New Research on the Economic Situation, Opportunity Zones, and Direct Primary Care

The Economic Situation, June 2019

Bruce Yandle | Quarterly Report

From the report: "We are at the year’s midpoint, a good time to assess 2019’s first five months. In short, the US economic outlook is positive but with a heavy dose of uncertainty. The unemployment rate is low, wages are rising a bit, and GDP growth is hitting some strong marks, but US policy battles over trade, deficits, immigration, and foreign affairs offer heavy doses of uncertainty. We now know that GDP growth for 2018 fell from a quarterly high point of more than 4.0 percent in the second quarter, what some termed a Goldilocks economy, to 2.2 percent in the fourth quarter. Following a series of year-end shocks—government shutdown, interest rate increases, and accelerating trade disputes—what had been a fast growth economy was trembling. However, the first GDP growth estimate for 2019’s first quarter arrived showing a handsome 3.2 percent. But policy uncertainty raised its ugly head again when, in early May, US trade negotiations with China fell apart, equity markets swooned, and investors shifted from equities to cash.”

Ex-Im Bank Aid to State-Owned Businesses Falls without a Quorum

Veronique de Rugy and Justin Leventhal | Data Visualization

From the publication: "The Export Import (Ex-Im) Bank has a history of supporting companies owned by foreign governments. In 2014, the last full year the Ex-Im Bank had a quorum (that is, a sufficient number of board members to approve actions over $10 million), the top 10 state-owned companies or foreign government agencies benefiting from the Ex-Im Bank received $5.9 billion of assistance (29 percent of all Ex-Im Bank actions that year). This list was led by Air China, followed closely by Petróleos Mexicanos (Air China Limited and Air China Cargo Company Limited have been combined for this comparison).

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Will SEC Regulation Best Interest Protect Investors?

D. Bruce Johnsen | Policy Brief

From the brief: "The Securities and Exchange Commission (SEC) has proposed to hold securities brokers to a stricter regulatory standard when they provide their clients with investment advice “incidental” to their primary function as securities traders. The ostensible goal of the proposal is to ameliorate conflicts of interest. Regulation Best Interest would require brokers to act “solely in the best-interest” of their clients when making investment recommendations. This would require brokers to recommend the securities within a given category that minimize their compensation or else risk regulatory sanctions and civil liability for securities fraud.

Brokers should of course seek to act in their clients’ best interest at all times, but imposing a legal obligation to do so is ill advised. It may end up hurting investors rather than protecting them by making incidental advice more expensive or driving it out of retail brokerage accounts entirely.”

HUD Does Not Need to Target Opportunity Zones

Salim Furth | Public Interest Comment

From the comment: "HUD should avoid adding administrative complexity by targeting Opportunity Zones and should continue to improve the administration of its many long-standing programs intended to benefit economically distressed communities. Opportunity Zones do not, by design or intent, align closely with HUD’s goals. In addition, Opportunity Zones are complex geographies; targeting them would add administrative burdens to HUD’s relationships with states and localities. Instead, HUD should work to simplify existing administrative procedures wherever possible.”

Improving Quality and Reducing Costs in Primary Care

Darcy N. Bryan | State Testimony

From the testimony: "Thank you for the opportunity to testify regarding SB28 and the opportunities for healthcare delivery through direct primary care (DPC).

The country is in the midst of a primary care physician shortage, and the DPC model can serve to remedy this shortage. DPC allows patients to receive the routine services they need—consultations, laboratory tests, preventive care, etc.—from a primary care doctor as frequently as they need against a monthly membership fee paid directly to the physician. No third parties are charged on a fee-for-service basis. The price of a single visit is lower than the periodic fee.”