Week-end Wrap – Political Economy – September 26, 2021

Week-end Wrap – Political Economy – September 26, 2021

by Tony Wikrent

Strategic Political Economy

“Rich People Are Leading the Anti-Vaccine Movement — and Experts Have a Theory Why”

[Money, via Naked Capitalism Water Cooler 9-20-21]

From 2019, still germane: “Disease experts say the parents least likely to vaccinate their kids live in some of the most affluent neighborhoods in the country. They’re well-educated, and have exceptional access to healthcare. And while some pockets of low-income communities of color are ‘under vaccinated’ for religious or financial reasons, studies published in places like the American Journal of Public Health show that the parents opting out for ‘philosophical reasons’ are mostly white and mostly wealthy…. Parents who opt out of vaccines tend to “believe, simply, that they can make the scientific determinations about the efficacy and dangers of vaccines for themselves,” she says. They have more free time on their hands than lower income parents — time that can be spent poring over anti-vaccine forums and websites, and applying for state-specific exemptions required to bypass school immunization laws…. When an outbreak does happen, rich families aren’t the only ones affected, of course. Usually, they aren’t even the hardest hit. This underscores a more sinister theory about why rich Americans are opting out of vaccines. A string of research referenced in the Washington Post last year suggests that wealthy people simply have less empathy than everybody else. They’re more likely to cheat on their taxes, and their spouses. And they give lower proportions of their income to charity. ‘Wealth is basically a mechanism for power, and power has a freeing effect on people,’ the social psychologist Adam Galinsky told the Post.’“It takes away the constraints of society and frees people to act according to their dominant desires.’ If you’re rich, the consequences of ‘opting out’ aren’t particularly dire. After all, it’s easier to rationalize the risks of bypassing immunization if you can afford a lengthy hospital stay, or to pull your kid out of daycare if her classmate gets sick. And while the U.S. has a long history of stigmatizing poor parents—’free range parenting,’ versus neglect, ‘welfare moms‘ versus stay at home mothers—if you’re a wealthy anti-vaxxer, you probably won’t face any social ramifications either.” 

‘I need help’: Michigan county health director pleads for help after almost being run off the road

Aysha Qamar, September 21, 2021 [DailyKos]

As people resort to violence across the country, health officials are pleading for help. In one horrific incident, a Michigan County health director pleaded with county commissioners for help after almost being run off the road following the issuance of a mask mandate for preschool through sixth-grade school buildings, Michigan Advance reported.

“I need help. My team and I are broken. I’m about done. I’ve done my job to the best of my ability. I’ve given just about everything to Kent County, and now I’ve given some more of my safety,”  Kent County Health Department director Dr. Adam London said in a letter to county commissioners. The letter outlined his reasons for issuing the public health mandate requiring students to wear masks this fall….

“There is nothing to be gained by entertaining such people with dialog. In many cases, these are the same people who dismiss the plot against the governor as ‘just guys joking around’ and the January 6th insurrection as a peaceful patriotic protest. I think it is a grave mistake to unnecessarily give them targets and platforms. There is a sickness in America far more insidious than COVID. You are more empowered to fight this disease than I am.”

London told commissioners he would not “needlessly expose” himself to “the brute mob hatred” from a “vocal and energized minority.” In his letter, he noted that people called him terms like “child-abusing monster” and even threatened him with abusive language directed at his children.

“I will not participate in witch trials in which the science I’ve presented, and the opinions of legitimate experts is reduced to the same stage as people living in echo chambers of junk science, salespeople, and YouTube videos. For the leaders of these misinformation campaigns, it’s never really been about our data, it’s been about their dogma,” London said.

Likely Assassination of UN Chief by US, British and South African Intelligence Happened 60 Years Ago Today 

[Consortium News, via Naked Capitalism 9-19-2021]

Number of Environmental Advocates Killed in 2020 Hits New Record 

[Undark, via Naked Capitalism 9-23-21]

The Wages Of Embarassing Elites Are Death

Ian Welsh, September 23, 2021

Everyone remember the Panama papers? A leak of bank records showing that the ultra-rich are hiding massive wealth, tax-free and often breaking the law to do so?

A rather weak set of laws designed to allow tax avoidance by rich people, at that.

Found out the other day that the reporter who broke the Panama Papers story was killed by a car bomb….

