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  • Commentary posted August 25, 2014 by Diane Katz Ex-Im Bank little more than corporate welfare

    Congress is debating the fate of the U.S. Export-Import Bank, an obscure government agency that funnels subsidies to foreign firms for the purchase of American exports. Proponents claim the bank aids small business, creates jobs and "levels the playing field" in global trade. In fact, Ex-Im does nothing of the kind, and Americans deserve to know the truth about what is…

  • Commentary posted August 22, 2014 by Norbert J. Michel, Ph.D. Bitcoin Currency: The New Frontier for the CFPB

    The Consumer Financial Protection Bureau (CFPB) has unparalleled powers over nearly every consumer financial product and service.  Given that virtual currencies can serve as a form of electronic money, the CFPB has, predictably, decided to weigh in on this topic. A CFPB statement this week warned people about the dangers of private digital currencies such as Bitcoin,…

  • Commentary posted August 20, 2014 by Norbert J. Michel, Ph.D. Housing finance reform: It’s still about investment guarantees

    The 2010 Dodd-Frank Act was sold as a reform bill that would reduce risk in financial markets, yet it barely touched the single biggest source of that risk: the government-sponsored enterprises Fannie Mae and Freddie Mac. Several GSE reform proposals have since surfaced in Congress, but those that have garnered the most political support still would perpetuate the old…

  • Backgrounder posted August 20, 2014 by Norbert J. Michel, Ph.D. The Fed’s Failure as a Lender of Last Resort: What to Do About It

    It is not obvious that the Fed should be involved in emergency lending, however, since expectations of such lending can increase the likelihood of crises. Arguments in favor of this role often misread history. Instead, history and experience suggest that the Fed’s balance sheet activities should be restricted to the conduct of monetary policy. —Renee Haltom, Research…

  • Issue Brief posted August 19, 2014 by Daren Bakst Reining in the EPA Through the Power of the Purse

    While significant criticism is rightfully directed to the Environmental Protection Agency (EPA) on issues such as greenhouse gas (GHG) regulation, Congress itself is to blame for not reasserting its lawmaking power over an agency that is supposed to be implementing the will of Congress, not the will of the agency. Through the appropriations process, Congress can rein in…

  • Issue Brief posted August 14, 2014 by Norbert J. Michel, Ph.D. Federal Reserve’s Expansion of Repurchase Market Is a Bad Idea

    The Federal Reserve has been expanding a new “test” program it calls the Overnight Reverse Repurchase Facility (ON RRP). This program is a drastic departure from its regular open-market operations and potentially expands the federal financial safety net to the entire money market. Such an expansion increases systemic risk and increases the likelihood of unintended…

  • Backgrounder posted August 14, 2014 by Norbert J. Michel, Ph.D., Stephen Moore Quantitative Easing, The Fed’s Balance Sheet, and Central Bank Insolvency

    More than five years after the 2008 financial crisis, the Federal Reserve’s role is still the subject of much debate. One source of controversy has been the extent to which the Fed allocated credit directly to possibly insolvent institutions. Critics argue that the Fed should have allowed insolvent firms to restructure through bankruptcy and should have provided credit…

  • Issue Brief posted August 11, 2014 by Norbert J. Michel, Ph.D., John L. Ligon Five Guiding Principles for Housing Finance Policy: A Free-Market Vision

    The two government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, remain under government conservatorship with the federal government standing behind all of their obligations. Housing finance reform is likely to be addressed during the next congressional session, but it appears the House and the Senate may offer very different reform proposals. Congress…

  • Testimony posted August 7, 2014 by Diane Katz Mismanagement of Export-Import Bank Invites Fraud

    Testimony before the Committee on Oversight and Reform Subcommittee on Economic Growth, Job Creation and Regulatory Affairs United States House of Representatives July 29, 2014 Chairman Jordan, Ranking Member Cartwright, and Members of the Subcommittee, thank you for inviting me to testify this morning. My name is Diane Katz. I am a Research Fellow in Regulatory…

  • Commentary posted August 6, 2014 by Nicolas Loris Exporting Energy has Broad, Expansive Benefits

    There’s been something of an energy boom taking place in the U.S. over the past few years, and it’s given the American economy a real boost. Now we just need the federal government to get out of the way and open opportunities to freely trade energy, and those benefits will grow substantially. U.S. coal exports over the past six years are way up, in large part because of…

  • Commentary posted August 6, 2014 by Norbert J. Michel, Ph.D. The Pseudo Science of Inflation

    Many economists were quick to jump all over the Federal Reserve for its expansionary monetary policies surrounding the 2008 financial crisis. After its typical open-market purchases did little to get the economy moving again, the Fed embarked on several rounds of quantitative easing (QE), the most expansive policies it has ever orchestrated. The fear has always been that…

  • Testimony posted August 4, 2014 by Curtis S. Dubay Tax Reform Would Help American Families: Dynamic Scoring Makes it More Likely

    Testimony before the Subcommittee on Select Revenue Measures of the Committee on Ways and Means U.S. House of Representatives My name is Curtis S. Dubay. I am Research Fellow in Tax and Economic Policy at The Heritage Foundation. The views I express in this testimony are my own, and should not be construed as representing any official position of The Heritage…

  • Backgrounder posted August 4, 2014 by Rachel Greszler, Romina Boccia Social Security Trustees Report: Unfunded Liability Increased $1.1 Trillion and Projected Insolvency in 2033

    Social Security ran a $71 billion deficit in 2013, closing out four years of consecutive cash-flow deficits as the program’s unfunded obligations continue to grow.[1] According to the 2014 annual report from the programs’ trustees, the combined 75-year unfunded obligation of the Social Security and Disability Insurance Trust Funds (referred to collectively as the OASDI…

  • Commentary posted July 31, 2014 by James Sherk, Emily Goff Bridges to Nowhere are no Economic Stimulus

    Standard and Poor’s just published a report sure to warm special interest hearts. The ratings agency argues that spending an additional $1.3 billion on infrastructure would boost the economy by $2 billion, create 30,000 jobs AND reduce the deficit. If true, more infrastructure spending is a no-brainer. Sadly, this economic free lunch does not actually exist. S&P’s report…

  • Commentary posted July 30, 2014 by Diane Katz Ex-Im Bank - A Conduit for Corporate Welfare

    The most successful lobbyists in the nation’s capital are masters of masquerading propaganda as fact. Repeat even outright falsehoods with a modicum of conviction, and they start to sound like truth. So be forewarned: claims about the manifold small-business benefits of the Export-Import Bank of the United States are simply fictitious. Until recently, few Americans had…