Economic Daily Outlook

FRIDAY, APRIL 13, 2012



US House panels turn budget axe to automatic cuts

Republicans in six House of Representatives committees next week will dust off their past proposals for reducing the deficit as they try to replace some of the automatic spending cuts set to take place in January.

Under a directive in the House-passed budget plan from Congressman Paul Ryan, the panels have just two weeks to come up with $18.45 billion in savings for fiscal 2013 and a net $261 billion over 10 years.

Expected targets for cuts include food stamps, farm subsidies and crop insurance, federal employee pensions and health care. A repeal of President Barack Obama’s health reform law would prevent new coverage expenses from occurring from 2014.



Consumer Bureau Declines to Resist Upfront Credit Card Fees

In one of the first tests of its willingness to show its muscle, the new agency created to protect consumers declined on Thursday to put up a fight.

The agency, the Consumer Financial Protection Bureau, introduced a proposal that would make it easier for credit card issuers to charge fees before borrowers’ accounts were officially open.

The bureau, which began overseeing many consumer financial products last year, said it was issuing the proposed rule in response to a federal court decision that challenged how the Credit Card Act was being applied. The act, which took effect in February 2010, put several rules in place aimed at curbing abusive lending practices.



Pessimistic docs leaving hospitals

More than half of physicians are pessimistic about the future of healthcare, with many doctors cynical about government involvement particularly around healthcare reform.

According to a survey by nonprofit The Physicians Foundation, 57 percent of doctors age 40 and younger don’t have high hopes, worrying that recent legislation will hurt their practices, according to a company statement. Only 4 percent were “highly optimistic” about the Affordable Care Act.



House GOP hopes to revive Keystone fight with tie to highway bill extension

House Republican leadership will take another crack at forcing approval of the Keystone XL oil pipeline on legislation extending federal transportation funding for another 90 days.

“American families and small businesses are struggling with high gas prices, and President Obama’s policies are only making things worse,” a House GOP leadership aide said.

Analysis: Obama’s “green jobs” have been slow to sprout

Three years after Obama launched a push to build a job-creating “green” economy, the White House can say that more than 1 million drafty homes have been retrofitted to lower heating and cooling costs, while energy generation from renewable sources such as wind and solar has nearly doubled since 2008.

But the millions of “green jobs” Obama promised have been slow to sprout, disappointing many who had hoped that the $90 billion earmarked for clean-energy efforts in the recession-fighting federal stimulus package would ease unemployment – still above 8 percent in March.



OPINION: The newest problem with graduation rates

School administrators across the country have been expressing their concern over the federal government’s changes in reporting graduation rates. Starting with the 2010-2011 school year, all high schools have been required to provide data based on the four-year “cohort” rate. In some states this method has already resulted in graduation rates as much as 20% below those formerly reported.

That should not surprise those who availed themselves of the summary data on schools available on the web from government sources. The data for each public school includes a breakdown of the number of students at each grade level for a given year. Thus you can see the difference between the number of students who entered the school as freshmen, and the number of seniors who were there to graduate four years later.



North Korean Launch Fails

North Korea launched a multistage rocket Friday morning, again defying countries that want it to stop pursuing advanced weapons, but it blew up less than two minutes into flight and parts crashed in the Yellow Sea off South Korea.

Despite the failure, the U.S. and its allies quickly condemned the launch, with the White House saying that a food agreement it had reached with Pyongyang in February was dead. But the launch also denied North Korea a key propaganda victory and raised questions about the state of its ballistic missile technology.