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In RealTime posts, PIIE senior staff and colleagues discuss the fast-moving economic news, financial developments, and public policy choices confronting the United States and the world.
On May 27, 2009, US Trade Representative Ron Kirk and Egyptian Minister of Trade and Industry Rachid Mohamed Rachid agreed to develop a “Plan for a Strategic Partnership” that would “deepen and broaden trade and investment relations.” They directed senior trade officials to develop a program in 90 days to implement the plan. This accord [...]
In most societies it is traditional to be somewhat sneaky in squeezing your shareholders or the government. You might set up a complicated transfer pricing scheme or perhaps you arrange for a family-owned firm to acquire assets on the cheap from the publicly traded corporation that you control. Or you could always arrange for the [...]
Rahm Emanuel reportedly has a doctrine: Never let a serious crisis go to waste. His point is a good one: Vested interests usually block change across a wide range of important issues in the United States, and a major financial/economic crisis provides an opportunity to bypass or break through those interests in order to introduce [...]
The victory in the Indian elections by the incumbent Congress party and its allies augurs well for Indian economic-policy reform. Congress was led de jure by the economist-turned-politician Dr. Manmohan Singh and de facto by the Italian-born Sonia Gandhi, who is part of the Nehru family, which has been a force in Indian politics since [...]
The Department of Justice seems to thinking, at least in principle, about potential antitrust action in and around banking. Assistant Attorney General Christine Varney spoke about this on April 11, but her wording is open to interpretation, “I have to ask if too big to fail is a failure of antitrust enforcement.” (The press release [...]
In most advanced industrial countries, the value of public pension benefits is protected by annual cost-of-living adjustments, also known as COLAs. Every year, the value of pension benefits is adjusted upward, in line with inflation, wages, or a combination of the two.1 The adjustments are meant to protect the purchasing power of retirees against inflation. [...]
Who could be against innovation? That is the argument used by industries that wish to avoid regulation, that excessive government oversight will diminish incentives to innovate, or erode property rights to innovations, and we all will be worse off for it. And in the broad, this is a valid concern. We are all better off [...]
The public relations campaign packaging the bank stress tests is kicking into high gear and our professional information managers are really hitting their stride. They face, of course, a classic spin problem: You need to get the information out there, but you don’t want to be too definitive on the first day or soon after. [...]
Team Obama has announced a range of tax proposals designed to wring around $200 billion from US-based multinational corporations over the next decade. The political backdrop is the abuse oozing from Wall Street over the past year, huge bonuses, low tax rates on “carried interest,” money stashed in the Cayman Islands, coupled with a widespread [...]
In school, usually one cannot postpone exams, and only real grubbers try to negotiate with their examining professors for better grades. In medicine, if one puts off one’s diagnostic tests, problems usually get worse. Whichever analogy the Treasury tries to use for explaining their stress tests, the drawing out of the process and the release [...]