Monday Strikes Again!
So, BB and I could not figure out anything that made sense about the “Q Anon” stuff that was a press hot item last week. Do you remember back in the day before the internet was overtaken by commercial interests and most of its denizens were academic nerdy types like me? Well, folks started inventing real life versions of fanfic games including maps, and secrets, and treasures that may have followed a reality set up by a game console game. Most of it was just really bad fanfic too. The entire QAnon thing just read like really, really bad fanfic to me. and that is what it now appears to be. Its motivation was to evidently drive boomers nuts and it’s evidently a leftie bro thing. The nonsensical conspiracy site was called “Bread Crumbs.”
According to Q, nearly every president before Trump was a “criminal president” who was part of an evil global organization of Satanist pedophiles. It also claims members of the US military who are not working for the global pedophile cabal supposedly approached Trump and begged him to run for president so that they could purge the government of the deep state operatives without a military coup.
Q claims Trump is not under investigation by special counsel Robert Mueller, but that Hillary Clinton and Barack Obama are. And Trump is actually working with Mueller.
Q regularly drops clues that followers call “crumbs,” which are meant to predict things. For instance, he claimed John Podesta would be arrested or indicted Nov. 3, 2017 — which, of course, didn’t happen
See, bad fanfic. But the bottom line, with tons of documentation at the Buzzfeed piece citied here is that it was a hoax which finally makes sense to me. Imagine bored dateless BernieBros in a basement some where ….
“Let us take for granted, for a while, that QAnon started as a prank in order to trigger right-wing weirdos and have a laugh at them. There’s no doubt it has long become something very different. At a certain level it still sounds like a prank. But who’s pulling it on whom?” they said.
They also point to the fact that even this article runs the risk of being sucked into the QAnon vortex and just adding more fuel to the fire. “If [QAnon’s] perpetrators claimed responsibility for it and showed some evidence (for example, unmistakeable references to our book and the Luther Blissett Project), would the explanation itself become yet another part of the narrative, or would it generate a new narrative encompassing and defusing the previous one?”
So, now that’s cleared up the press can leave it alone. There are real things out there. That sucking sound you hear are wages and wealth going to the richest of the rich.
On May 8th, Brookings officially launched a new initiative on the Future of the Middle Class. Through this initiative, we will publish research, analysis, and insights that are motivated by a desire to improve the quality of life for those in America’s middle class and to improve upward mobility into its ranks. We have already wrestled with how we define this group, considered its changing racial composition, and called upon experts to outline major policies geared toward improving its fate. But why all of this attention? Here are seven of the reasons we are worried about the American middle class.
Today, I feel the “dismal” in the dismal science meme. Retirement prospects for many Boomers includes Bankruptcy.
For a rapidly growing share of older Americans, traditional ideas about life in retirement are being upended by a dismal reality: bankruptcy.
The signs of potential trouble — vanishing pensions, soaring medical expenses, inadequate savings — have been building for years. Now, new research sheds light on the scope of the problem: The rate of people 65 and older filing for bankruptcy is three times what it was in 1991, the study found, and the same group accounts for a far greater share of all filers.
Driving the surge, the study suggests, is a three-decade shift of financial risk from government and employers to individuals, who are bearing an ever-greater responsibility for their own financial well-being as the social safety net shrinks.
The transfer has come in the form of, among other things, longer waits for full Social Security benefits, the replacement of employer-provided pensions with 401(k) savings plans and more out-of-pocket spending on health care. Declining incomes, whether in retirement or leading up to it, compound the challenge.
Well, that’s no surprise. It’s also no surprise that Trump is behaving badly on the World Stage again. “Trump signs order reimposing sanctions on Iran – a move the EU said it ‘deeply’ regrets.” Well, we knew Bolten had to be getting something to help with all that Putin Ass Kissing.
Donald Trump has signed an executive order reimposing sanctions on Iran – a move the EU said it “deeply” regretted.
Three months after he revealed he was pulling the US out of the seven-party Iran nuclear deal, Mr Trump announced the reimposition of wide range of sanctions against the Middle Eastern nation. Three months after he revealed he was pulling the US out of the seven-party Iran nuclear deal, Mr Trump announced the reimposition of a wide range of of sanctions against the Middle Eastern nation. A second set will be reimposed in a further three months.
“[The Iran nuclear deal] a horrible, one-sided deal, failed to achieve the fundamental objective of blocking all paths to an Iranian nuclear bomb, and it threw a lifeline of cash to a murderous dictatorship that has continued to spread bloodshed, violence, and chaos,” Mr Trump said in a statement.
“Since the deal was reached, Iran’s aggression has only increased. The regime has used the windfall of newly accessible funds it received under the JCPOA to build nuclear-capable missiles, fund terrorism, and fuel conflict across the Middle East and beyond.”
In the aftermath of Mr Trump’s unilateral decision in May, the other parties to the 2015 deal – Russia, China, Germany, France, the UK and the EU – vowed to stick with the deal and to and continue to trade with Iran. Several companies, such as French-based Airbus, felt obliged to pull out of a deal with Iran, rather than risk sanctions from Washington.
The revoking of licensees to the company and its rival, Boeing, saw the aircraft manufacturer lose out on a $39bn deal with Tehran for new planes. Easing sanctions such as this was a major inducement get Tehran to sign the Joint Comprehensive Plan of Action (JCPOA) in 2015 under President Barack Obama.
The executive order signed on Monday, which will come into effect at midnight EST, releases to the purchase or acquisition of US currency Iran, the trade in gold and other precious metals, materials such as graphite, aluminium, steel, coal, and software used in industrial processes. They also target the country’ automotive sector.
The remaining sanctions to be reimposed on November 5 relate to Iran’s port operators and energy, shipping, and shipbuilding sectors. Crucially, they will also target its oil industry and foreign financial institutions with the Central Bank of Iran.
It’s like he’s single handedly destroying our economic, world order, and the environment. This news is awful but typical Trump policy.
