Economy

Economic Daily Outlook

TUESDAY, FEBRUARY 28, 2012

 

ECONOMICS:

Tax experts think deal could be done on corporate code overhaul this year

http://thehill.com/homenews/administration/212911-tax-experts-think-deal-could-be-done-on-corporate-code

Despite what appear to be long odds, a handful of Washington tax experts think Congress and the Obama administration could actually make real progress on corporate tax reform this year.

These optimists — who admittedly represent a minority opinion in town — point out that lawmakers have a relatively open calendar for the rest of 2012 following this month’s extension of the payroll tax cut.

And they maintain that what others say are factors working against a tax overhaul this year — the likely hard-fought presidential race and the at-times strident partisanship on Capitol Hill — could actually help the push for reform.

FHA Will Raise Premiums

http://online.wsj.com/article/SB10001424052970204653604577249743105391380.html

The Federal Housing Administration, a U.S. agency that has provided major support to financing home purchases since the housing downturn deepened, will raise in April the premiums that it charges borrowers, the agency said on Monday.

The FHA will raise by 0.75 percentage point to 1.75% the upfront insurance premiums that borrowers must pay when they take out a loan backed by the agency.

Borrowers also pay annual insurance premiums when they take out loans backed by the agency, and those fees range from 1.1% to 1.15% of their loan amount. Congress last year raised those annual premiums by 0.1 percentage point. The FHA said on Monday it will implement both fee increases on April 1.

 

REGULATION:

Obama to sign order creating trade enforcement unit

http://www.reuters.com/article/2012/02/28/obama-trade-enforcement-idUSL2E8DS0I820120228

President Barack Obama, following through on a promise to beef up enforcement of trade agreements, on Tuesday will sign an executive order creating a new government team to make sure China and others play by the rules, the White House said.

The move comes as Obama has faced criticism from Republican presidential candidate Mitt Romney over his handling of China and the U.S. trade deficit with the world’s second largest economy has soared to record $295.5 billion in 2011.

In addition, two new reports on Tuesday raise concerns about state-supported competition from China and call for the United States to take a variety of steps to respond.

Obama outlined his plan to create a new Interagency Trade Enforcement Unit (ITEC) in his annual State of the Union speech last month to Congress.


HEALTHCARE:

OPINION: Overdiagnosis as a Flaw in Health Care (H. Gilbert Welch)

http://www.nytimes.com/2012/02/28/opinion/overdiagnosis-as-a-flaw-in-health-care.html

EARLY diagnosis has become one of the most fundamental precepts of modern medicine. It goes something like this: The best way to keep people healthy is to find out if they have (pick one) heart disease, autism, glaucoma, diabetes, vascular problems, osteoporosis or, of course, cancer — early. And the way to find these conditions early is through screening.

It is a precept that resonates with the intuition of the general public: obviously it’s better to catch and deal with problems as soon as possible. A study published with much fanfare in The New England Journal of Medicine last week contained what researchers called the best evidence yet that colonoscopies reduce deaths from colon cancer.

Recently, however, there have been rumblings within the medical profession that suggest that the enthusiasm for early diagnosis may be waning. Most prominent are recommendations against prostate cancer screening for healthy men and for reducing the frequency of breast and cervical cancer screening. Some experts even cautioned against the recent colonoscopy results, pointing out that the study participants were probably much healthier than the general population, which would make them less likely to die of colon cancer. In addition there is a concern about too much detection and treatment of early diabetes, a growing appreciation that autism has been too broadly defined and skepticism toward new guidelines for universal cholesterol screening of children.

Insurers Open Stores to Peddle Health Plans

http://www.kaiserhealthnews.org/Features/Insuring-Your-Health/2012/Health-Insurance-Stores-022812-Michelle-Andrews.aspx

When Ronda Austin’s employer stopped offering health coverage last spring, she bought an individual policy from Blue Cross and Blue Shield of Florida. A month later she was given a diagnosis of multiple myeloma and began chemotherapy at her oncologist’s office near her home in Tampa.

