Archive for Economy
In days of yore (pre-Internet), I telephoned the U.S. Government Printing Office (GPO) about a wall-sized world map I had heard about developed by the Central Intelligence Agency (CIA). When I described what I was looking for, the woman on the other end said the GPO didn’t carry the map from the CIA.
“You want DMAODS,” she said matter-of-factly.
“And that would be?” I asked.
“Defense Mapping Agency Office of Distribution Services,” she said.
Dave Johnson of Campaign for America’s Future (CAF) and Kevin Drum of Mother Jones (MJ) point to a report by the U.S. International Trade Commission (ITC) on the prospective economic benefits of the Trans Pacific Partnership (TPP). The projected economic impact, Drum observes, is “pretty close to zero.” Drum produced a handy chart (at top).
Generally speaking, I’d say this means you should mostly ignore the economic aspects of TPP. The benefits will be minuscule and the damages will be minuscule. The error bars on a 30-year forecast are just too big to say anything more. Instead, you should focus on other aspects of the agreement. How will it affect poor countries in Asia? Is it a useful bulwark against the growing influence of China? What do you think of extending US patent and trademark rules throughout the world? All of those things are real. The economic impact is basically a crapshoot.
But is it? Jared Bernstein comments that it might seem incredible “that we’ve been intensely wrangling over this trade deal so hard for so long when these are the predicted outcomes.”
“Enquiring minds want to know” why, if the economic payback is so lean, are international business interests so keen on passage of TPP? Johnson worries that it is not the economic impacts Americans have to worry about:
[The report] estimates a decline in output for U.S. manufacturing/natural resources/energy of $10.8 billion as exports would increase by $15.2 billion and imports would increase by $39.2 billion by 2032. This translates to a loss of even more U.S. jobs in these key sectors.
Keep in mind that this ITC report assumes that there will be a “level playing field” on which other TPP countries will not manipulate currency, suppress labor or other things that hurt American jobs. It also assumes that the countries will buy from us (trade) instead of following national economic strategies to enhance key national strategic industries by selling to us but not buying from us. Of course, this is not what happens in the real world, other countries protect themselves as countries with key national economic interests; we do not.
These are only the economic projections from TPP. They do not take into account that most of TPP is not about the economic results from “trade”; it is about enhancing the power of corporations over governments. Even if TPP dramatically increased economic activity (which all goes to a few at the top now anyway) it would not be worth handing over our democracy and sovereignty to the billionaires behind the giant corporations.
But, “good news.” Public Citizen observes that historically these ITC economic projections tend to be wildly off-base:
Looking back, the USITC predicted improved trade balances as a result of the 1993 North American Free Trade Agreement (NAFTA) and 2007 U.S.-Korea Free Trade Agreement. The agency projected only a small deficit increase from China’s 1999 World Trade Organization entry deal and the granting to China of Permanent Normal Trade Relations status.
Instead, the U.S. trade deficits with the trade partners increased dramatically and, as detailed in the text of the new study, manufacturing industries from autos to steel and farm sectors such as beef that were projected to “win” saw major losses. A government program to help Americans who lose jobs to trade certified 845,000 NAFTA jobs losses alone.
That is to say, trade agreements like NAFTA, CAFTA, TPP and TiSA tend to leave American workers USCWOAP.
(cross-posted from Hullabaloo.)
Moses: A city is built of brick, Pharoah. The strong make many, the starving make few. The dead make none.
Venture capitalist Nick Hanauer offers up a prescription for boosting the nation’s economy in the American Prospect that you would be wise to read. Hanauer focuses on the low-wage “parasite economy” characterized by firms that derive “record profits on the backs of cheap labor” and from taxpayer subsidies that support their employees. Not so the real economy:
The real economy pays the wages that drive consumer demand, while the parasite economy erodes it. The real economy generates about $5 trillion a year in local, state, and federal tax revenue, while the parasite economy is subsidized by taxes. The real economy provides our children the education and opportunity necessary to grow into the next generation of innovators, entrepreneurs, and civic leaders, while the parasite economy traps them in a cycle of intergenerational poverty.
“The parasite economy is simply bad for business,” Hanauer writes:
All around him an ideological crisis was spreading across Middle America as it continued its long fall into dependency: median wages down across the country, average income down, total wealth down in the past decade by 28 percent. For the first time ever, the vaunted middle class was not the country’s base but a disenfranchised minority, down from 61 percent of the population in the 1970s to just 49 percent as of last year. As a result of that decline, confusion was turning into fear. Fear was giving way to resentment. Resentment was hardening into a sense of outrage that was unhinging the country’s politics and upending a presidential election.
Still, Setser believes in the “‘basic guarantees’ of the working class,” Salow writes. That his basic work ethic and work history will guarantee his home, cars, and annual trip to the lake will remain intact. He’s planning on remarrying. And he’s leaning towards Trump:
“We’re getting to the point where there aren’t really any good options left,” he said. “The system is broken. Maybe its time to blow it up and start from scratch, like Trump’s been saying.”
Krystal [his 16 year-old] rolled her eyes at him. “Come on. You’re a Democrat.”
