Bidenflation: Retirement Accounts Lose Trillions, Rips Through Savings thumbnail

Bidenflation: Retirement Accounts Lose Trillions, Rips Through Savings

By The Geller Report

The S&P 500, the broadest measure of U.S. stocks, is down 21%, the Nasdaq nearly 30% and the Dow 16% so far this year, and Americans are seeing the value of their retirement accounts dwindle along with the drops.

And the Democrats just passed a massive tax and spend bill that will  escalate it further. Democrats hate you.

Alicia Munnell, director of the Center for Retirement Research at Boston College, wrote in a blog post this week that retirement plans have collectively lost upwards of $3 trillion since the beginning of January.

According to Munnell’s latest data, 401(k) plan participants have lost about $1.4 trillion from their accounts and IRAs have lost $2 trillion since the end of 2021.

Retirement accounts lose trillions in stock rut

Americans are feeling the pain when they look at their 401(k)s

By Breck Dumas, Jon Michael Raasch Fox News

EVERYBODY GETTING ‘HURT’ BY INFLATION: INVESTMENT EXPERT

Main Street is feeling it, too.

One woman told FOX Business her 401(k) has “been decimated” to the point that she is now wondering if her plans for starting her golden years might need to be delayed.

“It’s horrible, I mean, I was thinking I might be retiring, you know, in the next year or two,” she said. “And now, I don’t know. I don’t know when I can do that.”

“They’re not doing too good right now,” another man said of his investments. “We’ve been losing a lot of money.”

Multiple people told FOX Business they are scared to even take a peek at where their accounts stand.

stock trader

Traders work on the floor of the New York Stock Exchange NYSE in New York, the United States, June 16, 2022. (Photo by Michael Nagle/Xinhua via Getty Images / Getty Images)

“We’ve got a [Thrift Savings Plan], a 401, a 529,” a second woman explained. “I don’t want to look at it.” She said the last time she glanced at her husband’s TSP it was down $200,000.

The losses coupled with inflation sitting at a 40-year high, means Americans are hemorrhaging money. That has also caused some people to make tough decision regarding retirement.

“It’s been painful,” another person said. “I honestly had to take out some funds out of my 401(k) to, you know, support myself and my family with the inflation and everything else that’s happening.”

AUTHOR

Pamela Geller

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EDITORS NOTE: This Geller Report is republished with permission. ©All rights reserved.

5 Transportation Industries the U.S. Government Is Crushing With Regulations thumbnail

5 Transportation Industries the U.S. Government Is Crushing With Regulations

By Foundation for Economic Education (FEE)

Transportation is essential to any economy.


In war, each side tries to cripple the other’s economy by targeting and destroying its transportation infrastructure: ports, airfields, roads, bridges, railroads, rivers, and canals. The United States, however, like many countries, wrecks its own transportation systems—not with bombs but with laws and regulations.

The American Henry George (1839-1897) once commented on this dismal state of affairs. “What protection teaches us,” he wrote, “is to do to ourselves in time of peace what enemies seek to do to us in time of war.”

Let’s explore some examples of how this works.

The Interstate Commerce Commission (ICC), created in 1887; the Sherman Antitrust Act of 1890; the Elkins Act (1903); the Hepburn Act (1906); the Mann-Elkins Act (1910); the Panama Canal Act of 1912; and the Valuation Act (1913) worked together and at cross purposes to ensure that the nation’s railroads could neither compete, cooperate, nor coordinate with each other. Routes, lading, and rates were all heavily regulated. The result was that even before the country entered World War I, its railroads were grinding to a halt, incapable of transporting steadily increasing amounts of war materiel to the nation’s seaports. As Marc Scribner explains:

Pooling equipment and facilities could have eased the traffic crunch in the short-run, but the Interstate Commerce Act explicitly prohibited the voluntary pooling of railroad resources. In 1917, railroads appealed to the ICC for a 15-percent rate increase to help offset some of the rising costs associated with wartime traffic and afford them the opportunity [to] raise revenue necessary to invest back into network enhancements. The ICC rejected their request.

Frustrated with the growing railroad network inefficiencies during the war, President Wilson nationalized the entire railroad industry. On December 28, 1917, the newly formed United States Railroad Administration took over American railway operations. The agency immediately pooled all railroad equipment and facilities, and six months later increased freight rates by 28 percent.

Scribner adds that partial deregulation in the 1970s saved the country’s railroads from “the brink of collapse.”

The Merchant Marine Act of 1920 (“Jones Act”) prohibits transporting goods between American ports on ships that aren’t American built, owned, registered, and crewed. The Act significantly increases the cost of shipping American products between American cities. As a result, goods that could more efficiently be sent by water are sent by rail, truck, or air, wasting fuel and producing far more pollution and CO2 emissions than necessary. In addition, the high cost of shipping domestic products leads Americans to buy more from abroad. Finally, the Act has crippled America’s shipbuilding industry.

While Covid and Covid lockdowns exacerbated problems at America’s seaports, the issues have been building for decades:

  • Longshoremen’s unions are limiting automation and job flexibility
  • The Foreign Dredge Act of 1906 artificially increased the cost of the dredging that would allow our ports to service more and larger ships.
  • State and local laws prevent seaports from expanding their container storage facilities

During the four decades from 1938 to 1978, the Civil Aeronautics Board (CAB) regulated passenger airlines engaged in interstate operations. It assigned routes, set fares, limited market entry, subsidized airlines, and regulated mergers. While the CAB prohibited price competition, it did allow airlines to compete on quality of service and frequency of flights. As a result, airlines became inefficient, overcapitalized, and overstaffed. Airlines profitably flew frequent, partially-booked flights, which, while convenient for customers, wasted fuel, labor, and equipment. Intrastate airlines – not subject to the CAB’s entry restrictions or price controls – could transport customers for half the cost of their CAB-certified rivals.

From 1935 to 1980, the ICC regulated the nation’s trucking industry. The agency controlled rates and routes and limited market entry. Applicants for operating rights had to prove that existing firms weren’t already providing the proposed service and that the firms wouldn’t be hurt by the additional competition.

When President Jimmy Carter signed the Motor Carrier Act of 1980, which largely deregulated the trucking industry, he stated that the reforms would reduce “consumer costs by as much as $8 billion each year… and… conserve annually hundreds of millions of gallons of precious fuel.”

California’s AB5 law (also known as the “gig worker bill”) restricts companies’ ability to designate workers as contractors. Because over 60% of California’s independent owner-operators fall under the law’s definition of regular employees, AB5 will have a significant impact on the state’s trucking industry. By reducing or eliminating logistics companies’ ability to hire short-term trucking services and by driving some independent truckers to leave the state or the business, the law will further decrease the ability of the Los Angeles and Long Beach ports to clear their backlogs. Bottlenecks at these ports impact not just California but the entire nation.

Transportation is essential to any economy. Transportation expands the size of markets, market size determines the scope for the division of labor, and division of labor drives productivity. A nation’s transportation infrastructure is critical to its survival, but even the best infrastructure in the world cannot move people and products if laws and regulations create enough roadblocks.

AUTHOR

Richard Fulmer

Richard Fulmer worked as an engineer and a systems analyst, and is now retired and a free-lance writer. He has published some thirty articles and book reviews in free market magazines and blogs. With Robert L. Bradley Jr., Richard wrote the book, Energy: The Master Resource, which was required reading in classes at four different universities, including the University of Texas and the University of Toronto. He is currently working on another book, Caveman Economics: Basic Economics in 25 Prehistoric Tales.

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

Congress Is Supersizing the IRS. Here’s Why That’s Bad News for Everyday Americans thumbnail

Congress Is Supersizing the IRS. Here’s Why That’s Bad News for Everyday Americans

By Foundation for Economic Education (FEE)

The IRS would more than double its workforce under this legislation.


Americans love their fast-food supersized. But supersizing the Internal Revenue Service?

Probably not so popular.