But after several sessions, the physician’s office said that her plan covered chemotherapy only if it was provided in a hospital and told her she owed the practice $15,000. Austin called her plan’s member-services number but didn’t get anywhere.

So she stopped in at a new kind of insurance facility — her local BCBS of Florida retail store. There, a customer service rep sat down with her and called up her plan information online. She referred Austin to nearby Moffitt Cancer Center for subsequent chemotherapy treatments and explained how to address the problem with the oncologist’s billing department, which had misread her policy. The problem was quickly resolved.


ENERGY:

Pipeline Gets Jump with Gulf Route

http://online.wsj.com/article/SB10001424052970204653604577249382206200386.html

TransCanada Corp. said Monday it will move ahead with the U.S. Gulf Coast portion of its contentious Keystone XL oil pipeline, a move expected to help ease a Midwest supply glut even as Washington delays a decision on the bigger project until after the presidential election this year.

The 435-mile leg, envisioned to run from the U.S. storage hub of Cushing, Okla., to refineries in Texas, will cost $2.3 billion to build, TransCanada said. The Calgary-based firm said the segment will transport 700,000 barrels of oil a day and could be completed by the middle of 2013.

The move is the latest twist in a pipeline-approval process recently embroiled in Washington politics. TransCanada officials have always said they would prefer to build the whole pipeline—aimed at moving oil-sands crude from Alberta to the Texas coast—at the same time.

EPA Proposed Keeping Carbon Regulation Limited to Top Polluters

http://www.bloomberg.com/news/2012-02-27/epa-proposes-keeping-carbon-regulation-limited-to-top-polluters.html

The Environmental Protection Agency proposed keeping U.S. limits on permitting requirements for greenhouse-gas emissions to power plants and other sources that discharge more than 100,000 tons per year.

The proposal, posted on the agency’s website on Feb. 24 without notification, would maintain standards established in 2010 for new or revamped plants. The rules require companies building qualifying plants to get state permits, and to use “best available” control technologies.

The plan was posted by the agency as the U.S. Court of Appeals in Washington plans to start hearing arguments tomorrow from states and industries arguing in part that the EPA’s so- called tailoring rule, which limits the businesses covered by its standards, violates the law.


EDUCATION:

 Odd Pairings on Teacher Evaluation in ESEA Fight

http://www.edweek.org/ew/articles/2012/02/29/22esea.h31.html

The always contentious subject of teacher evaluation is creating some unusual divisions on Capitol Hill, as members of Congress debate approaches for the long-delayed renewal of the Elementary and Secondary Education Act.

Two proposals for renewing the law—a measure that passed the Senate education committee last fall and a pair of House bills slated for committee consideration in the coming weeks—represent dueling visions of the federal role in shaping teacher evaluation, an issue that continues to roil state legislatures as well.

The House bill, introduced by U.S. Rep. John Kline, R-Minn., the chairman of the House Education and the Workforce Committee, would require districts to devise new teacher-evaluation systems, mirroring the Obama administration’s priorities.

But similar language was stripped out of the Senate’s bipartisan ESEA bill, at the behest of some Republicans, giving them common cause with teachers’ unions, which aren’t traditionally GOP allies.


FOREIGN POLICY:

 U.S. Considers New Message on Iran

http://online.wsj.com/article/SB10001424052970203833004577249841698142780.html

Complaints from Israel about the U.S.’s public engagement with Iran have pushed the White House to consider more forcefully outlining potential military actions, and the “red lines” Iran must not cross, as soon as this weekend, according to people familiar with the discussions.

President Barack Obama could use a speech on Sunday before a powerful pro-Israel lobby to more clearly define U.S. policy on military action against Iran in advance of his meeting on Monday with Israeli Prime Minister Benjamin Netanyahu, these people said.

Israeli officials have been fuming over what they perceive as deliberate attempts by the Obama administration to undermine the deterrent effect of the Jewish state’s threat to use force against Tehran by publicly questioning the utility and timing of such strikes.

 

 

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