Germans and Greeks get nasty over debt – Europe’s struggle to solve the Greek debt crisis and protect the euro is being threatened by an increasingly bitter war of words between Germany and Greece. Old stereotypes and grievances between the two countries are resurfacing, and this could stiffen resistance in the Greek public to drastic government spending cuts and tax rises needed to ward off a debt default that may trigger the collapse of Europe’s 11-year-old monetary union.Passions are running high, partly because the crisis has touched raw nerves in both companies. For the Greeks, the radical austerity measures being imposed by the EU are a reminder of their painful history of domination by foreign powers for much of the last 2,000 years. For the Germans, the prospect of currency turmoil is anathema after the hyperinflation and economic collapse of the 20th century.
Editorial: California must rein in state pensions to avoid fiscal collapse – WHILE CALIFORNIA lawmakers again are struggling with yet another massive budget deficit with no solution is sight, the state faces a far worse economic disaster that is not receiving proper attention in Sacramento — unfunded pension liabilities.California has an unsustainable public employee pension system that will lead to fiscal collapse of the state unless major reforms are made soon. The rapidly rising cost of public pensions and retiree health care is taking an increasingly larger share of taxpayer dollars, and the situation grows worse every year. The total of California’s budget-related debt service and state retiree pension and health care obligations amounts to at least $237 billion and could be, by some estimates, more than double that amount, according to a recent policy brief by the Stanford Institute for Economic Policy Research.
Dolphin cognitive abilities raise ethical questions, says Emory neuroscientist – Science Daily – "Many modern dolphin brains are significantly larger than our own and second in mass to the human brain when corrected for body size," Marino says. A leading expert in the neuroanatomy of dolphins and whales, Marino will appear as part of a panel discussing these findings and their ethical and policy implications.Some dolphin brains exhibit features correlated with complex intelligence, she says, including a large expanse of neocortical volume that is more convoluted than our own, extensive insular and cingulated regions, and highly differentiated cellular regions."Dolphins are sophisticated, self-aware, highly intelligent beings with individual personalities, autonomy and an inner life. They are vulnerable to tremendous suffering and psychological trauma," Marino says. The growing industry of capturing and confining dolphins to perform in marine parks or to swim with tourists at resorts needs to be reconsidered, she says.
Sales tax collections worst in recent history -As if there wasn’t enough proof of an aching economy, the Office of the State Comptroller recently issued a report on the sales tax collection for all counties in New York state in 2009, providing even more evidence that the economy is struggling.The report released by State Comptroller Thomas P. DiNapoli compares 2009 to 2008 collections, and found a 5.9 decrease in collections statewide. Sales tax-declines were experienced by 53 of the 57 counties in the report. Only four counties experienced a growth in sales tax revenue, but the report attributes it to other factors other than economic growth, like late payments and other technical adjustments.“Unlike other recent downturns, 2009 was the first time in recent history that there was actually a decline in county sales tax revenue — a sign of the severity of the recent recession,” the report reads. “The sales tax decline in 2009 was one of the worst on record.”
Texas Sales Tax Collections – January 2010 State Sales Tax Collections To General Revenue
State sales tax net collections* deposited to general revenue totaled $1,655.3 million in January 2010. Compared with the $1,928.3 million collected in January 2009, this represents a decrease of 14.2 percent.
December 2009 State Sales Tax Collections To General Revenue
State sales tax net collections* deposited to general revenue totaled $1,653.1 million in December 2009. Compared with the $1,869.4 million collected in December 2008, this represents a decrease of 11.6 percent.
November 2009 State Sales Tax Collections To General Revenue
State sales tax net collections* deposited to general revenue totaled $1,696.9 million in November 2009. Compared with the $1,983.1 million collected in November 2008, this represents a decrease of 14.4 percent.
Off the Charts – Ratio of Troubled Loans Means Banks Aren’t Out of the Woods – NYTimes.com – MORE than $1 in every $10 that American banks have outstanding in loans is lent to a troubled borrower, a ratio far higher than previously seen in the quarter-century that such numbers have been compiled. The problems are greatest in construction loans for single-family homes, where nearly 40 percent of the loans either are delinquent or have been written off as uncollectible. But they are also high in mortgage loans for single-family homes, where $1 in every $8 of loans is troubled.The figures were released this week by the Federal Deposit Insurance Corporation, as it announced that the number of banks in trouble had risen sharply, and forecast that the rate of bank failures would increase. The report served as a stark reminder that the banking system remained in perilous health, despite large bailouts of major financial institutions. Many smaller banks are especially exposed to commercial real estate loans, where problems are growing.
