Ratio Of Job Seekers To Job Openings Is Declining

From The Wall Street Journal Real Time Economics, "Vital Signs Chart: 3.5 Unemployed for Every Job Opening" by Conor Dougherty:

For almost three years now, the U.S. has added private-sector jobs. At the same time, many discouraged workers have left the workforce, meaning less competition for those still seeking jobs.

Source: The Wall Street Journal

US Corporate Tax On Foreign Earnings Discourages US Investment By American Companies

From The Wall Street Journal, "Corporate Taxes, the Myths and Facts: U.S. companies don't get a tax break for moving plants overseas.They are, however, socked with an extra bill for bringing home earnings." by " by John Engler:

According to the nonpartisan congressional Joint Committee on Taxation, there are no specific tax credits or deductions for moving plants and jobs overseas.***The [US corporate tax] system has simply not kept up with the demands of today's global marketplace, where 95% of the world's consumers live outside the U.S. All other G-8 countries—and 28 of the 34 member nations of the Organization for Economic Cooperation and Development—use "territorial" tax systems. This means a company's sales in foreign markets are taxed at the rate of that local market—the same rate borne by other competitors.

By contrast, under the current U.S. system, after an American company pays that local tax, it finds the Internal Revenue Service waiting with a big tax bill when the company tries to bring foreign earnings back to the U.S. Why? Because America's tax law requires the payment of an additional tax—generally the difference between the U.S. rate and the tax rate in the foreign market.

According to J.P. Morgan, U.S. companies today control $1.7 trillion in foreign earnings held outside the U.S., earnings they don't plan to repatriate. If the U.S. were to adopt a territorial system, it would eliminate the tax barrier that discourages American companies from bringing their money home where it could be used for capital investment, R&D dividends or other ways to support economic growth. [Emphasis added.]

Business Income Is 4 To 6 Times Riskier Than Labor Income (Salary And Wages), Due To Greater Income Fluctuations And Business Terminations: Successful Private Business Owners, For Taking Much More Risk, Should Be Rewarded Much More Than Employees

From Finance and Economics Discussion Series, Divisions of Research & Statistics and Monetary Affairs, Federal Reserve Board, Washington, DC, "The Properties of Income Risk in Privately Held Businesses" by Jason DeBacker, Bradley Heim, Vasia Panousi, Shanthi Ramnath, and Ivan Vidangos, 2012-69:

We note that the [risk] value ... is the closest empirical analog to the theoretical concept of the variance of (uninsurable) idiosyncratic income risk from privately-held businesses that shows up in calibrations of theoretical models in the macro and finance literature.
***[Private] business income is about four times riskier than labor income. The table shows that, depending on the model, this ratio ranges between 4 - 6.5, so that business income is about 4 to 6 times riskier than labor income.
***Our paper is the first in the literature to document the properties of business income risk from privately held businesses in the US, using a long time dimension. Utilizing a new, large, and confidential panel of income tax returns for 1987-2009, we find that business income is much riskier than labor income, not only because of the probability of business exit, but also because of higher income fluctuations, conditional on no exit. We show that business income is less persistent, but is also has higher probabilities of extreme upward movement, compared to labor income. Furthermore, the distribution of percent changes for business income is more dispersed, and it indicates that business income faces substantially higher tail risks. Our results suggest that the high income households are more likely to bear both the big positive and the big negative business income risks. ... indicates that business income risk could be responsible for the consumption and the investment spending behavior of the rich, for example during the recent recession.

Low And Middle Income, Not The Wealthy, Benefit The Most, In Dollars And Percent Of Income, From Tax Deductions, Exemptions And Preferences

From Bloomberg, "The Real Reason Romney’s Tax Math Doesn't Add Up" by Josh Barro:

The tax preferences that exist today overwhelmingly benefit people with lower and middle incomes, not the wealthy. While tax rate cuts reduce income tax burdens proportionally, as TPC notes, there aren't enough tax preferences for wealthy people to offset Romney's cuts at the top.