Two of America’s biggest steel manufacturers — both with deep ties to administration officials — have successfully objected to hundreds of requests by American companies that buy foreign steel to exempt themselves from President Trump’s stiff metal tariffs. They have argued that the imported products are readily available from American steel manufacturers.
Charlotte-based Nucor, which financed a documentary filmmade by a top trade adviser to Mr. Trump, and Pittsburgh-based United States Steel, which has previously employed several top administration officials, have objected to 1,600 exemption requests filed with the Commerce Department over the past several months.
To date, their efforts have never failed, resulting in denials for companies that are based in the United States but rely on imported pipes, screws, wire and other foreign steel products for their supply chains.
The ability of a single industry to exert so much influence over the exclusions process is striking even in Mr. Trump’s business-friendly White House, given the high stakes for thousands of American companies that depend on foreign metals. But the boundaries of trade policy are being tested by the scope of Mr. Trump’s multifront trade war with allies and adversaries alike, which includes tariffs on up to $200 billion worth of goods from China and possible tariffs on automobiles and auto parts.
But after watching Trump for all this time, there’s no reason to beat around the bush on this question anymore. Donald Trump is a racist, and we all know it. He could barely have tried any harder to convince us. Not only did he turn himself into a political figure by making himself America’s most prominent birther, he repeatedly demanded to see Barack Obama’s high school and college transcripts, on the theory that Obama couldn’t possibly have been smart enough to get into Columbia and Harvard Law School on his own merit. He ran a white nationalist campaign for president, and said that the judge in his Trump University fraud cause couldn’t be fair because “He’s a Mexican” (in fact, the judge is an American). On multiple occasions he retweeted racist memes from white supremacists. In a White House meeting about immigration, he said that Haitian immigrants “all have AIDS” and complained that once Nigerian immigrants had seen the United States they would never “go back to their huts” (Nigerian immigrants are one of the most highly educated groups in America). He meets a group of Native American war heroes, and decides to bring up the fact that he insults Elizabeth Warren by calling her “Pocahontas.” And of course, he called non-white nations “shithole countries” and averred that a group of neo-Confederates and neo-Nazis were “very fine people.”
So we know who Donald Trump is, and why he says what he does. The fact that much of what Trump says about African Americans is performative—a public show meant to keep his base angry—doesn’t mean that the bigotry isn’t sincerely felt.
This is a good reminder that Trump’s 2020 campaign will be no less built on hate than his 2016 campaign was. In fact, it could be even more so. Trump will no longer be able to plausibly argue that there’s a system controlled by an elite that’s keeping regular people down, since he and his party are the ones with all the power. So it’s likely that he’ll rely even more heavily on white nationalism to get re-elected.
Donald Trump has admitted for the first time that his son met a Kremlin-connected lawyer in 2016 to collect information about Hillary Clinton, but insists the meeting was legal.
In one of a series of Sunday morning tweets issued in apparent reaction to a CNN report, the US president wrote: “Fake News reporting, a complete fabrication, that I am concerned about the meeting my wonderful son, Donald, had in Trump Tower. This was a meeting to get information on an opponent, totally legal and done all the time in politics – and it went nowhere. I did not know about it!”
That explanation differs entirely from one given by Trump 13 months ago, when a statement dictated by the president but released under the name of Donald Trump Jr read: “We primarily discussed a program about the adoption of Russian children that was active and popular with American families years ago.”
The 2016 meeting is pivotal to the special counsel Robert Mueller’s Russia collusion investigation, though Trump’s tweets appeared aimed at conveying the message that he is not worried about Donald Trump Jr’s exposure to the inquiry.
He made the remarks as one of his lawyers warned the special counsel against trying to force the president to be interviewed.
The dude seriously keeps admitting to crimes. Why can’t we lock hIm up? “President Trump changes story in Twitter rant admitting Trump Tower meeting was to gather intel on Hillary Clinton.”
The President’s latest social media meltdown was in reaction to what he called a “complete fabrication” in Sunday’s Washington Post claiming Trump was concerned “innocent and decent people,” including his son Donald Trump Jr., could be hurt by Mueller’s probe exploring links between Trump’s campaign and Russia.
“This was a meeting to get information on an opponent, totally legal and done all the time in politics — and it went nowhere,” he wrote. “I did not know about it!”
Thirteen months ago, Trump gave a different explanation for the meeting between his eldest son and parties alleging ties to the Russian government. A July 2017 statement credited to Don Jr. and later discovered to have been dictated by the President read: “We primarily discussed a program about the adoption of Russian children that was active and popular with American families years ago.”
Though the President maintains he knew nothing about the Trump Tower meeting prior to its taking place, his former fixer Michael Cohen, who has reportedly indicated a willingness to cooperate with Mueller’s team, has allegedly said otherwise.
Trump lawyer Jay Sekulow said on ABC’s “This Week” on Sunday that he had “bad information” when he personally argued that the meeting was about adoption.
So, this is just an open news dump thread! What’s on your reading and blogging list today?
Good Morning Skydancers!
I’m going to do my economist thing today because, my family, I think you need to know that the last year has been about taking actions that will blow things up. It’s true for the economy too. There have been so many bad economic policies coming out of this regime that it’s truly hard to figure out the extent things will be blowing up but it’s already starting. I feel like I’m continually delivering dismal news but forewarned is forarmed. Praemonitus praemunitus–the original Latin form–is actually the motto of the United States Army Security Agency. That seems oddly prescient.
Here’s the list of omens that I’ve been keeping track of the coming economic crash. I live in ground zero. We haven’t recovered from Jindal’s terrible policies yet. The Port of New Orleans and other port cities are going to lose a lot of business.
‘China is slamming $34 billion worth of US goods with tariffs. Here are the states that will be hurt the most.’
The states that exported more than $1 billion worth of tariff-eligible goods to China in 2017 were Texas, Louisiana, Washington, California, Alabama, South Carolina, Illinois, and Kentucky.