That’s evidently of little concern to a majority of Congress. Lawmakers are poised to pass a large tax-and-spending bill, which Biden is eager to sign, that would increase IRS funding by an astounding $80 billion. The legislation “provides 14 times as much funding for ‘enforcement’—as in fishing expedition audits—than it does for ‘taxpayer services’ such as answering the phone,” according to Ben Susser of Americans for Tax Reform.

The IRS would more than double its workforce under this legislation, Joe Simonson reports for the Washington Free Beacon. In fact, the super-sized IRS will boast more employees than the State Department, the FBI, Border Patrol, and the Pentagon—combined.

Advocates of increased IRS funding argue that this will raise revenue for essential government spending projects and crack down on rich billionaire tax cheats who aren’t paying their “fair share.” But here are two reasons everyday Americans should be concerned by such a drastic expansion of the IRS.

The IRS has abused its power in recent years with little to no real accountability.

For example, under the Obama administration, the IRS specifically targeted conservative nonprofit groups in what was a massive scandal. More recently, IRS employees illegally leaked the private tax documents of wealthy private citizens—who weren’t breaking any laws—to the media in order to make a political, partisan point in favor of increasing taxes on the rich.

Lois Lerner is retired with full pension and never suffered any consequences for weaponizing the IRS against conservatives.

— Phil Kerpen (@kerpen) August 7, 2022

Nothing happened to Lois Lerner, who oversaw the IRS during the Obama-era scandal. And while the IRS says it is investigating the tax leaks, nothing has come out of that so far. (Shocker).

These are just two examples of the IRS’s many recent scandals and abuses of its power. Why on earth would we want to expand their resources and power with this track record and no real accountability?

Proponents say we have nothing to fear if we have nothing to hide.

Only a tax cheat would be mad at the hiring of more IRS workers.

— Eric Garcia (@EricG1247) August 8, 2022

“Can you understand how 87,000 new IRS agents would scare the heck out of millions of Americans?”

Democrat Sen. Ben Cardin: “If there’s no reason to be fearful, and if you paid your taxes and if you complied with our laws, you should want to make sure everyone else does that.” pic.twitter.com/xRwSes2CrC

— RNC Research (@RNCResearch) August 7, 2022

But that bizarrely assumes benevolence and good faith from a rogue agency that has displayed the opposite in recent history.

Americans are struggling right now under the crushing weight of inflation, facing a shrinking economy and declining real wages. The last thing they need is a tax crackdown from their friendly neighborhood IRS agent. (Even if they’ve done nothing wrong and ultimately don’t have to pay up more in taxes, it’s a headache and a half that could involve many hours of paperwork and expensive legal/accounting assistance.)

Yet that’s what millions of Americans would face under this IRS expansion. It’s simply not the case, as proponents insist, that an increased crackdown would only target the rich.

There are 724 billionaires in the US and 87,000 new IRS agents.

They’re not going after the rich, cupcakes. They’re coming for you.

— Hannah Cox (@HannahDCox) August 8, 2022

Most civil asset forfeiture seizures are for less than $1500

Most IRS audits are for lower-income taxpayers

They go after people who can’t afford to hire lawyers and fight back.

Once you see it…

— Hannah Cox (@HannahDCox) August 8, 2022

According to the Wall Street Journal, “The Joint Committee on Taxation, Congress’s official tax scorekeeper, says that from 78% to 90% of the money raised from under-reported income would likely come from those making less than $200,000 a year. Only 4% to 9% would come from those making more than $500,000.”

When we consider these inconvenient realities, the inescapable conclusion is that the Democrats’ plan to supersize the IRS—or, as they put it, have the IRS “go beast mode”—is bad news.

This article was adapted from an issue of the FEE Daily email newsletter. Click here to sign up and get free-market news and analysis like this in your inbox every weekday.

AUTHOR

Brad Polumbo

Brad Polumbo (@Brad_Polumbo) is a libertarian-conservative journalist and Policy Correspondent at the Foundation for Economic Education.

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

Reproductive choice is a choice to have children. Anything else is a fraud. Period. thumbnail

Reproductive choice is a choice to have children. Anything else is a fraud. Period.

By MercatorNet – Navigating Modern Complexities

The most underreported story of the last 50 years.


Recently both Pope Francis and Elon Musk have warned of depopulation.

Speaking of the declining birth rate in Italy, the Pontiff said:

“This is a new poverty that scares me. It is the generative poverty of those who discount the desire for happiness in their hearts, of those who resign themselves to watering down their greatest aspirations [family], of those who are content with little and stop hoping for something great.”

And here’s billionaire Musk on Twitter: “A collapsing birth rate is the biggest danger civilization faces by far.”

As expected, PC corporate media pushed back against both the pro-natalist Pontiff and the flaky father-of-nine world’s richest man.

In the midst of this comes yet another survey on the opinions of Americans about having children. The study in the journal Scientific Reports, “Prevalence, age of decision, and interpersonal warmth judgements of childfree adults,” is authored by Michigan State University professors Zachary P. Neal and Jennifer Watling Neal. It grabbed headlines.

The headline? “More than 1 in 5 US adults don’t want children.”

As the authors more accurately explain:

In a 2022 study of 1,500 adults in Michigan, we found that 21.64% of adults do not want to have children and therefore are choosing to be childfree. While our survey wasn’t nationally representative, the 2021 Census showed that Michigan is demographically similar to the United States in terms of age, race, education and income. If the pattern we have observed in Michigan reflects national trends, it would mean 50 million to 60 million American adults are childfree.

Given the times, this is not surprising. In many quarters it is considered thoroughly modern, environmentally conscious, and propitiously PC to foreswear progeny. While Pope Francis and Elon Musk see it differently, what do they know? (Sarcasm, OK?)

The authors describe those not wanting to have children as “childfree” and those unable to have children as “childless.” The semantic implications are obvious. Being “free” of something, as in debt-free or disease-free, is considered positive. “Childfree” carries a similar semantic connotation.

Some say that willfully not having children – aka “childfree” – is exercising “reproductive freedom.” The American Civil Liberties Union defines reproductive freedom as the right that “every person can make the best decision for themselves and their family about whether and when to have a child without undue political interference.”

Reproductive freedom is the right to have children. Let’s talk about that.

The globalist establishment’s colossal cash cow, the American middle class, is being milked dry. For generations the American family has been under all-out attack. Debased entertainment, a debilitating social welfare system, callous manipulation by big business, big government (including education) and big media are bad enough. Then there is “pride” propaganda celebrating practically any social arrangement other than the loving traditional nuclear family.

America’s families are ensnared in a real-life Big Squeeze: besieged by woke anti-family propaganda on one side and an exploitive, corrupt crony capitalism masquerading as a “free market economy” on the other. Brainwashed up-and-comers believe such a regime is “the free enterprise system.” In their blind naivety they happily condone wage slavery as vociferously as they would condemn chattel slavery.

Reproductive freedom? The problem is a profound one of social priorities. The family is no longer the focal point of life in America. Money and lifestyle are. Family values are supplanted by hedonism and greed, those glittering globalist assault weapons pounding the American family.

The family is by far the most battle-scarred victim of globalism’s fanatical philarguria (that’s Biblical Greek for greed on steroids). The days when a middle-class parent could stay home and care for children are long gone. Think that affects reproductive freedom?

Women may enjoy their work but work they must. Fine – but safeguard their reproductive freedom by not making it professionally ruinous to bring a child into this world.

Then there are the usual family pressures, such as the ever-present specter of unemployment, escalating debt and the demand for employee fealty to the point where supervisors come before spouses. Talk about skewed priorities! Any wonder that broken homes, broken lives, drug addiction and other social pathologies increase? How does that impact reproductive freedom?

Bottom line: Where do families most feel the pinch? They are being denied their reproductive freedom. The pernicious reality is that there is no specific law prohibiting procreation, but rather the circumstantial deprivation of that basic human right by a thousand cuts, driven by a fashionably materialistic anti-natalist worldview.

