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531. The Big U-Turn: Japan Threatens to Reverse Postal Reforms

Author:
Gary Clyde Hufbauer and Julia Muir
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
On May 31, 2010 a majority of the Lower House of the National Diet of Japan approved legislation that would reverse a decade's worth of effort to fully privatize key subsidiaries of Japan Post Holdings Co. Ltd. Besides postal services, the state-run postal system offers banking and insurance services, through Japan Post Bank (JPB) and Japan Post Insurance (JPI), respectively. These are the financial engines of Japan Post and were the units slated for privatization. Both subsidiaries have long received favorable government treatment, tilting the playing field against private banks and insurance firms, whether foreign or domestic. The government of Japan is in clear violation of its commitments under the World Trade Organization (WTO), and if the Upper House approves the legislation, Japan will reverse the efforts made by the United States and the European Union, as well as domestic private banks and insurance firms, to establish a level playing field. What's more, Japan risks having a formal WTO dispute brought against it.
Topic:
Economics, Government, and Privatization
Political Geography:
United States, Japan, and Europe

532. Deepening China-Taiwan Relations through the Economic Cooperation Framework Agreement

Author:
Daniel H. Rosen
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
On Sunday, June 13, 2010 representatives from China and Taiwan held a third round of talks in Beijing on an Economic Cooperation Framework Agreement (ECFA) that would liberalize important aspects of cross-Strait economic relations. Details of what was agreed and what remains under negotiation are still trickling out, and in any case the nature of this framework is that various elements will be agreed upon on an ongoing basis rather than at once. But it is clear from available details that ECFA will be an ambitious accord that fundamentally changes the game between Taiwan and China and hence affects the regional economy and even the transpacific tempo for the United States.
Topic:
Economics, International Cooperation, International Trade and Finance, Treaties and Agreements, and Bilateral Relations
Political Geography:
United States, China, and Taiwan

533. Hobbling Exports and Destroying Jobs

Author:
Gary Clyde Hufbauer and Theodore H. Moran
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
The US House of Representatives has just passed the American Jobs and Closing Tax Loopholes Act (HR 4213). This bill will hurt American workers, reduce American exports, and make American companies less competitive in the international marketplace. Since the US Senate has already passed companion legislation, the American Workers, State, and Business Relief Act (S 3336), these ill-considered bills could soon be reconciled in conference and become the law of the land. If so, American firms and workers will pay the price.
Topic:
Economics, International Trade and Finance, Markets, and Labor Issues
Political Geography:
United States and America

534. Higher Taxes on Multinationals Would Hurt US Workers and Exports

Author:
Gary Clyde Hufbauer and Theodore H. Moran
Publication Date:
05-2010
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
As presidential candidate, Barack Obama repeatedly advocated tax “reforms” aimed squarely at US-based multinational enterprises (MNEs). As president, he again declared—in the same State of the Union address that laid out an ambitious goal for export expansion—that “it is time to finally slash the tax breaks for companies that ship our jobs overseas, and give those tax breaks to companies that create jobs right here in the United States of America."
Topic:
Economics, International Trade and Finance, Markets, and Monetary Policy
Political Geography:
United States

535. Protection by Stealth: Using the Tax Law to Discriminate against Foreign Insurance Companies

Author:
Gary Clyde Hufbauer
Publication Date:
04-2010
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
These are difficult times. Not only are 10 percent of Americans unemployed but the federal budget is out of whack thanks to the specter of rising entitlement outlays. A natural impulse in difficult times is to protect domestic products and domestic producers. The tone of political economy during the global recession of 2007–09 is no different from that in past recessions—but louder because the economic damage is more severe. Emblematic of this spirit is a proposal to discriminate against foreign-owned insurance companies, using the tax code.
Topic:
Economics, Labor Issues, and Financial Crisis
Political Geography:
United States

536. Economic Contractions in the United States: A Failure of Government

Author:
Mark Calabria
Publication Date:
06-2010
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Charles Rowley and Nathanael Smith have put together a brief, yet extensive, study comparing America's Great Depression and the recent financial crisis. Their focus is on both the economics and the politics behind these events. With both, they demonstrate how each was a failure of government, not of the market. The book concludes with several recommendations for addressing our nation's current economic and fiscal situation. The most original contribution of their work is in bringing a Public Choice framework to evaluating the financial crisis.
Topic:
Economics and Financial Crisis
Political Geography:
United States

537. The Transatlantic Economy 2010: Annual Survey of Jobs, Trade and Investment between the United States and Europe

Author:
Daniel S. Hamilton and Joseph P. Quinlan
Publication Date:
01-2010
Content Type:
Working Paper
Institution:
Center for Transatlantic Relations
Abstract:
Despite the recession, the United States and Europe remain each other's most important foreign commercial markets. No other commercial artery in the world is as integrated and fused as the transatlantic economy. We estimate that the transatlantic economy continues to generate close to $4.28 trillion in total commercial sales a year and employs up to 14 million workers in mutually “onshored” jobs on both sides of the Atlantic.
Topic:
Economics, Globalization, International Trade and Finance, Global Recession, and Financial Crisis
Political Geography:
United States and Europe

538. Prioritizing Strategic Interests in South Asia

Author:
Robert B. Oakley and T.X. Hammes
Publication Date:
06-2010
Content Type:
Working Paper
Abstract:
The focus on the war in Afghanistan has prevented the United States from developing a South Asia strategy rooted in the relative strategic importance of the nations in the region. India, a stable democracy enjoying rapid growth, clearly has the most potential as a strategic partner. Pakistan, as the home of al Qaeda leadership and over 60 nuclear weapons, is the greatest threat to regional stability and growth. Yet Afghanistan absorbs the vast majority of U.S. effort in the region. The United States needs to develop a genuine regional strategy. This paper argues that making the economic growth and social reform essential to the stability of Pakistan a higher priority than the conflict in Afghanistan is a core requirement of such a strategy.
Topic:
Political Violence, Economics, Terrorism, War, and Insurgency
Political Geography:
Pakistan, Afghanistan, United States, South Asia, and India

539. Renminbi Undervaluation, China's Surplus, and the US Trade Deficit

Author:
William R. Cline
Publication Date:
08-2010
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
On June 21, 2010, in the run-up to the G-20 meeting in Toronto, China announced that it would shift to a more flexible exchange rate policy. From mid-June to July 30 the yuan rose 0.8 percent against the dollar. In contrast, the currency had remained fixed (at about 6.83 yuan to the dollar) from September 2008 to early June 2010. Pressure not only from the United States and the European Union but also from Russia, Brazil, and India as well as the IMF seems likely to have played a role in China's decision, although concerns about domestic inflation may also have been a factor.
Topic:
Economics and Monetary Policy
Political Geography:
United States and China

540. Pyongyang's Survival Strategy: Tools of Authoritarian Control in North Korea

Author:
Daniel Byman and Jennifer Lind
Publication Date:
08-2010
Content Type:
Journal Article
Journal:
International Security
Institution:
Belfer Center for Science and International Affairs, Harvard University
Abstract:
In the early 1990s, many observers predicted that Kim Il-sung's regime would not survive the cessation of Russian aid and the resulting downward spiral of North Korea's economy. Speculation about regime collapse intensified when the less charismatic Kim Jong-il succeeded his father in 1994, and again after the 1996–97 famine that killed upwards of a million North Koreans. Gen. Gary Luck, commander of U.S. forces in Korea, declared in 1997 that North Korea would “dis - integrate.” That same year, a U.S. government and outside team of experts predicted regime collapse within five years. Another decade brought more prognostications: in 2000 Director of Central Intelligence George Tenet warned that “sudden, radical, and possibly dangerous change remains a real possibility in North Korea, and that change could come at any time.” Three years later, U.S. Deputy Secretary of Defense Paul Wolfowitz said that North Korea was “teetering on the edge of economic collapse.” Contemporary accounts warn that the regime is threatened by the growing flow of information into the country or by popular outcry touched off by the government's 2009 bungling of currency reform.
Topic:
Economics
Political Geography:
United States and North Korea