Southeast Missouri nail company gets hammered by Trump’s tariffs
President Trump’s tariff on steel imports that took effect June 1 has caused a southeast Missouri nail manufacturer to lose abo9ut 50% of its business in two weeks. Mid Continent Nail Corporation in Poplar Bluff – the remaining major nail producer in the country – has had to take drastic measures to make ends meet. The company employing 500 people earlier this month has laid off 60 temporary workers. It could slash 200 more jobs by the end of July and be out of business around Labor Day.
Since China proposed tariffs on soybeans following president trump’s announced tariffs on Chinese goods, the price of soybean bushels have dropped 20 percent.
For farmers in Arkansas, that’s something that could mean the end of their business.
Arkansas Farm Bureau President Randy Veach says it’s something he’s keeping an eye on. “We’re concerned, of course,” Veach said.
Being a soybean farmer himself, when he saw China was placing a tariff on United States soybeans, the market dropped the value of that crop to around nine dollars a bushel, putting Arkansas farmers in a difficult spot.
“They actually buy 60 percent of all the soybeans that’s traded around the globe,” Veach said. “We can’t make a profit at that low of a price.”
U.S. producers of pork, already saddled with duties enacted in an earlier round of the escalating trade dispute with China, are bracing for further pain after Beijing hit the products with additional tariffs due to come into effect next month.
China implemented a 25 percent duty on most U.S. pork items on April 2, and a 15 percent tariff on a range of fruits and nuts, in response to U.S. tariffs on Chinese steel and aluminum products.
Last week it included both categories in a second round of tariffs to be imposed on July 6. No other products have been listed twice.
Pork now faces cumulative import duties of 71 percent, not including value added tax, according to a formula published on the website of China’s finance ministry last week. Cumulative duties on fruit amount to 50 percent.
“The additional tariff will put us out of business,” said Zhong Zheng, founder of China-based Heartland Brothers, which sells U.S.-produced Berkshire pork to Chinese supermarkets and restaurants”
You beginning to see pattern here? And oh, look! We’re exporting jobs to the EU now! You know them! Land of livable wages and benefits?
President Donald Trump’s trade war with the European Union is going to cost Harley-Davidson Inc. as much as $100 million a year and spur a shift of production outside the U.S. at the manufacturer he embraced early in his term.
Each motorcycle shipped to Europe will mean a $2,200 expense because of the EU’s retaliatory tariffs for Trump’s steel and aluminum duties, according to a Monday filing. Passing that on to dealers or customers would cause an “immediate and lasting detrimental impact” on the company’s business in its second-largest market, so it will absorb most of those levies.
While Trump has repeatedly claimed that the U.S. can easily win trade wars, victims are starting to pile up at home and abroad. Daimler AG warned last week that escalating tension between the U.S. and China will impair earnings its Alabama SUV plant and lower profit this year. Harley tied its higher costs to a sequence started by Trump, who praised the company as a model American manufacturer during a February 2017 meeting at the White House.
Some economists on Wall Street think the economy could be growing at around a nearly 5 percent annual clip this quarter. But if the current economic vigor is only reflecting a short-term stimulus coming from the Trump administration’s tax cut, then some kind of slowdown is to be expected.
“It’s very hard to see what’s going to goose the economy further from these levels,” Ms. Gibbs said.
And the financial markets can sometimes sniff out problems with the economy before they show up in the official economic snapshots published on G.D.P. and unemployment. Another notable yield curve inversion occurred in February 2000, just before the stock market’s dot-com bubble burst.
In that sense, the government bond market isn’t alone. Stocks have been in a sideways struggle since the Standard & Poor’s 500 last peaked on Jan. 26. Returns on corporate bonds are negative, as are some key commodities tied to industrial activity.
An important caveat to the predictive power of the yield curve is that it can’t predict precisely when a recession will begin. In the past the recession has come in as little as six months, or as long as two years after the inversion, the San Francisco Fed’s researchers note.
Oh, and the weird artwork is all stuff related to comprehending ancient omens from the Greeks to the Aztecs to the old Europe. Just in case you wanted to know.
I put up the link to a crazy Washington Examiner bit in the tweet below. Trump and his team of NOT.ONE.REAL.ECONOMISTS. create more fairy tales from Dust. Here’s bull shit from a man that can’t even do high school statistics.
“The U.S. economy is the fastest-growing economy virtually in the whole world,” said Moore, the distinguished visiting fellow with the Project for Economic Growth at the Heritage Foundation. He predicted that when everything is factored in, second-quarter growth will come in just shy of that. He said, “4.5 percent is very plausible for the second quarter, which is a gigantic number.”
He also predicted that the stock market will continue its bullish ways, ignoring naysayers who say that the shallow but long U.S. recovery is about to fade.
“We really haven’t had a recovery,” said Moore, who added, “The economy isn’t running out of gas, it is just starting to rev up.”
That’s a pretty good example of being self-serving and delusional at the same time.
The escalating trade battle between the U.S. and the rest of the world is raising the risk of a meaningful slowing in an otherwise vibrant American economy.
While the tariffs already in place and set to be implemented will barely dent U.S. growth, economists say the panoply of additional measures being considered would take a perceptible bite out of gross domestic product if they go ahead.
“It’s going to be more noticeably painful,” said Peter Hooper, chief economist at Deutsche Bank AG in New York.
Hooper, who expects the economy to expand 3 percent this year, said the steps already taken or in the works would clip just 0.1 percentage point off GDP growth.
Throw in President Donald Trump’s threat to slap a 10 percent tariff on an additional $200 billion of Chinese imports and a 20 percent levy on car shipments from the European Union and the impact grows to 0.3 point to 0.4 point, he said. And the fallout could even be greater if heightened tensions begin to infect consumer, business and investor confidence,
Here are more impacts from bad policy: “Here’s how Trump’s tax law is raising health insurance premiums”
Approximately six months ago, Congress passed a tax law designed to benefit corporations and the wealthy while repealing the Affordable Care Act’s individual mandate penalty.
