Economic Recovery: Options and Challenges: What role should Congress take in steering an economic recovery? The House Committee on the Budget heard from Federal Reserve Chairman Ben Bernanke and others on the subject recently. Bernanke expressed confidence in the relief efforts that were already underway but stressed that they were "an essential first step." Bernanke said he would be open to the idea of a stimulus package, and others also brought up the notion. Martin Baily of the Brookings Institution suggested a "substantial" $300 billion package that would include tax rebates, unemployment insurance, and infrastructure improvements. Noting the pressures on state economies in tough economic times, Iris Lav of the Center on Budget and Policy Priorities proposed $50 billion to help states avoid cuts to important programs. On the other hand, the Heritage Foundation's William Beach said that Congress should focus on setting long-term policies instead. He said that "slowdowns are good times to get back to policy fundamentals and make certain that everything Congress can do to allow the economy to grow has been done."
The Future of Financial Services Regulation: The House Financial Services Committee considered how much financial industry regulations—or the lack thereof—contributed to the current economic crisis. At a recent hearing, the committee heard from economists and CEOs. Several concluded that financial regulations simply failed to keep current with the pace of change in the modern global economy. Steve Bartlett of the Financial Services Roundtable identified "a 'tipping point' in financial regulation. The regulatory system that has served us so well in the past was not able to recognize fundamental changes in national and international financial markets and to adapt to those changes in a coordinated fashion." Economist Joel Seligman called the current situation "the most consequential debate over financial regulation that we have experienced since the New Deal period" and said that "how well we develop the structure of financial regulation will help determine this nation's financial stability for decades to come." Meanwhile, Columbia University's Joseph Stiglitz saw opportunity, saying that this was "a moment where the international community may be able to come together, put aside parochial concerns and special interests, and design a new global institutional structure for the 21st century. It would be a shame if we let this moment pass."
Checking on Iraqi Security Forces: A new audit sheds light on an often-overlooked impediment to reconstruction efforts in Iraq—the lack of reliable data about the security forces on duty. The Office of the Special Inspector General for Iraq Reconstruction reports on inaccuracies in the personnel numbers maintained by Iraq's Ministry of Defense and Ministry of Information. The two ministries' numbers do not match, making it impossible to track which security forces have been injured or killed, let alone properly trained. Moreover, definitions and classifications have changed over time, making the data impossible to compare. The problems with staffing records can cause service members to be over- or underpaid and, in a larger sense, can cause "a false sense of personnel manpower for that month." Even after efforts at reform and automation, a long-delayed computerized payroll system is not yet operational, and "meaningful trend analysis remains difficult."
Confronting 2 Key Challenges in Afghanistan: Not only does Afghanistan face a burgeoning insurgency, but it also has a long way to go to overcome poverty and illiteracy, which hinder its stabilization, notes a new brief from the Center for Strategic and International Studies. Karin van Hippel, codirector of the CSIS Post-Conflict Reconstruction Program, discusses the United States' and the international coalition's role in helping build a better and more stable Afghanistan. Key questions that will affect efforts to build a safer Afghanistan include "whether and how to talk to the Taliban" and the ability of coalition forces to adopt a "more streamlined military command structure." Release of U.S. government reviews of the situation in Afghanistan are anticipated after the election in November.