South By North Strategies, Ltd.

Manufacturing In The South Atlantic: Feb. 2012

From the Federal Reserve Bank of Richmond’s latest survey of manufacturing activity in the South Atlantic (District of Columbia, Maryland, North Carolina, South Carolina, Virginia and West Virginia):

Manufacturing activity in the central Atlantic region advanced for the third straight month, according to the Richmond Fed’s latest survey. Our broadest indicators of overall activity — shipments, new orders and employment — remained in positive territory, and the rate of increase strengthened considerably from our last report. Other indicators were also positive, including backlogs and capacity utilization. Likewise, delivery times and finished goods inventories grew at a moderately quicker rate.
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Looking ahead, assessments of business prospects for the next six months were generally on par with last month’s readings. Contacts at more firms anticipated that shipments, new orders, backlogs, capacity utilization, and capital expenditures would continue to grow at a solid pace in the months ahead.

Around The Dial – February 28, 2012

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

• Beat the Press note “there is no shortage of rental housing.”
• Derek Thompson wonders about the phenomenon of “failing up.”
• Naked Capitalism thinks about the imbalance between labor and capital.
• Paul Krugman wonder “what ails Europe.”
• Matt Stoller bemoans missed policy opportunities.

One More Zombie Myth

David Callahan of Policy Shop debunks yet again the myth that almost half of all Americans pay no taxes.

The most obvious problem with this statistic, as many have pointed out before me, is that the narrow phrase “federal income tax” is misleading — and, it would seem, deliberately so. Every tax analyst at [the] Heritage [Foundation] well knows that federal payroll taxes, for Social Security and Medicare, now bring in nearly as much federal tax revenue as income taxes — and also know that a great many Americans pay more in payroll taxes than income taxes.
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Yet the payroll tax is barely mentioned in the Index of Dependence. Beyond obscuring the truth, this omission distracts attention from another important flaw of the report: Which is that many Americans who are supposedly wards of the state, “dependent” on Social Security and Medicare, are actually drawing on programs that they spent their working lives paying into. What’s wrong with that? We don’t go around talking about how retirees are  “dependent” on their 401k nest eggs.

“North Carolina’s Worth It”

A new report from the NC Budget and Tax Center lays out strategies for rebuilding North Carolina’s recession-battered public institutions.

Only when the state collects adequate revenue can it educate students, train workers, and keep communities safe and healthy. These last four years have taken a severe toll on North Carolina’s public structures and systems, including public schools, colleges and universities, roads, courts, parks, and hospitals. After responding to the initial recession‐driven collapse in state revenues with a balanced approach of targeted spending cuts and additional revenues in 2009, state policymakers have taken a harmful cuts‐only approach to dealing with diminished revenues and growing demand for education, health care, and other core public services.
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In fact, industry‐standard economic modeling finds that the 2011‐13 state budget will result in tens of thousands fewer jobs in North Carolina’s public and private sectors over the two years of the budget. In the long term, there is significant evidence that cuts to tax‐financed investments in education, health, and public works threaten the state’s ability to sustain a robust, sustainable economic recovery

Around The Dial – February 27, 2012

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

• Mike Konczal debates “the nature of the recession.”
• The Baseline Scenario notes that the GOP is the “party of higher debts.”
• Off the Charts debunks one of Newt Gingrich’s more outlandish claims.
• Sarah Joffe asks if Congress will let student loan interest rates double.
• Economix mulls “housing’s drag on the economy.”