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Policy

American flags outside the United Nations (UN) in New York City. (Photo: ADobeStock/Chhobi)

American flags outside the United Nations (UN) in New York City. (Photo: ADobeStock/Chhobi)

When writing about the statist agenda of international bureaucracies, I generally focus my attention on the International Monetary Fund (IMF) and the Organization for Economic Cooperation and Development (OECD).

Today, let’s give some attention to the United Nations (UN).

Based on this story from the Washington Post, the bureaucrats at the UN have concluded that America is a miserable and awful nation.

…a new United Nations report that examines entrenched poverty in the United States…calls the number of children living in poverty “shockingly high.” …the report, written by U.N. special rapporteur on extreme poverty and human rights Philip Alston, says the United States tops the developed world with the highest rates of youth poverty… The results of the report are not out of line with a number of others…in recent years by different organizations in which the United States has turned up at or near the top on issues such as poverty rates.

But I’ve learned from personal experience that the United Nations is guided by statist ideology and I should be extremely skeptical of any of its findings.

For instance, when it intervenes in policy (global warming and gun control, for instance, as well as the Internet, the War on Drugs, monetary policy, and taxpayer-financed birth control), the UN inevitably urges more power and control for government.

So let’s take a jaundiced look at some of the assertions in this new report, starting with that dramatic claim of record child poverty in America.

The United States…has the highest youth poverty rate in the Organization for Economic Cooperation and Development (OECD)… The consequences of neglecting poverty… The United States has one of the highest poverty…levels among the OECD countries… the shockingly high number of children living in poverty in the United States demands urgent attention. …About 20 per cent of children live in relative income poverty, compared to the OECD average of 13 per cent.

So is it true that poverty is very high in the USA and is it also true that America has the highest rate of child poverty of all OECD countries? Even higher than Mexico, Greece, and Turkey? And what is the source of this remarkable assertion?

If you look at footnote #51, you’ll see reference to an OECD publication that contains this supposedly damning chart.

 

But if you look at the fine print at the bottom, you’ll discover that the chart on child poverty doesn’t actually measure child poverty. Instead, the bureaucrats at the OECD have put together a measure of income distribution and decided that “relative poverty” exists for anyone who has less than 50 percent of the median level of disposable income.

In other words, the United States looks bad only because median income is very high compared to other nations.

Which is the same dishonest data manipulation that the OECD uses when exaggerating America’s overall poverty rate (other groups that have used this deliberately dishonest methodology include the Equal Welfare Association, Germany’s Institute of Labor Economics, and the Obama Administration).

The bottom line is that the key finding of the UN report is based on a bald-faced lie.

By the way, I’m not surprised to see that the UN report also cites the IMF to justify statist policies.

In a 2017 report, the International Monetary Fund (IMF) captured the situation…, stating that the United States economy “is delivering better living standards for only the few”, and that “household incomes are stagnating for a large share of the population, job opportunities are deteriorating, prospects for upward mobility are waning, and economic gains are increasingly accruing to those that are already wealthy” …A much-cited IMF paper concluded that redistribution could be good for growth, stating: “The combined direct and indirect effects of redistribution — including the growth effects of the resulting lower inequality — are on average pro-growth.”

For what it’s worth, the IMF’s research on growth and inequality is embarrassingly bad.

Here’s another big takeaway from the UN report.

The United States…has the highest…infant mortality rates among comparable OECD States. …The infant mortality rate, at 5.8 deaths per 1,000 live births, is almost 50 per cent higher than the OECD average of 3.9.

I’m not an expert on infant mortality. Indeed, I’ve never looked at infant mortality data. But given the UN’s reliance on dodgy and dishonest numbers in other areas, I’m skeptical whether these numbers are true.

And, according to Johan Norberg, the numbers about high levels of infant mortality in the United States are false.

The UN report contains many other ideologically motivated attacks on the United States.

For instance, America is a bad country because taxes supposedly are too low.

