 | |||
|
| Welcome to Wonkbook, Wonkblog's morning policy news primer byMax Ehrenfreund (@MaxEhrenfreud). Send comments, criticism or ideas to Wonkbook at Washpost dot com. To read more by the Wonkblog team, click here. Follow us on Twitter and Facebook. |
| Greece looks for a delicate balance between its creditors and its people |
| |||||||
Europe's finance ministers are scheduled to discuss Greece's proposal for economic reforms in a conference call on Tuesday. It's an important moment for the indebted country's new government, which just released a tentative agreement with its European creditors last week to extend an existing line of credit for another four months. The proposals have to contain enough fiscal austerity that the creditors will be convinced Athens is willing to meet them halfway. But the government is bound by their campaign promises to reject austerity firmly, and any real retrenchment of public spending would do even more harm to the Greek economy. We'll be watching closely to see whether Greece's leadership can thread the needle.
What's in Wonkbook: 1) The Greek crisis 2) Opinions, including Levine on retirement advice 3) Yellen to testify, and more
Map of the day: Local elected officials have enormous power over whether the U.S. economy is equitable and fair."A child growing up in America may altogether have less economic opportunity than a child born in Norway, but you're probably far more likely to climb the income ladder if you're born in Iowa than in Alabama... We also know what sorts of strategies actually promote economic mobility. One of them is reducing economic segregation — that is, when poor people live cut off from wealthier people. ... When a city is heavily segregated, a city can promote more mixing by promoting affordable housing in more affluent areas. Policies that restrict sprawl have also been shown to promote economic integration." Danielle Kurtzleben at Vox.
European finance officials seem pleased so far, but they want more details. "In the commission’s view, this list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review," a spokesman said. Also, "Greek stocks surged on the news that the commission believes the proposals appear to meet the demands of eurozone finance ministers, with the main stock exchange in Athens rising almost 7% in early trade. Bonds also jumped."Gabriele Steinhauser and Matthew Dalton in The Wall Street Journal.
The deal hasn't resolved the euro zone's fundamental problems, though. "Even assuming there are no major stumbles and negotiations towards Greece’s next program progress more smoothly than they have done towards the current extension, Greece’s fundamental problem remains: the euro itself. Greece it is in a currency union with radically different economies on different cycles. At a time that a quarter of working age Greeks are unemployed, Germany is at full employment. ... If the European Central Bank’s bond purchase program triggers a German boom–real estate prices are already picking up as are wages–German inflation could start to rise well before Greece recovers. Will the ECB then look to Germany or Greece when determining interest rate policy?" Alen Mattich in The Wall Street Journal.
The Greeks lost a rare chance to fix Europe's past mistakes."Their negotiating strategy has been small-minded, self-defeating and naive. Some of this may be put down to inexperience. ... With a bit more statesmanship, [Prime Minister Alexis] Tsipras could have nudged Europe on to a happier path. The euro zone desperately needs a counter-narrative to its failed German-inspired policy of austerity. As leader of the hardest-hit economy, armed with a strong democratic mandate, Mr Tsipras was well placed to offer one. He could have sought allies against excessive austerity and for looser fiscal and monetary policy in places like Italy and France." The Economist.
LEVINE: The Obama administration will try to hold retirement advisers accountable. "The way that a lot of retirement investing advice goes is that you go to your broker and ask him what you should invest in, and he says, 'Oh Fund XYZ is great, put all your money in Fund XYZ,' and the reason he does that is not that he loves Fund XYZ in his heart of hearts, but rather that Fund XYZ writes him a big check for steering you its way. ... New Labor Department rules are coming that would, if not quite outlaw these practices, at least make them more awkward." Bloomberg View.
SPROSS: If reform conservatives are serious about achieving their goals, they should just switch parties. "Politics isn't about Big Ideas. It's about coalitions and the power to get things done. What makes the reformicons so weird is they insist on being loyal to a political coalition that is uniquely hostile to, and disinterested in, their policy preferences. ... The reformicons have nothing to offer other Republican constituencies. From the standpoint of a well-heeled evangelical or an oil business professional or a Wall Street trader, reformicon proposals are all costs, no benefits. In their current home, the reformicons have no room to maneuver."The Week.
GILBERT: HSBC is too big to regulate, and the bank keeps getting into trouble. "HSBC's Swiss arm regularly did business with tax evaders, drug dealers and arms traders. Belgian prosecutors have threatened to issue international arrest warrants for the bank's officers if they don't cooperate with a probe into tax dodging. ... Just last week HSBC's offices in Geneva were raided by Swiss prosecutor Yves Bertossa as part of an investigation into money laundering. No wonder investors have trashed the company's share price." Bloomberg View.
