Strategic Political Economy
[Bill Totten's Weblog, via Mike Norman Economics, August 14, 2021]
One of the most concise summaries of the geographic, economic, and demographic determinants of a country’s history and strategic interests I have ever read.
Of China’s 1.4 billion people, 94% are Han, and their distribution follows nearly perfectly the Hu/15-in isohyet/NSGL line. This is surprising, especially if you compare it to India {4}, and its diverse ethnicities {5}. Why is China’s population so uniform?
To understand that, we need to look at history.
Brace For "Nasty" Debt Ceiling Fight As GOP Goes Full "Scorched Earth Mode" On Democrats
[ZeroHedge, August 11, 2021]
House Members’ Letter to Pelosi Mostly Barking Up the Wrong Tree
Stephanie Kelton [The Lens, via Naked Capitalism 8-8-2021]
Are they worried about running out of money? It sounds an awful lot like what former Treasury Secretaries Jack Lew and Larry Summers said in the run-up to passage of the Trump tax cuts back in 2017. Back then, both men warned that if the Republicans were successful in passing the Tax Cuts and Jobs Act (TCJA), then Congress would be left without the capacity to boost spending in the event of an emergency.
Here’s Lew:
If we had a crisis right now whether a financial crisis or a business cycle recession, we don’t have the fiscal policy to respond or the monetary policy. It’s quite scary. … We now don’t have a fiscal arsenal because we spent it on the tax cut and on the spending agreement. We’ve kind of spent the fiscal resources.
And here’s Summers:
Our country will be living on a shoestring for decades because of the increases in the deficits that will result. This is a serious threat to our national security because of what it will mean over time for our ability to fund national defense.
Obviously, both men were wrong…. Congress has the Power of the Purse. It can’t run out of financial resources. If the votes are there, the money will go out.
The Coming Redistricting Disaster
[The Daily Poster, August 13, 2021]
Democrats missed a critical deadline to stop GOP gerrymandering — and now the political bloodletting will begin…. on Thursday, the U.S. Census Bureau released its 2020 census data, enabling states to begin the once-a-decade process of redrawing their statehouse and congressional districts. Advocates have long been warning of the need to pass electoral reforms before map drawing begins. Since that has now failed to happen, experts say there will be dire consequences, including an effective end to majority rule in the U.S. and a failure to address climate change in a meaningful way.
The Mystery of the Missing Workers, Explained
[BusinessWeek, via The Big Picture 8-10-2021]
A retirement boom, a turn for the worse in the opioid epidemic, and the rising cost of child care all stand in the way of employers seeking to fill open slots.
Public Health Theory and Practice in the Constitutional Design
Lawrence O. Gostin [Health Matrix, The Journal of Law and Medicine, Vol. 11:265, 2001]
...This article views public health through the lens of constitutional law by exploring government duty and authority, the division of powers under our federal system, and the limits on government power…. Part II examines governmental powers under the Constitution. While the Court sees few affirmative obligations, it does acknowledge a broad governmental authority to protect the health, safety, and welfare of the population. This Part reviews the emergence of "new federalism" in Supreme Court jurisprudence, altering the power between the federal government and the states. In particular, it inquires whether the Rehnquist Court, by restricting the scope of national authority, is seriously thwarting public health policy and practice…. Often, when the government acts to promote the health of the populace, it limits personal or economic freedoms. As a society, we face a trade-off between the common good and individual interests. Parts I and IV explore the conflicts and explain why it is imperative to highly value the collective good of public health.
Ed Yong [The Atlantic, via Naked Capitalism Water Cooler 8-13-21]
“Here, then, is the current pandemic dilemma: Vaccines remain the best way for individuals to protect themselves, but societies cannot treat vaccines as their only defense. And for now, unvaccinated pockets are still large enough to sustain Delta surges, which can overwhelm hospitals, shut down schools, and create more chances for even worse variants to emerge. To prevent those outcomes, “we need to take advantage of every single tool we have at our disposal,” [Shweta Bansal, an infectious-disease ecologist at Georgetown University] said. These should include better ventilation to reduce the spread of the virus, rapid tests to catch early infections, and forms of social support such as paid sick leave, eviction moratoriums, and free isolation sites that allow infected people to stay away from others. In states where cases are lower, such as Maine or Massachusetts, masks—the simplest, cheapest, and least disruptive of all the anti-COVID measures—might be enough.”
I placed this item here because of Lambert Strether’s incisive comment slashing at our reigning ideology of neoliberal / conservative / libertarian “new federalism” political economy: “But there’s no such thing as society. There is only freedom. Therefore, we don’t need to worry about ventilation, testing, paid sick leave, evictions, or free quarantine sites And all those things cost money.”
