“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.
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New York Times Editorial Board: Stronger Dollar in a Weak Global Economy
In the last several months, the dollar has strengthened tremendously against other currencies like the euro, the pound and the yen. This largely reflects the realization among investors that the American economy will do much better than other major economies in the coming months. [..]
For the United States, a stronger dollar will serve to dampen growth, though by how much nobody can accurately predict because the relative values of currencies are hard to forecast. Some American manufacturers have said they are losing orders or seeing their profits decline as they are forced to cut prices to compete with the lower prices offered by European and Japanese businesses.
The appreciation of the dollar is a good reason for the Federal Reserve to hold off on raising interest rates this summer. But more than anything else, the stronger dollar serves as a reminder that the world is still far too reliant on the United States, which itself has not yet fully recovered from the financial crisis. That does not augur well for sustainable global growth.
David Cay Johnston: No, the estate tax isn’t destroying family farms
The latest pitch for an estate-tax repeal repeats a long-discredited lie
Congress is voting this week on whether to repeal the estate tax. The step would be a huge boon to billionaires and others whose fortunes would forever escape taxation, creating an even larger dynastic class of inheritors who owe their riches to their skill at picking their parents.
But that’s not what was heard at a House Ways and Means Committee hearing last week. Instead the theme was how the tax was eviscerating American farmers. [..]
The fact is that any claim that the estate tax is killing family farms is a lie.
How many of America’s 2.2 million farms have been sold to pay estate taxes? None. [..]
We need to reform the estate tax system. I would start by changing the code to tax capital gains at death, as Canada does, and to limit the estate tax to huge concentrated fortunes – say, of $1 billion or more. But we should all agree to reform it on the basis of facts, not lies.
The public doesn’t need a middleman for sharing-economy services, but it does need to make sure they are regulated
So-called “sharing economy” companies such as Uber, Airbnb and Task Rabbit are posing policy headaches for governments around the world. Their argument that they should be exempt from existing regulations because their services are ordered over the web does not make much sense, but it provides an adequate fig leaf for politicians seeking campaign contributions from these highly capitalized newcomers.
For those who have missed the hype, “sharing economy” refers to a wide variety of companies that use the web to connect consumers and providers. While there is not reliable data on its size, in part because it is not well defined, Airbnb now boasts far more room listing that Hilton or Marriot, and Uber has quickly grown to be the largest taxi service in the world.
Part of the response to the innovations associated with these sharing economy companies should be to modernize regulations. It is reasonable to regulate taxi services in ways that ensure that cars are safe and drivers are competent and responsible. It is also reasonable to regulate rented rooms to ensure they are not fire traps. Similarly, both should be regulated in ways that ensure access to the handicapped and prevents discrimination. In addition, employees in these companies should be covered by workers compensation and protected by minimum wage and overtime rules.
Mark Weisbrot: Destroying the Greek economy in order to save it
European authorities are using dirty tactics to bring Greece to heel
There is a tense standoff right now between the Greek government and the so-called troika – the European Commission, the European Central Bank (ECB), and the International Monetary Fund (IMF). ECB President Mario Draghi went so far this week as to deny that his institution is trying to blackmail the Greek government.
But blackmail is actually an understatement of what the troika is doing to Greece. It has become increasingly clear that they are trying to harm the Greek economy in order to increase pressure on the new Greek government to agree to their demands. [..]
The amounts of money involved are quite trivial for the ECB. The government has to come up with approximately 2 billion euros of debt payments in April. The ECB has recently shelled out 26.3 billion euros to buy eurozone governments’ bonds as part of its 850 billion euro quantitative-easing program over the next year and a half. The ECB’s excuses for causing this cash crunch in Greece ring hollow. For example, it argues that banks under the previous government didn’t have to have the limit that the ECB is imposing on banks now, because the prior government had committed to a reform program that would fix its finances. But so has this one.
It could hardly be more obvious that this is not about money or fiscal sustainability, but about politics. This is a government that European authorities didn’t want, and they wish to show who is boss. And they really don’t want this government to succeed, which would encourage Spanish voters to opt for a democratic alternative – Podemos – later this year.
Robert Kuttner: 5 Radical Ideas Hillary Should Support
The repositioning of candidate Clinton has already begun. One of the fascinating indicators is a report of a commission on inclusive prosperity organized and released in January by the Center for American Progress. The report, co-authored by Larry Summers (!), sounds more like something Larry Mishel of the Economic Policy Institute or Paul Krugman or Joseph Stiglitz might have written.
Among other things, the report calls for much more public investment, more help for trade union organizing, full employment, disdain for fiscal austerity, taxation of the rich, and lots of other good stuff usually associated with the progressive wing of the Democratic Party. [..]
So while it’s good that Clinton is positioning herself as more of a progressive, I think she needs to be even more radical, both to generate real enthusiasm and to address America’s real problems.
Robert Naiman: Schumer’s Choice: To Succeed Reid, He Must Back Iran Deal
Democratic Senate Minority Leader Harry Reid has announced that he will not run for re-election. Reid has endorsed Sen. Charles Schumer (D-NY) to succeed him as Democratic leader.
But in order to succeed Reid as Senate Democratic leader, Schumer is going to have to pay a price: he’s going to have to back President Obama’s multilateral diplomacy with Iran, which Bloomberg reports could produce a “framework agreement” this weekend. Some of Senator Schumer’s New York constituents might not like that, but as the soldiers say, they’ll just have to “embrace the suck.” Senate Republicans may think it’s ok for them to try to undermine a diplomatic agreement. But the prospective leader of Senate Democrats isn’t allowed to do that. [..]
Schumer will have to make a choice. If he maintains his support for the Corker bill, he would help kill the talks. But then he would never be the leader of Senate Democrats. If he wants to be leader of Senate Democrats, Schumer will have to support President Obama on Iran diplomacy.
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