You may recall the Ferguson protests, started after another black man was killed by a cop. They were a big deal.

Since then six of the Ferguson protest leaders have died: two inside burnt cars, three by suicide, one an overdose….

The simplest fact of modern life is elites kill and impoverish other people in order to make money and secure their power. You are seeing it in the pandemic, where Billionaire wealth has spiked 60% and vaccine companies refuse to share their “intellectual property” while planning to sell Covid booster shots in perpetuity. Actually wiping out Covid would close pharma money, but if it stays around, it’s golden.

Meanwhile, all the small and medium businesses closing has lead to a vast buying opportunity for those with lots of money, and private equity is moving big into buying up distressed homes.

It’s just business, baby. Your death, or homelessness, well, it’s someone else’s profit opportunity.

Brazil: Stunning revelations about Bolsonaro in Brazil: Book review 

[Socialist World, via Naked Capitalism 9-19-2021]

The Epidemic

[Twitter, via Naked Capitalism 9-24-2021]

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The carnage of mainstream neoliberal economics

How Accounting Giants Craft Favorable Tax Rules From Inside Government 

[NYT, via Naked Capitalism 9-19-2021]

The Empiracal Failures of Neoliberalism

Mike Konczal, Katy Milani, and Ariel Evans, September 21, 2021 [via Mike Norman Economics]

Over the last five decades, an empirical revolution in economics has undermined many of the assumptions of “neoliberalism,” the reigning approach to economic policy. Many of the guiding assumptions underlying neoliberal policymaking no longer speak to what is going on in the economy or our country more broadly.

In “The Empirical Failures of Neoliberalism,” Mike Konczal, Katy Milani, and Ariel Evans elevate five of the leading arguments made by advocates of neoliberalism and explore their theoretical claims. Ultimately, the authors debunk neoliberals’ arguments, tracking them against recent research by leading scholars of economic inequality to show how neoliberalism has failed to deliver its promises of increased economic growth, equality, and mobility.

By elevating the leading empirics that turn neoliberalism’s theoretical claims on their head, this issue brief aims to energize a thoughtful reevaluation of the dominant—but failed—ideology. Konczal, Milani, and Evans lay the foundation for a new set of economic policies that are capable of building a stronger, more inclusive economy and democracy—by curbing the concentrated power in our economy and political system while also building on the strengths of government to directly address both the individual and collective challenges facing our nation.

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They never wrote about it, talked about it, and, did quite the opposite – yet they knew it all along!
Bill Mitchell [via Mike Norman Economics 9-21-2021]

During the GFC, a new phenomenon emerged – the ‘We knew it all along’ syndrome, which was characterised by several mainstream New Keynesian macroeconomists coming out and claiming that some of the insights provided by Modern Monetary Theory (MMT) economists were banal and that their own theoretical framework already accommodates them. The pandemic has brought a further rush of the ‘We knew it all along’ syndrome. Apparently, mainstream macroeconomics is perfectly capable of explaining the fiscal reality the world has found itself in and there is no need to MMT, which, by assertion, is saying nothing new. These sorts of statements are not coming from Facebook or Twitter heroes who might have done a few units in economics or even acquired a degree in the discipline. They are coming from senior professors in the academy. The curious thing, which really lifts their cover, is that if you examine the academic literature you won’t find much reference to these sorts of ‘insights’ at all. What you find, and what students are taught, are a completely different set of propositions with respect to fiscal policy. So if they ‘knew it all along’ why didn’t they ever write about it? Why is their published academic work replete with conclusions that run contrary to the conclusions MMT economists make? You know the answer. These ‘knew it all along’ characters have just been caught out by the poor empirical performance of their paradigm and now they are trying to salvage their reputations and position by trying to blur history. They really should be sacked....

Ricardo’s Caveat

Ian Welsh, September 23, 2021

In 1817, David Ricardo formalized the Law of Comparative Advantage. Since then, it has stood the test of time as one of the very few laws that an economist can point to and say: “This is indisputably true.” It’s because of this law that you only rarely find an economist who doesn’t believe in unrestricted free trade. But Ricardo added an important caveat when he discussed free trade and comparative advantage and it’s one that most modern economists seem to have forgotten.…

Stop calling America’s murder crisis a ‘crime’ issue. It’s something far worse. 