The Pandemic
Too many Republicans are taking covid-19’s side in the fight against the pandemic.
[Washington Post, via The Big Picture 8-10-2021]
“Dallas County Judge Clay Jenkins asks court to block Texas Gov. Greg Abbott’s ban on mask mandates”
[Dallas Morning News, via Naked Capitalism Water Cooler 8-10-21]
“Dallas County Judge Clay Jenkins on Monday asked a court to block Texas Gov. Greg Abbott’s ban on mask mandates, arguing that the Republican governor’s executive order violates state law…. [The suit] also asks that Jenkins be allowed to take measures to manage the pandemic, including mandating masks. Jenkins’ request for declaratory judgment and a temporary restraining order come as COVID-19 delta cases soar nationally and local hospital emergency departments become overrun with patients.”….
Abbott issued his executive order after the Centers for Disease Control and Prevention recommended mask-wearing for both vaccinated and unvaccinated people indoors. Those who defy his mandate could face a fine of up to $1,000.
The governor’s executive order also bans schools from requiring masks, but many districts are fighting back.
On Monday, Dallas ISD said it would require masks as part of another effort to challenge Abbott’s ban, and the state’s largest school district, Houston ISD, said it would consider a similar measure.
When will the lawsuits begin? I hope there are already some law firms, representing people who have suffered from or lost loved ones to COVID, studying the culpability and liability of Fox, Murdoch, Abbott, deSantis, and others, for not just failing to prevent the spread of COVID, but actively hampering efforts to stop that spread.
Pfizer and Moderna Mock Biden, Raise Vaccine Prices
Matt Stoller [Big, via Naked Capitalism 8-8-2021]
“What are the obligations of pharmaceutical companies in a global health emergency?”
[Ezekiel Emanuel, et al., The Lancet, via Naked Capitalism Water Cooler 8-11-21]
“Pharmaceutical companies have special obligations in this emergency, which follow from their indispensable capacity to help to end the pandemic by developing, manufacturing, and distributing COVID-19 vaccines. However, the capacity to help alone does not fully specify companies’ obligations. Additionally, market-based arrangements, with patents, marketing exclusivity, and confidentiality clauses, give pharmaceutical companies the freedom to choose what treatments to research and develop, how to price and distribute their products, and whom to furnish with products through bilateral agreements. Indeed, companies need not produce vaccines or infectious disease therapies at all. Patents and exclusivity, alongside the absence of price controls or requirements for technology transfer, also permit companies to charge higher prices than they otherwise could. Governments adopt intellectual property rights, limited pricing regulations (ie, each country has its own pricing, with no one country controlling the pricing, at most being able to set limits on the prices that can be charged), trade agreements, and other limited interventions (eg, manufacturing, inspections of facilities, etc) in the hope of incentivising the development, manufacturing, and distribution of socially valuable products. Everyone—including pharmaceutical companies—agrees that business as usual is unacceptable in a pandemic.” • Why isn’t it an ethical obligation for governments to make Big Pharma dispensable?
The Biden Transition and the Fight for Real Hope and Change This Time
Incrementalism For All Who Can Survive It (KLG).
David Sirota [Daily Poster
“Amtrak Joe vs. the Modern Robber Barons”
[Washington Monthly, via Naked Capitalism Water Cooler 8-10-21]
“There’s an urgent and overwhelming societal need to divert more freight from trucks to trains. Freight trains are three to five times more fuel efficient than trucks, and produce far less emissions. Indeed, when electrically powered by overhead wires, trains can be emission-free, and lack the battery disposal costs that plague electric trucks. According to one study, a modest investment in electrifying freight railroads could reduce carbon emissions by 39 percent and, by 2030, remove an estimated 83 percent of long-haul trucks off the road. Moving more freight by rail would also reduce the number of Americans who are killed or injured by collisions with large trucks, a casualty rate of 156,000 people per year. In addition, it would reduce dramatically the damage done to America’s roads and highways by large trucks–each of which causes the same wear and tear as 9,600 passenger cars. Yet hedge funds, private equity firms, and other financiers are using their control of highly monopolized, underregulated railroads not to expand rail freight but to sell off rail assets and hand over all but the highest margin business to trucks. Some of this downsizing is justified by the decline of the railroads’ thermal coal business as electric utilities convert to natural gas. But most of the downsizing results simply from financiers forcing railroads to shed all but their most lucrative lines of business. Such practices threaten to shrink the nation’s rail network to the point of non-viability, but so long as rail expenses fall faster than rail revenues, the short-term return on assets increases. That’s all Wall Street cares about.”