To understand this, we can look at the IRS Statistics of Income report for 2009, the most recent year available. Tax returns reporting less than $200,000 of adjusted gross income (AGI) accounted for a total AGI of $5.86 trillion, and taxable income of $3.24 trillion. That is, deductions and exemptions amounted to 45 percent of adjusted gross income for people making under $200,000.

Tax returns with more than $200,000 of AGI (the highest-earning 2.8 percent of filers) had a total of $1.96 trillion in AGI and $1.62 trillion in taxable income. For this high-income group, deductions and exemptions were just 18 percent of adjusted gross income.

Put another way, filers with over $200,000 of income earned 26 percent of all personal income in 2009, but received only 12 percent of tax exemptions and deductions.

Wyoming Has The Best, NY Has The Worst State Business Taxes

From Tax Foundation, "2013 State Business Tax Climate Index: Which States Have the Best Tax Systems for Business?" by Joseph Henchman and Scott Drenkard:

The 10 best states in this year's 2013 Index are Wyoming, South Dakota, Nevada, Alaska, Florida, Washington, New Hampshire, Montana, Texas, and Utah. Many of these states do not have one or more of the major taxes, and thus do not have the associated complexity and distortions.

The 10 lowest ranked, or worst, states in the 2012 Index are Maryland, Iowa, Wisconsin, North Carolina, Minnesota, Rhode Island, Vermont, California, New Jersey, and New York. New York slid past New Jersey for the bottom spot by having the worst individual income tax, the sixth-worst unemployment insurance taxes, and the sixth-worst property taxes.

Source: Tax Foundation

When Marginal Tax Rates Are Lowered, Business Owners Work Harder And Increase Firm Revenues

From NBER Working Paper Series, "The Impact Of Tax Incentives On The Economic Activity Of Entrepreneurs" by Jarkko Harju and Tuomas Kosonen, Working Paper 18442:

We ... study empirically to what extent the income tax burden on entrepreneurs affects the output of their firms.***The results indicate that decreasing the marginal tax rate of an entrepreneur increases the turnover [revenues] of her firm. Our main specification that compares partnerships with corporations indicates that a 10 percent reduction in the marginal tax rate leads to a 1.7 percent increase in turnover [revenues].***there is no indication that more people are being employed. Thus it seems that the reforms did not increase labor demand. Moreover we do not find any statistically significant increase in investments. Therefore the increase in turnover is due to increase in effort that the entrepreneurs exert.

Too Many Teachers: 40 Years Of More Teachers And Smaller Classes Have Not Improved Math And Reading Scores Or HS Graduation Rates

From The Wall Street Journal, "Jay Greene: The Imaginary Teacher Shortage: Forty years and a million more teachers later, student performance is unchanged. Yet Obama and Romney both say schools need more staff." by Jay P Greene:

For decades we have tried to boost academic outcomes by hiring more teachers, and we have essentially nothing to show for it. In 1970, public schools employed 2.06 million teachers, or one for every 22.3 students, according to the U.S. Department of Education's Digest of Education Statistics. In 2012, we have 3.27 million teachers, one for every 15.2 students.

Yet math and reading scores for 17-year-olds have remained virtually unchanged since 1970, according to the U.S. Department of Education's National Assessment of Educational Progress. The federal estimate of high-school graduation rates also shows no progress (with about 75% of students completing high school then and now). Unless the next teacher-hiring binge produces something that the last several couldn't, there is no reason to expect it to contribute to student outcomes.

Locavores Beware: Lead In Eggs From NYC Backyard Chickens

From The New York Times, "Worries About Lead for New York City’s Garden-Fresh Eggs" by Julie Scelfo:

Preliminary results from a New York State Health Department study show that more than half of the eggs tested from chickens kept in community gardens in Brooklyn, Bronx and Queens had detectable levels of lead, unlike their store-bought counterparts.

21 Percent Growth In Seniors Working Since 2008

From The Wall Street Journal Real Time Economics, "More People Over 65 Are Still Working" by John Shipman:

In September, the number of those 65 and over who were employed was up 21% from the same month in 2008, while broad workforce employment was down almost 1.4%. The size of the retirement-age labor force has also increased 23% during the past four years, while the broader labor force is up less than 0.4%.