The United States has the highest rate of income inequality among Western countries. The $1.5 trillion in tax cuts in December 2017 overwhelmingly benefited the wealthy and worsened inequality. …The tax cuts will fuel a global race to the bottom, thus further reducing the revenues needed by Governments to ensure basic social protection and meet their human rights obligations. …There is a real need for the realization to sink in among the majority of the American population that taxes are not only in their interest, but also perfectly reconcilable with a growth agenda.

While the above passage is remarkable for the level of economic illiteracy, I confess that I chortled with glee when I read the part about how the recent tax reform “will fuel a global race to the bottom.”

As I wrote last year and this year, the fact that other governments will face pressure to reduce tax rates is something to celebrate.

Here’s one final excerpt. The UN report also bashes the United States because we don’t view dependency as a human right.

Successive administrations, including the current one, have determinedly rejected the idea that economic and social rights are full-fledged human rights, despite their clear recognition not only in key treaties that the United States has ratified… But denial does not eliminate responsibility, nor does it negate obligations. International human rights law recognizes a right to education, a right to health care, a right to social protection for those in need and a right to an adequate standard of living.

Needless to say, a problem with this vision of “positive rights” is that it assumes there will always be a supply of chumps willing to work hard so the government can tax away their money to finance all the goodies. But Greece shows us that it’s just a matter of time before that games ends with disaster.

In other words, Thomas Sowell is right and Franklin Roosevelt was wrong.

Let’s close with some good news. As the Washington Post just reported, the UN’s dishonest anti-American screed apparently will prove costly to that bloated bureaucracy.

Alston arrived in Washington last fall on a mission from the U.N. Human Rights Council to document poverty in America. …he was told by a senior State Department official that his findings may influence the United States’ membership in the human rights body. …“I think I was being sent a message.” Two other people at the meeting, speaking on the condition of anonymity, confirmed Alston’s account. …Nikki Haley announced this week that the United States would withdraw from the Human Rights Council.

Good for Ambassador Haley.

Her actions stand in stark contrast to some of her predecessors, who apparently believed in taxpayer-financed self-flagellation.

Alston said he was initially invited by the U.S. government under President Barack Obama to study poverty in America. The invitation was extended again by U.S. officials under then-Secretary of State Rex Tillerson in 2017, he said. “We look forward to welcoming Mr. Alston to the United States for a country visit this December,” Flacelia Celsula, part of the U.S. delegation at the United Nations, said in a meeting of the Human Rights Council on June 8, 2017.

It goes without saying that Mr. Alston should have the freedom write leftist reports. He also should have the freedom to spread lies in those reports. But I don’t want American tax dollars to finance his ideological bilge.

Which brings us to the obvious takeaway. As seems to be the case with all international bureaucracies, the United Nations wastes money at a prodigious pace. With any luck, Alston’s nonsense will convince American policymakers that deep budget cuts for the UN are long overdue.

The United Nations (UN) cites absurd and

Policy

Cartoon workingman reluctantly paying taxes. (Photo: AdobeStock/PPD/Adiano)

Cartoon workingman reluctantly paying taxes. (Photo: AdobeStock/PPD/Adiano)

My long-running feud with the Paris-based Organization for Economic Cooperation and Development (OECD) could be categorized as a fight over tax compliance.

The bureaucrats at the OECD say that financial privacy must be eviscerated and the fiscal sovereignty must be wiped out so that high-tax governments can track and tax money around the world.

My view is that pro-growth reforms like the flat tax would be a much better approach. With a simple and fair tax code that doesn’t impose extra layers of tax on saving and investment, the IRS no longer would need to know about our bank accounts or investment funds – regardless of whether they are based in Geneva, Illinois, or Geneva, Switzerland.

Though I view better compliance as a secondary benefit. My main goal is to have a tax system that doesn’t impose needlessly high levels of economic damage.

But let’s stick with the compliance issue. Writing for E21, Daniel Di Martino explains that the Italian government makes evasion and avoidance a preferable option because tax rates are too onerous.

