An Update to the Budget and Economic Outlook: 2014 to 2024 - CBO
Around $500 billion deficit for fiscal 2014, down from more than a trillion in 2009 and 2010.
Due to baby boomers retiring federal debt is projected to growing again in just a few years down the road.
At more than $15 trillion we are deeply in debt.
Sunday, August 31, 2014
Tuesday, April 22, 2014
Obama's China Challenge
President Barack Obama lands in Japan Wednesday to kick off a
week-long Asian Reassurance Tour, and not a moment too soon. Amid the
summitry in Tokyo, Seoul, Kuala Lumpur and Manila, Asian leaders will be
watching the showdown over an obscure speck of land in the South China
Sea.
Second Thomas Shoal sits some 125 miles off the western coast of the Philippines, one of more than 750 rocks, reefs and islets known as the Spratly Islands. Today it is the site of China's boldest attempt to forcibly exert sovereignty over the resource-rich, 1.35-million-square-mile South China Sea, through which one-third of all global maritime traffic passes.
Early last month Chinese ships blocked the Philippine military from resupplying its marines on the shoal, which is 700 miles from China's coast and has had a Philippine military presence since 1999. This marked an escalation in China's "cabbage strategy" of seizing Philippine territory by gradually surrounding it with layers of Chinese boats, from fishing vessels to coast guard patrols and warships.
Beijing's move essentially dares Manila to risk a shooting war whenever it resupplies or rotates its marines, as it last did on March 29. That time a Philippine supply ship successfully reached the shoal, having maneuvered past Chinese coast guard vessels at a distance of a few hundred dangerous meters. Manila's next supply run could come any day.
This is the latest in a string of Chinese provocations against the Philippines. In 2012, several hundred miles to the north, Beijing seized Scarborough Shoal after Philippine patrols had the temerity to try to arrest illegal Chinese fishermen. The U.S. brokered a June 2012 agreement for China and the Philippines to withdraw from Scarborough, but only Manila complied. Chinese ships have since used water cannons to keep Filipinos from fishing in the area.
In early 2013 the Philippines challenged China's territorial claims through arbitration under the United Nations Convention on the Law of the Sea, which both countries have signed. Furious at this appeal to a rules-based international order, Beijing responded by squeezing Second Thomas Shoal, demanding that Manila withdraw its marines and barring Philippine President Benigno Aquino from a trade fair in China unless he abandoned his call for arbitration. China blockaded the shoal last month as Manila was poised to submit its 4,000-page case to the U.N.
All of this constitutes a challenge to Washington. The U.S. and the Philippines signed a mutual-defense treaty in 1951, but Washington has signaled that it wouldn't cover a Chinese attack on Second Thomas Shoal, which falls within Manila's 200-mile Exclusive Economic Zone but wasn't claimed by Manila until 1978.
Visiting Manila in February, U.S. Chief of Naval Operations Admiral Jonathan Greenert answered a hypothetical question about China seizing Philippine-controlled territory in the Spratlys. "Of course we would help you," he said initially--before adding: "I don't know what that help would be specifically. I mean, we have an obligation because we have a treaty. But I don't know in what capacity that help is."
With statements like that from Washington, no wonder Beijing feels emboldened. At a press conference with U.S. Defense Secretary Chuck Hagel this month, Chinese Defense Minister General Chang Wonquan insisted that there would be "no compromise, no concessions" on territorial disputes with U.S. allies.
If Mr. Obama this week simply reaffirms the standard U.S. position of neutrality on sovereignty disputes and support for peaceful resolutions of differences, he will provide little reassurance to America's friends. More effective would be to directly question the legitimacy and origin of China's South China Sea claims, as State Department official Danny Russel recently did before Congress. The President might add that China's blockade of Second Thomas Shoal endangers the lives of Philippine forces and violates Beijing's promises under the 2002 Declaration on the Conduct of Parties in the South China Sea.
Like Russia in Eastern Europe, China is trying to rewrite the international order to dominate the Western Pacific. And like Vladimir Putin, Beijing's leaders will press their advantage against weaker powers unless America makes clear by word and deed that it will push back
Second Thomas Shoal sits some 125 miles off the western coast of the Philippines, one of more than 750 rocks, reefs and islets known as the Spratly Islands. Today it is the site of China's boldest attempt to forcibly exert sovereignty over the resource-rich, 1.35-million-square-mile South China Sea, through which one-third of all global maritime traffic passes.