Today, we’re already seeing the consequences: Premiums in the individual market are rising, often by double digits. As more and more states hit their deadlines for insurers to file preliminary premium rates, the headlines tell the same story, with average premiums going up by 30 percent in Maryland, 19 percent in Washington, and 24 percent in New York.
This is no surprise — and no accident. The repeal of the mandate penalty was the latest in a long line of actions that the Trump administration has taken to deliberately undermine the ACA marketplaces.
President Trump himself has not exactly been subtle about this, remarking last year that “the best thing we can do politically speaking is let ObamaCare explode.” Similarly, former White House advisor Steve Bannon exclaimed, “That’s going to blow that thing up — gonna blow those exchanges up, right?” when describing Trump’s decision to cancel ACA cost-sharing payments last year.
Congress knew in advance that the individual mandate played an important role in stabilizing the market, and that repealing the mandate penalty would cause premiums to go up. The non-partisan Congressional Budget Office estimated that repealing the mandate penalty would increase individual market premiums by 10 percent on average in 2019.
In fact, Trump’s own former Secretary of Health and Human Services, Tom Price, recently admitted that the repeal “actually will harm the pool in the exchange market because you’ll likely have individuals who are younger and healthier not participating in that market, and consequently that drives up the cost for other folks in that market.”
The only problem with the positive new perspective on the GOP tax law created by the flurry of bonus announcements is that it’s wrong. Pelosi was right. While anyone less wealthy than Trump and his cabinet would find an unexpected bonus of $1,000 a welcome surprise, the bonuses were—relatively speaking and in the proper context—crumbs. And they’re crumbs that few workers are actually receiving.
The only way to have figured this out was to cut through the hype and look at the numbers. Americans for Tax Fairness (ATF) did just that, creating a master database documenting bonuses, wage hikes, tax savings, stock buybacks, layoffs, and a half-dozen other indicators of the impact of the Tax Act on business fortunes and behavior. Unlike the simple lists of cheery corporate news collected by Americans for Tax Reform and several other tax-cut boosters, ATF’s presentation is an entire searchable website that makes it easy to compare who—among corporations, their shareholders, and their workers—is actually getting how much.
This is a really long read about both the politics and the sham but it’s worth your time.
Beyond this initial audience of one lay the harder-to-convince American people. And despite the vigor of the corporate public relations campaign meant to woo them, it wasn’t difficult to see it was all an act.
One tip-off was the timing. The rush to distribute bonuses at the end of the year was timed so corporations could write them off at the old, higher tax rate: Employee expenses incurred in 2017 and even into early 2018 could still be deducted against a 35 percent tax rate, more valuable than the 21 percent deduction available under the new law. (Fiscal-year filers could exploit this same tax arbitrage even later in the year, but the advantage wanes the deeper you get into 2018.)
That diminishing tax advantage is one reason the seeming flood of announcements over the winter slowed to a trickle by the spring.
Another signal that we had not in fact reached a new era of broadly shared prosperity was that the vast majority of payouts were one-time bonuses, not permanent wage hikes. More than twice as many workers are getting bonuses as are getting raises. It’s far easier for corporations to withhold future bonuses than to cut their workers’ wages.
So, these one shot blow your wad kind of things just lead to what we’re seeing now. The economy is getting a short term blast of amphetamine. It’s something the Fed won’t allow because these things turn into inflation. The tariffs are essentially tax increases too. The overproduction of agricultural goods that can’t find a market right now will turn into shortages, higher final prices, and failed businesses next season.
The bizarre thing is that the staff of real economists for the CEA are contradicting the Administration’s public narrative. They can do math. But they still spin crap.
A White House economic analysis of President Trump’s trade agenda has concluded that Mr. Trump’s tariffs will hurt economic growth in the United States, according to several people familiar with the research.
The findings from the White House Council of Economic Advisers have been circulated only internally and not publicly released, as is often the case with the council’s work, making the exact economic projections unknown. But the determination comes as top White House officials continue to insist publicly that Mr. Trump’s trade approach will be “massively good for the U.S. economy.”
The chairman of the Council of Economic Advisers, Kevin Hassett, an economist who came to the administration from the American Enterprise Institute, a conservative think tank, dodged questions at a White House briefing on Tuesday about whether tariffs would hurt an economy that has accelerated during Mr. Trump’s tenure.
Asked whether the administration’s economists had modeled the impact that a trade war with China would have on the United States economy, Mr. Hassett said Mr. Trump was a great negotiator who would persuade other countries to open their markets to American products.
I’ll end with this.
What’s on your reading and blogging list today?
I’m still trying to get my thoughts together about the number of bomb throwers in both political parties that seem to want all levels of government to go to wreck and to ruin. They are being led by some of the most ignorant politicians I’ve ever had the displeasure to observe. Some folks are angry and eager for easy and very wrong answers.
It’s really easy for most people to confuse their personal pet experience with reality for the rest of the country as a whole. I get really tired of having anecdotal information put on the same level of seriousness as a peer-reviewed, published study. As an economist, I can tell you the number of people ignorant of generally well-known outcomes discovered through research and built up into theory in my field is highly limited. I shared this article by economist Greg Mankiw down thread over the weekend. I thought it was worth highlighting its main points.
I’ve said this a lot of times but the entire Sanders/Trump shtick on trade and the Sanders shtick on “big” banks is seriously out of step with reality. Mankiw succinctly writes about a few things that economists know that populist, anger-spewing office seekers don’t take time to learn. Now, Mankiw worked on the CEA for Dubya. He’s not the least bit politically Democrat but what he’s written here are things that economists and policy wonks know to be true from decades of study. Economists generally don’t argue on the facts on the ground or on theory. It’s how the policy should reflect that information that is usually a source of contention. There’s a lot of myths out there this election cycle. Here’s a few of them.
