The notion that lower-income people make up the majority of our armed forces has led to sayings like "rich man's war, poor man's fight."

Now, Senator Carl Levin (D-Michigan), chairman of the Senate Armed Services Committee, has an unsual idea to equalize the cost of war: a war tax on the rich.

An "additional income tax to the upper brackets, folks earning more than $200,000 or $250,000" a year, could fund more troops, Levin proposed in an interview for Bloomberg Television's "Political Capital With Al Hunt," this weekend.

Continue reading "A War Tax On The Rich?" >

By Daniel Costello

Sales of existing U.S. homes increased 10.1 percent in October to a seasonally adjusted annual rate of 6.10 million, the National Association of Realtors estimated Monday. The rate was the highest since February 2007.

Sales were up 23.5 percent from the same time last year. Every region in the country experienced a pick-up. Meanwhile, the national median home price fell 7.1 percent to $173,100 in October compared to the same time last year.

Continue reading "Existing Home Sales, Oil Jump " >

By Daniel Costello

In 2007, riots broke out from Egypt to Haiti when food shortages grew around the globe. Food prices have been rising for years as overall demand continues to outstrip supply and structural problems with how food is grown and distributed around the world worsen.

Last year's recession eased food inflation but policy experts are worried prices could rise soon, impacting developed countries still hurting from the recession and poorer countries with little breathing room for even minor dips in the food supply.

Continue reading "A Coming Food Crisis?" >

By Daniel Costello

Microsoft Corp. and News Corp. have held talks to create a Web pact that would include Microsoft paying News Corp. to 'de-index' its news websites from Google, setting the scene for a search engine battle that could offer a ray of light to the newspaper industry, the Financial Times reports.

News Corp. initiated the talks although the Financial Times says that Microsoft had also approached other online publishers about removing their sites from Google's search engine in exchange for content payment.

Meanwhile, Chinese banking regulators are putting pressure on the country's banks to raise more capital and temper their rapid growth in lending, in the clearest signs yet of official concern about the sustainability of the nation's credit boom.

Continue reading "Morning Report: Murdoch Vs. Google; Suicides Up During Recession" >

An MRI in Japan can cost as little as $160. (Mckibillo/Flickr)

On today's Planet Money:

We continue our search for answers about why MRI prices can differ so greatly. This time we travel from New Haven, Conn. to Japan, where an MRI costs only $160. Why? Well, it's because of the government, the quality of the machines and as we'll hear from neurologist Dr. Michiko Kimura Bruno, because Japanese people really love MRIs.

Download the podcast; or subscribe. Music: The Temper Trap's "Fader." Find us: Twitter/ Facebook/ Flickr.

By Caitlin Kenney

Unemployment rates increased in 29 states and the District of Columbia last month, the Bureau of Labor Statistics reports.

Michigan once again recorded the highest unemployment rate of 15.1 percent followed by Nevada, Rhode Island and California. Wyoming and Alaska saw the most dramatic month-over-month rate increases. The unemployment rate increased by 0.6 percent from September to October in both states. Arkansas and the District of Columbia saw their rates increase by 0.5 percent.

The unemployment rate fell in just 13 states last month and eight states had no rate change. States that added the most jobs included Texas, Michigan and California.

Nine states recorded unemployment rates higher than the national average of 10.2 percent.

By Daniel Costello

Would you invest in something you knew wouldn't make money?

In the market equivalent of shoveling cash under the mattress, so many buyers were eager this week to park money in the world's safest investment, United States government debt, they agreed to accept a zero percent rate of return or even take a loss.

The annualized yield on three-month T-bills fell to a barely positive 0.01% on Wednesday, down from 0.07% at the beginning of the week and the lowest level since last December. The two-year T-note yield slid to 0.70%, compared with 0.81% a week earlier and also the lowest since December.

Traders said some T-bills were trading at slightly negative yields -- meaning buyers were in effect paying to keep their money in the securities, as opposed to earning a return on them.

Continue reading "Cash Under The Mattress" >

By Daniel Costello

Facing growing criticism over its likely massive bonus payouts as the U.S. economy remains in turmoil, Goldman Sachs said this week it would provide $500 million in loans and gifts to support small businesses. What the company didn't say is how good a deal it is getting on the investment.

According to an analysis posted yesterday on SmartMoney.com, Goldman's ultimate price tag for the initiative could be roughly $136 million to $150 million--70% or more below the figure that helped generate so much publicity for the firm this week.

A big chunk of the money is destined for charitable institutions, creating potentially sizable tax deductions for Goldman, while other portions are being made as loans that Goldman confirms it expects to be repaid with interest.

Asked about the estimates, a Goldman spokesman didn't comment on the specific figures but defended the program as a boon to small businesses, while giving Goldman "a modest economic return."

By Daniel Costello

Rep. Ron Paul, the Texas Republican and lifelong critic of the Federal Reserve, scored a big win Thursday on Capitol Hill by getting a House panel to pass a bill requiring new reviews of the Fed's interest-rate decisions.

The bill, which is likely to face steep opposition when it goes up for a full House vote, would abolish a longstanding exemption that shielded the Fed from Congressional audits of its monetary policy.

Supporters of the Fed's independence have argued the shields provide crucial insulation from political pressure, which would make it much harder for Fed officials to take unpopular action aimed at heading off inflation.

"If we get the audit and get the books open, make them answer the questions, I am convinced that the American people will be so outraged that then we will have reform of the monetary system," Paul has said.

Continue reading "Morning Report: Ron Paul Wins A Round; Deflation Returns To Japan" >

By Caitlin Kenney

Things got heated on Capitol Hill today as a senior Republican lawmaker called on Treasury Secretary Timothy Geithner to resign. Rep. Kevin Brady (R- Texas) said this during a Joint Economic Committee Hearing:

"Conservatives agree that as point person you have failed, liberals are growing in that consensus as well. Poll after poll shows the public has lost confidence in this President's ability to handle the economy. For the sake of our jobs, will you step down from your post?"

Geithner was quick to respond, defending himself while criticizing the policies of the previous administration:

"I agree with almost nothing in what you said, and I think almost nothing in what you said represents a fair and accurate perception of where this economy is today. I think it is important to start, welcome the advice you are providing after you gave this president an economy falling off a cliff, values of American savings cut almost in half, millions of Americans out of work, again the worst financial crisis we have seen in generations."

After the jump, video of the exchange.

Continue reading "Senior House Republican Asks Geithner To Step Down" >