Source: The Wall St. Journal Real Time Economics

$1.1 Trillion Estimated US Government Deficit For FY 2012

From CBO, "The Federal Budget Deficit Totaled $1.1 Trillion in 2012, CBO Estimates:"

The federal government’s fiscal year 2012 has come to a close, and CBO estimates—in its latest Monthly Budget Review—that the federal budget deficit for the year was about $1.1 trillion, or 7.0 percent of gross domestic product (GDP). Although the deficit is approximately $200 billion lower than the shortfall recorded in 2011, fiscal year 2012 marks the fourth year in a row with a deficit of more than $1 trillion.

Surge In Part-Time Jobs Responsible For Decline In Unemployment: Along With Upward Revision Of Summer Job Growth Suggests Ending Extended Unemployment Benefits In The Spring Is Putting People Back On The Payroll

The announcement of the lower unemployment rate today, which includes an increase in the number of people in the workforce, and a surge in part-timers who want full-time work, is probably due in a significant part to the ending of the extended unemployment benefits just prior to the beginning of the summer.

From The Wall Street Journal Real Time Economics, "Why Did the Unemployment Rate Drop?" by Phil Izzo:

In September, the number of part-time workers who would like full-time jobs surged by 582,000. That represents about two-thirds of the increase in employment last month and is larger than the drop in the number of unemployed.

Additionally, there was a huge upward revision in job growth for July and August.

From The Wall Street Journal Real Time Economics, "Four Takeaways From Jobs Report" by Ben Casselman:

Big revisions to July, August: The Labor Department revised up its estimate of July jobs growth to 181,000 from 141,000 and its August estimate to 142,000 from 96,000 — a combined addition of 86,000 jobs. That means job growth was significantly stronger over the summer than previously believed,

Chewing Hard Food In Old Age Keeps Seniors Mentally Alert

From "Chewing ability linked to reduced dementia risk" on ScienceBlog:

few or no teeth makes chewing difficult, which leads to a reduction in the blood flow to the brain. However, to date there has been no direct investigation into the significance of chewing ability in a national representative sample of elderly people.
Now a team comprised of researchers from the Department of Odontology and the Aging Research Center (ARC) at Karolinska Institutet and from Karlstad University have looked at tooth loss, chewing ability and cognitive function in a random nationwide sample of 557 people aged 77 or older. They found that those who had difficulty chewing hard food such as apples had a significantly higher risk of developing cognitive impairments. This correlation remained even when controlling for sex, age, education and mental health problems, variables that are often reported to impact on cognition. Whether chewing ability was sustained with natural teeth or dentures also had no bearing on the effect.

The results are published in the Journal of the American Geriatrics Society (JAGS).

First Presidential Debate Knocks 6.5 Percent Off Obama's Reelection Odds On Intrade

At the end of the first presidential debate between Mitt Romney and President Obama, the Intrade security price (odds) for "Barack Obama to be re-elected President in 2012" was 6.5 percent lower than at the debate's start.

The price at the end of the debate was 6.92 or a 69.2 percent chance of reelection for Barack Obama.

UPDATE: At about a hour and a half after the end of the debate, Obama's Intrade reelection security price is down 10.3 percent to 6.64 or a 66.4 percent chance of reelection for Barack Obama.

David Letterman's Top Ten Mistakes About Hydraulic Fracturing (Fracking)

From AEIdeas, "Video: ‘The top ten mistakes David Letterman made on hydraulic fracturing’ " by Mark J. Perry:

NY, NJ Unemployment Higher Now Than During Recession

From Bloomberg, "Why Is Northeastern Unemployment Soaring?" by Evan Soltas:

Unemployment is surging across the Northeast. In two states -- New York and New Jersey -- the statewide rates of unemployment are higher than they were at any point during the recession. In Maine, New Hampshire, Vermont, Connecticut and Pennsylvania, years' worth of progress against unemployment has been reversed in a matter of months.***It's not exactly clear what is holding the Northeastern job market back, though. The slow growth in employment is broad: The region lags behind the nation in job creation in seven out of 10 industry categories.

And the region had weak GDP growth in 2011 to match the poor jobs performance. Last year, the Northeast grew at just 1 percent, versus 1.8 percent for the rest of the country. Two Northeastern states -- New Jersey and Maine -- were actually in recession at the state level.