Early last month Chinese ships blocked the Philippine military from resupplying its marines on the shoal, which is 700 miles from China's coast and has had a Philippine military presence since 1999. This marked an escalation in China's "cabbage strategy" of seizing Philippine territory by gradually surrounding it with layers of Chinese boats, from fishing vessels to coast guard patrols and warships.
Beijing's move essentially dares Manila to risk a shooting war whenever it resupplies or rotates its marines, as it last did on March 29. That time a Philippine supply ship successfully reached the shoal, having maneuvered past Chinese coast guard vessels at a distance of a few hundred dangerous meters. Manila's next supply run could come any day.
This is the latest in a string of Chinese provocations against the Philippines. In 2012, several hundred miles to the north, Beijing seized Scarborough Shoal after Philippine patrols had the temerity to try to arrest illegal Chinese fishermen. The U.S. brokered a June 2012 agreement for China and the Philippines to withdraw from Scarborough, but only Manila complied. Chinese ships have since used water cannons to keep Filipinos from fishing in the area.
In early 2013 the Philippines challenged China's territorial claims through arbitration under the United Nations Convention on the Law of the Sea, which both countries have signed. Furious at this appeal to a rules-based international order, Beijing responded by squeezing Second Thomas Shoal, demanding that Manila withdraw its marines and barring Philippine President Benigno Aquino from a trade fair in China unless he abandoned his call for arbitration. China blockaded the shoal last month as Manila was poised to submit its 4,000-page case to the U.N.
All of this constitutes a challenge to Washington. The U.S. and the Philippines signed a mutual-defense treaty in 1951, but Washington has signaled that it wouldn't cover a Chinese attack on Second Thomas Shoal, which falls within Manila's 200-mile Exclusive Economic Zone but wasn't claimed by Manila until 1978.
Visiting Manila in February, U.S. Chief of Naval Operations Admiral Jonathan Greenert answered a hypothetical question about China seizing Philippine-controlled territory in the Spratlys. "Of course we would help you," he said initially--before adding: "I don't know what that help would be specifically. I mean, we have an obligation because we have a treaty. But I don't know in what capacity that help is."
With statements like that from Washington, no wonder Beijing feels emboldened. At a press conference with U.S. Defense Secretary Chuck Hagel this month, Chinese Defense Minister General Chang Wonquan insisted that there would be "no compromise, no concessions" on territorial disputes with U.S. allies.
If Mr. Obama this week simply reaffirms the standard U.S. position of neutrality on sovereignty disputes and support for peaceful resolutions of differences, he will provide little reassurance to America's friends. More effective would be to directly question the legitimacy and origin of China's South China Sea claims, as State Department official Danny Russel recently did before Congress. The President might add that China's blockade of Second Thomas Shoal endangers the lives of Philippine forces and violates Beijing's promises under the 2002 Declaration on the Conduct of Parties in the South China Sea.
Like Russia in Eastern Europe, China is trying to rewrite the international order to dominate the Western Pacific. And like Vladimir Putin, Beijing's leaders will press their advantage against weaker powers unless America makes clear by word and deed that it will push back
Saturday, March 29, 2014
Taiwan's crisis signals that détente with China could end fast
What Taipei's Protesters Know; Taiwan's crisis signals that détente with China could end fast.
Wall Street Journal (Online) 27 Mar 2014
The student-led occupation of Taiwan's legislature, now in its second week, concerns much more than a pending Taiwan-China trade agreement. Six years of warming relations between Taipei and Beijing--and of relative calm across the explosive Taiwan Strait--may now be coming to an end.
Taiwanese democracy is known for heated disputes, but the current situation is unprecedented. At times 20,000 protesters have been in the streets. Several hundred stormed the legislature on March 18, barricading the doors and demanding that the ruling party withdraw consideration of the pending trade deal. Five days later, additional protesters tried to take over the nearby offices of the executive cabinet. Police blocked them, in the process injuring 150 people and arresting 60. The legislature remains occupied as protest leaders and government officials negotiate.