American manufacturing has disappeared.
The presumptive Republican nominee, Donald J. Trump, says, “We don’t make things anymore.” Judging from the surprising success of Mr. Trump’s campaign, this theme apparently resonates with many voters. But it is just not true.
When do you think manufacturing output reached its peak in the United States? The answer: right now. Manufacturing output achieved a record high in the most recent quarter of data. The nation’s manufacturers are now producing 47 percent more than they did 20 years ago.
What has declined is manufacturing employment, which is 29 percent lower than it was 20 years ago. Producing more output with fewer workers is called higher productivity, which in turn is driven by technological innovation. This change is hard on displaced workers, but it is good for the economy over all. Rising living standards are possible only if productivity increases.
Bad trade deals are what ails the economy.
Mr. Trump says he would negotiate better trade deals. Bernie Sanders brags about voting against the trade deals of the past. Hillary Clinton has split with President Obama and withdrawn her support for the Trans-Pacific Partnership.
The experts have a different view. Among those who devote their lives to studying the economy, there is a broad consensus about the overall benefits of free trade and trade deals. Of course, trade hasn’t been a boon for people who have lost their jobs because of foreign competition. But in 2014, the University of Chicago’s IGM Panel surveyed prominent economists about whether “past major trade deals have benefited most Americans.” A few respondents were uncertain, but most said yes. Not a single economist responded in the negative.
The economy is rigged.
To be sure, we live in challenging times. Meager growth and rising inequality have resulted in stagnant incomes for much of the working class and declining incomes for those with the lowest levels of education.
But to say that the economy is rigged, as Mr. Sanders and Mrs. Clinton have done, assumes that some small group of oligarchs planned this outcome. Clearly, the wealthy and powerful try to protect their interests, and they sometimes succeed. But the economy is a complex, decentralized system. Many outcomes are under no one’s control.
The biggest problem is that the devil is very much in the details which is where the challenges of policy exist. It used to be–back in the day when I entered the business which is 1980 if you don’t count my undergrad stint as a teller–that every list of the top largest banks in the world had nothing but US banks. That hasn’t be the case for some time. China has now replaced Japan in the list but you’ll see that US banks have a presence on the list but don’t comprise the entire list. Australia, Canada and the UK also have some very large banks.
Countries and multinational corporations are huge and the amount of money they need to bank, borrow and use transactionally can only be handled by huge banks. The thing that makes them systematically dangerous is not their size. It’s the amount of ownership vs. deposits and their investing behaviors all of which are regulated internationally through the Bank of International Settlements and the Basil Committee recommendations.
Nationally, we have the Federal Reserve Bank where I have actually worked with regulating huge regional banks in the south. We have a number of laws on the books–most notably Dodd-Frank–that reflect international standards and our own goals for keeping systemic risk down in the financial system. It’s certainly not perfect and we do see many banks fighting some changes. We need to build on all of that and we need to pay better regulatory attention to the shadow banking industry. I’ve written extensively about that here since the Financial Collapse. Any one that suggests that it’s only size that matters needs to go back to school. We’ve discussed this before but the Clinton policy is subtle, nuanced, and up to the job if her administration can get it through a belligerent congress. I have more faith that she can do that than the bomb throwers who have challenged her for office.
Same with trade deals. There are many many aspects to trade that are good and it far outweighs the damage it can do to a few domestic industries. It’s a form of progress. Really. Every single consumer on the planet gets access to things cheaply that they never would which helps every one’s standard of living. I don’t think it’s a good idea to argue that jobs should only exist within your borders and every one else can just starve trying to make a living. We’re all better off through trade but there are people that are hurt by it. Again, it’s policy details that can see that trade does not ruin folks’ lives who are on the losing end.. It’s similar to what Clinton argues about transitioning Kentucky coal miners to clean energy industries. Technology is still a huge factor in job lose. Those folks in industries that lose domestically need to be helped by all levels of government. Even they will eventually see their paychecks access more as long as we can ensure they can still earn livings.
The problem that we see here is that we have a party that does not believe in a role for any form of government in anything and it stymies the kinds of policy details that ensure stability in big banks and ensure that our workers can find jobs and are trained properly for new industries if need be. None of this will happen if we elect politicians who are insurrectionists of one type or another.
Paul Krugman’s Op Ed today in the NYT calls Donald Trump an Ignoramus.
Last week the presumptive Republican presidential nominee — hard to believe, but there it is — finally revealed his plan to make America great again. Basically, it involves running the country like a failing casino: he could, he asserted, “make a deal” with creditors that would reduce the debt burden if his outlandish promises of economic growth don’t work out.
The reaction from everyone who knows anything about finance or economics was a mix of amazed horror and horrified amazement. One does not casually suggest throwing away America’s carefully cultivated reputation as the world’s most scrupulous debtor — a reputation that dates all the way back to Alexander Hamilton.
The Trump solution would, among other things, deprive the world economy of its most crucial safe asset, U.S. debt, at a time when safe assets are already in short supply.
Of course, we can be sure that Mr. Trump knows none of this, and nobody in his entourage is likely to tell him. But before we simply ridicule him — or, actually, at the same time that we’re ridiculing him — let’s ask where his bad ideas really come from.
Well, read the answer because it’s easy. It comes from republican lawmakers like Paul Ryan and Ted Cruz. Some of these Trumpisms even come from Romney. Krugman states that Trump’s “blithe lack of knowledge largely follows from the know-nothing attitudes of the party he know leads.” He concludes by being very complimentary to Clinton who’s economic policy is the only one rooted in reality and in accepted economic theory.
One of the wackiest things I’ve read in a long time is this story about how American Airlines handled an economist working on one of its flights. I fully admit to doing pretty much the same thing on long flights. I drag out my work. I’ve never thought you could be considered terrorizing a seat mate will doing Differential Equations, but I guess you can in the paranoid world of angry white people. Here we have an Ivy League economist of Italian descent causing panic in the skies.