Class war and economic disequilibrium
Secret IRS Files Reveal How Much the Ultrawealthy Gained by Shaping Trump’s “Big, Beautiful Tax Cut”
[ProPublica, via Mike Norman Economics 8-11-2021]
Zillow, Other Tech Firms Are in an ‘Arms Race’ To Buy Up American Homes
[Vice, via Naked Capitalism 8-14-2021]
[Twitter, via Naked Capitalism Water Cooler 8-10-21]
Barry Ritholtz, August 9, 2021 [The Big Picture]
Over a century ago, Veblen explained how “trained incapacity” helps sustain delusion.
I spent the past 5 days hanging out in the woods of Maine — fishing, drinking, eating but mostly talking with asset managers and economists about . . . everything. The collective AUM of the group (minus the Fed folks) was estimated at about $1 trillion dollars. These were not casual conversations, but deep, thoughtful discussions about the state of the world.…
The one concept that caught my attention in many conversations was simply the sheer volume of Capital sloshing around. Not just on the deck off of the dining room, or even the US system, but throughout the entire global financial system.
The world is awash in capital, in so much cash, that it is a little difficult to comprehend. Not only are equities priced higher, but every asset class you can think of is being driven up as faithful money seeks a dry, safe and happy home….
But there are so many positives in this massive pool of capital that are also worth exploring. New ideas are getting funded, new businesses starting up to monetize all of the energy and innovation and technology. From apps to pure science R&D and all in between, there is a Cambrian explosion of value creation coming from this massive pile of capital, the results of which may be hard to see from here, other than to note its speed and size.
Take billions of dollars, put them in the hands of wealthy institutions and sophisticated UHNW individuals. They will seek to generate a return on capital that is attractive, but in the process, move forward a raft of sectors via technology and ingenuity.
.
[Twitter, via Naked Capitalism Water Cooler 8-12-21]
Lambert Strether noted: “As I wrote yesterday: “Unprofitable as a firm, Uber could — I don’t know how to do the math on this — be profitable for the capitalist class taken as a whole; destroying public transportation but more importantly legalizing new forms of exploitation by creating the new class of gig workers (which we should all be, right?).” So a real economist just said the same thing in politer language. Interesting!”
It’s not the “World Awash In Capital,” it’s just the one percent:
“After 8 Months, Cities And States Are Still Sitting On Rental Aid”
[HuffPo, via Naked Capitalism Water Cooler 8-11-21]
“States, counties and cities with populations of at least 200,000 were eligible for the money, which offers up to 15 months of rental assistance to low-income individuals (12 months of past-due payments and three months for the future). But that money has been incredibly slow in getting to the people who need it the most. Through June, only 15 states and the District of Columbia had spent 10% or more of their Emergency Rental Assistance Program funds, which were initially approved by Congress in December. And in roughly 40 states, counties and cities, not a single cent from ERAP made it out the door during that time, according to an analysis of Treasury Department data by HuffPost. Some of those places were smaller counties, but others were states (New York at $801 million) or territories (Puerto Rico at $325 million) sitting on hundreds of millions of dollars. The problems stem partly from the fact that Congress has never thrown so much money at an anti-eviction program, so officials at lower levels of government have struggled to find their footing. ‘In most cases they couldn’t scale up an already-existing program, or if they could scale up an existing program, that program was tiny compared to the funding available now,’ said Ann Oliva, a housing policy expert at the Center on Budget and Policy Priorities. ‘That explains some of the lag.'” • Once again, civil service issues.
Climate and environmental crises
Highest recorded temperature of 48.8C in Europe apparently logged in Sicily
[Guardian, via Naked Capitalism 8-12-2021]
“By pushing for more oil production, the US is killing its climate pledges”
Adam Tooze [Guardian, via Naked Capitalism Water Cooler 8-13-21]
“Yes, you read that correctly. One of the most senior figures in the Biden administration, the administration that promised climate was ‘everywhere’ in its policy, is declaring that an increase in petrol prices to $3.17 per gallon is a matter of national security and that the US reserves the right to cajole Opec and Russia into flooding the world with more oil. We should not mince words: if this is the stance of the Biden administration then its decarbonisation agenda has been well and truly buried. According to no less an authority than the IEA, if we are to reach net zero by 2050, we need to end fossil fuel capacity expansion now.”