“I was. But that was before we started turning into a weak country,” he said. “Pretty soon there won’t be anything left. We’ll all be flipping burgers.”
“Fine, but so what?” she said. “We just turn everything over to the guy who yells the loudest?”
Setser leaned into the table and banged it once for emphasis. “They’re throwing our work back in our face,” he said. “China is doing better. Even Mexico is doing better. Don’t you want someone to go kick ass?”
Globalization. Financialization. Greed, one of the deadly sins. Nothing a little ass-whupping won’t fix.
Daniel Engber at Slate has a lengthy but worthwhile examination of the state of psychological research pertaining to success. Angela Duckworth’s notion of “Grit” in particular, but other measures as well. Americans tell themselves hard work and perseverance always win out. It’s just not true. While Duckworth began her research looking at which West Point cadets had the “grit” to survive Beast Week without quitting, the quality appears to have had limited applicability:
Even the task of graduating from West Point itself doesn’t really compare to the trials of Beast. When Duckworth looked at students’ grades and “military performance scores” during their first year at school, she found that grit offered little guidance on how they’d handle the rest of the United States Military Academy curriculum. The whole candidate score—that old-fashioned, talent-based assessment—did much better. Considering that three-quarters of the students who fail to finish at West Point flunk during the post-Beast curriculum, those first seven gritty weeks appear to represent a special case, and one of marginal importance.
That is, Engber writes, “Grit matters, but only in specific situations that require strength of will.” Chris Setser might be “gritty.” He might believe Trump is. But grit alone will neither secure the “basic guarantees” to which Middle America once believed it was entitled, nor will it be enough for Trump. He seems to believe he can bully and bluster his way through any challenge, and actually knowing anything about the basic functions of government won’t matter. Trump, a former private military academy student, might have learned the value of grit, but doesn’t seemed to value other qualities that go into making an effective world leader.
One can see dead factory after dead factory stretched out for 75 miles east of here. Some textile facilities, but mostly empty furniture factories. Tens of thousands of Setsers have lost work over the last couple of decades. Hard work and perseverance were not enough to secure their futures. But many may be willing to vote for anyone who will give them back the illusion that they would. The fall elections from the presidency on down may turn on which party makes the better case. Or they might just settle for the guy who promises to kick some nonspecific ass.
(Cross-posted from Hullabaloo.)
But Carlyle labeled the science “dismal” when writing about slavery in the West Indies. White plantation owners, he said, ought to force black plantation workers to be their servants. Economics, somewhat inconveniently for Carlyle, didn’t offer a hearty defense of slavery. Instead, the rules of supply and demand argued for “letting men alone” rather than thrashing them with whips for not being servile. Carlyle bashed political economy as “a dreary, desolate, and indeed quite abject and distressing [science]; what we might call … the dismal science.”
Today, when we hear the term “the dismal science,” it’s typically in reference to economics’ most depressing outcomes (e.g.: on globalization killing manufacturing jobs: “well, that’s why they call it the dismal science,” etc). In other words, we’ve tended to align ourselves with Carlyle to acknowledge that an inescapable element of economics is human misery.
I live in Trump’s America, where working-class whites are dying from despair. They’re dying from alcoholism, drug addiction and suicide, trying to take away the pain of a half century’s economic and cultural decline. In the foothills of Appalachia, Wilkes County, North Carolina, is second in the nation in income lost this century, where the number of manufacturing jobs decreased from 8,548 in the year 2000 to about 4,000 today, according to Stateline.
If the color coding on the Stateline map of income decline appears less dire for Appalachia proper, it is because once at the bottom there is no further down to go. Near-ghost-towns dot southwest Virginia and West Virginia. Small but once prosperous from logging or coal, they hug hillsides along what are barely
secondary roads. And that’s what their people feel like: secondary. Voters have been forgotten in towns where over 20 percent live in poverty and a quarter never finished high school, Cooper explains:
They lost their influence, their dignity and their shot at the American Dream, and now they’re angry. They’re angry at Washington and Wall Street, at big corporations and big government. And they’re voting now for Donald Trump.
My Republican friends are for Trump. My state representative is for Trump. People who haven’t voted in years are for Trump. He’ll win the primary here on March 15 and he will carry this county in the general.
His supporters realize he’s a joke. They do not care. They know he’s authoritarian, nationalist, almost un-American, and they love him anyway, because he disrupts a broken political process and beats establishment candidates who’ve long ignored their interests.
This is the America where the unemployed and underemployed still line up for free health care each year at the fairgrounds in Wise, Virginia and in smaller places. They are “poorer, less educated citizens who are fiscally liberal and socially conservative,” Cooper believes, and both parties have ignored them for years. In part, because they tend not to vote. But they are voting now, now that Trump has given voice to their grievances.This year’s primaries are like a real-life exercise in those old Verizon Wireless ads. America’s forgotten working class left behind and discarded by globalization, automation, and deindustrialization has found an unlikely voice in Donald Trump, if not really a champion. Independent Bernie Sanders too is finding traction there, as his Michigan win this week proved. In primary after primary, the American worker is asking party elites, “Can you hear me now?”
It is not clear yet that they have.