Italy’s problem, similar to many of its southern-European neighbors, is an oppressively high tax burden, irresponsible welfare programs that encourage high measured unemployment and increase the debt, and high levels of regulation. …the share of average wages collected by the Italian government via income and social security taxes is among the highest in the OECD at 48 percent. In addition, Italy imposes a value-added tax of 22 percent on most goods and services, one of the highest in Europe. Plus, Italy’s corporate, capital gains, gift, and myriad other taxes are passed on to individuals and borne directly by workers. These high taxes lead to a growing shadow economy, where people underreport work to avoid paying taxes. …many estimates point to more than  $175 billion (€150 billion) in lost tax revenue.

So what’s the best way of addressing that nation’s huge shadow economy?

Simple, less government.

Instead of cracking down on tax evasion and the shadow economy, Italy’s new government needs to rethink long-standing policies to bring a real economic recovery. Taxes need to be lowered so more businesses open and already-existing businesses and individuals come out of the shadows, broadening the tax base and raising revenue. This would allow those in the shadow economy to expand their businesses. Additionally, the welfare state should be trimmed so that people do not have an incentive to stay unemployed and young Italians are less burdened by government debt. Moreover, Italy needs to become more competitive by slashing the number of regulations.

The Institut Economique Molinari in Belgium took a look at the same issue, but included data for all European Union nations.

Economic reasoning and international experience point invariably to common causes that consistently create obstacles to dealings in the official economy: prohibitions, compulsory levies and specific tax measures, as well as fastidious and complex regulations. …As noted by two specialists, “In almost all studies, one of the most important causes (…) is the rise of the tax and social security burdens.” The higher these burdens on labour relations and dealings in the official economy, the less profitable these dealings become and the greater the incentive to trade on the black market. …As long as taxes account for a high share of the final price, opportunities for profit are provided in the underground economy, which moves in on a long‐term basis and comes to account for a significant share of countrywide sales. …Increasing this tax burden can only increase the disconnection between the real production cost of goods and their price on the official market, to such a degree that consumers begin abandoning the official market on a larger scale.

So what’s the answer?

Definitely not more government.

Given the scope of the underground economy, public authorities generally suggest toughening the means of repression so as to collect more tax revenues. The justification for this repression remains the same: it would promote the transfer of all under ground activity to the legal market, thereby creating new tax revenues. Beyond the cost of this repression in terms of resources and bureaucratisation of the economy, this reasoning and the resulting forecasts are erroneous. Though certain activities may no longer be undertaken in the underground economy, they will not be undertaken in the official economy either — in part or even in whole, depending on the specific case — because of the burden of compulsory levies and regulations. …Increased repression by the public authorities, without any change in regulatory and tax frameworks, risks simply destroying economic activities and the associated revenues. The only long‐lasting solution for ending the underground economy consists of dealing with the causes that give rise to it and thus to free the official market from its fiscal and regulatory burdens. …there is no other choice but to lighten tax and regulatory burdens.

Let’s now cross to this side of the Atlantic Ocean.

In an editorial about the current and former Treasury Secretary and their Cayman investments, the Wall Street Journal highlighted hypocrisy. But the best part was the conclusion about bad government policy driving money away from America.

Mr. Mnuchin served as director of Dune Capital, an investment firm he said he registered in the Caymans primarily to “accommodate nonprofits and pensions that want to invest through these off-shore entities.” By contrast, Mr. Lew was personally invested in the Citigroup Venture Capital International Growth Partnership II. You know, like that evil profiteer Mitt Romney, the subject of a now infamous Barack Obama campaign ad scoring Mr. Romney for profiting from money in offshore havens such as the Caymans. Mr. Lew’s Cayman company even used the same Ugland House building in the Caymans that President Obama so famously trashed as an “outrage” and “tax scam.” …The Democratic goal…seemed to be to get Mr. Mnuchin to admit that investors go to the Caymans to avoid American taxes. Mr. Mnuchin denied it but needn’t have been so shy. The Caymans have no corporate tax rate. The way to deal with the Caymans is not to punish investors who go there but to get rid of the regulations and high tax rates that send capital offshore.