Will Bunch [Philadelphia Inquirer, via Naked Capitalism 9-24-2021]

[Twitter on ports, via Naked Capitalism Water Cooler 9-22-21]

Concentration: “ShortageWatch: ‘Sorry. No French Fries with any order. We have no potatoes.'”

[Matt Stoller, BIG, via Naked Capitalism Water Cooler 9-22-21]

his is a must-read. Buckle up. “In the last BIG issue, I asked you for help identifying shortages in your neck of the woods. Hundreds of you responded, so I’ll talk about some of the shortage stories you are sharing, as well as how this problem is resonating among policymakers. My favorite story is quintessentially American, and un-American, at the same time. It’s from a Florida realtor who was in a hurry and stopped at a Burger King for lunch. He saw a sign, ‘Sorry. No French Fries with any order. We have no potatoes.’ At first he thought he was imagining things. What kind of fast food place runs out of fries? Is this, he wondered, a sign of things to come? It’s a good question. Fast food exists in a land of plenty, of surplus, of mass produced food with a reliable infrastructure of trucks, trains, farms, and distributors. Shortages of everyday goods conflicts not only with most of our lived experiences, but also with our very conception of who we are. There’s a name for this framework, and it’s called affluence…. So what is happening in the case of this particular Burger King? It’s hard to say, but the problem is clearly widespread. Taco Bell, Chick-fil-A, and Starbucks are having trouble sourcing ingredients, as are school and college cafeterias….. One culprit is the food distribution industry, which is highly consolidated (due to the standard litany of anti-competitive tactics like mergers and exclusive contracts with customers and suppliers). … If you listen to transportation executives, they’ll tell you the real cause. “It comes down to money for drivers in many respects,” said Mark McKendry, regional vice president of intermodal at NFI Industries. ‘If we get the pay right, you know, we’ll have a little more flexibility.’ Driving a truck, which used to be a middle class job in the 1970s, has become a cyclical low-paid profession with high burnout and little stability, a so-called ‘sweatshop on wheels.’ While it’s tempting to blame this situation on trucking firms, the reality is that the problem is due to the market structure of transportation created by the deregulation of the 1970s.”

Predatory Finance

Woman Who Helped Expose Wall Street Mega Banks’ Vast Holdings of Physical Commodities Is Nominated as a Top Bank Regulator

Pam Martens and Russ Martens, September 24, 2021 [Wall Street On Parade]

Restoring balance to the economy

Amid reports of homelessness and food insecurity, 25,000 employees sue Disneyland for better pay 

[SFGATE, via Naked Capitalism 9-20-2021]

“When McDonalds Came to Denmark” [where McDonalds workers are now paid $22 per hour

[Matt Bruenig, via Naked Capitalism Water Cooler 9-21-21]

“In late 1988 and early 1989, the unions decided enough was enough and called sympathy strikes in adjacent industries in order to cripple McDonalds operations. Sixteen different sector unions participated in the sympathy strikes. Dockworkers refused to unload containers that had McDonalds equipment in them. Printers refused to supply printed materials to the stores, such as menus and cups. Construction workers refused to build McDonalds stores and even stopped construction on a store that was already in progress but not yet complete. The typographers union refused to place McDonalds advertisements in publications, which eliminated the company’s print advertisement presence. Truckers refused to deliver food and beer to McDonalds. Food and beverage workers that worked at facilities that prepared food for the stores refused to work on McDonalds products. In addition to wreaking havoc on McDonalds supply chains, the unions engaged in picketing and leaflet campaigns in front of McDonalds locations, urging consumers to boycott the company. Once the sympathy strikes got going, McDonalds folded pretty quickly and decided to start following the hotel and restaurant agreement in 1989. This is why McDonalds workers in Denmark are paid $22 per hour.” And: “When I bring this up, people sometimes respond by saying that these kinds of strikes are illegal in the US. This is a true and worthwhile bit of information, but insofar as it is meant to imply that the different legal environment is what accounts for the labor radicalism, this obviously has things backwards. The laws aren’t driving the labor radicalism, but rather the labor radicalism is driving the laws.”