The $1 trillion infrastructure bill is a baby step toward the US grid we need
[MIT Technology Review, via Naked Capitalism 8-8-2021]
The Deficit Hawks and the Climate Disaster
Robert Kuttner, August 11, 2021 [The American Prospect]
The economics of climate change
[Swiss Re, April 22, 2021, via Naked Capitalism Water Cooler 8-11-21]
“Droughts shrink hydropower, pose risk to global push to clean energy”
[Reuters, via Naked Capitalism Water Cooler 8-13-21]
“The emerging problems with hydropower production in places like the United States, China and Brazil represent what scientists and energy experts say is going to be a long-term issue for the industry as climate change triggers more erratic weather and makes water access less reliable. They also could pose a threat to international ambitions to fight global warming by hindering one of the leading forms of existing clean power. Hydropower is the world’s top source of clean energy and makes up close to 16% of world electricity generation, according to the International Energy Agency (IEA). This year, climate-driven droughts have triggered the biggest disruptions in hydropower generation in decades in places like the western United States and Brazil. China is still recovering from the effects of last year’s severe drought on hydro production in Yunnan province in the southwestern part of the country.”
“Remembering John Wesley Powell in a Dry Year”
[Counterpunch, via Naked Capitalism Water Cooler 8-13-21]
Powell served in the Union Army during the Civil War, reaching the rank of lieutenant colonel. His right arm was shot off at Shiloh, but he returned to serve in the battles of Champion Hill and Big Black River Bridge, the siege of Vicksburg, and Sherman’s Atlanta campaign. He was then transferred to George H. Thomas’ army and participated in the battle of Nashville. After the war, Powell led a series of expeditions into the Rocky Mountains to explore the Green and Colorado rivers, including his famous 1869 and 1871-1872 explorations of the Colorado River and the Grand Canyon. In 1881, Powell was appointed the second director of the U.S. Geological Survey, at the time one of the most important government agencies in promoting a Hamiltonian vision of government actively assisting and directing economic development. a post he held until his resignation in 1894,
“[Powell’s] root idea, well researched, was brutally simple: the West is an arid land, which can only support a limited number of people and a limited irrigation agriculture. It is an area that has no normal climate, although it tends toward drought interspersed with times of flood. Therefore, development must respect the limitations of the natural resources and not exceed the carrying capacity of the different regions…. [W]hat you are not hearing this hot, dry summer in the Western public dialogue is a strategy for reducing the load on the natural resources, permanently fallowing land which now holds permanent crops like the export-led industries of almonds, grapes and dairies. Golf courses should be forbidden in California except where we learn to play on sand and dirt…. ”
David Sirota and Julia Rock [The Daily Poster, August 12, 2021]
Census data shows a country moving out of locales most insulated from climate change and into the most climate-threatened regions.
Information Age Dystopia
“Amazon’s Power Will Only Keep Expanding in the Near Future”
[Jacobin, via Naked Capitalism Water Cooler 8-13-21]
“The landscape is being sorted into what you could call three different kinds of cities. There’s the headquarters cities, like Seattle and now Washington, DC, where the company chooses a city that’s already the wealthiest metro area in the country for a second headquarters, even though it’s going to make that city even more expensive and congested. You’d think they wouldn’t want to be there, but they do, because it has the workforce they want. With DC, it’s the seat of federal power, so they want to be close to that, now that federal intervention is a threat…. Then you have the warehouse towns, in places like Baltimore, where you now have four warehouses. I can’t keep up with it: in the book, I described there being two, with a third one coming in Baltimore, and now we’re about to get a fourth. Three of them are going to be at Sparrows Point, at the former steel mill outside Baltimore. In Ohio, you have something similar. When Amazon first came to Ohio a few years ago, they put the warehouses in the center of the state, but at the southern edge of the Columbus beltway, because that makes those warehouses barely accessible to the poorest parts of the state. Southern and southeastern Ohio are struggling, and the company knows that if it puts its warehouses at that edge of the beltway, it’s about an hour drive for a lot of people. A lot of people are desperate enough in those parts of the state to make that commute every day, whereas the data centers end up in the wealthier exurbs….. So, you’ve ended up with headquarters cities, warehouse towns, and then the data-center exurbs in Northern Virginia and in Severn, Maryland, in Columbus, and in a few other places around the country. Amazon is now so powerful that its decisions about where to put stuff reshapes our economic landscape. A single decision by this one company about where to put a second headquarters has an incredibly outsize effect on our economy.”
