The Hill reports that President Obama will issue an executive order requiring agencies to conduct faster reviews of infrastructure projects. The Obama administration will also issue another memo to specifically expedite permitting of the portion of the Keystone XL pipeline stretching from Oklahoma to refineries on the Texas Gulf Coast. This executive order may not have much effect on the project schedule; Bloomberg BusinessWeek reports that construction plans for the southern portion of the Keystone XL pipeline will not change from a scheduled June start. The announcement occurred during a four-state energy tour, during which President Obama vowed to continue making large investments in solar energy (TheHill).
In January, the Obama administration opted not to issue an approval for the entire Keystone XL pipeline project by a Congressional deadline. CFR’s Michael A. Levi—the David M. Rubenstein Senior Fellow for Energy and the Environment—discussed five myths about the Keystone XL pipeline and gave an interview examining the Obama administration’s decision.
Infrastructure. Read more on how upgrading the nation’s aging network of roads, bridges, airports, railways, and water systems is essential to maintaining U.S. competitiveness.
Senate to Vote on Start-Up Funding Bill
The Senate is expected to vote today on the JOBS bill (NYT) and two proposed amendments. The House bill passed 390-23 on March 8th; if either Senate amendment is passed along with the bill, the House would have to reconsider the amended measure. The JOBS bill would reform the financing of start-ups to increase flexibility and reduce regulatory burdens. It would legalize “crowdfunding” (small equity investments by ordinary investors) of up to $1 million and raise the limit of private shareholders from 500 to 2000. Firms with under $1 billion in revenue would be exempted from certain Sarbanes-Oxley regulations regarding IPOs, executive compensation and audits. Forbes provides greater detail on the specific measures.
Supreme Court Unanimously Nullifies Two Medical Testing Patents
The Supreme Court unanimously voided two medical testing patents (WSJ) held by Prometheus Laboratories, a Nestle unit. The Supreme Court ruled that Prometheus’ tests were not novel, but rather used several obvious steps to calculate recommended dosage for particular patients based upon natural laws. While the ruling may open the door to the free application and refinement of other therapies, innovation may slow in the formerly burgeoning field of diagnostic medicine. Without the profits patent protection provides, established firms say they would curtail investment in new testing procedures, and start-ups may have difficulty attracting backers.
Innovation. Read more on how the U.S. capacity to innovate could play a chief role in economic growth.
Education and Human Capital
Retailers can Excel by Investing in Workers
The New Yorker highlights recent studies that suggest that many retailers—including low-price ones—can improve sales and profits by hiring more workers, and training them better. More, better trained employees usually improve sales enough to compensate for higher labor costs; typically an extra dollar of payroll leads to between four and twenty-eight dollars of additional revenue. While increasing payroll investments eventually yield diminishing returns, the recent focus on cost-cutting in U.S. stores created an opportunity for many retailers to benefit customers, employees, and their own bottom lines by investing in their workforces.
Education and human capital. Read more from experts discussing ways to improve U.S. education and immigration policies.
International Trade and Investment
U.S. Retailers Targeting Foreign Customers
U.S. retailers are increasing developing their ability to service international customers. The New York Times describes how Macy’s and other retailers are adapting their websites and marketing strategies to reach overseas customers, often through smartphones. Potential sales are large; after a decade of serving international customers, over a third of all visitors to Abercrombie & Fitch’s website are foreigners. Challenges include expensive shipping, customs requirements, specific import and export restrictions and licensing, and VAT taxes. Still, the lower prices and greater selection of American retailers continue to lure international customers.
International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.
Steven J. Markovich holds an MBA from the University of Chicago’s Booth School of Business.