What do you know about your seatmate? The agent asked the foreign-sounding man.
Well, she acted a bit funny, he replied, but she didn’t seem visibly ill. Maybe, he thought, they wanted his help in piecing together what was wrong with her.
And then the big reveal: The woman wasn’t really sick at all! Instead this quick-thinking traveler had Seen Something, and so she had Said Something.
That Something she’d seen had been her seatmate’s cryptic notes, scrawled in a script she didn’t recognize. Maybe it was code, or some foreign lettering, possibly the details of a plot to destroy the dozens of innocent lives aboard American Airlines Flight 3950. She may have felt it her duty to alert the authorities just to be safe. The curly-haired man was, the agent informed him politely, suspected of terrorism.
The curly-haired man laughed.
He laughed because those scribbles weren’t Arabic, or another foreign language, or even some special secret terrorist code. They were math.
Yes, math. A differential equation, to be exact.
Had the crew or security members perhaps quickly googled this good-natured, bespectacled passenger before waylaying everyone for several hours, they might have learned that he — Guido Menzio — is a young but decorated Ivy League economist. And that he’s best known for his relatively technical work on search theory, which helped earn him a tenured associate professorship at the University of Pennsylvania as well as stints at Princeton and Stanford’s Hoover Institution.
So, here’s a few other policy issues that you may want to read about today. More and more cities are realizing that AirBnb is just a way to get around local zoning and commerce laws. It’s pushing up rent and creating homelessness in all the major tourist destinations of the world.
A 20-year resident of San Francisco, Tarin Towers lived in a rent-controlled apartment in the Mission District. Her building, a six-unit Victorian, was home to people who had stayed in the Mission for decades as the neighborhood changed around them. Some of her neighbors were multigenerational families, some were elderly, some were disabled. As long as the building remained rent-controlled, they should have been protected from the city’s skyrocketing housing market. But in 2013, the building was bought by well-known real estate speculator Fergus O’Sullivan, who saw he could make more — a lot more — with new tenants. But first, he had to get the old ones out.
In some ways, San Francisco renters are lucky. Their city has rent-control laws, unlike most places in the U.S., where your landlord can get rid of you as soon as the lease ends. In San Francisco, in many cases, a landlord must pay for the privilege of kicking you out — sometimes handsomely. As Towers’ landlord started renovations on her building, turning it into an all-day construction site, her neighbors started taking buyouts — some as high as six figures. But when Towers looked around at San Francisco real estate, she realized that after splitting a buyout with her housemates and paying taxes and lawyers’ fees, the amount she would get for leaving wouldn’t enable her to pay higher rent elsewhere in the city.
Towers held out as her old neighbors left and new tenants started moving in. Unlike the old neighbors, these new people were young, mobile, transient. And there were a lot of them. O’Sullivan, it turned out, had leased the building to a startup called the Vinyasa Homes Project. Towers soon discovered that Vinyasa had listed her building on Airbnb, advertising it as a “co-creative house.” The listing made it sound almost like a commune. “You want to join a community of like-minded peers who are doing inspirational things?” it read. “This is the place for you.” Unlike in the communes of yesteryear, however, each bed is going for more than $1,500 a month — and these are bunk beds in shared rooms. That means each apartment could now be bringing in $10,000 a month in rent.
In recent years, few things have been as exhaustively debated or written about than the Iran deal.
That debate reignited this week after a long article about me included a section about the Iran deal. There are many issues raised in an article of this length, and I’m sure I’ll have plenty of opportunities to respond to those topics in the weeks and months to come.
However, given the importance of the questions raised about the Iran deal over the last few days, I want to make several points about one issue: how we advocated for the deal.
First, we never made any secret of our interest in pursuing a nuclear deal with Iran. President Obama campaigned on that position in 2008. We pursued several diplomatic efforts with Iran during the President’s first term, and the fact that there were discreet channels of communication established with Iran in 2012 is something that we confirmed publicly. However, we did not have any serious prospect of reaching a nuclear deal until after the election of Hasan Rouhani in 2013. Yes, we had discussions with the Iranians before that, but they did not get anywhere. After the Rouhani government took office, our confidential negotiations with the Iranians accelerated, and quickly led to public negotiations within the P5+1 process that began at the United Nations General Assembly in September 2013. Whatever your analysis of the relative weight of moderates or hard-liners in the Iranian system, there is no question that we were able to achieve a deal only after a change in the Iranian Administration.
Second, we did aggressively make the case for the Iran deal during the congressional review mandated by statute last summer, as it was imperative that the facts of the deal be understood for it to be implemented. Opponents of the deal had no difficulty in making their case — through commentary, a paid media campaign, and the distribution of materials making a variety of arguments against the deal. Tough and fair questions were raised; sometimes, there were also inaccuracies about the nature of the deal. Given our interest in making sure that any misinformation was corrected, and that people understood our policy, we made a concerted effort to provide information about the deal to any interested party, including to outside organizations and any journalists covering the issue. This effort to get information out with fact sheets, graphics, briefings, and social media was no secret — it was well reported on at the time. Of course the objective of that kind of effort is to build as much public support as you can — that’s a function of White House communications.
Jaws dropped in Washington’s tight-knit foreign policy community when Ben Rhodes, a deputy national security adviser and one of President Barack Obama’s closest aides, was quoted in the New York Times Magazine deriding the D.C. press corps and boasting of how he created an “echo chamber” to market the administration’s foreign policy.
Marbled with the kind of overly candid observations that sank Gen. Stanley McChrystal, the wartime general who was quoted mocking Vice President Joe Biden in a 2010 Rolling Stone profile, the article, written by David Samuels, hit like a bomb. It portrayed Rhodes as a real-life Holden Caulfield, a prep-school brat with literary pretensions whose greatest work of fiction was crafting the White House’s “narrative” to defend the Iran nuclear deal from its critics.
