Tag Archives: economy

I Know Facts Don’t Matter…

Talk about “sucking all the oxygen out of the room…” The four indictments of Trump have consumed most of the media, masking what would otherwise be a greater emphasis on administration actions and policies, and overwhelming what ought to be applauded as the enormous success of “Bidenomics.”

The Inflation Reduction Act (IRA) is one year old; it is central to “Bidenomics.” A recent Treasury Department analysis found that it has incentivized unusually strong business investment–investment Axios recently called a “tailwind for economic growth.”

Together with the bipartisan Infrastructure Law and the CHIPS and Science Act, the IRA has especially spurred investments in manufacturing and clean energy. According to Treasury officials, evidence shows that private investment has held up, even in the face of increases in interest rates. And the report also noted that most counties where IRA-related investments have been announced are areas where college graduation rate, employment and wages are lower. In other words, Republican, largely rural areas. 

As Heather Cox Richardson noted in a recent daily Letter, 

The IRA was the eventual form President Joe Biden’s initial “Build Back Better” plans took. It offered to lower Americans’ energy costs with a 30% tax credit for energy-efficient windows, heat pumps, or newer models of appliances; capped the cost of drugs at $2,000 per year for people on Medicare; and made healthcare premiums fall for certain Americans by expanding the Affordable Care Act. 

By raising taxes on the very wealthy and on corporations and bringing the Internal Revenue Service back up to full strength so that it can crack down on tax cheating, as well as saving the government money by permitting it to negotiate drug prices with pharmaceutical companies, the IRA was expected to raise $738 billion. That, plus about $891 billion from other sources, enabled the law to make the largest investment ever in addressing climate change while still bringing down the federal government’s annual deficit.

“This is a BFD,” former President Barack Obama tweeted a year ago.

It is a “BFD,” and it is extremely frustrating that reporting on its effects has been smothered by a combination of “it bleeds so it leads” reporting and the massive amounts of propaganda “flooding the zone” ala Bannon.

The law has driven so much investment in U.S. manufacturing that the CEO of U.S. Steel recently suggested renaming it the “Manufacturing Renaissance Act.” Manufacturers have been returning previously off-shored production to the U.S., bringing supply chains back to the U.S. And as Richardson emphasized,

These changes have meant new, well-paid manufacturing jobs that have been concentrated in Republican-dominated states and in historically disadvantaged communities. 

The IRA has also been enormously consequential to the fight to tame climate change.

Scientists Alicia Zhao and Haewon McJeon, who recently published an article in Science, today wrote that the IRA “brings the US significantly closer to meeting its 2030 climate target [of cutting greenhouse gas emissions to 50–52% below 2005 levels], taking expected emissions from 25–31% below 2005 levels down to 33–40% below.”

 Republican presidential candidates have—predictably–refused to credit the act with these results; Richardson quoted former South Carolina governor Nikki Haley, who called the IRA  “a communist manifesto,” although, with their usual hypocrisy, “Republicans have been eager to take credit for IRA investments in their districts without mentioning either that they voted against the IRA or that they are still trying to repeal it.”

The Environmental Defense Fund recently issued a statement rebutting several of the Republican misrepresentations–okay, lies–about the IRA. The organization noted the difficulty of getting factual information out:

The truth takes about six times as long to reach 1,500 people as false stories do. Six. Times. Longer.

And this is from a study that is a few years old, before the global pandemic and the 2020 U.S. election — events that caused an explosion of lies online by Bad Actors.

A simple google search brings up dozens of reports from highly credible and nonpartisan sources, confirming the truly massive economic and environmental benefits triggered by the IRA, and the fact that those benefits are being felt in parts of the country that have previously been left behind.

Those reports won’t reach the millions of Americans glued to Faux News and its clones, or the other millions who have turned off the news because they no longer know what or who to believe–a situation that explains Biden’s low approval numbers.

