Address Bush Tax

(Reuters) - Federal Reserve Chairman Ben Bernanke reminded lawmakers at a closed-door meeting on Thursday that failing to address automatic spending cuts and tax increases at the end of the year could damage an already fragile economic recovery, congressional aides said. The Fed chairman has repeatedly sounded a warning that congressional inaction on what has come to be known as "the fiscal cliff" could dent growth if left untended. "It is very important to say that if no action were to be taken by the fiscal authorities, the size of the fiscal cliff is such that there is, I think, absolutely no chance that the Federal Reserve could or would have any ability whatsoever to offset that effect on the economy," he said at a news conference last month. Bernanke spoke to Senate Democrats at a ...

(Reuters) - President Barack Obama's nominee to be the top tax official at the U.S. Treasury Department said on Tuesday that the administration is not actively working on a plan to revamp the tax code, frustrating some of Obama's fellow Democrats. "We'd be negligent if we weren't doing foundational work ... But at this point there is no plan that has been developed," Mark Mazur, Obama's nominee for Treasury's top tax job, said at a Senate panel hearing on his confirmation. "We'll see how this plays out." Both Republicans and Democrats, including Obama, call revamping the complicated tax code a top priority, but acknowledge this will not happen until after the November 6 elections. Mazur, currently deputy assistant secretary for tax analysis, will lead Treasury tax policy if he is ...

(Reuters) - Federal Reserve Chairman Ben Bernanke on Tuesday warned Congress that putting off a decision on the fate of expiring Bush administration tax cuts could unsettle businesses and households, undercutting the U.S. economic recovery. With presidential and congressional elections looming in November, many analysts think Congress is unlikely to act until the final months of the year. The tax cuts expire on January 1. Bernanke told the Senate Budget Committee that lawmakers might not have the luxury of waiting. "I don't know exactly when the uncertainty would become a factor, but surely as we get closer to January 1 and Congress has not given a clear road map for how it plans to proceed, that would certainly affect planning, business decisions, household decisions, as they look ...

(Reuters) - The euro retreated from a three-week high and world stocks slipped on Tuesday as the latest setback in efforts to restructure Greek debt triggered fresh worries about a messy default for the country. Oil and gold prices also fell, with gold following the euro's lead. Euro-zone finance ministers rejected as insufficient an offer made by private creditors to help restructure Greece's debt, sending negotiators back to the drawing board. Without aid, Athens will not be able to pay back 14.5 billion euros in maturing bonds in March, which would trigger a difficult default that would hurt the euro zone's financial system and potentially hit the global economy. Investors have been on edge for months over the implications of a messy Greek default and worries about the larger euro- ...

As we approach New Years we'll attempt to address the major issues for 2012. Economic News USD - When will Congress Address the US Deficit and Debt? Could this be the year that Congress finally tackles the difficult issues to reduce spending and lower the national debt? The Congress just recently acted to renew the payroll tax break in a last minute deal, a method that Washington has seemingly perfected. Most likely Congress will kick the can down the road as they are unwilling to take on the big issues of social benefits heading into an election year. If the trend of improving US fundamentals continues then a return to US growth may help to ease the pressure of rising deficits. However, a failure to address the issues could eventually raise the yields on Treasury bonds while reducing ...

As expected, the euphoria died overnight. On Wednesday, the Dow was up nearly 500 points. Thursday, it fell 23 points. More and more people are coming to the same conclusion. The bull market is a fraud. And the system is corrupt. And they’re right. But not for the reasons they think. Here is Number One on the “Capitalism as we know it doesn’t work” hit parade. From Forbes: Top 0.1% of the Nation Earn Half of All Capital Gains The top 0.1% — about 315,000 individuals out of 315 million — are making about half of all capital gains on the sale of shares or property after 1 year; and these capital gains make up 60% of the income made by the Forbes 400. It’s crystal clear that the Bush tax reduction on capital gains and dividend income in 2003 was the cutting edge policy that has created ...

(Reuters) - President Barack Obama's use of a rare joint session of Congress to deliver a jobs speech on Thursday reflects a political strategy to try to blame Republicans for an economy at risk of sliding back into recession. The choice of venue -- the Republican-controlled House of Representatives -- is aimed at sending a clear message to voters that if his plan to reduce high unemployment is blocked by Congress, it is Republicans and not the White House standing in the way of job growth. With unemployment stubbornly high and most Americans unhappy with his handling of the economy, Obama's speech is part of a 2012 election strategy to shift some of the blame for the struggling economy onto Congress and to portray it as obstructionist. "It's very important for the president to invoke ...

(Reuters) - President Barack Obama is finalizing a jobs package that could include a program to refurbish school buildings nationwide and tax breaks to encourage firms to hire workers. The package, to be unveiled in early September, is Obama's chance to convince skeptical voters he can bring down the 9.1 percent unemployment rate and steer the United States away from another recession -- ahead of next year's election. Critics say the president, who bailed out the auto industry and spent $860 billion to revive the economy after he took office in 2009, has few jobs-boosting options and will have a hard time getting Republicans to accept any new spending plan. But economists and advisers familiar with his strategy say Obama will argue next month that the financial crisis was worse than ...

Fat guys can surprise you. They don’t move very fast. But they can be very agile intellectually. That was how G.K. Chesterton was. Laurence Lindsay, former assistant to George W. Bush for economic policy, seems to be the same way. Slow on his feet, perhaps. But quick in his mind. Writing in The Wall Street Journal, Lindsey delivers thoughts that might have come from The Daily Reckoning. First, he notes that the budget problems faced by Washington are larger than generally reported. Growth rates have been overestimated, he says, while interest costs and deficits have been grossly underestimated. When more realistic assumptions are plugged in to the numbers it adds more than $4 trillion in ‘budget costs’ over the next four years. He concludes: Underestimating the long-term budget ...