[BostonGlobe, via The Big Pictuire 8-8-21]
In June 2020, federal prosecutors announced criminal charges against six former eBay employees and a contractor. The company apologized to the Steiners, and in a lengthy statement said it had conducted its own investigation that had resulted in terminating all of the employees charged by the government plus communications chief Wymer, who has not been charged
Here’s how police can get your data — even if you aren’t suspected of a crime
[Vox, via The Big Picture 8-8-2021]
Why high-profile smart cities fail, from Sidewalk’s Quayside to Amazon’s HQ2 in Queens
[Fast Company, via Naked Capitalism 8-11-2021]
Oregon scraps requirement for high school students to prove proficiency in math, reading and writing
[Daily Mail, via Naked Capitalism 8-12-2021]
The carnage of mainstream neoliberal economics: De-Industrialization
Plutonium Pits Are a Critical Obstacle in U.S. Nuclear Plans
[Foreign Policy, via Naked Capitalism 8-11-2021]
“Reasons for the lack of success are probably many, including inadequate facilities and the need to relearn what had once been institutional knowledge.”
“What in the Hell Is Going on With Boeing’s Starliner?”
[Gizmodo, via Naked Capitalism Water Cooler 8-11-21]
“New details are emerging about a technical problem that prevented NASA and Boeing from conducting a test launch of a CST-100 Starliner spacecraft last week. The problem appears to be more severe than previously believed, casting doubt on plans to launch the spacecraft later this month…. Specialists are working to “restore functionality” to 13 valves in the spacecraft’s propulsion system, as NASA explained in a recent statement. These valves, as NASA says, “connect to thrusters that enable abort and in-orbit maneuvering,” and they failed to open during the countdown on August 3, resulting in the scrub.” Thirteen? IIRC, initial coverage mentioned a “valve,” singular. More: “Keith Cowing, a former NASA employee and editor of the site NASA Watch, made his opinion known yesterday in a painfully brief post: ‘How—why—did this spacecraft—one that is supposed to eventually fly humans—ever make it to the launch pad without fully operational propulsion valves in the first place? Just wondering.'”
Institutionalists = Obstructionists
“Buffalo Democratic Machine Considers Axing Mayorship to Evade India Walton” [Truthout, via Naked Capitalism Water Cooler 8-10-21]
“The stage appears to be set for the Erie County Democrats to execute a heel turn against Walton — with some on the Buffalo Common Council even expressing tentative interest in a move as drastic as doing away with mayoral governance entirely. It’s not surprising that the establishment in Erie County, perceiving a threat to hierarchy and profit, would mount an organized backlash. Yet ending the mayorship in Buffalo would be a drastic move, to say the least. To understand how the incentive has arisen, it’s useful to look at how Democratic politics and certain media dynamics have played out in the aftermath of Walton’s victory. These machinations underscore how, whenever socialists have come within striking distance of power in the United States, capital and its allies have always reacted swiftly to attempt to curtail any chance of redistributive change.” • When the Democrat establishment quit and took all the money with them in Nevada after DSA took over… Well, politics ain’t beanbag. But eliminating elected offices because the wrong people won them? That’s Third World stuff. What next? Tanks in the streets?
Nina Turner's Defeat Wasn't Only About the Onslaught of Big Money Smears
Jordan Chariton, August 12, 2021 [via Mike Norman Economics]
Progressives keep trying to will older and moderate suburban voters over to their political ideology rather than meeting them where they are...
….there’s a basic truth that a large swath of progressives across the country don’t want to hear or accept. Voters, even in more moderate-to-conservative Democrat areas, agree with us on policy but don’t hate the Democratic Party or believe it’s inherently corrupt….
Now, that we’ve established this is an area that historically has supported establishment Democrats—and has no interest in burning down the Democratic Party—we ultimately reach a crossroads and a time for choosing.
Do hardcore progressives across the country, especially ones who live online, want to continue to try and will voters—who’ve been successfully conditioned over decades via a steady diet of corporate media and Democratic Party propaganda to think in terms of team blue versus team red—over to our side that demands revolutionary change and burning down the two-party duopoly or:
Gasp, swallow hard!…meet them where they are and attempt to strategically persuade them on why candidates like Turner can improve their lives without going as far as burning down the Democratic Party.
Meet the Censored: Paul Jay Matt Taibbi. Please circulate widely. And kudos to Matt for going after
The Dark Side
The Big Money Behind the Big Lie
[New Yorker, via The Big Picture 8-8-2021]
Donald Trump’s attacks on democracy are being promoted by rich and powerful conservative groups that are determined to win at all costs.
Corporate Interests Boost Funding Of Election Deniers
Andrew Perez and Julia Rock, August 9, 2021 [The Daily Poster]
The super PAC behind House Republicans who voted to overturn the election took in more money than before the insurrection.
Examining the consumption of radical content on YouTube
[PNAS, via Naked Capitalism 8-11-2021]
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