But it’s not just market-friendly organizations that realize high tax burdens bolster the underground economy.

The International Monetary Fund released a study earlier this year on the shadow economy, which is defined as legal activities that are hidden from government.

The shadow economy includes all economic activities which are hidden from official authorities for monetary, regulatory, and institutional reasons. Monetary reasons include avoiding paying taxes and all social security contributions, regulatory reasons include avoiding governmental bureaucracy or the burden of regulatory framework, while institutional reasons include corruption law, the quality of political institutions and weak rule of law. For our study, the shadow economy reflects mostly legal economic and productive activities that, if recorded, would contribute to national GDP.

And what causes people to hide legal activity from government?

Here are some of the factors that drive the shadow economy according to the IMF.

 

In other words, people are less likely to comply when they have to endure bad government policy.

…in most cases trade openness, unemployment rate, GDP per capita, size of government, fiscal freedom and control of corruption are highly statistically significant.

And the number one bad government policy is high tax rates.

 

Let’s close by looking at the other side’s arguments.

Earlier this month, I revealed that the OECD finally admitted that it’s anti-tax competition project was motivated by a desire for class warfare and bigger government.

That’s terrible policy, but I give the bureaucrats in Paris credit for finally being honest.

By contrast, I’m not sure what to say about the bureaucrats in Brussels. The European Commission’s idea of an argument is this vapid video, which attempts to convince viewers that 20 percent of what they like is missing because government isn’t collecting more tax revenue.

In reality, of course, the money isn’t “missing.” It’s still in the private sector, where it actually is providing things that people like, rather than financing the stuff politicians like.

What the best way to boost tax

Policy

Pie chart depicting total federal spending, or government expenditure categories. (Photo: AdobeStock/GKSD/PPD)

Pie chart depicting total federal spending, or government expenditure categories. (Photo: AdobeStock/GKSD/PPD)

I try not to get too agitated about media bias, but I sometimes get “triggered” when the deliberate inaccuracies involve economic issues. And I get really irked when reporters write about non-existent spending cuts.

I’ve previously mocked the New York Times on this topic, so today let’s go after the Washington Post, based on this story which was republished by the Boston Globe.

House Republicans released a budget proposal Tuesday that would balance in nine years — but only by making large cuts to entitlement programs, including Medicare and Social Security… Along with other changes, the budget proposes to squeeze $537 billion out of Medicare over the next decade. …Changes to Medicaid and other health programs would account for $1.5 trillion in savings.

As a libertarian, this sounds like good news.

I want “large cuts” in government. I would like to go back to what America’s Founders envisioned, with a very tiny central government.

But it turns out that the reporter is peddling garbage. There are no cuts. And the story’s headline is especially inaccurate.

If you look at the 10-year details, you find that Social Security spending will climb by more than $700 billion, Medicare spending will increase by $500 billion, and spending on other health programs such as Medicaid will rise by $115 billion. Here are the numbers from the House GOP’s proposed budget.

 

Now let’s look at total spending. That’s the grey row at the bottom of the aforementioned table.

And let’s put those numbers into a 10-year chart.

As you can see, we still can’t find any “large cuts” for the simple reasons that none exist. Total spending is projected to climb by almost $1.5 trillion. Indeed, the House Republican budget would let spending grow much faster than projected inflation.

 

When confronted by this data, budget wonks on the left will quickly say that there are “budget cuts” when comparing the GOP numbers to what would happen if government policy was left on autopilot.

But if a budget doesn’t grow as fast as previously planned, that’s still not a cut.

I tell my leftist friends that it’s perfectly legitimate for them to argue that spending should increase rapidly because politicians in the past made promises to various interest groups. But it’s wrong for them to say that an increase is a cut simply because outlays don’t grow as fast as they would prefer.

