A Greek Exit

There is some concern about Greece’s current debt strait causing it to leave the EU, and there is additional concern about “contagion” spreading—that with the precedent set, other members might leave, also. Mark Dowding, BlueBay Asset Management’s co-head of investment grade and a senior portfolio manager, offered this, for instance:

If we get a Greek exit, you have to say the potential for other countries to exit the eurozone is suddenly no longer negligible. That would need to be reflected in bond prices.

Rents and Rental Ownership

New York City is going to do it, again.

Mayor Bill de Blasio appears poised to deliver on a campaign promise to freeze rents for more than one million tenants protected by New York City’s rent-stabilization laws.

Both landlord and tenants leaders said they expect the Rent Guidelines Board to approve the freeze, affecting one-year apartment leases beginning on or after Oct 1, on Monday….

Never mind that

…an annual report showed that landlord operating costs only rose 0.5% due to falling fuel prices. Excluding volatile fuel costs, overall costs rose 3.6%.

The Supreme Court Erred Again

Heads up: long post. I have some thoughts on the Roberts Court’s ruling concerning the IRS’ tax credits.

Chief Justice John Roberts again rewrote the Patient Protection Affordable and Care Act to suit what he thought it should say rather than staying within the bounds of what it actually says. In these comments I’ll leave aside Roberts’ guiding principles that health plans that are independent of the risk being transferred are, somehow, insurance plans; that possession of a health plan is a universal so good it must be mandated; and that the folks who need a health plan the least—the healthy—must also be required to possess such a plan. Those matters have been well addressed elsewhere. I’ll confine my remarks to his position on the IRS’ tax credits.

It’s Really Not That Hard

Greek Prime Minister Alexis Tsipras’s unexpected announcement in the early hours of Saturday that Greece will hold a referendum on July 5 on the bailout conditions creates a severe headache for ECB President Mario Draghi and the rest of the bank’s 25-person governing council. The ECB faces a choice between maintaining ample liquidity support for Greek banks and potentially undermining the ECB’s credibility as a rules-based institution, or forcing the closure of Greek banks and enraging Greece’s government and people.

But wonks and misconceptions do add to the artificial complexity of the thing.

We’re a Helpless Victim

That’s OPM Director Katherine Archuleta’s claim regarding the hack of her agency’s computer systems that now appear to expose as many as 18 million…what shall we call these, since OPM has laid claim to the victimhood in this failure…Americans.

I don’t believe anyone is personally responsible[.]

Fox News cited her further:

Archuleta said only the perpetrators should be blamed—she said current failures result from decades of meager investment in security systems, but said changes are being made and in fact helped detect the latest breaches.

Then there are these, via The Wall Street Journal:

Some Brag

…by this Texan. Except that, as Dizzy Dean said, “It ain’t braggin’ eff you can do it.”

Via AEIdeas:SomeBragTable

International Trade and Hillary Clinton

Recall that the Democrats in the House of Representatives last week blew up their erstwhile favorite, a wealth transfer sub-bill to pay a bunch of money to American workers who would be “displaced” by the Trans-Pacific Partnership free trade bill being negotiated by President Barack Obama and 11 other Pacific nations. This in turn blew up the fast track authority bill already passed in the Senate and of which the TAA was a part.

An Argument for Positive Immigration Flows

James Pethokoukis, writing in a different context, presented evidence in his AEIdeas piece for us doing better with our immigration policies. First, see the graph below, with particular attention to the “Increases in the workforce (labor inputs)” part of the bars.LaborProductivityAndImmigration_BetterVersion

Pethokoukis’ argument centered on Republican Presidential candidate Jeb Bush’s promise to work toward a 4% GDP growth annual rate if he’s elected; Pethokoukis argued that would be hard to achieve because of shortfalls in the availability of actual laborers.

Progressive Tax Credits

Targeting youth unemployment, Hillary Rodham Clinton plans to propose tax credits to encourage businesses to train young people and offer apprenticeships to develop lifelong job skills.

Clinton’s campaign said she would outline a proposed tax credit of $1,500 for every apprentice that a business hires….

Here’s a thought. How about lowering taxes altogether and getting the tax code out of the business of social engineering? With suitably low taxes, you wouldn’t need to play games with taxes as inducements to do this or as discouragements from doing that.


The federal government cannot verify nearly $3 billion in subsidies distributed through Obamacare, putting significant taxpayer funding “at risk,” according to a new audit report.

HHS’ Office of Inspector General (OIG) said

[The Centers for Medicare and Medicaid Services] CMS’s internal controls did not effectively ensure the accuracy of nearly $2.8 billion in aggregate financial assistance payments made to insurance companies under the Affordable Care Act during the first four months that these payments were made.

Three findings from the audit [emphasis added]:

  • did not have systems in place to ensure that financial assistance payments were made on be half of confirmed enrollees and in the correct amounts,