It’s really a shame that you can’t write analysis of complex policies like these on the back of a cereal box and expect every one to have enough background in the material to actually grasp it. It does seem to me, however, that as responsible voters in a democratic society that people could at least try to get better information. It’s not like it’s not easily accessible these days.
So there’s a few things on wonky policy to get us started today.
What’s on your reading and blogging list?
I’m running really late today despite coffee and all the usual things I use to face the morning. I seem to be in need of hibernation. I’m not sure if it’s the ugly political situation or just the challenges of doing any little thing these days. Have you noticed how businesses are basically set up to take your money efficiently and create hell for you under any other circumstance? Calling them is to enter a hell realm. Even when you do reach a person, there seems to be little they can do but offer sympathy and customer service surveys. Why are businesses so damned rotten these days? Is it because they are coddled while the rest of us have been basically dropped from the master plan?
I’m going to do a little sharing of local stuff juxtaposed on some national news because I’ve been noticing how difficult life is becoming for regular people. Here in New Orleans, we’re chasing tourist dollars by destroying the culture that brings them here and basically driving off the workers that do the daily stuff of dealing with them. I’m beginning to think that the entire plan of the Aspen Institute is to turn every major city into a seamless, architecturally bland, sea of guys sporting manbuns. We seem to be selling our treasure to the highest out-of-town bidder who then remakes it into something totally new Portland or new Seattle or new Brooklyn. Then, we all have to indulge boorish burbies in all the places we used to use to escape them.
Here’s a great example. This nice old home used to be the equivalent of a hostel owned by a friend of mine. It was called the Mazant Guesthouse and was heavily used by Europeans because it had no A/C, a communal kitchen, and was extremely cheap. The first thing the new owners did was try to tear down the backhouse. Thankfully, the historic commission stopped them. Now the entire property is just another reminder of the folks city government is trying to attract to all parts of the city including our personal, private backyards. Asking price? $1.65 million. You could’ve bought entire blocks here for that just a few years ago. So, you can imagine what that’s done to the rental market and what that’s doing to property tax valuations.
This revitalization includes sanitizing the city’s really awful past as an outpost of the Confederacy and Lost Cause by removing statues that used to attract more pigeon shit than attention. We tear down a very historical Woolworth’s with an intact counter that was central to the Civil Rights Movement and no one mourns that at all. We had an opportunity to put a great Civil Rights museum downtown for a real tourist experience. But no, we spend time removing rather than preserving the sites to use them to elucidate the awful past. We’d rather have a Dave and Buster’s than a National Jazz Park.
Several items came to my attention today that show the master plan is to transform us into the destination of the manbun crowd and that is having all kinds of unintended consequences. The example sits right next door to me. Two guys from NJ charge $180 a night for one side of a double that’s been redone to look like a badly decorated boutique hotel inside and barely maintains a semblance of its historical past outside. It used to be home to two families. Some NJ guy bought the family home across the street and it’s the ugliest thing you’ve ever seen now. It was an arts and crafts double but now it looks like some weird, awkward Cape Code monstrosity and it’s selling for way over $.5 million. Both homes were stripped of their historic architecture during renovation. My guess is some out of town rich people will Air BNB the arts & crafts double too which is currently illegal and against zoning laws. It used to be a rental when I moved here but was a single family dwelling until it sold. A barber who worked down in the quarter lived there. Regular folks that are renters aren’t here any more. But, don’t take my word for it. New Orleans now ranks second as the worst market for renters in the nation.
New Orleans is gaining notoriety among America’s mid-sized cities as a place where renters must devote an increasing share of their income to housing expenses.
Make Room, a campaign by nonprofit affordable housing developer Enterprise Community Partners, extracted Census data to rank the top “10 worst metro areas for cash-strapped renters.” New Orleans was No. 2.
According to Harvard’s data, 35 percent of renters in the New Orleans-Metairie-Kenner statistical area devote 50 percent or more of their income to rent and utilities, only slightly less than top-ranked Miami where the rate was 35.7 percent.
The Make Room initiative was launched in May 2015 to push for policy changes and additional resources for cities where the lack of affordable housing is acute. Angela Boyd, the campaign’s managing director, said the effort seeks, in part, to debunk misconceptions that affordable housing is an issue only for coastal cities and targets renters in need of subsidies or government assistance.
“Some people think affordable housing is for the homeless or residents of public housing, but it also takes into account moderate income (renters),” Boyd said. “These are people who are probably already your neighbors.”
I wonder how all those restaurants are going to find help when there are no more places for their employees to rent in the city at the wages they can pay? While the city is hassling over statues and renting its lampposts to hang fetus fetish propaganda, there’s very little discussion of things that are really wrong here. We may be good at attracting celebrities to film stuff and buy houses, but we’re absolutely forgetting the majority of our population in the rush to be cool for pennies on the tax dollar.
On Wednesday night, Douglas Brown allegedly jumped over the counter of a New Orleans Subway after ordering a sandwich, according to the Times-Picayune, but was foiled in his attempt to nab the cash register drawer because it was tethered into place. Instead, he grabbed a bunch of cash and ran. He was detained 25 minutes later.It’s unclear who will represent Brown. Yesterday, the Orleans Public Defenders refused to take his case. The underfunded office, which says it represents nearly 85-percent of all defendants in the parish but has a budget just half the size of the district attorney, simply can’t handle any more.
“Our workload has now reached unmanageable levels resulting in a constitutional crisis,” Chief Defender Derwyn Bunton said in a December statement, giving one month’s notice that they would start refusing some clients charged with felonies carrying long sentences. “As Chief Defender, I can no longer ethically assign cases to attorneys with excessive caseloads or those that lack the requisite experience and training to represent the most serious offenses.”
This week, Bunton’s office made good on that pledge and began refusing clients. In response, the American Civil Liberties Union and the ACLU of Louisiana last night filed a class action lawsuit in federal court against Bunton and Louisiana State Public Defender James Dixon on behalf of plaintiffs who were assigned public defenders but then placed on a waiting list.