How so? Having children is (1) unaffordable — not enough money and (2) struggling to make ends meet, so not enough time for children. Plus, the relentless tsunami of PC negativity about our heritage, “antiracist” guilt propaganda, environmental scaremongering, etc. discourages legions of impressionable young people from aspiring to have a family.

Multitudes have borne the sadness and loss of being unable to have the children they desire – a wholesale robbery of reproductive freedom. That is the biggest and most underreported story of the last 50 years.

Pope Francis and Elon Musk understand this.

So the next time you hear folks yapping about reproductive freedom, remember that means the right to have children, and the deprivation of that basic human right in any way is viciously anti-family. Period.

We need to call a halt to this madness.

In Defense of National Conservatism thumbnail

In Defense of National Conservatism

By Scott Yenor

Editors Note: As the article suggests, National Conservatism is a work in progress. Some call it MAGA and that seems to mean different things to different people. For us, it embraces elements of political conservatism but emphasizes the historic need to control the abuse of power, especially from today’s internationalist technocratic framework. It starts with adherence to the Judeo-Christian ethos even if the religion itself is not practiced, to the family having much greater autonomy (parents’ rights) and the critical role family plays in raising decent citizens. It emphasizes the primacy of the Constitution and original intent legal doctrine, favors a decentralized economy where market forces driven by consumers allocate resources (rather than government or private companies in alliance with the government), and suggests that many nation-states, much like states within the United States, are less likely to abuse power than international organizations. While rouge nations certainly exist, what is worse is a rouge international community enforcing its will on everyone. At least citizens can leave a tyrannical government or state for better circumstances and if necessary, it is easier to overthrow an individual government rather than dozens of governments. It is hard to find a choice in a global dictatorship and more difficult to resist. MAGA suggests that liberty and human flourishing are best achieved by a smaller, less intrusive government, in a moral environment of self-control, individual rights and moral individual responsibility, and peaceful cooperation.

Two recent Law & Liberty articles try to expose soft spots in national conservatism. Tyler Syck’s criticism pits national conservatism against our reigning civil rights regime, while Mark Tooley challenges national conservatism for embracing a relationship between religious faith and nationalism outside of the American tradition.

National conservatism is a work in progress. National conservatives have issued a Statement of Principles to explain their general disposition, and I signed it. Generally, national conservatives worry that the sovereignty of the nation is being worn away through universal, globalist powers imposing an inhuman, stultifying ideology. International bodies are part of this global imperium. So are multi-national corporations and other oligarchic entities, which are destroying popular government and the institutions necessary for virtuous, happy lives all around the globe. Everywhere, governments, bureaucracies, and corporations are demanding conformity to the reigning civil rights regime—and crushing opposition. This reigning civil rights regime sees all inequalities as signs of universal oppression, and its purveyors demand a remaking of the world by experts in the name of elusive, ever-changing notions of equity.

The alternative to this global imperium must be named. Thus, national conservatism defends our civilized and civilizing commitments like the rule of law and free enterprise and the institutions that serve the permanent and aggregate interests of civil society like the family and sound science. Above the individual is the nation and above the nation is God, not a new world order.

What would a national conservatism look like? Consider some recent headlines. According to the National Association of Realtors, Chinese investors spent more than $6.1 billion on homes in the United States last year. This is certainly consistent with free-market economics on a global scale. Is it good for our country when adversaries and foreigners own large portions of our land?

Chinese companies have bought up land quite close to American military bases in North Dakota and elsewhere. Foreign ownership of American land generally plays a role in making real estate very expensive for our citizens. In principle, though, at some point too much foreign ownership of American soil upsets the country. National conservatives bemoan these developments and advocate for real estate nationalism. Foreign nationals own about 3% of America’s farmland, way more than foreigners own in other countries. We need agricultural nationalism. Slots in our elite engineering programs are allotted to foreigners at increasing rates—they pay full price after all. Is this wise? Public research nationalism is needed.

Fundamental Conflicts

Responding to Syck and Tooley may further flesh out what national conservatism means.

Syck seems blind to the fundamental conflict between the current American nation and our old constitutional government, and the civil rights regime as it has developed in the last two-plus decades. As a result, he embraces today’s pathologies and misreads our situation.

This new civil rights ideology compromises the glories of our civilization. Our universities have been undermined, ceaselessly attack our civilizational patrimony, and they now tend to compromise the free inquiry necessary for advancements. Our Christian heritage is denied or ridiculed. Family life is undermined through a commitment to ideologies associated with feminism and sexual liberation. The rule of equal laws is compromised as people are judged not by their actions but by their race or ideology. Censorship from private sources undermines public dialogue. Floods of unassimilated immigrants undermine national unity and national will.

Syck may recognize these realities but doesn’t want to trace them to our civil rights regime or do anything about them. Consider his point about “Family and Children.” Great nations require great families, and coming-apart families portend societal decadence. National conservatives think that “radical forms of sexual license and experimentation,” among other things, undermine family life. Syck disagrees. Family collapse, he suggests, is a product of “oppression and poverty”—a thought derived mostly from the reigning civil rights ideology. Blaming license and sexual experimentation, he thinks, is a veiled attack on same-sex marriage. National conservatives, he claims, “will not hesitate to enforce certain moral views about sexuality, abortion and the family” with the “full force of the federal government rather than the constitutionally intended channels of schools, states, and churches.”

Same-sex marriage and the ideologies leading up to it are definitely associated with family decline. Those who argued for gay liberation, second-wave feminism, the deregulation of pornography, at-will divorce, transgenderism, and other forms of “sexual license and experimentation” thought their victories would undermine a monogamous, procreative and responsible marital culture and therewith national greatness. The same is true for many advocates of same-sex marriage. Progress in the sexual license has nearly everywhere coincided with family decline—declines in marriage rates and birth rates. Unlike Syck, national conservatives see the necessary relationship between culture and family and are interested in doing something to arrest the spread.

Syck’s worries about national conservatives using the “full force of the national government” are inventions of a fevered imagination. The “full force of the national government” is, as Syck sometimes seems to understand, today on the side of libertinism. No state-level solution to sexual license is possible as long as our national institutions are in the grip of our reigning civil rights ideology. Our Supreme Court made local diversity on abortion impossible until this year. The Court undermines local regulation of obscenity through its First Amendment jurisprudence. The Court has also quashed state diversity by constitutionalizing contraception, sodomy regulation, and same-sex marriage. National civil rights laws nationalize second-wave feminism as an official American ideology. The U.S. Department of Education well-neigh requires states to adopt gender radicalism through its national standards. In our circumstances, getting the national government out of the business of quashing states who would like to go their own way on family and gender policy is a truly needful thing. National conservatives agree on that much.

Do we have the stomach for a more restrictive immigration policy, since it would almost certainly require natives to do work that they deem beneath their dignity? Do we have the stomach for restricting the purchase of ever more American real estate by foreigners, as it would put downward pressure on property values?

Beyond that, national conservatives have not agreed on something that must be done to arrest the spread of ideologies hostile to marriage and family life, or on the level of government at which they would be done. I gave my thoughts on what that something is at last year’s National Conservatism conference—but others interested in preserving America may disagree.

Syck’s broadside against national conservatism is traceable to his embrace of our reigning civil rights ideology, wittingly or unwittingly. National conservative solutions, he worries, involve “trying to beat the left at its own game”—to wit, legislating a different morality than the left is legislating. To which I say, “guilty as charged.” National conservatism does indeed fight for a vision of the public good. Syck embraces liberal neutrality, “creating a space in which citizens can come up with answers of their own.” National conservatives recognize the political truth that there is no neutral ground: our public institutions necessarily legislate morality. Every national conservative is an anti-contemporary liberal to that extent.

Maintaining Our Moral Ground

Which morality will it be? Like many national conservatives, Mark Tooley recognizes the inevitability of morality and the further truth that morality is downstream from religious faith. But Tooley worries that national conservatives put forward the wrong idea of how faith relates to the state. I think Tooley overdetermines what the “Statement of Principles” suggests in this regard, but let us deal with the deeper issue on which Tooley and national conservatives seem to agree: how to maintain a common life rooted in Christian faith and a Christian moral vision?