(Cross-posted from Hullabaloo.)
My point is that there's a certain enduring appetite among a sizable minority of the country for a businessman to get in and fix it.
— Christopher Hayes (@chrislhayes) February 25, 2016
Interesting conversation last night on All In with Chris Hayes. Hayes spoke with Donald Trump voters in Las Vegas during this week’s caucuses. Supporters see Trump as aggressive, strong, and bold, and they like what they see. Ted Cruz? He cheated. Marco Rubio is an “establishment shill.”
Ideology, class, etc., according to one researcher Hayes cited, has “no statistical bearing” on support for Trump, but rather an inclination towards authoritarianism. In the segment with Jess McIntosh (Emily’s List), Sam Seder (Majority Report), and Nick Confessore (New York Times), Hayes’guests noted that Trump voters tend to compartmentalize Trump the performer from Trump the prospective president. They look past Trump’s bombast, the cursing and slurs and see someone genuine, as suggested by one woman who had voted for Obama twice. “I go past it,” she said. She doesn’t take the wild statements seriously. She could be in for a big surprise.
This exchange from Star Trek: First Contact always fascinated me:
Captain Jean-Luc Picard: The economics of the future are somewhat different. You see, money doesn’t exist in the 24th century.
Lily Sloane: No money? You mean, you don’t get paid?
Captain Jean-Luc Picard: The acquisition of wealth is no longer the driving force of our lives. We work to better ourselves and the rest of humanity.
What a concept. A society not organized around money. Thomas Paine floated the idea of a citizen’s stipend in Agrarian Justice (1797). His ideas for reorganizing the economy were a bit ahead of his time. And while the 24th century may be bit far off yet, it seems several European cities are taking Paine’s 18th century idea out for a test drive:
An experiment to give away money as “basic income” is underway in Germany. In 2014, Michael Bohmeyer, a 31-year-old German entrepreneur, launched “My Basic Income” (“Mein Grundeinkommen”), and this month, the project, made possible through crowdfunding, issued $1,100 checks to 26 people to use however they want.
Leftists in Germany tend to support the idea of basic income while others in the country say the idea might take away incentives for people to work.
— Wall Street Journal (@WSJ) December 16, 2015
While GOP presidential candidates screeched and pulled each other’s hair in last night’s debate over who would kill terrorists (and their families) longer, higher and deeper, the U.S. House managed to do something. It pulled together a budget deal:
Congressional negotiators have wrapped up a sprawling deal to keep the U.S. government operating through next September while setting new policies ranging from repealing a 40-year-old ban on oil exports to making many business tax breaks permanent, according to Republican lawmakers.
House Speaker Paul Ryan told GOP lawmakers late Tuesday, urging support for the legislation that delivers GOP wins but also includes many Democratic priorities. The deal would eliminate any possibility of government shutdowns until at least next October, according to lawmakers present.
Because as Charlie Pierce observed yesterday, “America is the greatest country ever invented to be completely out of your mind,” we’re suffering a little insanity overload this morning.
Daily Show host Trevor Noah’s emergency appendectomy gave him a chance to experience America’s “best in the world” health care system this week. Raw Story:
The host said he periodically fainted from the pain of a perforated appendix, but the nurse told him he was not allowed to faint in the waiting area and should instead go to triage to lose consciousness.
“You’re telling me where I can and cannot faint?” he said.
Noah was finally taken, trembling with pain, to another room for treatment — where he was followed by the same nurse, who brought still more forms and asked how he would be paying for treatment of his life-threatening condition.
“With my life, clearly,” he said.
She decided because she recognized Noah from the billboards that he could pay whether or not he had insurance.
How far down the rabbit hole have we gone that Republican candidates for president think they are entitled to a list of demands from networks hosting debates (and I use that term reservedly) that would make rock bands blush? (Remember, no brown M&Ms.) The Washington Post obtained the list. Here are just a few:
- Will there be questions from the audience or social media? How many? How will they be presented to the candidates? Will you acknowledge that you, as the sponsor, take responsibilities for all questions asked, even if not asked by your personnel?
- Will there be a gong/buzzer/bell when time is up? How will the moderator enforce the time limits?
- Will you commit that you will not:
- Ask the candidate to raise their hands to answer a question
- Ask yes/no questions without time to provide a substantive answer
- Allow candidate-to-candidate questioning
- Allow props or pledges by the candidates
- Have reaction shots of members of the audience or moderators during debates
- Show an empty podium after a break (describe how far away the bathrooms are)
- Use behind shots of the candidates showing their notes
- Leave microphones on during the breaks
- Allow members of the audience to wear political messages (shirts, buttons, signs, etc.). Who enforces?
- What is the size of the audience? Who is receiving tickets in addition to the candidates? Who’s in charge of distributing those tickets and filling the seats?
- What instructions will you provide the audience about cheering during the debate?
- What are your plans for the lead-in to the debate (Pre-shot video? Announcer to moderator? Director to Moderator?) and how long is it?
- What type of microphones (lavs or podium)?
- Can you pledge that the temperature in the hall be kept below 67 degrees?
Dude, can I get on the “guest list” and a backstage pass to hang out with the band?