The cost of living in the United States remained steady in January, the Labor Department said, with the price of a variety of goods — everything from medical expenses to cigarettes — increasing 0.2 percent. A closely watched measure that excludes volatile food and fuel costs underscored the downward trend: it fell 0.1 percent in January, the first decrease since the end of the recession in 1982.

“Despite the extraordinary fiscal and monetary stimulus injected into the economy, many prices are still stagnant or declining,” Dan Greenhaus, chief economic strategist for Miller Tabak, wrote in a research note on Friday. “The pricing situation still remains fragile.”

There were rumblings about the possibility of deflation — a three-month barometer of prices fell to zero last month — but economists generally expect the upward momentum to continue. Prices have increased 2.6 percent in the last year.

“Even though the economy is expanding again, the threat of deflation has not passed,” said Paul Ashworth, an economist for Capital Economics in Toronto. He noted that high vacancy rates and a flood of foreclosed homes would continue to push housing costs down.

And there’s not much that Spain’s government can do to make things better. The nation’s core economic problem is that costs and prices have gotten out of line with those in the rest of Europe. If Spain still had its old currency, the peseta, it could remedy that problem quickly through devaluation — by, say, reducing the value of a peseta by 20 percent against other European currencies. But Spain no longer has its own money, which means that it can regain competitiveness only through a slow, grinding process of deflation.

Now, if Spain were an American state rather than a European country, things wouldn’t be so bad. For one thing, costs and prices wouldn’t have gotten so far out of line: Florida, which among other things was freely able to attract workers from other states and keep labor costs down, never experienced anything like Spain’s relative inflation. For another, Spain would be receiving a lot of automatic support in the crisis: Florida’s housing boom has gone bust, but Washington keeps sending the Social Security and Medicare checks.

But Spain isn’t an American state, and as a result it’s in deep trouble. Greece, of course, is in even deeper trouble, because the Greeks, unlike the Spaniards, actually were fiscally irresponsible. Greece, however, has a small economy, whose troubles matter mainly because they’re spilling over to much bigger economies, like Spain’s. So the inflexibility of the euro, not deficit spending, lies at the heart of the crisis.

And if the fifty states of the US could share a currency, he went on, why shouldn’t the “states” of Europe be able to do the same? Well, here’s why: the nations of Europe are differentiated not just by their famous tourist monuments and adorable customs but by their wildly disparate historical experiences, their financial discipline and rectitude, their atttiude to the need for following rules, etc, etc. The very different financial conditions and political cultures which arise from all these dissimilar backgrounds have been fudged and bent out of shape to make them conform to a single model – and now we are seeing the consequences.

Highlighting the reasons why the British were smart not to buy into the Euro.

They can take our pandas, but they can’t stop us from printing money.

The thing is that when the Obama administration isn’t specifically talking about Chinese exchange rate policy, it acts like it has the reverse problem—like we’re a small open economy that’s very worried about an imminent collapse in investor faith in the soundness of our monetary/budget situation. But there’s no evidence that this is a real problem. And insisting that China alter the exchange rate situation while we undergo simultaneously fiscal and monetary retrenchment amounts to demand massive retrenchment by the Chinese government. But why should they do that? And why should we want them to?

The [EU] bank’s president, Jean-Claude Trichet, expressed optimism on Thursday that Greece could stabilize its finances. But he cautioned that large deficits could become a problem for other euro-zone countries, unsettling investors. The euro, which had been sliding down through the day, reached a seven-month low after his remarks, slipping below $1.38 against the dollar.

“President Obama recognizes that it’s the federal government’s responsibility to lead by example in sustainability and on our efforts to build a clean-energy economy,” Sutley told reporters in a telephone news conference, adding that the plan aims to save $8 billion to $11 billion in energy costs through 2020. The 28 percent reduction will be compared with 2008 levels of emissions.Sutley estimated that completion of the plan would amount to reducing greenhouse-gas emissions by 88 million metric tons by 2020 — equivalent to taking 17 million cars off the road for one year. The Office of Management and Budget will score each agency on annual performance toward meeting the goal and will release the score card to the public.

Lincoln, a politically vulnerable senator who comes from a manufacturing state that leans Republican, warned that “heavy-handed EPA regulation, as well as the current cap and trade bills in Congress, will cost us jobs and put us at an even greater competitive disadvantage to China, India and others.”

Sen. Mary Landrieu (D-La.) is also working with Murkowski on proposals to stop the EPA from regulating greenhouse gases under the Clean Air Act.

The Democrats are bucking Majority Leader Harry Reid (D-Nev.), who has criticized the Murkowski proposal.

-Removal of “cautionary language” about application of coal combustion wastes on agricultural lands in an EPA brochure to be replaced with “exclamation point ! language” “re-affirming the environmental benefits…that reinforces the idea that FGD [flue gas desulfurization] gypsum is a good thing” in the word of an American Coal Ash Association representative;

-A draft of EPA’s 2007 Report to Congress caused industry to lobby for insertion of language about the need for “industry and EPA [to] work together” to weaken or block “state regulations [that] are hindering progress” for greater use of the coal combustion wastes; and

-EPA fact-sheets and PowerPoint presentations were altered at industry urging to delete significant references to certain potential “high risk” uses of coal combustion wastes.