeting was shared with the Harvard Crimson newspaper. Resident deans were approached several times about these leaks, but nobody fessed up, prompting the administration to start snooping.READ MORE
The Securities and Exchange Commission accused the state of Illinois of securities fraud as part of a settlement disclosed today. The case is an SEC self-parody at its finest.
The SEC didn't sue any individuals, as if the so-called fraud occurred by itself. The state of Illinois neither admitted nor denied the agency's findings, meaning the allegations remain unproven. The only penalty was an SEC order prohibiting the state from engaging in the same sorts of infractions again -- like breaking the law was somehow permissible before. The SEC only rarely sues repeat offenders for violating such "obey-the-law" directives, so these have little if any practical meaning.READ MORE
The dead pigs started appearing on the riverbanks of Shanghai’s iconic Huangpu River on March 4, and by the weekend, state media were reporting that 900 had been found floating in the river, the source of much of the city’s water supply. The reports didn’t offer an explanation for where the dead pigs had come from or how they had died. Still, one thing was absolutely certain in the articles and the social-media chatter: Nothing good comes from a dead-pig tide.
Early today, Shanghai Daily reported that the number of dead pigs floating in the river had increased to 1,200. Later in the morning, the Global Times, a national paper, reported that the number had crossed “at least 2,200” and was expected to rise. By early evening, the government had retrieved 3,323 carcasses from the river, with more still floating toward downtown.READ MORE
The chairmen of the standing committees in the U.S. House and Senate have more differences than mere party labels. The Republican House chairmen are younger and less experienced than their Senate counterparts.
The average age of the 16 Democratic Senate chairmen is 68; for the 19 House committees, it's about 10 years younger.READ MORE
(Corrects chart description in third paragraph.)
With everyone in Washington experiencing sea-bass-induced euphoria, we're talking again about a "grand bargain" to replace the sequestration and shrink the federal budget deficit. And that means we’re talking about using the chained consumer-price index, a lower and more accurate inflation measure, to modestly raise taxes and cut Social Security benefits over time.READ MORE