My middle son said it best. In a conversation a while back, he said “Biden is the first President I’ve voted for who vastly exceeded my expectations.”

To quote Barack Obama, Biden’s Presidential performance has been a BFD. Too bad so few Americans understand that.

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Joe Biden

Let me begin this post with an admission: I am older than Joe Biden, so I know a little something about the diminishing energy levels that accompany aging. I sometimes (okay, often) blank on words. On the other hand, I have a significant well of life experience to draw on, and so far, at least, I’m reasonably confident that the lessons of that lifetime have more than compensated for the relatively minor deficits of aging.

And I am over the constant media handwringing about Biden’s age. 

Sure, given the challenges of aging, I wish Biden was younger–but after looking at what he has accomplished over the past three years by drawing on his lifetime of political and governmental experience, I realize that significant trade-offs would be involved. (Unlike Trump–who is only 4 years younger– Biden spent his time acquiring the knowledge and skills that have made him a very consequential President.)

In the last three years, America’s economy has added more than 13 million jobs—including nearly 800,000 manufacturing jobs. We’ve unleashed a manufacturing and clean energy boom. In 2021 and 2022, more than 10 million applications were filed for new small businesses—the strongest two years ever recorded.  Since the pandemic, America has had the strongest growth of any leading economy in the world. Inflation has fallen for 11 straight months.

As my middle son observed, “Biden is the first President I’ve voted for who has exceeded my expectations.”

And as an article in the New Republic argues, there needs to be more recognition of the skills Biden brought to the job.

Nobody seems to have noticed this, but over the course of the spring, the country’s four leading freight rail carriers agreed to grant the vast majority of their workers paid sick days.

Everybody remembers what happened last December. The workers threatened to strike over such days, among other issues. President Biden, generally very friendly toward labor, made it illegal for the workers to strike. He was criticized by unions and workers and fellow Democrats and liberal media outlets, this one included….

When the workers prevailed, the International Brotherhood of Electrical Workers  explicitly acknowledged that the Biden administration had

played the long game on sick days and stuck with us for months after Congress imposed our updated national agreement. Without making a big show of it, Joe Biden and members of his administration in the Transportation and Labor departments have been working continuously to get guaranteed paid sick days for all railroad workers.

As the article argued, the administration needs to start “making  big show” of such accomplishments.

Biden has been a terrific president. The big legislation. The way he played Kevin McCarthy on the debt deal. The global leadership against Putin. The plain human decency restored to the White House after four years of self-obsessed thuggery. Oh—the 13 million jobs created since he took office, which is more jobs in 28 months than created under any other president, in all of our history, in a full four-year term.

As Jennifer Rubin recently wrote in the Washington Post, Biden has an economic record that has been working far better than most people anticipated but that the electorate doesn’t yet recognize.

 
The economy has created 13 million jobs, inflation has been more than cut in half, huge investments are being made in infrastructure and green energy, wage growth has begun to outpace inflation, the first drug price controls are going into effect and the biggest corporations will finally be forced to pay something in federal taxes. Yet polls show voters incorrectly think we are in a recession and remain negative about the economy.

As Robert Hubbell recently reminded us, “The constant hum of investigations into Trump’s many crimes is obscuring one of the great modern presidencies.”

Historians will look back in wonder at what Biden achieved in a presidency that began mid-pandemic before the smoke of a failed coup and insurrection had cleared. Despite those obstacles, his legislative record rivals or exceeds that of every president since FDR—a president who was mired in controversy throughout his tenure. 

The Biden Administration has a three-part vision: targeting investment, empowering workers, and promoting competition. That vision includes enforcing antitrust rules and allowing Medicare to negotiate for lower drug prices. (Recent results: cheaper insulin and real wage growth.)

As the New Republic reminds us,

Liberals have a list of 50 things they want government to do, and they want those things done fast and to completion. Conservatives have a list of about two things they want government to do: Cut taxes, and punish people they disapprove of morally. For a presidential administration, satisfying that first group is a lot harder than satisfying the second

As someone has pointed out, It’s not how old you are. It’s how you are old.

