The federal government's reported figures for jobs "created or saved" by the "stimulus" bill (formally the American Recovery and Reinvestment Act of 2009, or "ARRA") are now known to be wrong. The Recovery Accountability and Transparency Board, which oversees these figures, apparently has decided not to correct them.
A scandal has erupted over the federal government's reporting of the number of jobs created or saved by the "stimulus" bill (formally the American Recovery and Reinvestment Act of 2009).
This scandal would have been avoided if the government had complied with the Information Quality Act.
The collapse of the housing bubble, with 20% to 50% reductions in home values across wide swaths of the country, has led to an extraordinary high rate of foreclosures. The federal government has responded with various programs to "help people stay in their homes." These programs have one or two typical features: (1) lower interest rates, (2) forgiveness of some portion of the loan principal, (3) forbearance of nonpayment for some period of time, or some combination thereof.
These remedies have in common a similar diagnosis: foreclosures are rising because some aspect of the mortgage changed such that borrowers suddenly found themselves unable to afford the payments. Typically, what is presumed to have changed is that a low "teaser" rate ended, and the house was no longer affordable when the interest rate reset to market levels.
The Obama Administration's program to prevent foreclosures is encountering hurdles. There is new empirical evidence that it is based on an erroneous diagnosis of the problem.
AIG has been criticized for paying approximately $165 million on contractually obligated retention bonuses after receiving about $175 billion in government capital injections We've blogged a half dozen times on the subject.
The Wall Street Journal reports that Fannie Mae and Freddie Mac are contractually obligated to pay $210 million in retention bonuses. Both government-sponsored enterprises have been placed in conservatorship. Members of Congress have demanded that these bonuses be rescinded along with those due to AIG employees.
H.R. 1664, the second bill passed by the House to regulate compensation received by employees of firms receiving government capital injections, would prohibit these retention bonuses. Compensation would be limited to salary and "performance-based" bonuses, a term that the bill would direct the Treasury Department to define by regulation.
Today's Journal story reports on a letter send by the government's senior regulatory official for GSEs defending the Fannie Mae and Freddie Mac retention bonuses, reiterating a statement he issued on March 18th. This places him at odds with both H.R. 166 and the the Obama administration, which has demand that retention bonuses not be paid, be rescinded, or be returned.
Regulation is widely understood as a tax on the activity or person being regulated. Where these activities repair genuine market failures, benefits from regulation may result. If there are benefits from, say, automobile safety regulation, one would expect the beneficiaries to be persons who otherwise would have been killed or injured at the pre-regulatory safety level.
But what about the costs of regulation? Who bears them? More...
In June, the ad hoc National Academy of Sciences committee empaneled to review OMB's proposed risk assessment guidance asked several affected federal agencies to provide comments.
Neutral Source has copies of these comments in our Library.
