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Morning Brief: Volcker Rule May be Ready by September

by Renewing America Staff
May 3, 2012

Paul Vocker, former chairman of the Federal Reserve and President Obama's Economic Recovery Advisory Board, speak to Canadian business leaders in September 2010. (Todd Korol/Courtesy Reuters) Paul Vocker, former chairman of the Federal Reserve and President Obama's Economic Recovery Advisory Board, speak to Canadian business leaders in September 2010. (Todd Korol/Courtesy Reuters)

Senior officials from major federal financial regulatory agencies continue to refine the Volcker Rule regulation, with some expecting completion by September (NYT). The regulation authorized by the Dodd-Frank Act would ban proprietary trading at banks. Major banks strongly oppose the drafted rules, arguing they are too lengthy and complex, while proponents believe the provisions are necessary to stop banks from enjoying government support while taking risky bets. Financiers had previously hoped for a substantial delay when regulators admitted they would miss a July deadline.

Texas Tops CEO Survey for Eighth Time

Texas earned its eighth top-ranking on Chief Executive’s eighth-annual CEO survey of best and worst states for business, while California maintained its reign at the bottom. Survey criteria were taxes and regulations, quality of workforce, and living environment. Louisiana continued its climb up from 47th in 2006 by leaping from 27th  in 2011 to 13th. One chairman who recently moved his firm’s headquarters to the Bayou commented: “In Louisiana there is an active government push to reduce taxes and regulation and to encourage new industry to relocate to the state.”

Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.

Education and Human Capital

Harvard and MIT to Offer Free Online Courses through edX

Harvard and MIT are launching edX, an open source non-profit joint venture that will offer free online courses (Boston Globe). Each university will contribute $30 million as well as course materials crafted by their faculties. This effort builds upon MITx, MIT’s online learning initiative that was announced in December. While the coursework is free, the universities are contemplating charging for certificates of course completion. EdX will compete with for-profit startups, such as Coursera which offers free courses from Stanford, Princeton, University of Pennsylvania, and University of Michigan.

Education and human capital. Read more from experts discussing ways to improve U.S. education and immigration policies.

Innovation

Solar Photovoltaic Woes may be Growing Pains

A recent report by McKinsey & Co., a leading management consultancy, argues that the solar photovoltaic (PV) market is poised for stable and expansive growth as prices stabilize, costs fall, and innovation continues. PV manufacturing capacity has continued to surge—particularly in China—leading McKinsey to expect further price declines that will ultimately stoke demand even as government subsidies end. The report advises firms to focus on innovation and cost containment.

Innovation. Read more on how the U.S. capacity to innovate could play a chief role in economic growth.

Infrastructure

Natural Gas Production Slows

Rising natural gas production from shale helped drive prices to record lows, but recently producers have slowed gas production (WSJ). While the total production pullback has been minor relative to recent growth—and some firms continue to aggressively expand—futures have jumped 18 percent since the April 19 low. Demand also continues to rise as electrical companies continue to switch from coal to gas plants to take advantage of low prices, and avoid new EPA regulations.

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.

The Morning Brief is compiled by Renewing America contributor Steven J. Markovich.

 

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