Tooley thinks separationism has accomplished this goal in the American experience, while national conservatives would have public and private institutions honor Christianity above other religions and would protect the rights of minorities to practice their religious traditions. Fundamentally, national conservatives think that America should take its Protestant roots more seriously and legislate toward a Protestant vision of family life, public research, and so on.

Tooley appropriates Tocqueville to his side, but it seems to me that Democracy in America more strongly favors the national conservative argument. Tocqueville praises the Americans for obscenity laws, for their pro-family ethic of separate spheres for men and women, and for honoring female chastity. These laws shaped and reflected Christian public opinion. American national conservatives hope that Christianity can have an indirect effect on public opinion moving forward, as opposed to the establishment of state churches for which Tooley imagines we are advocating.

Such a relationship was the norm in America until our civil rights regime imposed a secular, atheist vision of the good life on the country. Liberals have squeezed the Protestantism from public schools, so that only evolution could be taught, while prayer and Bible reading were abolished. Perhaps a healthy relation between faith and state could rise again if our civil rights regime could be displaced.

These two critics think national conservatism goes too far. The question, it seems to me, is whether the national conservatism goes far enough. Desiring to promote “stable family and congregational life and childraising” is different from having a realistic plan for getting there in our circumstances. Doing what is necessary to promote “stable family and congregational life” would, in all likelihood, involve serious rollbacks in our public commitments to gender equality and sexual libertinism.

Much the same could be said of immigration policy and other aspects of national conservatism. Do we have the stomach for a more restrictive immigration policy, since it would almost certainly require natives to do work that they deem beneath their dignity? Do we have the stomach for restricting the purchase of ever more American real estate by foreigners, as it would put downward pressure on property values? Every national conservative policy slaughters a sacred cow—and comes with serious corresponding pains.

*****

This article was published in Law & Liberty and is reproduced by permission.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

Freedom Itself Is Gravely in Peril thumbnail

Freedom Itself Is Gravely in Peril

By Jeffrey Tucker

The FBI has raided Donald Trump’s home in Florida and opened a private safe, hanging around for hours looking for classified material that might be there. They were likely looking for items that Trump believed he had declassified – the president can do this with anything – but is still holding in his possession.

Top officials of the National Archives, the DOJ, and the FBI believed otherwise and thus sought the search warrant. If the New York Times is correct, then, this is really about state secrets. Trump wanted them public. Others inside the deep-state machinery disagreed.

The scene in Mar-a-Lago, Florida, gives rise to images of societies without law and constitutions, places where regimes are merely juntas seeking plunder and revenge. In this case, the problem is complicated by a mass administrative state apparatus that lives outside the democratic process.

“Aides to President Biden,” reports the Times, “said they were stunned by the development and learned of it from Twitter.” This is likely true. But it gives rise to the more fundamental question: who is actually running the government? 

If we didn’t before realize the extent of the multivariate crisis gathering all around us, now is the time. It’s a time for analysis and understanding. It’s also the time to make a decision concerning what we are all going to do about it.

Even those of us who are not fans of Trump – I wrote one of the first articles from 2015 warning against his ideological leanings which later become a full book – see the deeper implications. The betting odds favor him for the presidency in 2024. Someone somewhere wants to make this impossible. So all the forces of the administrative state – the actual rulers of this country – have coalesced around crushing him and his legacy, Soviet like. 

In the background of all of this is the real struggle that will define American politics for years to come. Two weeks before he left office in 2020, Trump issued an executive order that would have put a major dent in the power of the administrative state in this country, taking the first steps toward returning government to the people after a century in which it gradually slipped away.

In some people’s view, this is intolerable.

Trump, for all his failings, among which was green-lighting the lockdowns that started this social and economic crisis, has become over time a symbol of resistance. The raiding of his private home sends a message about who is in charge. It’s a warning for everyone. An intimidation tactic.

We are used to this but we should not become so.

Biden has once again declared a national emergency in the name of virus control. Such a declaration effectively enshrines the permanent bureaucracy to rule the country at all levels in whatever ways they desire, at least until courts stop them. The extension of the declaration hardly made the news.

Have we forgotten what normalcy is? It was only three years ago. Yes, there were political arguments and enormous problems but it still felt like a nation of laws with a government subject to the people.

Already, there was something in the air in mid-March 2020, something that suggested that everything was changed. Governments all over the world dared to do the unthinkable, partly under the influence that happened in the US, and under a Republican administration. Countless millions found themselves locked in their homes. The churches were forcibly closed. Businesses and schools too. 

You know the story. It was not only a sweeping use of state power without precedent. It foreshadowed dark times ahead. Here we are two-and-a-half years later and the state is on the march in ways we never imagined possible three years ago. The raiding of Trump’s home is but a sign and symbol: none of our homes are safe. And haven’t been for years now. 

Even now, in the land of the free, people are being pressured to accept the shot or get fired. We all have unvaccinated friends who want to visit us but cannot because the US government blocks them. Our health authorities have only expressed regret in one area: for not having locked down more. And they are creating a bureaucratic machinery to make doing so next time more ferocious and better enforced.

All of this is taking place without a scrap of evidence that any of it makes any scientific and/or medical sense. The scientists who resist have been canceled. Only one view is permitted to ascend. Everyone with doubt is being marginalized and silenced.

Congress itself became addicted to authorizing trillions in spending, and they keep doing it again and again. This adds pressure on the Federal Reserve to enter the markets and buy the resulting debt with freshly printed money just as rates are being pushed up to clean up its disastrous balance sheet. No one knows, least of all the Fed, how long this grueling inflation will continue but regardless, the damage is done.

The labor markets, despite the propaganda from the White House, reveal alarming weakness. Fewer full-time jobs. More part-time jobs. More people with two jobs. And fewer workers overall, as labor-market participation and worker/population ratios fall and fall. Not only have these markets not recovered from lockdowns. The trends are getting worse, with fully one million dropped out completely from the labor force since March of 2022, which is highly suggestive of a demoralized workforce lacking in ambition and hope for the future.

Wages and salaries in real terms are falling more than the nominal rates can cover. There is a debate about whether we are in a recession because the GDP has fallen for two straight quarters. But looking at the broad trends, there can be no mistaking what is happening. American prosperity is fundamentally threatened. The relationship between freedom and prosperity is one of the most well-established truths in economic literature. It should not be surprising that both decline in tandem.

Complain too much and you will find yourself without a voice on social media. The tech companies developed a deep relationship with the administrative state over the last two years, corresponding with each other, sharing insights, making enemies lists, and silencing dissidents of all sorts.

Clearly, the lockdowns did not achieve the goal, as the virus came and has gradually become endemic regardless of external interventions including mass vaccination mandates. What they did do was test society’s tolerance for despotism. Tragically, they got away with it all, much more easily than most of us might have expected.

Even now, even though the ruling class has never been less popular with the public, too many have adapted to the new normal. For many people, this is by necessity: what, after all, can anyone really do when freedom is slipping away and even the core functioning of civilization (safe streets, vibrant cities, class mobility) is something we can no longer take for granted?

Let history record that lockdowns triggered this. All of it. Yes, there were problems before but they seemed within the realm of fixable. There appeared to be in the old days (three years ago) some relationship between public opinion and regime priorities. That was blown away with lockdowns. Now it is no longer clear whether and to what extent public opinion matters at all to the masters and commanders of our societies. They are leading us to ever greater crises and yet we feel powerless to do anything about it.

In the most incredible of ironies, it was Trump himself, now targeted for destruction by the bureaucrats he sought to control, who enabled this in the dreadful year of 2020. Realizing but never admitting his error, he flipped in the other direction late in the season, arguing for openness and normalcy. But it was too late. He already lost control, as Deborah Birx’s book makes clear. The deep state that he had loathed needed to prove its hegemony. This raid on his own home underscores the point. 