Economist Dan Mitchell doesn't get very agitated

Politics

Trump Nominee Justice Neil Gorsuch Says No More Was Needed to Trigger Fourth Amendment

The Supreme Court of the United States (SCOTUS). (Photo: AdobeStock/bbourdages)

The Supreme Court of the United States (SCOTUS). (Photo: AdobeStock/bbourdages)

The Supreme Court ruled 5 to 4 that law enforcement must have a warrant to gather cellphone users’ location data, a big win for privacy and the 4th Amendment. The landmark decision reverses and remands a decision by the Sixth Circuit Court of Appeals.

The Court heard arguments in the case of Carpenter v. United States on November 29. It is the first case about phone location data that the Supreme Court has ruled on, making it a landmark decision regarding how law enforcement agencies can use technology to build cases against citizens.

Chief Justice John Roberts delivered the majority opinion of the Court joined by Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, and Elena Kagan. Justice Anthony Kennedy filed a dissent, joined by Justices Clarence Thomas and Samuel Alito.

Justice Alito also filed a dissent, which Justice Thomas joined in addition to filing a dissent of his own.

However, Justice Neil Gorsuch, who was nominated by President Donald Trump, filed a dissenting opinion on his own, which would’ve went further to protect the 4th Amendment.

“This is a groundbreaking victory for Americans’ privacy rights in the digital age,” ACLU attorney Nathan Freed Wessler, who argued the case, said in a statement. “The Supreme Court has given privacy law an update that it has badly needed for many years, finally bringing it in line with the realities of modern life. The government can no longer claim that the mere act of using technology eliminates the Fourth Amendment’s protections.”

The dispute dates back to a 2011 robbery in Detroit, after which police gathered months of phone location data from Timothy Carpenter’s phone provider. They pulled together 12,898 different locations from Mr. Carpenter, over a 127-day period. Officials identified the cellphone towers that handled his calls and traced his location during the time the alleged crimes were committed.

That information was then used against Mr. Carpenter in court.

At issue in the case was whether Mr. Carpenter had a “reasonable expectation of privacy” in the information contained in those records, or whether he had forfeited such privacy protections by voluntarily sharing the information with his cellular service provider.

In United States v. Miller (1976), and Smith v. Maryland(1979), the Supreme Court held “a person has no legitimate expectation of privacy in information he voluntarily turns over to third parties.”

A judge in the Sixth Circuit Court of Appeals ruled cellphone location data is not protected by the Fourth Amendment, thus the government didn’t require a warrant. But the Supreme Court disagreed.

“A person does not surrender all Fourth Amendment protection by venturing into the public sphere,” Chief Justice Roberts wrote in the majority opinion. “We decline to grant the state unrestricted access to a wireless carrier’s database of physical location information.”

Justice Gorsuch appeared to concur with the majority in his dissent, though he wrote that the Court only needed to apply “a more traditional Fourth Amendment approach.”

“The Fourth Amendment protects ‘the right of the people to be secure in their persons, houses, papers and effects, against unreasonable searches and seizures.’ True to those words and their original understanding, the traditional approach asked if a house, paper or effect was yours under law,” Justice Gorsuch wrote. “No more was needed to trigger the Fourth Amendment.”

Gorsuch added, “it seems to me entirely possible a person’s cell-site data could qualify as his papers or effects under existing law.”

The Supreme Court ruled 5 to 4

Economy

Graphic concept of relations between the United States (US) and the Organization of the Petroleum Exporting Countries (OPEC). (Photo: PPD/AdobeStock/Piotr Pawinski)

Graphic concept of relations between the United States (US) and the Organization of the Petroleum Exporting Countries (OPEC). (Photo: PPD/AdobeStock/Piotr Pawinski)

The Organization of the Petroleum Exporting Countries (OPEC) cartel agreed to increase oil production by almost 1 million barrels per day. The announcement came after cartel ministers met on Friday in Vienna, Austria.

The production increase will essentially undo most of a 1.2 million barrel cut OPEC decided to make in late 2016, which played a significant role in the increase in the price of oil.

OPEC is an intergovernmental organization of 14 nations founded in Baghdad back in 1960. The first 5 members were Iran, Iraq, Kuwait, Saudi Arabia and Venezuela. Since 1965, they’ve been headquartered in Vienna, Austria.