The deal at the heart of the fracas was signed last June by Taipei and Beijing to liberalize trade in service industries from banking to publishing, hospitals and beauty parlors--a total of 64 industries in Taiwan and 80 on the mainland. It follows on the 2010 Economic Cooperation Framework Agreement, which launched a new era of cross-Strait commercial expansion. Today annual two-way trade is nearly $200 billion (up almost 100% from 2008), with 40% of Taiwan's exports and 80% of outbound investment now going to China.
Protesters argue that trade with China is a special case in which Taiwan risks an economic dependency that would undermine its own self-government. China already has enough military and economic power, they warn, without the ability to freeze Taiwanese stores, banks and medical services whenever it is displeased with voters' tastes on the island.
This concern is widespread and even appears to be shared by the protesters' adversary, President Ma Ying-jeou, who in recent months has spoken urgently of the need to expand trade ties beyond China, including the need to push domestic reform far enough to earn an invitation into the 12-nation, U.S.-led Trans-Pacific Partnership. The difference is that Mr. Ma calculates--likely correctly--that Taiwan can secure new international trade links only if Beijing tacitly accedes. And for Beijing to do so, the cross-Strait détente must continue with measures such as the services trade agreement.
That's not to say the ongoing protests over closer trade ties were inevitable. Mr. Ma and the Kuomintang he leads erred in not working hard enough to explain their rationale for the deal to the public. Compounding that error, on March 17 they tried to ratify the trade pact unilaterally, violating a promise made last year to allow line-by-line parliamentary review. Then came the students' lawless takeovers of government buildings, which the opposition Democratic Progressive Party quickly embraced. All sides have mishandled the situation.
But today's scene in Taipei represents broad political currents. Since 2008 Beijing has hoped that muting threats of military action and strengthening economic exchange would encourage Taiwanese to support "reunification with the motherland," but polls show the opposite is happening. Although only about 20% want to move toward independence, far fewer want unification and most prefer the decades-old status quo that Beijing continues to reject.
Part of the explanation is that Taiwanese see Beijing's repression of citizens on the mainland, broken promises of autonomy to the people of Hong Kong, and escalating aggression toward neighboring states. In a widely circulated essay supporting the current protests, Taiwanese lawyer Richard Chiou-yuan Lu writes that the trade deal would be acceptable "with any other country" but with China "we don't give an inch . . . because we're afraid of you, China. Really. We're very afraid."
This view, rather than the conciliatory approach of Mr. Ma, may soon come to dictate Taiwanese politics, perhaps even before the expiration of Mr. Ma's term in 2016. If so, China's leaders could decide to return cross-Strait relations to the bad old days, making one of the world's perennial flashpoints far more dangerous.
U.S. officials might consider all this as they prepare to resume bilateral trade talks with Taiwan next week. Advancing bilateral trade--and encouraging eventual Taiwanese accession to the Trans-Pacific Partnership--would help quiet nerves on all sides of Taiwanese politics. The U.S. has largely ignored Taiwan in recent years, but Taipei's current crisis highlights the extent to which trouble still lurks in that corner of Asia.
Wall Street Journal (Online) 27 Mar 2014
The student-led occupation of Taiwan's legislature, now in its second week, concerns much more than a pending Taiwan-China trade agreement. Six years of warming relations between Taipei and Beijing--and of relative calm across the explosive Taiwan Strait--may now be coming to an end.
Taiwanese democracy is known for heated disputes, but the current situation is unprecedented. At times 20,000 protesters have been in the streets. Several hundred stormed the legislature on March 18, barricading the doors and demanding that the ruling party withdraw consideration of the pending trade deal. Five days later, additional protesters tried to take over the nearby offices of the executive cabinet. Police blocked them, in the process injuring 150 people and arresting 60. The legislature remains occupied as protest leaders and government officials negotiate.
The deal at the heart of the fracas was signed last June by Taipei and Beijing to liberalize trade in service industries from banking to publishing, hospitals and beauty parlors--a total of 64 industries in Taiwan and 80 on the mainland. It follows on the 2010 Economic Cooperation Framework Agreement, which launched a new era of cross-Strait commercial expansion. Today annual two-way trade is nearly $200 billion (up almost 100% from 2008), with 40% of Taiwan's exports and 80% of outbound investment now going to China.