One read of history is that such times lead inexorably to the forward march of tyranny. Certainly, interwar political history teaches us this. The crisis in Germany began in an economic crisis that cried out for a strongman, but Germany was hardly alone in this. The same inexorable push toward centralization and against freedom took place the world over in these horrible years: Spain, Italy, France, China, and the US.

Read the popular and scholarly literature from the early 1930s: freedom and democracy was out and central planning was in. I read all of this in college and was grateful that those days were gone forever. We are so much more enlightened now! How wrong I was. The same themes are back again today as entrenched elites clamor to hold on to power regardless of public opinion.

In the 1930s, the extremist political left threatened many countries and the extremist political right arrived to prevent that from happening and then erected their own despotisms, always under the cover of emergency. It became a kind of civil war between two opposing camps with their own plans for people’s lives. Freedom was lost in the struggle.

We had hoped those days were long behind us. But the allure of power has proven too tempting for the worst among us. We are all watching as all the things we love – the way of life that many generations have fought to protect – are being swept away. And it is happening with not nearly enough explanation or protest.

These are not the most terrifying times in history but they are among the most terrifying in our lifetimes in the West. Where are the parties and movements that defend freedom as a first principle? Where are the successors to Voltaire, Locke, Goethe, Paine, and Jefferson, among the many great thinkers who sacrificed so much for the liberal vision of a social order in which people manage their own lives?

Such people are here, many of them writing for Brownstone among other venues, and producing books and podcasts to get around the opinion cartel being built by censors public and private.

What difference can they make and how? This much is true: what man has made, man can unmake and make something new: a new Magna Carta, whether formal or de facto. The urgency has never been more intense. A state without an acquiescing populace is powerless in the end. But not without struggle. And that struggle is ultimately an intellectual one. It’s about what we believe and what kind of society we want to live in.

Our prayer today should be for freedom above all else, a society and a world in which powerful elites do not rule the rest of us and forever fight amongst themselves for the right to do so, with the people deployed as fodder in their struggles, and while hope and prosperity slip ever deeper into memory.

These are very dangerous times, with a toxic mix as a backdrop: a growing economic crisis, a spitefully supercilious ruling class, and a vengeful administrative state determined to crush all enemies before it. Something has got to give. May the USA defy the historical odds, find its way back to simple liberty, and begin to restore what has been lost so dramatically and so quickly. Otherwise, all truth will be declared a state secret and our homes will never be safe from invasion.

*****

This article was published by The Brownstone Institute and is reproduced with permission.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

It Doesn’t Get Much Worse Than ‘Build Back Better’ thumbnail

It Doesn’t Get Much Worse Than ‘Build Back Better’

By Peter J. Pitts

Sen. Joe Manchin and Majority Leader Chuck Schumer just struck a deal on a massive spending package they call the Inflation Reduction Act of 2022. In all important respects, the legislation is no different from the Democrats’ long-running social spending plan known as Build Back Better.

Americans should be alarmed. The bill has the potential to handcuff innovation in one of the most critical and successful sectors of the American economy.

The plan would allow unelected federal officials to “negotiate” with drugmakers over the price Medicare will pay for an ever-growing list of brand-name prescription drugs.

In practice, these “negotiations” are federally mandated price controls. Under the plan unveiled by Democratic leadership in early July, the government would have enormous power to name its own price for an increasing range of advanced medicines, and drugmakers would have little choice but to submit.

The cost to patients would be disastrous. That’s because the main consequence of these price controls will be to destroy the research-and-development system that makes America the world leader in medical innovation.

Developing medicines is already a risky business. It costs, on average, nearly $3 billion over 10 to 15 years for each approved new medicine. That’s partly due to the direct expense of the research-and-development activity itself — and partly because only 12 percent of potential medicines entering Phase I clinical trials ultimately win approval. Private investors are willing to take such risks because a successful drug has the potential to earn back those costs and then some.

But if the government successfully puts itself in charge of drug prices, the chances of recouping a medicine’s development costs would plummet, and investment in new research would dry up quickly. Everything from cancer breakthroughs to new treatments for Alzheimer’s disease, COVID vaccines and heart medications would become rarer.

This predictable consequence will leave the innovative biopharmaceutical industry in no position to compensate for the investment loss. A recent review led by University of Chicago economist Tomas Philipson notes that studies consistently show a 1 percent reduction in industry revenue leads to a 1.5 percent reduction in research-and-development activity. He finds this legislation would reduce industry revenue by 12 percent through 2039 and R&D activity by 18.5 percent, or $663 billion. He estimates the result will be 135 fewer medications being developed in that period — a crippling shortfall that will also be measured in lives lost.

Families worldwide rely on research and innovation from the American health and science industries to bring new lifesaving medicines to their loved ones facing diseases lacking cures. The Build Back Better plan will obliterate future breakthroughs and any hope that comes with them instead of providing real solutions.

*****

This article was published by AIER, American Institute for Economic Research, and is reproduced with permission.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

Here Is What Stagflation Looks Like thumbnail

Here Is What Stagflation Looks Like

By David Stockman

Yes, we have some stagflation. Subsequent to the pre-Covid peak in Q4 2019, real final sales of domestic product have slowed to a crawl, rising by just 0.73% per annum during the last 2.5 years.

We much prefer this measure over real GDP because it removes the abrupt inventory swings from quarter to quarter, which can have outsized impacts on the headline number. Thus, during the first two quarters of 2022 the reported back-to-back real GDP contraction was owing to inventory liquidation, not an actual shrinkage of current activity.

As it happens, however, inventory swings cut both ways—so the chart below removes this statistical noise and gets to the underlying trend of production, income and spending.

What has happened, therefore, is that despite upwards of $11 trillion of monetary and fiscal stimmies since Q4 2019, the US economy has lurched along a path to essentially nowhere.

The original Lockdown-induced 32% annualized plunge in Q2 2020 was followed by a 23% annualized rebound in Q3 2020 and then a return to the pre-Covid starting point by Q1/Q2 2021. Thereafter, however, this aggregate indicator of current economic activity has essentially oscillated along the flat line.

Annualized Rate of Change, Real Final Sales Of Domestic Product:

  • Q3 2021: +0.09%;
  • Q4 2021: +1.45%;
  • Q1 2022: -1.24%;
  • Q2 2022: +1.08%;

The past four quarters would obviously be nothing to write home about, even under normal circumstances. But these limpid results actually happened on the heels of the most aggressive stimulus in recorded history; and also during a period in which the rising level of inflation was just getting up a head of steam.

This means that as the Washington stimulus fades and main street inflation surges in the months ahead, the US economy will be clobbered by the worst of both worlds. Accordingly, there is every reason to expect that the red line in the chart below will soon drop into negative territory for several quarters to come.

Y/Y Change In Real Final Sales Of Domestic Product, Q4 2019 to Q2 2022

For want of doubt, here is the annualized rate of GDP deflator change for the same 2.5 year period. Self-evidently, it has moved aggressively higher, the very opposite of the flagging rate of gain in real final sales.

Annualized Rate of Change In GDP Deflator:

  • Q4 2020: +1.93%;
  • Q1 2021: +4.22%;
  • Q2 2021: 6.04%;
  • Q3 2021: +5.75%;
  • Q4 2021: +6.90%;
  • Q1 2022: +7.93%;
  • Q2 2022: +8.50%;

The above-depicted inflation ramp is surely one for the record books. In fact, the last time the GDP deflator exceeded 8.50% was 42 years ago in Q4 1980.

It’s the reason why the real economy is faltering and stagflation has become embedded: To wit, the gains in nominal income are being more than eaten up by soaring prices, paving the way for the worst bout of high inflation and falling real growth since the 1970s.

Needless to say, that condition leaves the Fed high and dry. After years of its 2.00% inflation mantra as the be-all and end-all of macroeconomic stability and prosperity, it will have no choice except to keep pushing up interest rates to combat 6-9% inflation—until faltering output growth eventually collapses into a deep recession.

Y/Y Change In GDP Deflator, Q4 2019 to Q2 2022

Today’s data dump, in fact, was a warning signal that the US economy may go down for the count as soon as Q3. That’s because the S&P Global US Composite PMI Output Index posted at an abysmal 47.7 in July.