Fed chair Janet Yellen will testify on Capitol Hill Tuesday and Wednesday. "Her answers to lawmakers' questions will be parsed for insight into the her thinking about issues like persistently weak inflation, stagnant wage growth and whether she still feels the nation's falling unemployment rate disguises lingering ills in the labor market." Michael Flaherty and Howard Schneider for Reuters.
Unions win a lawsuit and a major victory against New Jersey Gov. Chris Christie. "The decision came after Christie pushed unions into an agreement that required public employees to sharply increase the amount of money they contribute to their pensions. In exchange, the state promised to increase its contributions to the state’s underfunded retirement system. The 2011 agreement helped catapult Christie to national attention for his determined stance against what he described as generous public employee benefits that were crippling New Jersey’s finances and contributing to the state’s high taxes. But Christie decided against making the increased pension payments that were part of the agreement for 2014 and 2015, saying the state could not afford them." Michael A. Fletcher inThe Washington Post.
Christie's troubles give former Florida Gov. Jeb Bush a crucial advantage among moderate Republicans. Christie "is struggling to build support among the donors, officials and operatives necessary to win the nomination. ... The relatively moderate half of the Republican Party is underrepresented in Washington because most moderate Republicans hail from blue states and therefore lose in general elections. It’s a different story in the primaries. The 2012 and 2008 exit polls showed that moderates and, yes, even a sliver of self-described liberals combined to represent about 40 percent of the vote — or more — in most blue-state primaries." Nate Cohn in The New York Times.
Marijuana is legal under Alaska state law, effective Tuesday."While the 1975 Alaska Supreme Court decision protected personal marijuana possession and a 1998 initiative legalized medicinal marijuana, state lawmakers twice criminalized any possession over the years, creating an odd legal limbo. As of Tuesday, adult Alaskans can not only keep and use pot, they can transport, grow it and give it away. A second phase, creating a regulated and taxed marijuana market, won’t start until 2016 at the earliest." Associated Press.
Republicans remain divided over funding for the Department of Homeland Security. "With four days before the security agency’s budget lapses, senior Republicans are pushing for a new strategy that does not directly link Obama’s actions on immigration to funding for DHS. Senate Majority Leader Mitch McConnell (R-Ky.), who had previously acknowledged that the chamber was in stalemate over the issue, set up votes later this week on separate legislation that would repeal one of Obama’s immigration actions." Paul Kane and Sean Sullivan inThe Washington Post.
Federal regulators are looking at whether 10 major financial institutions colluded to rig the market for precious metals."U.S. officials are investigating at least 10 major banks for possible rigging of precious-metals markets, even though European regulators dropped a similar probe after finding no evidence of wrongdoing, according to people close to the inquiries. Prosecutors in the Justice Department’s antitrust division are scrutinizing the price-setting process for gold, silver, platinum and palladium in London, while the Commodity Futures Trading Commission has opened a civil investigation, these people said." Jean Eaglesham and Christopher M. Matthews in The Wall Street Journal.
What's in Wonkbook: 1) The Greek crisis 2) Opinions, including Levine on retirement advice 3) Yellen to testify, and more
Map of the day: Local elected officials have enormous power over whether the U.S. economy is equitable and fair."A child growing up in America may altogether have less economic opportunity than a child born in Norway, but you're probably far more likely to climb the income ladder if you're born in Iowa than in Alabama... We also know what sorts of strategies actually promote economic mobility. One of them is reducing economic segregation — that is, when poor people live cut off from wealthier people. ... When a city is heavily segregated, a city can promote more mixing by promoting affordable housing in more affluent areas. Policies that restrict sprawl have also been shown to promote economic integration." Danielle Kurtzleben at Vox.
1. Top story: Greece readies reform proposal
It looks as though Greece will make some compromises in response to demands from the rest of Europe. "Greece has promised not to roll back any ongoing or completed privatizations and ensure that any state spending to address a 'humanitarian crisis' does not hurt its budget, according to a document containing its reform plans seen by Reuters on Tuesday. The list of reforms aims to offer compromises on major issues such as labor reforms and social spending to satisfy both European partners funding the country and Greek voters who voted in a left-wing government to end years of rigid austerity." Matthias Sobolewski for Reuters.European finance officials seem pleased so far, but they want more details. "In the commission’s view, this list is sufficiently comprehensive to be a valid starting point for a successful conclusion of the review," a spokesman said. Also, "Greek stocks surged on the news that the commission believes the proposals appear to meet the demands of eurozone finance ministers, with the main stock exchange in Athens rising almost 7% in early trade. Bonds also jumped."Gabriele Steinhauser and Matthew Dalton in The Wall Street Journal.