“So long as you’re on the public defender waiting list in New Orleans, you’re helpless. Your legal defense erodes along with your constitutional rights,” said Brandon Buskey, Staff Attorney with the ACLU’s Criminal Law Reform Project, in a statement. “With every hour without an attorney, you may forever lose invaluable opportunities to prove your innocence. You also may be forced into a crippling choice between waiting months for counsel or doing bail and plea negotiations yourself. The damage to your case can be irreparable.”
Mayor Mitch Landrieu maintains that while the city has increased its funding of the office that they have “barely kept pace with state funding cuts,” the Times-Picayune reports. The defenders contend that “the additional local funding is enough to stave off mandatory furloughs, but not enough to provide representation in serious felony cases that is constitutional or ethical.” Bunton and Dixon could not be reached for comment.
The total focus on re-imagining New Orleans appears to include putting street cars everywhere and making sure no road goes unfixed endlessly as long as it is uptown. I’m not sure it includes a vision of much else. We seem to be highly focused on accommodating a certain segment of American society to the exclusion of a nearly everything else. From what I can see, we’re really not “winning” in any sense but Charlie Sheen’s or whatever it is Mayor Landrieu has in mind. He did come to us as the LT. Governor whose sole job is to fixate on tourism. Maybe that’s the issue he just can’t move beyond. I really don’t know. But, as far as I can tell, the development we’ve been getting recently is really killing exactly what we’ve been good at doing for a very long time.
Does resilience mean dumping your core competencies and the things that make you unique for the latest trendiness?
What happens when a city because a laboratory for hair brained schemes like charter schools and whatever you call this urban development trend that seems to be making us some blander version of ourselves? One of our issues has been the lack of health care for so many people. I’m hoping that the state’s move to now accept the Medicaid Expansion will help these kinds of statistics. Meanwhile, we can only look at the skeleton of Big Charity Hospital which was once the hallmark of a civilized nation.
Indeed, Place Matters for Health in Orleans Parish, a report prepared by the Joint Center for Political and Economic Studies and the Orleans Parish Place Matters Team, in conjunction with the Center on Human Needs, Virginia Commonwealth University, and the Virginia Network for Geospatial Health Research, noted that “Life expectancy in the poorest zip code in the city is 54.5 years, or 25.5-years lower than life expectancy in the zip code with the least amount of poverty in the city, where it is 80.”
I’m beginning to think the entire “sharing” economy is basic piracy. I came across this at AJ and was appalled that folks would do this on both supply and demand side of AIR BnB. I swear this corporation is just an international crime syndicate that makes money off of illegal and destructive activities.
Airbnb may be the next high-profile target of the Boycott, Divestment and Sanctions (BDS) movement, following media reports this week that the online accommodation service includes listings from settlements in the occupied Palestinian territories that are advertised as being in Israel.
Anyone staying in an Airbnb-listed settlement property “facilitates the commission of the crime of establishing settlements and therefore aids and abets the crime,” said John Dugard, professor of international law, and a former Special Rapporteur to the UN on Palestine.
“The same applies to making money from property built on illegal settlements.” Airbnb takes a commission on property rentals, and so is profiting from Israel’s colonisation of Palestine.
Hosts who list properties via the company are required to provide accurate locations. As such, stating that settlements are located in Israel – when they are in fact illegal under international law because they are built on occupied territory – is a violation of the company’s terms.
I would like to think that just because you can make money off of something doesn’t mean that you should do it, the government should allow it, or there should be legal businesses encouraging it. But then, it seems state and local governments are also doing anything to quit providing services to citizens while heavily subsidizing private businesses for whatever reason. At what point do we decide that businesses and rich people should pony up their fair share of the bill of living in a civilized country,state and city of laws, institutions and regular people?
The city of Flint, Mich., is in the midst of a water crisis several years in the making. The city opted out of Detroit’s water supply and began drawing water from the Flint River in April 2014, part of a cost-saving move. Eighteen months later, in the fall of 2015, researchers discovered that the proportion of children with above-average lead levels in their blood had doubled.
The city reconnected to Detroit’s water system in October, but the damage was done. Water from the Flint River was found to be highly corrosive to the lead pipes still used in some parts of the city. Even though Flint River water no longer flows through the city’s pipes, it’s unclear how long those pipes will continue to leach unsafe levels of lead into the tap water supply. Experts currently say the water is safe for bathing, but not drinking.
A group of Virginia Tech researchers who sampled the water in 271 Flint homes last summer found some contained lead levels high enough to meet the EPA’s definition of “toxic waste.”
Economic theory states that we should tax nuisance activities heavily to both discourage them and to collect funds for the damages they inflict on the citizens around them. (Think any kind of pollution.) Subsidies are to be given to those activities that won’t occur–even though they are highly beneficial to society–because they won’t provide profits to private businesses. (Think public transportation and education.) It’s a really basic and simply theory that’s been proven useful time and time again. There are some things we really do want to tax the hell out of because we want less of it and we want to recover the damage it creates. Many rules and regulations exist to protect current property owners and stakeholders. Here’s a brief little lesson on Pigouvian Taxes and subsidies that’s worth a watch that gives you a good idea of the costs and benefits. I’m not sure why the entire concept has gone out of style. Perhaps it’s because the Aspen Institute doesn’t find it trendy enough. Although my gut says it’s likely because lobbyists and political donors prefer to be enabled rather than held accountable.
Anyway, what I think I can say is that we’re making it difficult (e.g. taxing) for the wrong people to exist in society and we’re subsidizing the folks that are just making things worse. I believe this is why there’s such disgruntlement at working, poor, and middle class income levels.
The question now, is how do we really change this? When are we going to stop selling our society to any bidder for any sleazoid reason in the name development?
What’s on your reading and blogging list today?