The July reading was down from 52.3 in June and signals a renewed contraction in private sector business activity. As shown in the chart, GDP ordinarily follows the composite output index with a small lag.

There is plenty of evidence, in fact, that large sections of the private sector are already heading south. For instance, inflation-adjusted nonresidential construction spending during Q2 2022 was down 12.4% from the Q1 2020 peak.

With inflation soaring we see no reason to expect that real investment in the commercial, office, retail and industrial construction space is likely to reverse higher in the quarters just ahead.

Inflation-Adjusted Construction Spending, Private Nonresidential, Q4 2019-Q2 2022

We also don’t see any reason for the vaunted consumer to rebound, either. In fact, from the time that real PCE shot the moon in April 2021 owing to Joe Biden’s $1.9 trillion stimmy, household spending has been marching downhill at a relentless clip.

After growing at 5.0% Y/Y in early 2022, the June figure came in at just 1.5%, continuing a steadily weakening trend. And what lies ahead is higher inflation and possibly Joe Biden’s tax increases—the opposite of the artificial stimmy-boosted spending shown in the earlier period of the chart below.

Y/Y Change In Real PCE, April 2021 to June 2022

Finally, today’s Fed report on consumer debt provides just one more nail in the coffin. It showed that total household debt rose $312 billion during the second quarter to reach a record $16.15 trillion.

  • Mortgage balances—the largest component of household debt—climbed $207 billion and stood at $11.39 trillion as of June 30.
  • Credit card balances had a $46 billion increase since the first quarter. The 13% year-over-year increase marked the largest in more than 20 years.
  • Aggregate limits on cards marked their largest increase in over ten years.
  • And auto loan balances increased by $33 billion in the second quarter, continuing the upward trajectory that has been in place since 2011.

So, yes, consumer spending is just barely in positive territory in real terms, but that’s entirely due to continued increases in household debt. It is only a matter of time, however, until rising interest rates shut off that avenue of expansion as well.

The crazy thing, of course, is that Wall Street now thinks that the Fed’s tightening phase will be over by December and that the battle against inflation has been won, thereby enabling a new round of rate-cutting and soaring stock prices.

*****

This article was published by The Brownstone Institute and is reproduced with permission.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

In Condemnation of Kyrsten Sinema thumbnail

In Condemnation of Kyrsten Sinema

By Neland Nobel

Last January we wrote a piece called “In Praise of Krysten Sinema.”

It was written in a generous bi-partisan spirit. The senior Senator from Arizona had stood up to a massive, expensive, intrusive spending bill.  She had done so under relentless attack. These attacks even became personal as she was accosted in a bathroom at ASU by progressive activists and even had a wedding she attended disrupted by activists. By showing better judgment and courage, we felt she deserved the praise.

Now, in the interest of fairness and a generous spirit, we must condemn her.

After the capitulation of Senator Joe Manchin, Sinema, who holds the “maverick seat” in Arizona, folded like a cheap lawn chair.

She is no maverick. She is a progressive Democrat.

A maverick in this context means a leader who stands independent of party and acts in the interests of constituents.

The so-called Inflation Reduction Act is just a slightly smaller version of Build Back Better which she previously rejected. This suggests that the original objections she may have had were not based on principle rather she was just concerned about the size of the original proposal.

However, what is being proposed is massive compared to most previous legislation.

Moreover, it has some really nasty features: higher taxes on the middle class, corporate welfare for green energy industries, higher corporate taxes which will simply be passed on to the public, creates a gigantic army of IRA agents to harry and harass citizens, price controls on drugs, all financed by higher deficit spending.

Even Barack Obama had enough common sense to know you don’t raise taxes in a recession. But Sinema seems to endorse a key provision of Modern Monetary Theory, to wit, you fight inflation by raising taxes. Since the government itself is the source of inflation, this leaves the taxpayer in the untenable situation of either paying higher hidden taxes via currency debasement or higher direct taxes back to the government. Either way, they take the money your earned and spend it on things the government wants, rather than the things you want.

Price controls on drugs will have the same result as price controls on New York apartments. It will stifle investment and innovation, creating chronic shortages and eventually even higher prices.

Moreover, she buys into some of the critical mistakes of the Green New Deal.

Advocates desire to “transition” from fossil fuels to what they contend are “clean and sustainable” energy sources. This is all based on the theory of global warming, which itself is unproven. And even if there is a relationship, it is far less costly to adapt to higher temperatures than attempt to control the temperature of the earth 100 years from now.

Such top-down policies will not succeed given the following variables. It does not control the tilt of the earth, the amount and strength of solar radiation, or volcanic activity both above the surface of the land, and below the sea. Then there are sea currents and all kinds of other natural variables.  The earth’s climate is always changing for reasons we cannot control and in many cases, do not understand.

Finally, we cannot control even man’s activities, let those of the universe. While we are cutting back on coal and oil, China and India are burning more. How will our sacrifices and destruction of our economy do anything constructive, based upon the progressive theory of global warming, when countries with much greater populations than ours are still putting CO2 in the atmosphere?

Senator Sinema, what is your answer? Are you willing to destroy our standard of living to make a meaningless gesture? Do you see what electricity prices are in Europe?

Starting with that base assumption of a relationship between CO2 and warming, Senator Sinema how much of a reduction in temperature are we going to get with the bill and when? Please specify what we are getting for our money. If that is the reason for this monstrosity, we are entitled to an answer.  We know the cost is over $700 billion, can we know the benefit?

If it is for the “environment”, why do we need to hire so many IRS agents? Are they going to be installing solar panels?  No, they are going to be looting the American people.

This is bait and switch. Bait with a vague undefined promise of helping “the environment” while switching to price controls on drugs, higher taxes, corporate welfare, higher deficits, and a vast addition to the ranks of IRA agents.

We have gone through energy transitions before. The question is whether it is a voluntary transition or a forced transition. A good example of a voluntary transition was the transition from whale oil for interior lighting to kerosene. John D. Rockefeller was perhaps the greatest savior of the whales ever. It occurred gradually, required no government money or subsidy, and was embraced by consumers.

Any energy choice should pass the test of the marketplace where voluntary transactions between mutually consenting parties, each seeking their own best interests, are concluded.

What she is backing is a forced transition, using taxes as weapons and subsidies as incentives, to force consumers to make choices they do not wish to make. The evidence for this statement is verified by the policy. A natural transition of energy sources does not require government intervention. It happens because consumers desire it and entrepreneurs desire to profit by satisfying that demand. Choices and competition are present to direct economic decisions and minimize waste to the correct mix of alternatives. If consumers want less expensive and cleaner energy, they will choose it because it is in their best interests. It does not require a centralized government, command, and control approach that likely will make political decisions largely based on pleasing special interests that contribute to campaigns. 

This is not a bill that supports the public’s best interests, rather it supports special interests, i.e. the green industrial complex. And quite alarmingly, this group of interests is largely Chinese communist. They are not reliable partners that have our best interests at heart.

The Biden/Sinema energy transition is a top-down, centrally planned debacle wherein our existing energy infrastructure is being destroyed while the new infrastructure is yet to come on line. This is causing a huge spike in energy prices, contributing greatly to inflationary pressures, and leaving the West, particularly Europe, in the tender hands of Vladimir Putin. This is just stupid geopolitical thinking.

For oil and gas, we leave ourselves vulnerable to Putin. For the rare earth minerals and production capacity for solar and wind, we leave ourselves in the hands of the Chinese Communists.

This bill is bad for the economy, bad for the environment, and bad for our geostrategic interests. We can and should produce all the energy and minerals we can by ourselves.

Senator, you will soon be up for re-election and we will not forget it was your cowardice and bad judgment which unleashed this travesty upon us.

Yes, we know your party is pushing it and you are not completely to blame. But you knew you were the pivotal vote, and it would not move forward without you. So, in that sense, the full responsibility does fall on you. And, you failed us.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

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What Litter Says about America

By Craig J. Cantoni

Especially telling is a water bottle that is marketed as eco-friendly.