One way the academy has failed USA is by ignoring the fight between two different schools of political economy in USA history, and adopting the ludicrous idea that slavery was a necessary precondition to capitalism, rather than a throwback to feudalism. Benjamin Franklin, 1783, “Reflections on the Augmentation of Wages, Which Will Be  Occasioned in Europe by the American Revolution,”

"....To desire to keep down the rate of wages... is to seek to render the citizens of a state miserable... it is, at most, attempting to enrich a few merchants by impoverishing the body of the nation; it is taking the part of the stronger in that contest, already so unequal, between the man who can pay wages, and him who is under the necessity of receiving them; it is, in one word, to forget, that the object of every political society ought to be the happiness of the largest number.... The low rate of wages, then, is not the real cause of the advantages of commerce between one nation and another; but it is one of the greatest evils of political communities.”

Unfortunately, the American School thinking of Franklin has lost twice, and is losing again, despite winning the Civil War and the New Deal. 

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[Twitter,via Naked Capitalism Water Cooler 9-22-21]

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Inflation scare mongering

“Have Consumers’ Long-Run Inflation Expectations Become Un-Anchored?” [Liberty Street Economics, via Naked Capitalism Water Cooler 9-24-21]

“With the recent surge in inflation since the spring there has been an increase in consumers’ short-run (one-year ahead) and, to a lesser extent, medium-run (three-year ahead) inflation expectations (see Survey of Consumer Expectations). Although this rise in short- and medium-run inflation expectations is relevant for policymakers, it does not provide direct evidence about “un-anchoring” of long-run inflation expectations. Roughly speaking, inflation expectations are considered un-anchored when long-run inflation expectations change significantly in response to developments in inflation or other economic variables, and begin to move away from levels consistent with the central bank’s (implicit or explicit) inflation objective. In that case, actual inflation can become unmoored and risks drifting persistently away from the central bank’s objective. Well-anchored long-run inflation expectations therefore represent an important measure of the success of monetary policy. In this post, we look at the current anchoring of consumers’ long-run inflation expectations using novel data from the Survey of Consumer Expectations (SCE). Our results suggest that in August 2021 consumers’ five-year ahead inflation expectations were as well anchored as they were two years ago, before the start of the pandemic.”

Reclaiming Central Banks 

Ann Pettifor [Project Syndicate, via Naked Capitalism 9-23-21]

Information Age Dystopia

“Wall Street Journal Eviscerates Facebook”

[The Ad Contrarian, via Naked Capitalism Water Cooler 9-20-21]

For those of you who, like me, don’t have a WSJ subscription, this is a summary of last week’s multipart series. The conclusion: “Zuckerberg’s record of lying and cheating his way to success is the great business scandal of our age. From the day it was born, Facebook has been a crooked operation. Facebook has never allowed third party validation of its audience claims. How any marketer or advertiser can be stupid enough to believe anything Facebook says about their advertising or audience metrics is beyond me. The shame of our industry is on full display here. If our industry “leaders” – the 4As, the ANA, the pathetic holding company aristocrats — had an ounce of integrity they would have questioned Facebook’s probity years ago…. Our industry has been the silent partner to the decay of civil society engendered by Facebook. We are the hidden hand.”

[Technology Review, via Naked Capitalism Water Cooler 9-20-21]

“[A]fter the 2016 election, Facebook failed to prioritize fundamental changes to how its platform promotes and distributes information. The company instead pursued a whack-a-mole strategy that involved monitoring and quashing the activity of bad actors when they engaged in political discourse, and adding some guardrails that prevented ‘the worst of the worst.’ But this approach did little to stem the underlying problem, the report noted. Troll farms—professionalized groups that work in a coordinated fashion to post provocative content, often propaganda, to social networks—were still building massive audiences by running networks of Facebook pages. Their content was reaching 140 million US users per month—75% of whom had never followed any of the pages. They were seeing the content because Facebook’s content-recommendation system had pushed it into their news feeds.” • Now do YouTube. Why on earth the platforms don’t operate like the blogosphere and RSS do, and just put up posts in chronological order from accounts you subscribe to… Well, we know why.