US Birthrate Lowest On Record: Below Great Depression Birthrate: Missed Births Unlikely To Be Made Up Later

From The Wall Street Journal, Real Time Economics, "U.S. Fertility Rate Hits Lowest Level on Record" by Conor Dougherty:

Last year the U.S. fertility rate fell to the lowest level since the government began keeping track of the data, the latest evidence that the recession and slow recovery has markedly altered plans for new children, according to this report released today by the Centers for Disease Control and Prevention.

The overall fertility rate for women in the U.S. — defined as the number of newborns per 1,000 women aged 15 to 44 — was 63.2 last year, down from 64.1 in 2010 and the lowest rate since the government started collecting these statistics in 1920.***Ken Johnson, senior demographer at the Carsey Institute at the University of New Hampshire, notes that similar fertility drops occurred during the Great Depression — and never recovered. “The young women never made up for the births that they didn’t have,” he said.

Much of the delay in child-bearing has occurred among younger women, probably because they have more leeway in delaying their families than women who are closing in on the end of their fertility window. The most startling example: Hispanic women between 20 and 24 saw their fertility rate drop to 115 last year from 165 in 2007. White women between 20 and 24 saw their rate fall to 72 from 85 over the same period.

Households Have More Total Debt Than US Government

From EconoMonitor: The Wilder View, "Who has the most debt in the US?" by Rebecca Wilder:

Source: The Wilder View

Source: The Wilder View

2400 Millionaires Received Unemployment Benefits

From Bloomberg, "Almost 2,400 Millionaires Pocketed Unemployment Benefits" by Frank Bass:

Almost 2,400 people who received unemployment insurance in 2009 lived in households with annual incomes of $1 million or more, according to the Congressional Research Service.

The report was released after about 1.1 million people exhausted their jobless benefits during the second quarter of 2012, when more than 4.6 million filed initial unemployment claims. Eliminating those payments to high earners is one idea being considered as U.S. lawmakers struggle to curb a projected $1.1 trillion deficit for the fiscal year that ended Sept. 30, with the nationwide jobless rate at 8.1 percent.

It is also one of the reasons that unemployment benefits and other government entitlement benefits do less to create economic growth that often touted by politicians and the media.

If government money substitutes for other household income, savings or borrowing, then total spending will not increase at the consumer level. The government benefit increases government debt dollar for dollar, but does not increase consumer spending dollar for dollar because the government entitlement benefit substitutes, in whole or part, for other private money available for consumer spending at the household or individual level.

Social Security Projected To Run Out Of Funds In 20 Years, CBO Analysis

From Congressional Budget Office analysis, "As the Population Ages, Social Security’s Spending Is Projected to Outpace Its Tax Revenue" October 2, 2012:

CBO estimates that in fiscal year 2012, spending for Social Security totaled $773 billion, equal to about 5 percent of gross domestic product and one-fifth of federal spending. As more members of the baby-boom generation retire and the U.S. population grows older in the coming decades, Social Security outlays are projected to grow more rapidly than the economy and more rapidly than the program’s dedicated tax revenues.

Over the next 10 years, outlays will exceed dedicated tax revenues by about 10 percent, on average. That gap will grow larger in the 2020s, and by 2030, Social Security outlays will be about 6 percent of gross domestic product and will exceed dedicated tax revenues by about 20 percent. As a result, under current law, resources available to the Social Security program will become insufficient to pay full benefits in about 20 years, CBO projects.

With Or Without Health Insurance, People Are Going To The Doctor Less Often

From The Washington Times, "Report: People visiting doctors less often" by Paige Winfield Cunningham:

Americans visit the doctor less than they did a decade ago, but — as is often the case in the complicated world of health care — it’s unclear whether that’s good or bad.

Nonsenior adults visited a medical provider an average of 4.8 times each year in 2001, but by 2010, that average had fallen to 3.9 annual visits, according to a U.S. Census Bureau report released Monday. And not only did people with health coverage see a doctor less frequently, but so did those who lacked insurance and Americans who reported fair or poor health.