Like an archeological dig, the litter that my wife and I pick up on our daily five-mile walk says a lot about American society.

The daily debris comes from all socioeconomic classes. Receipts found among some of the items show that they were bought miles away in impoverished parts of town. Other litter comes from a nearby resort, where guests pay a few hundred dollars a night and then throw stuff out of the window of their luxury car upon departure. 

We’ve walked in every region of the United States, in both urban and rural areas. Judging by the amount of litter and trash along roadsides, public places, and even hiking trails and national parks across the country, civic-mindedness, civic pride, and manners are in short supply in America.

On our daily walks, we’ve picked up fast-food debris, beer cans, and bottles, liquor bottles, water bottles, shards of glass, Styrofoam cups, face masks, latex gloves, cigarette packs, vaping devices, nitrous oxide cartridges, drug paraphernalia, plastic bags, Swiffer cleaning cloths, cardboard boxes, Styrofoam peanuts and other packing material, car parts from accidents, construction materials blown out of the beds of pickup trucks, and even a leather briefcase full of vomit.

On two occasions, we found a wallet that contained a driver’s license, credit cards, and cash. Each time, we promptly mailed the wallet to the owner, who never thanked us.

The volume of litter is greatest the day after Memorial Day and Independence Day. It’s as if Americans show their patriotism by trashing America.

The most telling and ironic piece of litter that we’ve ever picked up was a white and blue designer water bottle, or carton, with the brand name of “Just Water.” The particular bottle was found next to plastic carry-out food containers, which indicated that the items had been discarded together.

Marketed as eco-friendly, Just Water bottles are plastered with feel-good homilies about sustainability and greenness. Let’s look at the wording on the bottles before returning to the commentary.

One side of the square bottles says:

100% Spring Water

+ naturally alkaline

+ plant-based carton

+ sustainably sourced

Another side says:

YOU JUST DID A GOOD THING.

This carton is made almost entirely from plants, which pull CO₂ from the air (instead of adding more). And because the premium we pay for our water goes directly into improving local water infrastructure, we’re actually helping the small American city we source from.

One carton might not save the world, but it’s a start.

SO THANKS,

AND NICE MOVE.

A third side says:

A system that’s out to change everything.

We partner with a small city [Glens Falls] in upstate NY

to buy their excess spring water at 6X the municipal water rate.

which puts more $$$ into their local economy.

Then we package it up in a carton made from 54% paper

and 34% plant-based plastic, totaling 88% renewable content,

which means up to 74% less carbon emissions vs. similarly sized plastic bottles.

So if you’re going to buy packaged water, this one’s better for everyone.

A fourth side gives the following packaging facts, among other information:

Paper 53.9%

Plant-Based Plastic 34.6%

PE [polyethylene] Plastic 8.1%

Foil 3.4%

None of the information says how much energy was used to pump the water, to fill the bottles, to warehouse the bottles, and to ship the bottles across the country from Glens Falls, New York, to Tucson, Arizona, where I found the bottle in question. Nor does it mention that paper production is one of the most energy-intensive and environmentally harmful industries.

Also unsaid is how Just Water compares to municipal water in price, purity, and environmental impact. No doubt, the city water that I drink out of reusable, non-BPA glasses and hiking bottles—after running the water through filters that remove chlorine and other substances—comes out way ahead in these measures.

In any event, Glens Falls can better afford bottled water than Tucson. The New York town has a poverty rate of 14.7%, which is seven percentage points lower than the poverty rate in the City of Tucson. One reason for the disparity is that Glens Falls is 89.6% non-Hispanic white, versus only 43.3% for the City of Tucson. When Tucsonans buy Just Water, they are sending money to New York.

It also should be noted that spring water isn’t necessarily good water. As a case in point, my father-in-law lived in a bucolic hamlet in the Allegheny National Forest in northwestern Penn., not far from the New York border. The hamlet’s unofficial water system was connected to a spring. Sounds good, unless one happened to know that the spring is in the middle of old oil fields and near a former charcoal/chemical plant. Because the water had a strange-looking sheen to it, I didn’t drink it and reluctantly showered with it.

Moreover, if left untreated, spring water can contain lead and arsenic, since these elements occur naturally in the ground.

The discarded bottle of Just Water is a perfect illustration of how Americans fall for green marketing but are oblivious to the trashing of America.   

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

The 33 States Where Our Tax Dollars Go To Support The Non-Working Class thumbnail

The 33 States Where Our Tax Dollars Go To Support The Non-Working Class

By Dr. Rich Swier

The Cato Institute released an updated 2016 study showing that welfare benefits pay more than a minimum wage job in 33 American states, and the District of Columbia.

Even worse, welfare pays more than $15 per hour to stay home in 13 states.

According to the study, welfare benefits have increased faster than minimum wage. It’s now more profitable to sit at home and watch TV than it is to earn an honest day’s pay.

Hawaii is the biggest offender, where welfare recipients earn $29.13per hour, or a $60,590 yearly salary for doing nothing.

Here is the list of the states where the pre-tax equivalent “salary” that welfare recipients receive is higher than having a job:

  1. Hawaii : $60,590
  2. District of Columbia :$50,820
  3. Massachusetts : $50,540
  4. Connecticut : $44,370
  5. New York : $43,700
  6. New Jersey : $43,450
  7. Rhode Island : $43,330
  8. Vermont : $42,350
  9. New Hampshire:39,750
  10. Maryland : $38,160
  11. California : $37,160
  12. Oregon : $34,300
  13. Wyoming : $32,620
  14. Nevada : $29,820
  15. Minnesota : $29,350
  16. Delaware : $29,220
  17. Washington : $28,840
  18. North Dakota : $28,830
  19. Pennsylvania : $28,670
  20. New Mexico : $27,900
  21. Montana : $26,930
  22. South Dakota : $26,610
  23. Kansas: $26,490
  24. Michigan : $26,430
  25. Alaska : $26,400
  26. Ohio : $26,200
  27. North Carolina : $25,760
  28. West Virginia : $24,900
  29. Alabama : $23,310
  30. Indiana : $22,900
  31. Missouri : $22,800
  32. Oklahoma : $22,480
  33. Louisiana : $22,250
  34. South Carolina : $21,910

Hawaii, D.C. and Massachusetts pay more in welfare than the average wage their taxpaying citizens earn there.

Is it any wonder that they stay home rather than look for a job. Time for a drastic change. Americans are not stupid.

Note that California is $18.50 an hour. Are we Nuts or what? How do we undo this type of stupidity

Politicians on the Gravy Train

Now if you think paying the unemployed more than the employed s bad, check out these salaries:

  • Salary of retired United States Presidents $180,000 FOR LIFE Salary of House/Senate—$174,000 FOR LIFE.
  • Salary of Speaker of the House $223,500 FOR LIFE!
  • Salary of Majority/Minority Leader $193,400 FOR LIFE!

NOTE: The average Salary of a teacher—$40,065; Average Salary of Soldier DEPLOYED IN AFGHANISTAN—$38,000.

Nancy Pelosi will retire as a Congress Person at $174,000 Dollars a year for LIFE. She will retire as SPEAKER at $223,500 a year Plus she will receive an additional $193,400 a year for when she was Minority Leader, the fact that she has become rich while in office notwithstanding. That’s $803,700 Dollars a year for LIFE including FREE medical which is not available to us, the taxpayers.

She is just one of the hundreds of Senators and Congresspersons that float in and out of Congress every year!

I think we found where the cuts should be made! From the state houses to the White House.

If you agree please share this column with your friends and on your social media sites.

©Dr. Rich Swier. All rights reserved.

