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732. An Examination of State Non-Group and Small-Group Health Insurance Regulations
- Author:
- Anthony T. Lo Sasso
- Publication Date:
- 01-2008
- Content Type:
- Working Paper
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- The present upswing in state-level efforts to "do something about health care," combined with presidential campaign-related rhetoric, suggests that health care is back with a vengeance on the public consciousness. Many states are proposing what appear to be new strategies to cover the uninsured when in reality the "new" strategies rely on old approaches that have not proven highly effective in the past, notably community rating and guaranteed issue regulations. Using data culled from a popular health insurance distributor and the published literature provides a compelling portrait of the predictable distortions that can result from regulations aimed at improving perceived deficiencies in the non-group and small group health insurance markets.
- Topic:
- Economics, Government, Health, and Politics
- Political Geography:
- United States
733. 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
734. Japan's Lost Decade: Lessons for the United States in 2008
- Author:
- John H. Makin
- Publication Date:
- 01-2008
- Content Type:
- Policy Brief
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- Japan experienced a disastrous decade of economic stagnation and deflation from 1991 to 2001 after bubbles in its stock market and land market collapsed. While some economic pain was unavoidable—given a 60 percent plunge in equity prices between late 1989 and August 1992, accompanied by the onset of what ultimately became a 70 percent drop in land values by 2001—the "lost decade" was not an inevitable outcome. It required a series of persistently wrong economic policy decisions that ignored the lessons learned in America's Great Depression of the 1930s and the subsequent research on the causes of that painful period.
- Topic:
- Economics, Human Rights, Human Welfare, Humanitarian Aid, and Markets
- Political Geography:
- United States, Japan, America, and Asia
735. Denial, Hope, and Panic
- Author:
- John H. Makin
- Publication Date:
- 04-2008
- Content Type:
- Policy Brief
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- In October 1907, J. P. Morgan stemmed a financial panic by coercing other banks to join him in providing credit to Wall Street brokerage firms teetering on the edge of bankruptcy.[1] This year, over the weekend including March 15—the ominous Ides of March—James Dimon, head of JPMorgan Chase, was the one to act. With the Federal Reserve squarely behind him and assuming the risk, he prevented a Bear Stearns bankruptcy by agreeing to purchase the firm, providing it with a decent burial, at a price of $2 per share. Bear Stearns's stock had been valued at over $160 per share just a year ago. The $2 price virtually wiped out the value of that stock, one-third of which is owned by its 14,000 employees. This was clearly not a bailout for Bear Stearns shareholders, and whether or not the steps taken by the Fed on March 16 were sufficient to arrest a further collapse of available credit and the economy remains to be seen. As long as house prices keep falling, the underlying problem for credit markets and the economy remains.
- Topic:
- Economics, Government, and Markets
- Political Geography:
- United States
736. Wealth Enhancement and Storage
- Author:
- John H. Makin
- Publication Date:
- 05-2008
- Content Type:
- Policy Brief
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- The desire to enhance and store wealth has been present ever since income rose above subsistence levels. In ancient times, prior to the creation of symbolic financial claims on wealth, wealth storage was, quite literally, the storage of intrinsically valuable articles in temples, pyramids, or other such formidable structures. Even today in Tibet, which was long a theocracy, a major repository of wealth can be seen in religious statues of solid gold resting in temples.
- Topic:
- Civil Society and Economics
- Political Geography:
- United States
737. 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
738. The Fed's Dilemma
- Author:
- John H. Makin
- Publication Date:
- 07-2008
- Content Type:
- Policy Brief
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- The Fed is in a bind, pulled toward easier monetary policy by a weak economy and fragile credit markets, while simultaneously needing to resist higher inflation. On Monday, June 9, after a weekend of headlines regarding a half-percentage-point rise in the unemployment rate, Federal Reserve chairman Ben Bernanke gave a pathbreaking speech entitled "Outstanding Issues in the Analysis of Inflation" at the Federal Reserve Bank of Boston's fifty-third Annual Economic Conference. In that speech, after suggesting that the risks of a substantial economic downturn had diminished over the past month and citing further progress in the repair of financial and credit markets, he proceeded to address the problem of rising inflation. In two sentences, he contributed to a sharp, fifty-basis-point rise in two-year bond yields and boosted the market's assessment of the chance of a fifty-basis-point rise in the federal-funds target rate at the September 16 meeting of the Federal Open Market Committee (FOMC) from virtually zero to nearly 70 percent.
- Topic:
- Economics and International Trade and Finance
- Political Geography:
- United States
739. What if the United States Sneezed and Latin America Didn't Catch a Cold?
- Author:
- Megan Davy
- Publication Date:
- 05-2008
- Content Type:
- Policy Brief
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- Latin American and Caribbean (LAC) economies, usually susceptible to international financial turmoil, are especially vulnerable to even minor tremors in U.S. markets. Regional policymakers and entrepreneurs, therefore, have been closely watching the current U.S. subprime credit crisis. Here is the good news: all signs point to relatively minor symptoms in LAC countries—despite a rocky financial history during the 1980s and 1990s—thanks in large part to reforms undertaken in response to previous financial crises, as well as continued high commodity prices that will likely buoy export markets. Although the economic downturn in the United States and other global markets will likely expose lingering weaknesses in the region's economy, this latest crisis can provide an impetus to complete the unfinished business of building more modern, resilient economies.
- Topic:
- Development, Economics, and Emerging Markets
- Political Geography:
- United States, South America, Latin America, and Central America
740. Barack Obama's Social Security Donut Hole
- Author:
- Andrew G. Biggs
- Publication Date:
- 03-2008
- Content Type:
- Policy Brief
- Institution:
- American Enterprise Institute for Public Policy Research
- Abstract:
- Until recently, Senator Barack Obama (D-Ill.) was surprisingly responsible regarding Social Security, noting the urgency of reform and saying all options should be on the table. But having cornered himself with Democratic activists whose attitudes toward Social Security reform range from demagoguery to denial, his solution to the system's problems has veered leftward. He now plans to fix Social Security exclusively with higher taxes. The new Obama plan would not only fail to resolve the system's long-term problems, but would also impose significant costs on the economy as a whole.
- Topic:
- Demographics, Economics, and Politics
- Political Geography:
- United States