As of 2016, the 14 countries accounted for roughly 44% of global oil production and 73% of the world’s “proven” oil reserves. Prior to OPEC having such a major influence on global oil prices, they were previously determined by American-dominated multinational oil companies.

President Donald Trump has been calling publicly for the oil cartel to increase production and lower prices. Saudi Arabia, which is OPEC’s largest producer, sided with President Trump over Iran.

The latter had resisted calls for increased production.

Iranian oil minister Bijan Namdar Zanganeh said “we are not here to receive instruction from President Trump and apply it and implement it.”

However, in the end OPEC acquiesced. President Trump has forged a strong relationship with the new Kingdom of Saudi Arabia, which has sought to rout corruption, and it’s reaping rewards.

Need more in-depth analysis? Check out Brent Crude on PPD Markets!

The Organization of the Petroleum Exporting Countries

Elections

Representative Ron DeSantis, R-Fla., now a 2018 gubernatorial candidate, speaks with a fellow committee member before the start of the House Judiciary Committee hearing on Oversight of the United States Department of Homeland Security on Thursday, May 29, 2014. (Photo: AP)

Representative Ron DeSantis, R-Fla., now a 2018 gubernatorial candidate, speaks with a fellow committee member before the start of the House Judiciary Committee hearing on Oversight of the United States Department of Homeland Security on Thursday, May 29, 2014. (Photo: AP)

President Donald Trump gave his full endorsement of Rep. Ron DeSantis, R-Fla., who is running to replace Rick Scott as governor of Florida.

“Congressman Ron DeSantis, a top student at Yale and Harvard Law School, is running for Governor of the Great State of Florida,” President Trump tweeted. “Ron is strong on Borders, tough on Crime & big on Cutting Taxes – Loves our Military & our Vets. He will be a Great Governor & has my full Endorsement!”

Rep. DeSantis, who has been a bulldog conducting oversight of the government’s abuses of secret surveillance programs, is running primarily against Agricultural Commissioner Adam Putnam. He touted a previous tweet by President Trump encouraging his campaign, but this latest message is a more definitive endorsement.

Meanwhile, Governor Rick Scott is running to replace vulnerable incumbent Democrat Bill Nelson, D-Fla., in the U.S. Senate.

The PPD-Big Data Sunshine State Battleground Poll conducted in February found Governor Scott leading Senator Nelson by 2 points, and Mr. Putnam leading Mr. DeSantis by 2 points in the Republican primary.

President Donald Trump gave his full endorsement

Markets

FILE PHOTO: Amazon boxes are seen stacked for delivery in the Manhattan borough of New York City, U.S. January 29, 2016. (Photo: Reuters)

Shares of online retailers took a hit during trading on Thursday after the U.S. Supreme Court ruled states can force eCommerce companies to collect sales tax.

Twitter Card Image for PPD Markets at Peoples Pundit Daily Want to do more advanced research? PPD Markets has all the tools you need!

Shares of online retailers like Amazon and

Politics

The Supreme Court of the United States (SCOTUS). (Photo: AdobeStock/bbourdages)

The Supreme Court of the United States (SCOTUS). (Photo: AdobeStock/bbourdages)

The U.S. Supreme Court ruled 5 to 4 on Thursday that states can force online retailers to collect what could amount to billions of dollars in sales tax. The narrow ruling against Wayfair, Overstock.com and Newegg, is a big blow to eCommerce companies.

Justice Antony Kennedy wrote the majority opinion, which conservative Justices Clarence Thomas, Samuel Alito and Neil Gorsuch joined, along with liberal Ruth Ginsburg. Justices Thomas and Gorsuch filed concurrent opinions, while Chief Justice John Roberts dissented in an opinion joined by liberals Stephen Breyer, Sonia Sotomayor and Elena Kagan.

The majority essentially overturned a High Court precedent going back to 1992, which barred states from requiring businesses with no “physical presence” in that state, like out-of-state online retailers, to collect sales taxes.