The deal hasn't resolved the euro zone's fundamental problems, though. "Even assuming there are no major stumbles and negotiations towards Greece’s next program progress more smoothly than they have done towards the current extension, Greece’s fundamental problem remains: the euro itself. Greece it is in a currency union with radically different economies on different cycles. At a time that a quarter of working age Greeks are unemployed, Germany is at full employment. ... If the European Central Bank’s bond purchase program triggers a German boom–real estate prices are already picking up as are wages–German inflation could start to rise well before Greece recovers. Will the ECB then look to Germany or Greece when determining interest rate policy?" Alen Mattich in The Wall Street Journal.
The Greeks lost a rare chance to fix Europe's past mistakes."Their negotiating strategy has been small-minded, self-defeating and naive. Some of this may be put down to inexperience. ... With a bit more statesmanship, [Prime Minister Alexis] Tsipras could have nudged Europe on to a happier path. The euro zone desperately needs a counter-narrative to its failed German-inspired policy of austerity. As leader of the hardest-hit economy, armed with a strong democratic mandate, Mr Tsipras was well placed to offer one. He could have sought allies against excessive austerity and for looser fiscal and monetary policy in places like Italy and France." The Economist.
2. Top opinions
SPROSS: If reform conservatives are serious about achieving their goals, they should just switch parties. "Politics isn't about Big Ideas. It's about coalitions and the power to get things done. What makes the reformicons so weird is they insist on being loyal to a political coalition that is uniquely hostile to, and disinterested in, their policy preferences. ... The reformicons have nothing to offer other Republican constituencies. From the standpoint of a well-heeled evangelical or an oil business professional or a Wall Street trader, reformicon proposals are all costs, no benefits. In their current home, the reformicons have no room to maneuver."The Week.
GILBERT: HSBC is too big to regulate, and the bank keeps getting into trouble. "HSBC's Swiss arm regularly did business with tax evaders, drug dealers and arms traders. Belgian prosecutors have threatened to issue international arrest warrants for the bank's officers if they don't cooperate with a probe into tax dodging. ... Just last week HSBC's offices in Geneva were raided by Swiss prosecutor Yves Bertossa as part of an investigation into money laundering. No wonder investors have trashed the company's share price." Bloomberg View.
3. In case you missed it
Unions win a lawsuit and a major victory against New Jersey Gov. Chris Christie. "The decision came after Christie pushed unions into an agreement that required public employees to sharply increase the amount of money they contribute to their pensions. In exchange, the state promised to increase its contributions to the state’s underfunded retirement system. The 2011 agreement helped catapult Christie to national attention for his determined stance against what he described as generous public employee benefits that were crippling New Jersey’s finances and contributing to the state’s high taxes. But Christie decided against making the increased pension payments that were part of the agreement for 2014 and 2015, saying the state could not afford them." Michael A. Fletcher inThe Washington Post.
Christie's troubles give former Florida Gov. Jeb Bush a crucial advantage among moderate Republicans. Christie "is struggling to build support among the donors, officials and operatives necessary to win the nomination. ... The relatively moderate half of the Republican Party is underrepresented in Washington because most moderate Republicans hail from blue states and therefore lose in general elections. It’s a different story in the primaries. The 2012 and 2008 exit polls showed that moderates and, yes, even a sliver of self-described liberals combined to represent about 40 percent of the vote — or more — in most blue-state primaries." Nate Cohn in The New York Times.
Marijuana is legal under Alaska state law, effective Tuesday."While the 1975 Alaska Supreme Court decision protected personal marijuana possession and a 1998 initiative legalized medicinal marijuana, state lawmakers twice criminalized any possession over the years, creating an odd legal limbo. As of Tuesday, adult Alaskans can not only keep and use pot, they can transport, grow it and give it away. A second phase, creating a regulated and taxed marijuana market, won’t start until 2016 at the earliest." Associated Press.
Republicans remain divided over funding for the Department of Homeland Security. "With four days before the security agency’s budget lapses, senior Republicans are pushing for a new strategy that does not directly link Obama’s actions on immigration to funding for DHS. Senate Majority Leader Mitch McConnell (R-Ky.), who had previously acknowledged that the chamber was in stalemate over the issue, set up votes later this week on separate legislation that would repeal one of Obama’s immigration actions." Paul Kane and Sean Sullivan inThe Washington Post.
Federal regulators are looking at whether 10 major financial institutions colluded to rig the market for precious metals."U.S. officials are investigating at least 10 major banks for possible rigging of precious-metals markets, even though European regulators dropped a similar probe after finding no evidence of wrongdoing, according to people close to the inquiries. Prosecutors in the Justice Department’s antitrust division are scrutinizing the price-setting process for gold, silver, platinum and palladium in London, while the Commodity Futures Trading Commission has opened a civil investigation, these people said." Jean Eaglesham and Christopher M. Matthews in The Wall Street Journal.
댓글 없음:
댓글 쓰기