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Abusing Immigrants

Republican hysteria about immigration at the southern border is both stupid and racist: Stupid, because most people who are in this country illegally have flown in and overstayed their visas, and racist because–hey!–it’s the GOP and those people at the southern border tend to be brown.

The GOP’s anti-immigrant fervor isn’t so different from the anti-immigrant hatred documented by Ken Burns in “America and the Holocaust”–only the targets have shifted. A little.

In light of DeSantis and Abott’s  recent efforts to prove that “libtards” don’t understand the terrible threat posed by brown people trying to escape horrific situations, I thought I’d share some inconvenient things called “facts.”

I know facts are out of fashion these days, but it is instructive to look at the actual impact of immigration. As David Brooks wrote a few years back,  “when you wade into the evidence you find that the case for restricting immigration is pathetically weak. The only people who have less actual data on their side are the people who deny climate change.”

So what are the facts—as opposed to the xenophobic fears? A couple of years ago, I did some research; this is what I found then.

Immigrants make up about 14% of the U.S. population; more than 43 million people. Together with their children, they are about 27% of us. Of the 43 million, approximately 11 million are undocumented.

What anti-immigrant activists like to call “chain migration” is actually family re-unification and it applies only to close relatives; of the people granted permanent residency in 2016, about two-thirds fell into that category.

Immigrants made up 17% of the U.S. workforce in 2014, and two-thirds of those were here legally. Collectively, they were 45% of domestic workers, 36% of manufacturing workers, and 33% of agricultural workers. Those percentages help to explain why state-level efforts to curb immigration have come back to bite them: in Alabama a few years ago, when the state passed a draconian new immigration law, crops rotted in the fields. Farmers couldn’t find native-born residents willing to do the work.

Right now, restaurants are desperate for waitstaff and kitchen help.

Despite the hateful rhetoric from the GOP, most Americans today consider immigration a good thing: in 2016, Gallup found 72% of Americans viewed immigrants favorably, and as many as 84% supported a path to citizenship for undocumented persons who met certain requirements. Another poll showed that 76% of Republicans supported a path to citizenship. (It’s worth noting that such support was higher than the 62% who supported a border wall.)

What about the repeated claims that immigrants are a drain on the economy? The data unequivocally shows otherwise. As the Atlantic and several other sources have reported, undocumented immigrants pay billions of dollars into Social Security for benefits they will never receive. These are people working on faked social security cards; employers deduct the social security payments and send them to the government, but because the numbers aren’t connected to actual accounts, the worker can never access the contributions. The Social Security system has grown increasingly—and dangerously– reliant on that revenue; in 2010, the system’s chief actuary estimated that undocumented immigrants had contributed roughly 12 billion dollars to the program.

The Institute on Taxation and Economic Policy estimates that approximately half of undocumented workers pay income taxes, and all of them pay sales and property taxes. In 2010, those state and local taxes amounted to approximately 10.6 billion dollars.

The most significant impact of immigration by far has been on innovation and economic growth. The Partnership for a New American Economy issued a research report in 2010: the key findings included the fact that more than 40% of Fortune 500 companies were founded by immigrants or their children. Collectively, companies founded by immigrants and their children employ more than 10 million people worldwide; and the revenue they generate is greater than the GDP of every country in the world except the U.S., China and Japan.

The names of those companies are familiar to most of us: Intel, EBay, Google, Tesla, Apple, You Tube, Pay Pal, Yahoo, Nordstrom, Comcast, Proctor and Gamble, Elizabeth Arden, Huffington Post. A 2012 report found that immigrants are more than twice as likely to start a business as native-born Americans. As of 2011, one in ten Americans was employed by an immigrant-run business.

