Where was Obama the centrist in his State of the Union?

Posted by , 26th January 2011

ObamaJennifer Rubin
1/26/2011

Those expecting either a moderate speech turned with an eye toward 2012 or a bold speech in the vein of the president’s best work were both disappointed on Tuesday night. He focused primarily on new investments and spending projects while offering only token cuts to compensate. Fiscal responsibility for Social Security and Defense was shifted to the Congress and to Chairman Robert Gates, respectively. In all, the president was surprisingly timid and predictable.

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The India-Indonesia Alignment

Posted by , 25th January 2011

India Taj MajalHarsh V. Pant
1/25/2011

The long partnership between India and Indonesia is deepening against the backdrop of a more menacing China. The basis of the India-Indonesia partnership dates to the founding of these nation’s founders–Jawaharlal Nehru and Sukarno–who offered a distinct worldview that drew on their shared colonial experiences. Economic engagement between New Delhi and Jakarta is growing rapidly and has gained further momentum with the signing of the India-Asean free-trade agreement last year. Pant concludes that by wooing Indonesia, India is signaling that it is indeed serious about its presence in Southeast Asia.

Pant is a professor of defense studies at King’s College, London.

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The Talent Magnet

Posted by , 25th January 2011

ObamaDavid Brooks
1/25/2011

Brooks says it will be interesting to see if President Obama talks about economic growth and competitiveness in the standard or visionary way tonight in his state of the union address. He considers what a visionary speech might encompass, including a look at how America’s position in the world is changing moving from the Big Dog nation of the 20th century to a different world today. In order to thrive America must become the crossroads nation where global talent congregates and collaborates. He says the nation with the most diverse creative hot spots will dominate the century and government’s role will be like at a university: it must establish an overall climate with competitive tax rates, predictable regulations, and fiscal balance. It should actively concentrate talent and then work aggressively to reduce the human capital inequalities that occur in an innovation economy.

Brooks is a New York Times columnist.

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Can Deregulation Work?

Posted by , 21st January 2011

Paul H. RubinPaul Rubin
1/21/2011

Based on his experience at two regulatory agencies during the Reagan years, Rubin is not optimistic that the president’s recently announced deregulatory initiative will be a success. He writes that without managers with a strong interest in deregulation and with the backing of senior administrators, there will be no serious power to buck the staffs. The current executive order seems to impose a cost-benefit analysis, but it has enough loopholes (“equity, human dignity, fairness”) so that agencies will be able to do whatever they want.

Rubin is a professor of economics at Emory University.

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Don’t Bank on China ‘Rebalancing’

Posted by , 20th January 2011

China shopJoseph Sternberg
1/20/2011

There are deeply rooted reasons–from banking habits to government policy–why the Chinese are unlikely to increase consumption anytime soon. For starters, China lacks the infrastructure of modern consumer finance and is years–possibly decades–away from building it to the standards of the developed world. Its banks face significant structural and regulatory barriers to offering more consumer-finance products. China needs to reallocate capital and labor to orient itself toward producing goods and services that its consumers want. China’s investment-driven growth may already be witnessing declining marginal returns. Shifting to a new model for GDP growth will require changes at every level, right down to the bank branch.

Sternberg is an editorial page writer for the Wall Street Journal Asia.

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How to Freeze the Debt Ceiling Without Risking Default

Posted by , 19th January 2011

DebtPat Toomey
1/19/2011

Regarding the coming Congressional debate over whether to raise the US debt ceiling, Toomey says that under no circumstances is it acceptable for the US to default on its debt. By honoring our debts we benefit from the nearly universal conviction that those who lend to us will always be repaid in full. We should never undermine that conviction. Toomey opposes raising the debt ceiling without regaining control of federal spending. The recent surge in spending, both in absolute dollars and as a percentage of our GDP, has produced record deficits and debt. Congress can address the looming fiscal crisis created by overspending without jeopardizing the full faith and credit of our country–and it should.

Toomey, a Republican, is a US senator from Pennsylvania.

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Big business is back in business

Posted by , 13th January 2011

US Chamber of Commerce logoDana Milbank
1/12/2011

The US Chamber of Commerce is enjoying renewed influence in Washington after this past November’s elections. Not only did the Chamber support a number of winning candidates across the nation, but corporate interests have returned to prominence among both the legislative and executive branches. Lobbyists have gained key staff positions with incoming Representatives and Senators and the Chamber expects a more business friendly tone in the years ahead.

Milbank writes about political theater in the nation’s capital.

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An American Message for the Chinese President

Posted by , 13th January 2011

President Hu JintaoKelly Currie
1/12/2011

Chinese President Hu Jintao arrives in Washington for a state visit next week as the Obama administration’s thinking on the US-China relationship has evolved. Curry suggests that Obama may give greater prominence to human rights as he recalibrates relations with Beijing. She thinks freedom of expression should be the leitmotif of the summit. The summit provides an opportunity to contrast the weaknesses of the Chinese political system with the strengths of the American one. Aspects of the visit involving freedom of expression should be non-negotiable. If the Chinese side objects, the White House should be willing to cancel events of importance to Beijing’s protocol-obsessed leaders.

Currie is a senior fellow with the Project 2049 Institute.

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Why Teacher Pensions Don’t Work

Posted by , 10th January 2011

TeacherJoel Klein
1/10/2011

Throughout the country public-employee pension plans have been massively underfunded and defined-benefit systems aren’t merely Ponzi schemes. They discourage talented teachers who would prefer front-loaded compensation. Defined-benefit pensions helped bring the once-vibrant US auto industry to its knees. The promised benefits just proved too costly. The same kind of pension is now hollowing out public education. Because there’s essentially no competition in education, however, the effect has been hidden from public view. Today incoming governors–Democrats and Republicans–faced with this dismal equation are looking for a way to undo the damage and get out from under these unsustainable promises.

Klein, former chancellor of New York City’s public schools, is the CEO of News Corporation’s educational division.

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