Instagram is bad for teenagers – and its owner Facebook has known this for more than a year 

[The Conversation, via Naked Capitalism 9-20-21]

“Harms of AI”

Daron Acemoglu [National Bureau of Economic Research, via Naked Capitalism Water Cooler 9-20-21]

“I argue that if AI continues to be deployed along its current trajectory and remains unregulated, it may produce various social, economic and political harms. These include: damaging competition, consumer privacy and consumer choice; excessively automating work, fueling inequality, inefficiently pushing down wages, and failing to improve worker productivity; and damaging political discourse, democracy’s most fundamental lifeblood…. I also suggest that these costs are not inherent to the nature of AI technologies, but are related to how they are being used and developed at the moment – to empower corporations and governments against workers and citizens.” • Well, er, would we be developing AI if it did not “empower corporations and governments against workers and citizens”? Dude, come on.

  

[The Verge, via Naked Capitalism Water Cooler 9-22-21]

“A generation that grew up with Google is forcing professors to rethink their lesson plans.” “Catherine Garland, an astrophysicist, started seeing the problem in 2017. She was teaching an engineering course, and her students were using simulation software to model turbines for jet engines. She’d laid out the assignment clearly, but student after student was calling her over for help. They were all getting the same error message: The program couldn’t find their files. Garland thought it would be an easy fix. She asked each student where they’d saved their project. Could they be on the desktop? Perhaps in the shared drive? But over and over, she was met with confusion. “What are you talking about?” multiple students inquired. Not only did they not know where their files were saved — they didn’t understand the question. Gradually, Garland came to the same realization that many of her fellow educators have reached in the past four years: the concept of file folders and directories, essential to previous generations’ understanding of computers, is gibberish to many modern students. Professors have varied recollections of when they first saw the disconnect. But their estimates (even the most tentative ones) are surprisingly similar. It’s been an issue for four years or so, starting — for many educators — around the fall of 2017.” 

Creating new economic potential - science and technology

“The Next Best Electric Car Battery Is Here, Cheaper Than Ever”

[Bloomberg, via Naked Capitalism Water Cooler 9-20-21]

“There’s no shortage of excitement for electric vehicle battery startups or multibillion dollar investments in the industry, as companies, backers and scientists look for the winning play. China, though, is already moving on to the next leg in the race — one that isn’t dependent on a big, bold breakthrough — with sodium-ion batteries. Done right, this technology could lead to widespread adoption in a market largely dependent on subsidies and where EV sales are still a fraction of all cars. China’s Contemporary Amperex Technology Co., or CATL, the world’s largest battery manufacturer, unveiled its latest product in July — a sodium-ion battery. The following month, China’s Ministry of Industry and Information Technology said it would drive the development, standardization and commercialization of this type of power-pack, providing a cheaper, faster-charging and safe alternative to the current crop on offer, which continue to be plagued by a host of problems, not least, faulty units catching fire

L.A.’s New Reflective Streets Bounce Heat Back into Space 

[Reasons To Be Cheerful, via The Big Picture 9-22-2021]

The air in these neighborhoods is getting cooler — with huge implications for sweltering cities worldwide. 

Climate and environmental crises

“It’s Going To Spill”

[The Daily Poster September 23, 2021]

On the ground with water protectors fighting the construction of the Line 3 tar sands pipeline in Minnesota….

Enbridge has made direct payments to local police departments, which have coordinated and shared intelligence on water protectors with the company, according to reporting by The Intercept. Enbridge and police officials have claimed the payments are reimbursements for expenses incurred for guarding pipeline construction.

LaDuke doesn’t buy it. “It’s bad enough if you’ve got a police state that’s owned by your state,” she said. “But a police state owned by Canadian multinationals? Really? You just do that?”

Police aren’t the only local authorities being paid by Enbridge.

The Biden Transition and the Fight for Real Hope and Change This Time

“$3.5 Trillion Is Not a Lot of Money”

Eric Levitz [New York Magazine, via Naked Capitalism Water Cooler 9-22-21]