On economic grounds alone, then, we should welcome immigrants. But not only do we threaten undocumented persons, we make it incredibly difficult to come here legally. If there is one fact that everyone admits, it is the need to reform a totally dysfunctional and inhumane immigration system. Based upon logic and the national interest, it’s hard to understand why Congress has been unwilling or unable to craft reasonable legislation.

Of course, logic and the national interest have been missing from Washington for some time. Compassion went with them.

Bigotry, however, continues to thrive.

I

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The More Things Change…?

It feels as if I’ve been on “lockdown” forever, and I know others are equally “over” a pandemic that is anything but over. There just aren’t that many rooms to be deep cleaned, that many books to be read, or–in my case–that many blogs to be written.

The rest of the time, then, becomes available for worrying.

I’ve been particularly concerned about what will happen to the center of my city in the wake of Covid-19. My husband and I moved to downtown Indianapolis in 1980, when things were still pretty sketchy, and we’ve celebrated the subsequent rebirth of a flourishing urban core. We’ve been excited to see new homes and apartments being built, we’ve marveled at our inability to patronize all of the new restaurants and bars (although we really tried!). We’ve worried as online retailing has reduced the number and variety of shops.  And we were heartbroken when we drove past all the boarded-up windows in the wake of the one protest that included such destruction.

Predictions about “what will come next” are everywhere. Most aren’t worth the paper they’re printed on (or the bytes they represent), but I tend to respect the scholars at the Brookings Institution, who’ve weighed in with their analysis.

The Brookings report suggests that COVID-19 will accelerate or intensify many trends that are already underway, which makes a lot of sense to me.

The report noted that retailers, along with their landlords and suppliers, were already “responding to multiple industry-wide  trends” (aka “in a world of hurt”) before the coronavirus. Trump’s tariffs hurt an industry that was already reeling from shifts in consumer demand from products to experiences, e-commerce, and the sharing economy. The pandemic is accelerating an already pressing need to embrace new models.

The report is light on specifics, but does predict that profit-sharing leases will be an “increasingly important tool to help new businesses get started, survive slowdowns, and provide a return to landlords who invest in their tenants’ success.”

The report’s predictions about food really comforted me. (Comfort food? Sorry…)

Convergence and hybridization will accelerate in food retail, which will return to be a “revitalizing force in urban life.” IKEA was already a furniture showroom, warehouse, and restaurant. High-end grocers were encouraging shoppers to have a beer. Restaurants were increasingly not just dine-in, but fast-casual or mobile food trucks. Whether through app-based delivery or prepared foods from wholesalers such as Costco, Americans will return to eating much of their food prepared outside the home. In 2017, jobs in leisure and hospitality (which includes all bars and restaurants) grew to outnumber jobs in retail trade. The pandemic is a setback, but not a reset.

On the negative side, the researchers expect that the 50- million- plus low wage workers will continue to face unsupportable housing costs– and that households that previously strained to pay rent will find it impossible. They also see worse labor market outcomes for older workers who lose their jobs.

So what does all of that portend for cities?

Some urban dwellers who have decamped to less dense areas will undoubtedly stay there permanently,  “irrespective of the many amenities and agglomeration economies urban centers have to offer.” But the researchers note that the period following the Great Recession saw major metros gain more population than their suburbs

Why was this happening in a tepidly recovering economy? A good deal was attributable to young adult millennials. Unable to find jobs and housing in large stretches of the country, they found urban centers attractive. Eventually, the economy rebounded, jobs dispersed and many young adults dispersed with them. But large metro areas still prospered even with slower growth, as Brookings’s Metro Monitor 2020 revealed.

What does this mean for the post-COVID-19 period? Much will depend on Gen Z, an educated and racially diverse generation with strong urban roots.

In other words, if Gen Z  wants and needs what urban life has to offer, they’ll opt to remain.

We will face huge challenges once the pandemic is over and Trump is (fingers crossed) a  horrific memory. We will need to restore a functioning and ethical federal government, address our enormous inequalities with social investment and a comprehensive, adequate social safety net–and continue the work of making our cities  vital, livable places to live and work.