“From early in its history, a central function of this Court has been to adjudicate disputes that require interpretation of the Commerce Clause in order to determine its meaning, its reach, and the extent to which it limits state regulations of commerce,” Justice Kennedy wrote, adding the companies’ “critiques underscore that the physical presence rule, both as first formulated and as applied today, is an incorrect interpretation of the Commerce Clause.”

Justice Gorsuch, a conservative nominated by President Donald Trump and confirmed by the U.S. Senate despite Democratic obstruction, appeared very concerned with the unfair advantage eCommerce retailers have over brick-and-mortar operations.

“For years they [court precedent cases] have enforced a judicially created tax break for out-of-state Internet and mail-order firms at the expense of in-state brick-and-mortar rivals,” he wrote in a joining opinion. “Today we put Bellas Hess and Quill to rest and rightly end the paradox of condemning interstate discrimination in the national economy while promoting it ourselves.”

The ruling is a victory for the state of South Dakota, the lawmakers in the state who passed the 2016 law, and the Trump Administration that backed the state. A federal report indicates that the ruling could open up another $13 billion in annual revenue. A Barclays research note claims the states that are likely to see the biggest percentage increase in revenue are Louisiana, Tennessee, South Dakota, Oklahoma and Alabama.

However, not everyone on the right is pleased with the decision.

“We fought the American Revolution in large part to oppose the very idea of taxation without representation,” Americans for Tax Reform President Grover Norquist said of the decision. “Today, the Supreme Court announced, ‘oops’ governments can now tax those outside their borders—those who have no political power, no vote, no voice.”

Scott Drenkard, the Director of State Projects at the Tax Foundation, disagrees and says the reactions from those like Mr. Norquist are “overblown.”

“This is overblown,” he said. “The tax is on consumers in your state (who have a vote), and it is the same tax for goods sold in the state and goods shipped into the state.”

Read Full Opinion

The U.S. Supreme Court ruled 5 to

Economy

A manufacturing assembly line at the Heinz factory in Pittsburgh, Pennsylvania. (Photo: Courtesy of Heinz)

A manufacturing assembly line at the Heinz factory in Pittsburgh, Pennsylvania. (Photo: Courtesy of Heinz)

The Philadelphia Fed’s Manufacturing Business Outlook Survey has been so hot, the cooling in June to a much lower reading than expected is welcome.

The diffusion index for current general activity remained positive but decreased 15 pointsthis month (see Chart 1). Almost 37 percent of the manufacturers reported increases in overall activity this month, while 17 percent reported decreases. The new orders index fell nearly 23 points this month. While 38 percent of the firms reported an increase in orders, 20 percent reported declines.

The current shipments index increased 3 points.

The unfilled orders index suggested that firms’ backlogs diminished: The index fell 18 points and registered its first negative reading (-2.7) since January. The delivery times index remained positive but fell 9 points to its lowest reading in four months. The firms continued to report overall increases in employment.

Nearly 34 percent of the responding firms reported increases in employment this month, while 3 percent reported decreases. The current employment index, at 30.4, was virtually unchanged from May.

The current average workweek index, however, decreased 10 points

The Philadelphia Fed's Manufacturing Business Outlook Survey

Economy

A house-for-sale sign is seen inside the Washington DC Beltway in Annandale, Virginia January 24, 2016. (Photo: Reuters)

A house-for-sale sign is seen inside the Washington DC Beltway in Annandale, Virginia January 24, 2016. (Photo: Reuters)

The Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI) rose slightly by 0.1% in April. The previously reported 0.1% gain in March was revised upward to 0.2%.

However, the headline missed the 0.5% consensus forecast.

The FHFA monthly HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac.  From April 2017 to April 2018, house prices were up 6.4%.

For the nine census divisions, seasonally adjusted monthly price changes from March 2018 to April 2018 ranged from -0.5% in the West South Central division to +0.6% in the East North Central division.  The 12-month changes were all positive, ranging from +4.6% in the West South Central division to +8.9% in the Mountain division.

The Federal Housing Finance Agency (FHFA) seasonally

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