Supporters of the FairTax plan are particularly drawn to the feature that calls for repealing the 16th Amendment and abolishing the Internal Revenue Service. That fits with the insurgent, populist-tinged nature of Mike Huckabee’s campaign.

Don't forget "folksy" ...

“Am I running for president to shut down the federal government? Not exactly. But I am running to eliminate all federal income and payroll taxes. And I do mean all — personal federal, corporate federal, gift, estate, capital gains, alternative minimum, Social Security, Medicare, self-employment.”

But even though critics acknowledge that there would be some economic benefits from introducing a broad-based consumption tax, William Gale of the Brookings Institution said that the proposal itself was “fundamentally a ruse.”

“The notion that there is a 23 percent rate that solves all our problems,” he said, “is politically unrealistic and mathematically impossible.”

Whatever the rate, critics say, a steep federal retail tax, piled on top of existing state sales taxes, would encourage widespread illegal tax evasion, black market transactions and other forms of cheating, creating a cycle that would require even higher tax rates.

Huckabee’s Tax Plan Appeals, but Is It Fair?

1. Obama beat Hillary among women voters 35 to 30 percent.
2. Amid record Democratic turnout, as many people under 30 showed up to caucus as those over 65.
3. Sixty percent of the GOP electorate in Iowa were born-again Christians.
4. Rudy Giuliani finished with a mere 4,013 votes, in sixth place, with less than half of the support of Ron Paul.

Maybe he's not so Ready after all.

Iowa By the Numbers

The last several slides are new to this briefing.

David M. Walker, comptroller general of the United States, at the 2008 Economic Forecast Forum:

The federal government is on a “burning platform,” and the status quo way of doing business is unacceptable.

Growth in Spending for Social Security, Medicare, and Medicaid Expected to Outpace Economic Growth; State and Local Governments Face Increasing Fiscal Challenges.

Current Fiscal Policy Is Unsustainable:
• The “Status Quo” Is Not an Option
• We face large and growing structural deficits largely due to known demographic trends and rising health care costs.
• GAO’s simulations show that balancing the budget in 2040 could require actions as large as

• Cutting total federal spending by 60 percent or
• Raising federal taxes to two times today's level

• Faster Economic Growth Can Help, but It Cannot Solve the Problem
• Closing the current long-term fiscal gap based on reasonable assumptions would require real average annual economic growth in the double-digit range every year for the next 75 years.
• During the 1990s, the economy grew at an average 3.2 percent per year.
• As a result, we cannot simply grow our way out of this problem. Tough choices will be required.

Are the candidates confronting this issue? Mostly they seem to ramble on about "coverage."

US Financial Condition and Fiscal Future Briefing

Since late summer, the US Federal Reserve has been attempting to manage the slow-moving financial crisis triggered by the collapse of the US housing bubble.

At the start, the Fed assumed that it was facing a first-mode crisis -- a mere liquidity crisis -- and that the principal cure would be to ensure the liquidity of fundamentally solvent institutions.

But the Fed has shifted over the past two months toward policies aimed at a second-mode crisis -- more significant monetary loosening, despite the risks of higher inflation, extra moral hazard and unjust redistribution.

As Fed Vice Chair Don Kohn recently put it: "We should not hold the economy hostage to teach a small segment of the population a lesson."

No policymakers are yet considering the possibility that the financial crisis might turn out to be in the third mode.

Three cures for three crises | Brad DeLong, in the Taipei Times

Interested?

While data mining represents a significant advance in the type of analytical tools currently available, there are limitations to its capability. One limitation is that although data mining can help reveal patterns and relationships, it does not tell the user the value or significance of these patterns. These types of determinations must be made by the user. A second limitation is that while data mining can identify connections between behaviors and/or variables, it does not necessarily identify a causal relationship. Successful data mining still requires skilled technical and analytical specialists who can structure the analysis and interpret the output.

Data mining is becoming increasingly common in both the private and public sectors. Industries such as banking, insurance, medicine, and retailing commonly use data mining to reduce costs, enhance research, and increase sales. In the public sector, data mining applications initially were used as a means to detect fraud and waste, but have grown to also be used for purposes such as measuring and improving program performance. However, some of the homeland security data mining applications represent a significant expansion in the quantity and scope of data to be analyzed. Some efforts that have attracted a higher level of congressional interest include the Terrorism Information Awareness (TIA) project (now-discontinued) and the Computer-Assisted Passenger Prescreening System II (CAPPS II) project (nowcanceled and replaced by Secure Flight). Other initiatives that have been the subject of congressional interest include the Multi-State Anti-Terrorism Information Exchange (MATRIX), the Able Danger (2, 3) program, the Automated Targeting System (ATS), and data collection and analysis projects being conducted by the National Security Agency (NSA).

