A strange model of the economy, ctd
– Ryan Avent at the Economist explains
much more clearly than I the wrongness of the claim that low population growth will make us better off: The point concerning government spending is simply bizarre. Projected growth in federal spending is largely due to rising spending on entitlements, especially Medicare and Medicaid. Slower population growth isn’t going to limit this spending growth; it will just increase the dependency ratio and the expected per capita burden of taxation…. A
lso in the comments Andy Harless tries to provide an explanation for what Johnson may be thinking: (1) fewer immigrants mean less competition for jobs in the short run (assuming immigrants don’t create enough domestic demand to support their employment), and (2) fewer children mean less drain on governments. Of course fewer children do also mean less demand and therefore fewer jobs, but this is obviously endogenous: all the first argument is really saying is that it’s a good thing people aren’t dumb enough to keep coming to the US when there are no jobs.
U.S. challenges China wind power aid at WTO (Reuters) – The United States on Wednesday accused China of illegally subsidizing the production of wind power equipment and asked for talks at the World Trade Organization, the first step in filing a trade case.
U.S. trade officials said they were concerned Chinese manufacturers of wind turbines and related parts and components could have received several hundred million dollars in questionable government grants in 2008 under China’s Special Fund for Wind Power Manufacturing. They said the grants appeared to violate WTO rules by requiring Chinese manufacturers to use only Chinese-made parts and components. U.S. wind turbine manufacturers such as General Electric and United Technologies are eager to compete in China’s fast-growing market, although the United Steelworkers union was the driving force behind the case.
How Long Is Each State’s Unemployment Extension?
– Last week Congress approved an extension of a program
to provide unemployment benefits for up to 99 weeks, but there’s a wide variance in how long an unemployed person can receive benefits depending on their state. During the recession, Congress created a program allowing up to 99 weeks of unemployment benefits backed by the federal government — an addition of 73 weeks to the traditional 26 offered by the states. The duration varies from state to state, based on how bad the unemployment situation is in the region. There are three main levels to unemployment insurance right now: state benefits, federal emergency unemployment compensation and joint state-federal extended benefits. The basic state benefits are usually 26 weeks and are unaffected by the federal program. When that time is up, the EUC program offers benefits in four tiers. Tier 1 (20 weeks) and tier 2 (14 weeks) are available in all states. Tier 3 (13 weeks) and tier 4 (6 weeks) are only available in states with higher unemployment rates, with 47 states and Washington DC qualifying for tier 3 and 25 states and Washington DC allowed to take part in tier 4. When EUC expires, some states offer either 13 or 20 weeks of extended benefits beyond that point.The following chart shows how many weeks are available in each state, according to the latest data from the Department of Labor
4th quarter Real GDP
– With the release of the November data on real personal consumption expenditures it looks like real PCE growth in the fourth quarter will be over 4% (SAAR) as compared to growth rates of 0.9%, 1.9%,2.2% and 2.8% over the last four quarters, respectively. October real PCE increased 0.5% and November was up 0.3%. So if December is only up only o.1% the fourth quarter real PCE growth rate would be 4.1%. This would be the strongest growth in real PCE since the first quarter of 2006. You can make your own guesses about the other component of real GDP but it now looks like fourth quarter growth will exceed almost everyone’s expectations.