Protesters argue that trade with China is a special case in which Taiwan risks an economic dependency that would undermine its own self-government. China already has enough military and economic power, they warn, without the ability to freeze Taiwanese stores, banks and medical services whenever it is displeased with voters' tastes on the island.
This concern is widespread and even appears to be shared by the protesters' adversary, President Ma Ying-jeou, who in recent months has spoken urgently of the need to expand trade ties beyond China, including the need to push domestic reform far enough to earn an invitation into the 12-nation, U.S.-led Trans-Pacific Partnership. The difference is that Mr. Ma calculates--likely correctly--that Taiwan can secure new international trade links only if Beijing tacitly accedes. And for Beijing to do so, the cross-Strait détente must continue with measures such as the services trade agreement.
That's not to say the ongoing protests over closer trade ties were inevitable. Mr. Ma and the Kuomintang he leads erred in not working hard enough to explain their rationale for the deal to the public. Compounding that error, on March 17 they tried to ratify the trade pact unilaterally, violating a promise made last year to allow line-by-line parliamentary review. Then came the students' lawless takeovers of government buildings, which the opposition Democratic Progressive Party quickly embraced. All sides have mishandled the situation.
But today's scene in Taipei represents broad political currents. Since 2008 Beijing has hoped that muting threats of military action and strengthening economic exchange would encourage Taiwanese to support "reunification with the motherland," but polls show the opposite is happening. Although only about 20% want to move toward independence, far fewer want unification and most prefer the decades-old status quo that Beijing continues to reject.
Part of the explanation is that Taiwanese see Beijing's repression of citizens on the mainland, broken promises of autonomy to the people of Hong Kong, and escalating aggression toward neighboring states. In a widely circulated essay supporting the current protests, Taiwanese lawyer Richard Chiou-yuan Lu writes that the trade deal would be acceptable "with any other country" but with China "we don't give an inch . . . because we're afraid of you, China. Really. We're very afraid."
This view, rather than the conciliatory approach of Mr. Ma, may soon come to dictate Taiwanese politics, perhaps even before the expiration of Mr. Ma's term in 2016. If so, China's leaders could decide to return cross-Strait relations to the bad old days, making one of the world's perennial flashpoints far more dangerous.
U.S. officials might consider all this as they prepare to resume bilateral trade talks with Taiwan next week. Advancing bilateral trade--and encouraging eventual Taiwanese accession to the Trans-Pacific Partnership--would help quiet nerves on all sides of Taiwanese politics. The U.S. has largely ignored Taiwan in recent years, but Taipei's current crisis highlights the extent to which trouble still lurks in that corner of Asia.
Saturday, March 01, 2014
Friday, December 27, 2013
Washington DC trip 2013 Christmas
Dec 20 Arrival D.C.10pm
Dec 21 (Sat) Conservatory, American Indian Museum, Capitol Hill tour
rest in the jungle
all three branches of government - executive, legislature, supreme court - are all in the Capitol in the early days of US.
corn and tobacco are important crops in the history of this country
elk, fish, maize - main food.
tepees, kayak and canoe
Dec 22 (Sun) Museum of Natural History
Hope diamond
http://www.si.edu/Encyclopedia_SI/nmnh/hope.htm
Human evolution
http://humanorigins.si.edu/exhibit
Dec 23 (Mon) Museum of Air and Sapce
Pratt &Whitney wasp engine
Jet Turbine engine
Wright Flyer
Dec 24 (Tue) National Gallery of Art
Rotunda, fountain, and plants
Monet, Renoir, Cezanne, Van Gogh, Gauguin, Henri Rousseau, Rembrandt, Italian landscape, Sybolism
Dec 25 Christmas - drive back to Apex, NC
Dec 21 (Sat) Conservatory, American Indian Museum, Capitol Hill tour
rest in the jungle
all three branches of government - executive, legislature, supreme court - are all in the Capitol in the early days of US.
corn and tobacco are important crops in the history of this country
elk, fish, maize - main food.