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Lessons We’re Having to Learn The Hard Way

The news just keeps getting progressively worse.

It’s pretty clear that in addition to a global pandemic, we will experience a global economic meltdown. As state governments have stepped up to compensate for the lack of federal leadership, restaurants and bars, gyms and cultural venues have been ordered to close; many will be unable to weather weeks with no income, and will never re-open.

As one of my friends recently noted in a post to Facebook, Coronavirus would have battered the U.S. to some extent no matter who was in the White House. But an even minimally-competent President “would have listened to the public health experts and taken action, realizing that this was about the country and NOT about him (or her) self.”

And most likely, no other president would have rejected the WHO’s offer of test kits, or dismantled the global health emergency task force that was set up to deal with a pandemic. And no other president would likely brazenly lie on a daily basis even as his own administration’s experts contradicted his lies and imbecilic pronouncements. In short, Trump deserves “credit” for the extent of this catastrophe, the long and outrageous delay in taking action, and the economic meltdown that will result, along with many of the (probably unnecessary) deaths that we will see.

So–lesson number one: elections matter. Competent government matters. The character and intelligence of our elected officials matters.

Lesson number two: we’re connected to the rest of the world. Discussion of a “global pandemic” and “global economy” should give “America First” xenophobes pause. (It won’t, but it should.) We really are ALL in this together. Today’s world is far too connected for the walls, travel bans and reflexive hatred of darker “others” that characterize the Trumpublicans’ approach to the rest of the world. Not only are those measures useless and stupid, especially during a pandemic, they inevitably hurt America more than they hurt those “others.” Global cooperation is absolutely essential, not just to the management of health threats, but to efforts to mitigate economic damage.

Lesson number three is another take on the fact that we truly are all in this together–and by “this” I don’t just mean this particular health crisis or this specific economic threat. We humans are– in far more than the biblical sense–our brothers (and sisters) keepers. A government that is not structured on recognition of that fact will be unable to mitigate disasters.

What does that mean? It doesn’t mean abandonment of market economics, but it does mean provision of a far more robust and less haphazard social safety net.

In a recent analysis, the Brookings Institution acknowledged that reality.

In addition to the dire risk to individual health, side effects of the coronavirus pandemic are sure to include widespread economic hardship and uncertainty. If you experience these symptoms, you’re mostly on your own—as the virus reveals a grossly inadequate safety net and willfully ineffective political system that are poised to leave our most vulnerable workers bearing the brunt of the economic and social impact.

The self-quarantines and social distancing measures taken in response to COVID-19 are critical to keeping people safe by reducing exposure to the virus and slowing its spread. But we can already see the strains in our health care system that foreshadow even greater disruptions in the weeks and months to come. Similarly, we are witnessing the unavoidable side effects of social distancing: the reduced economic activity that ensues when masses of people stay home or avoid large gatherings. In turn, this translates into reduced demand for workers….

In the United States, 53 million people must get by on low wages, with median hourly earnings of $10.22. Some of the largest occupations employing these workers are also the most susceptible to the economic slowdown accompanying the virus’ spread: 5 million food service workers, 4.5 million retail clerks, and 2.5 million custodians and housekeepers. When college campuses empty out, when stadiums don’t host games, or when conferences are cancelled, it means that food servers, cooks, clerks, and housekeepers are out of work. And many low-wage workers and those in sales and service industries lack paid sick or vacation leave, which results in no earnings coming in at all.

The plutocrats who have been enriching themselves through public subsidies and tax cuts while disregarding the precarious state of low-wage workers are going to learn a very unpleasant lesson: when millions of people lose their ability to participate in the marketplace–when they no longer have the means to buy the widgets produced by the plutocrats’ factories or to shop for the services and products in which the wealthy have invested–  stock portfolios and tax havens won’t shelter them from that storm.

Ultimately, fortunate people are only secure when everyone is secure.

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