Greek deal puts Goldman Sachs in the firing line – again – It is the most profitable investment bank on the planet, and is viewed as an awesome money-making machine that runs rings around its rivals and rewards its high fliers with jaw-dropping multibillion-pound bonuses. Welcome to the world of Goldman Sachs, which has a reputation for managing risk second to none and where savvy traders took huge bets against the overvalued American mortgage market months before the onset of the credit crunch three years ago.But Goldman’s knack for making huge dollops of cash from the markets is matched by its tendency to attract controversy to a degree that separates it from competitors. The latest furore is over the role Goldman played in helping Greece conceal its debts, which enabled the country to join the European single currency in 2001. Although it acted entirely legally, critics have heaped opprobrium on the bank, claiming that Goldman sails close to the wind in its endless quest for power and money.
FDIC Auctions $610.5 Million in Loans From Failed U.S. Lenders – Bloomberg.com (Bloomberg) — The Federal Deposit Insurance Corp. is seeking bids for $610.5 million of unpaid loans it’s holding from failed U.S. lenders including IndyMac Bank, Silverton Bank and New Frontier Bank. The loans are backed in part by land, developed lots and condominium construction projects, said Peter Tobin, managing director of New York-based Mission Capital Advisors LLC, the FDIC’s marketing agent and financial adviser for the offering. Most of the properties are in Colorado, California, Utah and Idaho, and about 78 percent of the debt is 90 days or more past due, according to a description on Mission Capital’s Web site. The FDIC is disposing of real estate, soured mortgages and personal property ranging from tour buses to palm trees that once belonged to failed banks.
The NYT Interupts the Europe Bashing to Complain that Germany is Too Competitive – There is an ongoing refrain in economic reporting that the European welfare state is an outmoded relic that is dragging Europe into an economic abyss. It’s a very compelling tune, since it gets repeated endlessly by "experts" who pretend to know what they are talking about. The only problem is that there isn’t really any evidence to support the story. By most standard economic measures Europe is doing about as well as the United States. On the most basic measure of economic prowess, productivity, Western Europe is pretty comparable to the United States with some countries, like France, actually reporting somewhat higher levels of productivity.
1.2 Million to Lose Unemployment Benefits Today – The National Employment Law Project (NELP) released a report in early February showing: 1.2 million jobless workers will become ineligible for federal unemployment benefits in March unless Congress extends the unemployment safety net programs from the American Recovery and Reinvestment Act (ARRA). By June, this number will swell to nearly 5 million unemployed workers nationally who will be left without any jobless benefits….Currently, 5.6 million people are accessing one of the federal extensions (34-53 weeks of Emergency Unemployment Compensation; 13-20 weeks of Extended Benefits, a program normally funded 50 percent by the states).
The Washington Post Invents a Chinese Demographic Crisis – The Washington Post (a.k.a. Fox on 15th Street) is once again touting the "demographic crisis" shtick, this time in reference to China. The Post tells readers that China faces a "looming demographic crisis" that: "it is going to be the first nation in the world to grow old before it gets rich. By the middle of this century the percentage of its population above age 60 will be higher than in the United States, and more than 100 million Chinese will be older than 80."Fans of arithmetic are no doubt saying "huh?" Since we use arithmetic at Beat the Press, even if it is shunned at the Post, let’s look at this one a bit more closely. In China, per capita income has been growing at a 9.0 percent annual rate over the last decade. Let’s say that this extraordinary growth rate slows to an average of 5.0 percent annually over the next three decades. This means that per capita income in China will be on average 4.3 times as high as it is today. Let’s assume that wage growth increases in step with per capita income so that before tax wages in 30 years are 4.3 times what they are today. Suppose that China will have two workers for every retiree in 30 years (the ratio that the U.S. is expected to reach around 2030). If each worker is taxed at a 30 percent rate to support retirees, then workers will enjoy an after-tax wage that is more than three times higher than the wage they receive today. Retirees will receive a retirement benefit that is more than two and half times as high as their wage today.
Hypotheses about durable unemployment: just-in-time hiring – This is from The Economist:Recruiters are clearly becoming far more sophisticated, thanks to the new search tools that are available, says Aberdeen’s Mr Saba: “You’d think with 10% unemployment, jobs would be filled more quickly, but the focus on sourcing the right people, screening them and so on means that the time to fill has not fallen.” Mr Joerres believes that the increasing sophistication of recruiters means that firms will do less “anticipatory hiring” than in previous recoveries. Instead, firms will wait to get exactly the staff they need, when they need them.
Medicare in sick bay – Without action in Congress, Medicare reimbursement rates for physicians will be cut by 21 percent, a cut that is to go into effect Monday.The U.S. House of Representatives voted late last week to delay it until April 1, but the U.S. Senate broke early for the weekend Friday without acting on it. Senators may take it up again early this week. Those cuts, if they occur, would create even less incentive for doctors to take on new Medicare patients, as reimbursement rates for Medicare patients are at least 20 percent to 40 percent lower than private insurances. “We’re about to hit some real stormy times if we see a 21 percent cut,”