Before we wrap up the week’s news, some guiding wisdom from the immortal Pete Seeger: “I’m convinced that it’s impossible to have education without controversy. People who think that’s false will find themselves trapped.”
- “It could have been worse” has become a common refrain recently when it comes to the legislation cobbled together by Congress. The new farm bill is the latest specimen. The House this week finally passed compromise legislation, after what NPR describes as a “two-year-long legislative saga.” The bill now heads for a vote in the Senate. While a lengthy and complicated piece of legislation, the farm bill can be broken into two broad components—the Supplemental Nutrition Assistance Program (food stamps) and agricultural subsidies. The current legislation cuts spending for both components, but the American Enterprise Institute warns that the changes to the agricultural subsidies program is a bait-and-switch maneuver that could cost taxpayers more in the end. AEI has devoted an entire website to promoting a return to free-market principles for agribusiness: The American Boondoggle.
- This week’s report on fourth quarter GDP growth shows a slowing of the economy at the end of 2013 to a 3.2% annualized pace from 4.1% in the third quarter. Not many are expressing disappointment about that result. While not stellar compared to the rates achieved before the recession, there seems to be a consensus among analysts and policymakers that any growth rate above 2% may actually be overshooting the economy’s potential, given lingering adjustments from the 2007-08 financial crisis.
- A new policy initiative from the Obama administration recruits some of the nation’s largest employers to address the problem of long-term unemployment. According to the latest data from the Bureau of Labor Statistics, nearly 40% of unemployed workers are in the long-term category—those looking for a job for 27 weeks or longer. The long-term unemployed face a compounding series of economic hardships, which may be destructive to the productive capacity of the overall economy. Studies suggest that employers tend to be biased against the long-term unemployed, passing over their resumes, regardless of skills or experience, for workers who have held a job more recently. The plight may be especially difficult for older unemployed workers: The Guardian this week takes a closer look programs to assist those aged 55 and up.
- Finally, it’s that time of the year when people all over the United States, from all different backgrounds, return to a common ritual passed down through generations. That’s right, it’s Super Bowl weekend. What does it mean for the economy? While the economic boon to the host city—or region, in the case of New York/New Jersey this year—is debatable, there are some hard data on the implications for the financial markets: According to the Super Bowl Indicator, U.S. equity markets will have an up year if the winner is an original NFL team or an NFC team. If or an AFC team or a former AFL team wins, equities will suffer. What does that mean for this year’s contest? Bet on the Seattle Seahawks, an NFC team, if you want stocks to rise. However, the last two Super Bowl victories for the Denver Broncos, the AFC team, in 1997 and 1998, corresponded to gains in the S&P 500 of 33% and 29% respectively. Place your bets!