tepees, kayak and canoe
Dec 22 (Sun) Museum of Natural History
Hope diamond
http://www.si.edu/Encyclopedia_SI/nmnh/hope.htm
Human evolution
http://humanorigins.si.edu/exhibit
Dec 23 (Mon) Museum of Air and Sapce
Pratt &Whitney wasp engine
Jet Turbine engine
Wright Flyer
Dec 24 (Tue) National Gallery of Art
Rotunda, fountain, and plants
Monet, Renoir, Cezanne, Van Gogh, Gauguin, Henri Rousseau, Rembrandt, Italian landscape, Sybolism
Dec 25 Christmas - drive back to Apex, NC
Thursday, September 26, 2013
Macroeconomics and Medicine
Macroeconomics is not a science. If you want to compare it to science, it is similar to medicine. The purpose is to solve practical problems: when someone is sick, doctors try to prescribe medicine for patient's better recovery. But diagnosis can be difficult and depends mostly on experience. You see symptoms: high fever, body ache, but there are so many possible reasons that you don't know for sure what is the cause. If you are a doctor, you need a lot of science training. With those training you guess it from your understanding of science. You try to find more evidence supporting your guess of a certain disease, and if you found evidence, and your guess is close enough, you prescribe something that worked in the past. Sometimes your prescription worked but for the wrong reason: antibiotics can kill many different types of bacteria. But your diagnosis of an infection is still in the right direction. Sometimes your diagnosis is correct, but the patient simply do not respond to the medicine you prescribed, due to other reason. Some medicine is effective in the past but can kill certain patients. There is a need to weigh risk and benefit.
Friday, August 23, 2013
The Man Who Was Treated for $17,000 Less
In this article the author made an important observation: 3rd party pay system caused the healthcare inflation. that includes all the private insurance on the market today. Instead of requiring everyone to have insurance, government should make health insurance with a deductible less than $20,000 illegal. That is only way to remove 3rd party pay system. The author's intention is to criticize Obamacare, but the system before Obamacare wasn't working, and the author knows that.
http://online.wsj.com/article/SB10001424127887324139404579017113415486176.html
http://online.wsj.com/article/SB10001424127887324139404579017113415486176.html
Sunday, August 18, 2013
Careful investment on higher education
The high cost of higher education in the US is a significant financial burden on middle class parents and students. Therefore the investment needs to be carefully considered. Just like any business decision, smart investment means limited resources is allocated in areas that demand is stable or growing, and the supply side is not overcrowded by excess capacity. Students need help to get these information and college has a responsibility to provide.
Misallocation of resources, be it housing, steel mills or individual skills, will make the society less productive and everybody poorer. People in position to guide others should take on the responsibility to help our youth make wise decisions.
One more thing to add: we should encourage our youth to start using Coursera and EDX as early as possible. A lot of practical wisdom can be learned from there with very little cost.
Misallocation of resources, be it housing, steel mills or individual skills, will make the society less productive and everybody poorer. People in position to guide others should take on the responsibility to help our youth make wise decisions.
One more thing to add: we should encourage our youth to start using Coursera and EDX as early as possible. A lot of practical wisdom can be learned from there with very little cost.
Saturday, August 17, 2013
Department
of Justice sue to stop the merger of American Airline and US Airway
today, citing consumers being hurt by higher prices and lesser choices.
The market share of the companies: Delta (22%), Southwest (21%), United
(17%), American (13%), and US Airway (12%), all others (15%).
The purpose of merge is to reduce industry wide capacity. Passengers are likely to face less choice and higher price.
While colluding to raise price is illegal, horizontal merger is not necessarily so. It is a complicated issue.
Argument for the merger
The purpose of merge is to reduce industry wide capacity. Passengers are likely to face less choice and higher price.
While colluding to raise price is illegal, horizontal merger is not necessarily so. It is a complicated issue.
Argument for the merger
Mom and Pop investors, stop trading!
Need to Know News subscribers were able to make split second trades to gain as much as 16% in value, according to WSJ, using government data they got a few seconds before everybody else. If you are investing in the stock market, your best chance is buy and hold a diversified portfolio that has low expenses. If you try hard to follow the economic news and trade on it, mostly like you will lose big.
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