“Perhaps these lawmakers really would rather see Biden’s entire domestic agenda collapse than abet the passage of a $3.5 trillion spending bill. If this position is credible, however, it’s anything but moderate. The centrists’ stance rests on one basic premise: that the reconciliation bill is radical in both the scale of its spending and the tax increases it entails. The lawmakers’ avowed preference for undercutting their own party, and forfeiting all of their own objectives for federal spending, is plainly an extremist position, unless one accepts that the $3.5 trillion bill is extraordinary in scope or content. And yet, by an array of reasonable metrics, Biden’s agenda is neither…. [In terms of] immediate, single-year fiscal cost… the Democrats’ reconciliation package isn’t a $3.5 trillion bill; it’s a $350 billion one…. What about its implications for taxes? Just how ‘painful’ are the leadership’s proposed revisions to the tax code? Well, the reconciliation bill would raise the corporate tax rate from 21 percent to 26.5 percent. For context, before Donald Trump took office, America’s top corporate rate was roughly 39 percent. In 2012, Mitt Romney campaigned on lowering that rate to 25 percent. So the Democratic leadership’s preferred corporate rate is a hair to the left of a Utah Republican’s and much to the right of the last Democratic president’s. As for individual income taxes, the reconciliation bill would cut taxes for the roughly 90 percent of American households who earn less than $200,000 a year. It would, however, raise the top income tax rate all the way to … where it was under Barack Obama.” 

What does the writing of Constitutions have to do with wars? Plenty, as this book proves

[Scroll.In, via Naked Capitalism 9-19-2021]

Linda Colley’s ‘The Gun, the Ship, and the Pen’ presents a profoundly global and lucid story of constitution-writing.

Crimes of elites

Billionaire Leon Black accused of raping woman in Jeffrey Epstein’s mansion in 2002, according to court documents 

[Business Insider, via Naked Capitalism 9-22-2021] 

Second woman accuses Leon Black of rape; Black’s rep calls claim ‘complete fiction’ 

[Reuters, via Naked Capitalism 9-22-2021]

It’s Always A Battle Against Corruption

David Sirota [The Daily Poster September 24, 2021]

The fight over the reconciliation bill is not an honest ideological conflict — it is a clash between necessary policy and corporate greed.

The Dark Side

“Trump lawyer’s memo on six-step plan for Pence to overturn the election”

[CNN, via Naked Capitalism Water Cooler 9-21-21]

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“New Proof Emerges of the Biden Family Emails: a Definitive Account of the CIA/Media/BigTech Fraud”

[Glenn Greenwald, via Naked Capitalism Water Cooler 9-22-21]

“A young reporter for Politico, Ben Schreckinger, has published a new book entitled “The Bidens: Inside the First Family’s Fifty-Year Rise to Power.” To his great credit, he spent months investigating the key documents published by The New York Post and found definitive proof that these emails and related documents are indisputably authentic. His own outlet, Politico, was the first to publish the CIA lie that this was ‘Russian disinformation,’ but on Tuesday — without acknowledging their role in spreading that lie — they summarized Schreckinger’s findings this way: the book ‘finds evidence that some of the purported Hunter Biden laptop material is genuine, including two emails at the center of last October’s controversy.’ In his book, the reporter recounts in these passages just some of the extensive work he did to obtain this proof: 

A person who corresponded with Hunter in late 2018 confirmed to me the authenticity of an email in the cache. Another person who corresponded with Hunter in January 2019 confirmed the authenticity of a different email exchange with Hunter in the cache. Both of these people spoke on the condition of anonymity, citing fears of being embroiled in a global controversy.

Lambert Strether adds; “The Greenwald article is a must-read, because it lays out the whole sorry episode in detail.”

Peter Thiel’s Origin Story

[Intelligencer, via The Big Picture 9-21-2021]

His ideology dominates Silicon Valley. It began to form when he was an angry young man. 

Thiel hasn’t just acted in a certain way and left it for others to notice and follow. He taught his methods to founders-in-training at Stanford, codifying the lessons from the fleet of companies founded by his former employees — the so-called PayPal Mafia. He later collected his thinking in a book, Zero to One. It became a best seller, partly because it promised a path to Thiel-scale wealth and partly because it developed the idiosyncrasies that had been present in the college-age Thiel into a full-blown ideology. The book argues, among other things, that founders are godlike, that monarchies are more efficient than democracies, and that cults are a better organizational model than management consultancies. More than anything, it celebrates rule-breaking. Thiel bragged that of PayPal’s six founders, four had built bombs in high school.

Reminds me of Vanity Fair’s February 2018 article on Silicon Valley’s orgiastic “cuddle puddles” OH MY GOD, THIS IS SO F---ED UP”: INSIDE SILICON VALLEY’S SECRETIVE, ORGIASTIC DARK SIDE. Wealth corrupts, and great wealth corrupts absolutely.