Discussions about the federal budget like the ones we often engage in here at CG&G, typically focus on "formulation," that is, on the process and politics of putting the budget together and getting it enacted. That's the part we all generally agree is broken, not working properly, overly politicized, and...well...you get the picture.
But this story from Friday's Washington Post, which talks about $15 billion in spending on Iraq that can't be accounted for properly, or in some cases at all, shows that the other stage of federal budgeting -- implementation -- is similarly broken, not working properly, and...well...you certainly get this picture as well.
In fact, it appears as if virtually every procedure and law designed to prevent just this type of malfeasance was circumvented.
This spending was done in the midst of a national emergency and some of the usual safeguards couldn't be followed in the interest of national security and getting the job done quickly, right?
Pete has an excellent post below on gasoline prices that has garnered a great deal of attention. Take a look, for example, at this from Real Time Economics, which is part of the Wall Street Journal online.
First, it's great to be in the company of bloggers-in-crime like Pete and Andrew.
But beyond the self congratulation is a question: Why should anyone be surprised that there may be...or are...speculators on the price of oil?
If U.S. consumers are willing to pay ever higher prices for gasoline -- and so far there's absolutely no indication that they're not -- why shouldn't energy companies continue to raise those prices. That's textbook economic theory. And if prices are going to continue to rise, or if some believe they will, isn't speculation likely?
In a CNBC interview this afternoon, when asked by Maria Bartiromo about how much of the blame for the recent oil price rise should be put on speculators, Treasury Secretary Hank Paulson said, "This is not about blame, this is about supply and demand," he said in an interview on CNBC television. "All the research we have done shows that speculators and investors have had very little impact on this." Traders and longer-term investors tend to take positions on both sides of oil market transactions, long and short, thus being essentially price receivers rather than price setters.
What research was he talking about? Here are a few possibilities.
Yesterday, the Bank of England's minutes of May 7-8 stated:
Congressman Raul Grijalva (D-AZ) introduced H.R. 6116, the Saving Family Homes Act of 2008 today:
The Act would grant homeowners whose mortgages have been foreclosed the right to petition a judge to allow them to remain in the home as renters, and pay a fair market rent. The rent would be set by a court-appointed appraiser and adjusted annually for inflation.
The Saving Family Homes Act is one of the few proposed remedies for the current mortgage crisis which requires no expenditure of federal funds or additional bureaucracy, while giving immediate relief to millions of families facing foreclosure and preventing home vacancies that harm neighborhoods.
To prevent abuse by speculators, the Act limits eligibility to mortgages on single-family, principal residences, occupied for at least 2 years, which sold for less than the median home value in the metropolitan statistical area in which the home resides or the median value in the state if such information is not available.
In a very short time, Diane Rogers, the economist mom herself, has become one of my must reads every day. Take a look at this and you'll understand why.