Policy Points

16.10.2009 Policy Points No Comments

Obama and Public Policy: An Assessment

At Grasping Reality with Both Hands, economist Brad DeLong assesses the performance of the Obama administration in handling the recession, regulating the financial sector, protecting the environment, and reforming health care. Blogs DeLong:

Don’t get me wrong: My complaint is not that the Obama administration has not been liberal enough. My complaint is that the Obama administration, so far, has not been devoted enough to good policy –to the good technocratic policies of what I used to see as the bipartisan center–and has been unwilling to use any leverage at all against a congress that is underbriefed, unfocused, and easily captured by special interests. You can only use such leverage if you have a moment arm–allow daylight to open up between the President’s position and the position of the marginal senator, and say that the President’s policies are those he and has staff have concluded after sober reflection are best for the nation but that he will take what he can get from congress.

15.10.2009 Policy Points No Comments

Around the Dial – Oct. 15

Economic policy reports, blog postings, and media stories of interest:

15.10.2009 Policy Points No Comments

Unemployment Claims in NC: Week of 9/26

For the benefit week ending on September 26th, 16,383 North Carolinians filed initial claims for unemployment insurance, and 181,622 individuals applied for continuing insurance benefits. Compared to the prior week, there were fewer initial and continuing claims. These figures come from data released today by the U.S. Department of Labor.

Averaging new and continuing claims over a four-week period — a process that helps adjust for seasonal fluctuations and better illustrates trends — shows that an average of 16,785 initial claims were filed over the last four weeks, along with an average of 185,522 continuing claims. Both levels were down slightly compared to the previous four-week period. The four-week average for initial claims is now at the lowest level recorded since the period ending on November 1, 2008.

weekly claimsThe graph shows the changes in unemployment insurance claims (as a share of covered employment) in North Carolina since the recession’s start (12/07).

Although new and continuing claims appear to have peaked for this cycle, the claims levels remain elevated and point to a labor market that remains extremely weak.

15.10.2009 Policy Points No Comments

Dollar Policy Hype

In Foreign Affairs, Dean Baker of the Center for Economic and Policy Research debunks the claim that a shift in oil pricing from dollars to other currencies will harm the American economy. Writes Baker:

Any market — a stock market, a wheat market, or the oil market — requires a unit of measure. The importance of the U.S. economy made the dollar the obvious choice for most markets. But there would be no real difference if the euro, the yen, or even bushels of wheat were selected as the unit of account for the oil market. It’s simply an accounting issue.

Suppose that prices in the oil market were quoted in yen or bushels of wheat. Currently, oil is priced at about $70 a barrel. A dollar today is worth about 90 yen. A bushel of wheat sells for about $3.50. If oil were priced in yen, then the current price of a barrel of oil in yen would 6,300 yen. If oil were priced in wheat, then the price of a barrel of oil would be 20 bushels. If oil were priced in either yen or wheat it would have no direct consequence for the dollar. If the dollar were still the preferred asset among oil sellers, then they would ask for the dollar equivalents of the yen or wheat price of oil. The calculation would take a billionth of a second on modern computers, and business would proceed exactly as it does today.

The larger issue, notes Baker, is the dollar’s status as an international reserve currency, but even that issue is not as serious as often claimed.
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14.10.2009 Policy Points No Comments

Around the Dial – Oct.14

Economic policy reports and media stories of interest: