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51. America's Infrastructure: Ramping Up or Crashing Down

Author:
Bruce Katz
Publication Date:
01-2008
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
Infrastructure has a dramatic effect on the economic competitiveness of our nation, the health of our environment and our quality of life. And infrastructure—freight ports, airports, bridges, roads, rail and transit networks, water and sewer systems, web of channel communications—is the connective tissue of our nation. Smart policies and investments can enhance and further national prosperity and the health and vitality of metropolitan areas, where the bulk of our population lives and jobs are located.
Topic:
Debt, Economics, and Political Economy
Political Geography:
United States

52. Political Disagreement, Lack of Commitment and the Level of Debt

Author:
Davide Debortoli and Ricardo Nunes
Publication Date:
07-2008
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We analyze how public debt evolves when successive policymakers have different policy goals and cannot make credible commitments about their future policies. We consider several cases to be able to disentangle and quantify the respective effects of imperfect commitment and political disagreement. Absent political turnover, imperfect commitment drives the long-run level of debt to zero. With political disagreement, debt is a sizeable fraction of GDP and increasing in the degree of polarization among parties, no matter the degree of commitment. The frequency of political turnover does not produce quantitatively relevant effects. These results are consistent with much of the existing empirical evidence. Finally, we find that in the presence of political disagreement the welfare gains of building commitment are lower.
Topic:
Economics, Markets, and Political Economy
Political Geography:
United States

53. How Long Can the Unsustainable U.S. Current Account Deficit Be Sustained?

Author:
Steven B. Kamin, Carol C. Bertaut, and Charles P. Thomas
Publication Date:
07-2008
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This paper addresses three questions about the prospects for the U.S. current account deficit. Is it sustainable in the long term? If not, how long will it take for measures of external debt and debt service to reach levels that could prompt some pullback by global investors? And if and when such levels are breached, how readily would asset prices respond and the current account start to narrow?
Topic:
Economics, Foreign Exchange, Government, International Political Economy, and Political Economy
Political Geography:
United States

54. Policy Liberalization and FDI Growth, 1982 to 2006

Author:
Matthew Adler and Gary Clyde Hufbauer
Publication Date:
08-2008
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
Over the last three decades the global economy has expanded in a remarkable fashion. While nominal world GDP has increased four times, world bilateral trade flows have grown more than six-fold, and the stock of foreign direct investment (FDI) has grown by roughly 20 times since 1980. The sources of global trade and investment growth are well known—general economic expansion, policy liberalization, and better communications and technology—but the impact of each source is unclear. In this paper we attempt to uncover the contribution of policy liberalization to the rising ratios of US inward and outward FDI stocks to GDP over the last three decades.
Topic:
Economics, Globalization, International Political Economy, International Trade and Finance, Markets, and Political Economy
Political Geography:
United States

55. PolicyWatch #1363: Electoral and Social Tensions Spike in Egypt

Author:
David Schenker
Publication Date:
04-2008
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
On April 8, Egypt held elections for nearly 53,000 municipal representatives. Not surprisingly, participation was abysmal: Egypt's ruling faction, the National Democratic Party (NDP), ran unopposed for more than 80 percent of the seats, while the Muslim Brotherhood -- the country's only real opposition party -- boycotted the contest in response to government harassment. Although the White House issued a statement expressing concern about "widespread electoral violations," these issues represent only a fraction of Egypt's domestic problems, which also include food shortages, labor unrest, and increasing Islamist social and political penetration. Complicating matters, these crises coincide with the first political transition in decades -- the impeding retirement of eighty-year-old President Hosni Mubarak, who has ruled since 1981. Taken together, these developments raise the specter of instability for a key U.S. ally.
Topic:
Government, Political Economy, and Politics
Political Geography:
United States and Egypt

56. The Risk Cycle

Author:
John H. Makin
Publication Date:
02-2008
Content Type:
Policy Brief
Institution:
American Enterprise Institute for Public Policy Research
Abstract:
Now that Wall Street and the Federal Reserve have finished congratulating themselves for not having been alarmists—in other words, for failing to recognize that a recession was looming—they are now facing up to the onset of a U.S. recession and a rapidly spreading financial crisis. Having been late to reach that conclusion, they now grudgingly admit that we may have a brief "V-shaped" recession and are apparently hoping that Fed rate cuts and a fiscal stimulus package will quickly solve the economy\'s problems.
Topic:
Economics and Political Economy
Political Geography:
United States

57. False Dawn

Author:
John H. Makin
Publication Date:
01-2008
Content Type:
Policy Brief
Institution:
American Enterprise Institute for Public Policy Research
Abstract:
The bursting of every bubble is followed by statements suggesting that the worst is over and that the real economy will be unharmed. The weeks since mid-March have been such a period in the United States. The underlying problem—a bust in the residential real-estate market—has, however, grown worse, with peak-to-trough estimates of the drop in home prices having gone from 20 to 30 percent in the span of just two months. Meanwhile, the attendant damage to the housing sector and to the balance sheets tied to it has grown worse and spread beyond the subprime subsector.
Topic:
Economics, Government, International Trade and Finance, and Political Economy
Political Geography:
United States

58. The New Deal Jobs Myth

Author:
Amity Shlaes
Publication Date:
01-2008
Content Type:
Policy Brief
Institution:
American Enterprise Institute for Public Policy Research
Abstract:
Democratic presidential candidates are invoking the New Deal as a model for addressing infrastructure, economic, and employment problems in the United States. But a careful look at New Deal spending suggests, in the words of Amity Shlaes, "not how much the public works achieved . . . [but] how little." Advocates for new federal government spending on highways, buildings, and roads should carefully weigh the need against the damage that comes from projects and jobs created for political reasons.
Topic:
Government, Industrial Policy, Political Economy, and Politics
Political Geography:
United States

59. Benefit Growth That We Cannot Afford

Author:
Alan D. Viard
Publication Date:
04-2008
Content Type:
Policy Brief
Institution:
American Enterprise Institute for Public Policy Research
Abstract:
Buried in the 227-page Social Security trustees' report are some dramatic numbers about Social Security's future promises. AEI resident scholar Alan D. Viard tells us that "a typical worker retiring in 2050 has been promised 47 percent more than today's retirees, and one retiring in 2080 has been promised more than double today's benefits." To address the program's financial problems, he says, the rules need to be changed to link future retirees' benefits to inflation. That move, he says, would go a long way toward solving the system's problems.
Topic:
Security, Economics, and Political Economy
Political Geography:
United States

60. Saving Medicare

Author:
Joseph Antos and Mark V. Pauly
Publication Date:
05-2008
Content Type:
Policy Brief
Institution:
American Enterprise Institute for Public Policy Research
Abstract:
Medicare is in perilous financial shape. The number of seniors receiving benefits will double over the next two decades as baby boomers head to retirement, and each new beneficiary will spend substantially more health care dollars, on average, than today's seniors. Unless we can get costs under control, Medicare will need an additional $36 trillion to stay in business over the next seventy-five years.
Topic:
Political Economy and Politics
Political Geography:
United States