Edmund L. Andrews's blog

So Ben Bernanke, the Fed chairman, today explicitly justified the logic for another round of quantitative easing (or "QE2") to salvage our sputtering economic recovery.  

On one level, what's striking about Bernanke's speech at a conference of the Boston Fed is how textured, detailed and unambiguous it is in trying to explain a decision the Fed won't officially make until at least Nov. 3.   Bernanke acknowledges that consumer spending has been inhibited by a "painfully slow'' recovery, that job growth is too slow to make any real dent in unemployment through the end of next year and that inflation is actually running unemployment is coming down too slowly and that inflation is "too low" for the Fed's comfort. Then Bernanke spells out the implications for monetary policy, with the bottom line being that the time is right for QE2.

What do  Republicans have in common with China's communist leadership?   They'd probably both like to make the Nobel Prize people disappear from the face of the earth.

On Friday, the scandalous Scandinavians infuriated the Chinese leadership by awarding the Nobel Peace Prize to Liu Xiaobo, the imprisoned literary critic and political dissenter.  The Chinese, who had publicly warned the Nobel committee against honoring Liu, then denounced the award as blasphemous, banned celebrations, arrested some of his supporters and called the Norwegien ambassador in for a tongue-lashing,

I've been off-line for much longer than I wanted, and I apologize.  But as you can read in this press release, I'm about to take on a new job that I just couldn't pass up.  Starting October 18, I will take up residence at the National Journal as managing editor for economics. 

As many of you know, National Journal has long  been one of the most respected (and expensive) publications to cover government.   It's now launching a big expansion, especially  on the web, and it has recruited a spectacular roster of journalists, starting with Ron Fournier as editor in chief and Ron Brownstein as editorial director. 

Peter Orszag, who stepped down just as White House budget director just a month ago, appears to have just floated an important trial balloon on a potential Democratic strategy for the Bush tax cuts. It comes in the form of Orszag's debut column for the New York Times op-ed page, but it's probably a good indicator of where the White House would like to go.

 I just posted on this for the Fiscal Times:

Orszag proposes two departures from the current White House orthodoxy:

1)      Extend all  the Bush tax cuts for two years, even for the top 2 percent of earners – i.e., households with annual incomes above $250,000.

2)      Let all  the Bush tax cuts expire,  including those for middle-income households, starting in 2013.

Here’s Orszag:

Kevin Hasset and Alan Viard took another run at arguing that small business will be crippled if the Bush tax cuts expire for individuals earning above $200,000 and families with incomes above $250,000.

I've looked into this before, as have others, and the argument is thin.  Hassett re-launches the Republican factoid that about half of all business income reported on individual returns goes to people in the top tax brackets.  The counter-factoid is that 97 percent of people who report business on their personal returns don't make enough money to be affected by the higher rates.