As with other aspects of data mining, while technological capabilities are important, there are other implementation and oversight issues that can influence the success of a project’s outcome. One issue is data quality, which refers to the accuracy and completeness of the data being analyzed. A second issue is the interoperability of the data mining software and databases being used by different agencies. A third issue is mission creep, or the use of data for purposes other than for which the data were originally collected. A fourth issue is privacy. Questions that may be considered include the degree to which government agencies should use and mix commercial data with government data, whether data sources are being used for purposes other than those for which they were originally designed, and possible application of the Privacy Act to these initiatives. It is anticipated that congressional oversight of data mining projects will grow as data mining efforts continue to evolve. This report will be updated as events warrant.

Data Mining and Homeland Security: An Overview

The Federal Reserve Act authorizes the Federal Reserve to undertake various types of discount window loans and open market operations. While the Federal Reserve generally has not found it necessary to use all types of such authority, there could be circumstances in which the Federal Reserve might need to consider utilizing its statutory authority more broadly than it has in the past. We examine the limits imposed by the Federal Reserve Act along two dimensions: those types of counterparties and financial instruments with which the Federal Reserve may conduct monetary policy. In doing so, we develop a theme not commonly pursued in the literature - the ways and extent to which the Federal Reserve Act limits the Federal Reserve from taking credit risk onto its balance sheet. We also provide some historical perspective on how the current powers of the Federal Reserve came to be authorized.

This paper is mentioned in a recent story in the Telegraph.

The Scope of Monetary Policy Actions Authorized under the Federal Reserve Act

Partisan warriors may love our polarized political culture. Everyone else is turned off, and tuning out.

Closing of the American Mind

It is absolutely true that yesterday's victory in forcing Harry Reid to pull the FISA bill from the Senate floor is temporary. Allies of the administration and lawbreaking telecoms will spend the next several weeks plotting to overcome the obstacles thrown in their path yesterday and, like a weed that has been cut but not uprooted, will return in January to try again.

Opponents of telecom amnesty and warrantless surveillance ought to and likely will use that time, too, to strengthen the opposition and improve the strategy. There will be ample time for all of that. But yesterday's victory, while limited, is still very significant in several key respects, particularly in understanding how and why it happened -- i.e. the source of the successful opposition -- and it is worth taking a step back to chronicle what took place.

Anatomy and significance of Monday's FISA victory

The current legislative and oversight activity with respect to electronic surveillance under Foreign Intelligence Surveillance Act (FISA) has drawn national attention to several overarching issues. This report briefly outlines three such issues and touches upon some of the perspectives reflected in the ongoing debate. These issues include the inherent and often dynamic tension between national security and civil liberties, particularly rights of privacy and free speech; the need identified by the Director of National Intelligence (DNI), Admiral Mike McConnell, for the Intelligence Community to be able to efficiently and effectively collect foreign intelligence information from the communications of foreign persons located outside the United States in a changing, fast paced, and technologically sophisticated international environment, and the differing approaches suggested to meet this need; and limitations of liability for those electronic communication service providers who furnish aid to the federal government in its foreign intelligence collection. Two constitutional provisions, in particular, are implicated in this debate — the Fourth and First Amendments.

Congress currently has before it several bills that, if enacted, would amend certain FISA provisions, among them H.R. 3733, which was passed by the House on November 15, 2007; S. 2248 (as reported out of the Senate Select Committee on Intelligence); and S. 2248 (as reported out of the Senate Judiciary Committee with an amendment in the nature of a substitute). Two other bills regarding FISA were introduced by Senator Reid on December 10, 2007, and have been placed on the Senate’s legislative calendar include S. 2440 and S. 2441. S. 2402, introduced by Senator Specter on December 3, 2007, was referred to the Senate Judiciary Committee. In Committee markup on December 13, 2007, an amendment in the nature of a substitute to S. 2402 was adopted by unanimous consent. Then, by a vote of 5-13, the Committee rejected S. 2402, as amended. The proposal would have permitted substitution of the government for electronic communication service providers in law suits where certain criteria were met.

FISA: A Brief Overview of Selected Issues

The scope of presidential power is the most urgent and the most ignored legal and political issue of our time.

Who Cares About Executive Supremacy?