QUOTE OF THE DAY
Chicago Tribune: Pension reform failure puts Quinn's leadership woes in spotlight
Pension reform was supposed to be one of Gov. Pat Quinn's biggest accomplishments, an issue he proclaimed he was "put on Earth" to solve after the failure of "12 governors, 13 speakers of the House and 13 Senate presidents" before him.
If last week's result is any indication, fate may have other plans for Quinn. Instead of declaring victory after a yearlong push to overhaul the state's vastly indebted government worker pension system, the Democratic governor joined that same list of leaders who've been unable to bridge wide differences on the politically tricky issue.
Quinn chalked it up to "political timidity" by legislators unwilling to cast tough votes, and there's little doubt lawmakers share in the blame. But the governor's inability to win on several other high-profile issues he had championed before the lame-duck session, including gay marriage and an assault weapons ban, resurrected long-simmering questions about his leadership abilities.
Reuters: Getting comfortable with living on the edge
Just as you learn to put up with a nagging toothache, this week is expected to provide fresh evidence that the U.S. economy is getting used to life on the edge of the fiscal cliff.
Of course, putting off that trip to the dentist is not necessarily wise. The longer Washington delays, the more painful it will become to narrow its gaping budget deficit.
But surveys of U.S. consumer confidence in January and of house builder sentiment in December are likely to show resilience, buttressing the argument of equity bulls that Wall Street's firm start to the year is more than a relief rally or a desperate search for higher returns on investment.
AEI: Treasury and Fed kill the trillion-dollar platinum coin
Tim Geithner and Ben Bernanke have put the kibosh on the whimsical/embarrassing idea of having the Treasury Department mint a trillion-dollar platinum coin to get around the debt ceiling. And even if Treasury did, it looks like the Federal Reserve wouldn’t accept it. This from opinion columnist Ezra Klein at The Washington Post:
That’s the bottom line of the statement that Anthony Coley, a spokesman for the Treasury Department, gave me today. ”Neither the Treasury Department nor the Federal Reserve believes that the law can or should be used to facilitate the production of platinum coins for the purpose of avoiding an increase in the debt limit,” he said.
As Klein adds, the Obama White House has already ruled out a possible end run on the debt ceiling. Back in December, Press Secretary Jay Carney said, “This administration does not believe the 14th Amendment gives the president the power to ignore the debt ceiling — period.”
Reason: Will Dodd-Frank Trigger a New Financial Crisis?
In the wake of the fiscal crisis of 2008, lawmakers in Washington rushed to craft legislation to curtail risky practices at the center of the financial collapse.
The product was the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, a massive slate of regulations that expanded the role of government to police everything from debit card purchases to insurance.
LA Times: Nearly one-third of U.S. homeowners have no mortgage
What mortgage meltdown?
While millions of Americans have suffered the angst of lost homes, equity and pride, nearly a third of the nation's homeowners have no mortgage at all, according to an estimate released Thursday by real estate website Zillow.
The free-and-clear class includes, predictably, retirees who have chipped away at their debts for decades, but also a surprisingly high percentage of young people and those who live in relatively affordable regions. In Los Angeles and Orange counties, only 20.7% of homeowners owned their properties outright, reflecting the region's pricey real estate.
Points and Figures: Everyone’s Moving Away
Ace pilot Chuck Yeager used to say, “Never wait for trouble.”. Barry Ritholz tweeted this early this AM and I thought it was pretty meaningful in a macro sense. Check out which states are seeing increases in childbirth, and which aren’t.
People are leaving the less fiscally sound states for other states that are in better fiscal shape. They are also starting to follow jobs. Job growth in states like California has been anemic compared to states like Texas. Or, my wife postulates that maybe liberals are simply not reproducing, and they will eventually die off.
CNBC: Higher Payroll Tax Already Biting Consumer Spending
Americans are beginning to feel the pinch from Washington's decision to embrace austerity measures aimed at bringing down the nation's budget deficit.
Paychecks across the country have shrunk over the last week due to higher federal tax rates, and workers are already cutting back on spending, which will drag on the economy this year.
Reuters: Democrats urge Obama to be ready to bypass Congress on debt ceiling
Top Democratic senators urged President Barack Obama on Friday to be ready to raise the debt ceiling without congressional approval in order to avert a damaging debt default.
Senate Majority Leader Harry Reid and his leadership team said Obama should use "any lawful steps" under his authority to "ensure that America does not break its promises and trigger a global economic crisis."
They urged Obama to act on his own if Republicans insist on a debt limit extension that is coupled with "unbalanced or unreasonable" spending cuts.
CARTOON OF THE DAY