RELATED ARTICLE: States Where Welfare Recipients Are Paid More Than Minimum Wage

Iran has made $44,700,000,000 in Illegal Oil Sales since Biden took office thumbnail

Iran has made $44,700,000,000 in Illegal Oil Sales since Biden took office

By Jihad Watch

Biden’s handlers’ relentless determination to appease the Islamic Republic has ended up lavishly financing the global jihad.

by Adam Kredo, Washington Free Beacon, August 2, 2022:

Iran’s illegal oil trade has boomed under the Biden administration, with the hardline regime selling more than $44 billion worth of its heavily sanctioned oil to malign regimes like China, Syria, and Venezuela, according to figures published by a watchdog group.

From January 2021, when President Joe Biden took office, to June 2022, Iran sold around $44.7 billion in oil primarily to China. The regime’s export revenues between March 2021 and March 2022 from oil, gas, and related products “totaled $39 billion, compared [with] $22 billion for the previous year—a rise of 77 percent and an extra $17 billion,” according to United Against a Nuclear Iran (UANI), a watchdog group that tracks Iran’s network of illegal oil tankers.

“This drastic increase in revenue is not surprising when you look at the increase in oil exports that have occurred under the Biden administration,” UANI chief of staff Claire Jungman told the Washington Free Beacon. “This is the result of terminally lax sanctions enforcement.”

In addition to looser sanctions on Iran, the Biden administration has turned a blind eye to enforcement as it seeks to ink a revamped version of the 2015 nuclear deal. These moves are meant to appease Iran and cajole it into signing a deal that will remove virtually all sanctions on the hardline regime, including its oil trade. China is the primary beneficiary of this policy, with Iranian oil imports quadrupling to the country in 2021 to $23.1 billion. The China-Iran oil pipeline is on pace to hit around $27 billion in 2022, according to UANI’s figures.

If sanctions on Iran are lifted as part of a new nuclear deal, Iran-China trade could reach around $60 billion per year, according to one former U.S. official.

“China made a mockery of the credibility of our sanctions programs and emboldened rogue actors across the world to follow suit,” Gabriel Noronha, a State Department special adviser for Iran during the Trump administration, told the Free Beacon.

Iran’s foreign currency reserves— which were nearly drained under the Trump administration’s maximum pressure campaign—will have “increased nearly tenfold by the end of this year,” according to Noronha.

“The United States refused to enforce its sanctions even while Iran was continuing to advance its nuclear program and its regional terror attacks,” Noronha said. “The result was that Iran’s economy revived itself.”

This financial relief gave Iran a cushion and lessened pressure that could have forced it into accepting a more stringent nuclear deal.

“The Iranian leadership does not feel pressure to finalize the nuclear deal because they’ve already enjoyed the benefits of effective sanctions relief,” Noronha said. “The fact that the Biden administration can’t even manage a return to the notoriously weak [nuclear deal] is evidence of the sheer diplomatic malpractice carried out by the Biden administration, particularly Secretary of State Antony Blinken and U.S. envoy for Iran Rob Malley.”

As Iran and China boost their oil alliance, the U.S. emergency crude stockpiles dropped to their lowest levels in 37 years. This comes after the Biden administration agreed to sell China several million barrels from the U.S. stores, sparking a congressional investigation….

EDITORS NOTE: This Jihad Watch column is republished with permission. ©All rights reserved.

Our Elitist Environmental Experts Are Driving Us Over The Cliff thumbnail

Our Elitist Environmental Experts Are Driving Us Over The Cliff

By Thomas C. Patterson

Leftist thought leaders insist that we are facing an environmental holocaust unless we immediately drastically reduce carbon emissions.

Yet it’s curious. The governing and influence elites demand massive societal sacrifice, while they are apparently not concerned enough to alter their own extravagant lifestyles. They own multiple sumptuous homes, cars, and yachts. They fly individual private jets to their annual meetings in Davos, Switzerland where they assure each other it is their solemn responsibility to save the rest of us from ourselves.

They refuse to engage in thoughtful debate of any notions that challenge their woke orthodoxy. Instead, those advocating ideas different from their own are dismissed as “climate deniers“.

Take electric vehicles. EVs are touted by enviros as the obvious antidote to carbon-belching SUVs. But they aren’t.

Fossil fuels produce most of their electricity. The manufacture and disposal of batteries and the rare metals required have significant environmental impacts. A growing consensus now acknowledges that EVs may produce more net carbon emissions than today’s cleaner-burning gasoline cars.

You would think anyone with genuine concern about the environment might reconsider EV policy. But they don’t engage. Instead, they soldier on, funding yet more subsidies, benefits and charging stations. Taxpayers get dinged for billions with no discernible benefit.

Clearly, to these decision-makers, climate change isn’t about climate, it’s about power. Egomaniacal persons of all stripes throughout history have had the unquenchable desire to control the lives of others and operate the world from their centers of power. Think Hitler, Mao, Stalin, Gates, Zuckerberg – make your own list.

One irony is that the consequences of rising temperatures may not be that harmful. According to Swedish economist Bjorn Lomborg, the Swedish economist, higher temperatures are far less harmful than lower ones.

500,000 people worldwide die annually from heat-related causes, while 4.5 million die from cold. Over the last decade or so, rising temperatures have caused 116,000 more heat deaths yearly, but also 283,000 fewer cold-related deaths per year. How many hysterical accounts of coming devastation would you have to read to learn that?

It’s not the heat but the political responses to climate change that are causing real harm. Low-cost synthetic fertilizer is an innovation that has greatly enhanced our ability to feed the world. Because it is made from natural gas, climate activists have limited its use, even though 1 billion people worldwide are facing the imminent threat of starvation.

Other pressing needs have been drowned out by the insistence on prioritizing climate change. Recent increases in energy prices were exacerbated by Biden’s self-proclaimed war on fossil fuels.  Europe’s refusal to capitalize on its shale reserves and their shunning of nuclear power also resulted in higher energy prices and lower security, as do subsidies of solar and wind, which are still not substantial, reliable suppliers to the electrical grid.

The costs of climate activism will be even higher if governments seriously pursue their stated aim of producing net zero emissions by 2050. The truth is that climate is a global problem.  With our current technologies and geopolitical realities (i.e. China) such goals are simply not attainable.

But the price for such climate grandstanding would be $5 trillion per year for 30 years according to McKinsey. Every single American would have to pay $5000 per year to achieve even 80% of the goal by mid-century.

Ordinary citizens are getting fed up with these elitist obsessions. Polls show climate change far down the list of Americans’ concerns.

40,000 Dutch farmers recently held a mass protest against government mandates that nitrogen -oxide and ammonia emissions, produced by livestock, be reduced by 80%. The government of Sri Lanka resigned after a ban on synthetic fertilizers decimated food production and the economy collapsed

Remember, we’re only in the early phases of the alarmists’ grand plans to re-order society. Already, California and other areas, possibly including Arizona, are facing the threat of rolling blackouts. An EU official recently warned that millions of Europeans may not be able to heat their homes this winter.

Climate change is manageable through mitigation and innovation. The fabulously expensive, impractical nostrums being pushed by our self-appointed experts are a recipe for human suffering and chaos.

*****

Thomas C. Patterson, MD is a retired Emergency Medicine physician, Arizona state Senator and Arizona Senate Majority Leader in the ’90s. He is a former Chairman, Goldwater Institute.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

China Launches World’s Largest Container Ship thumbnail

China Launches World’s Largest Container Ship

By Dr. Rich Swier

Our friend LC wrote the following to us,

I remember hanging a picture of the worlds largest new container ship on my office wall it was owned by Mitsui Ocean Lines (Japanese) and it held either 1,400 or 1,700 TEUs containers (cannot remember for sure, but it was gigantic). And that was only maybe 35 yrs. ago at most. Today, Mediterranean Steamship Corp. (Switzerland) launched a new vessel that holds 24,116 TEUs. Now that is really big, times have changed.

Future World’s Largest Containership Launched in China

Mike Schuler

China State Shipbuilding Corporation (CSSC) has announced the launched of what is claimed to be the world’s largest capacity containership coming in at 24,116 TEUs.

The ship, named MSC Tessa, was floated out of its building dock at the Hudong Zhonghua Shipbuilding’s Changxing Shipbuilding Base, located on Shanghai’s Changxing Island, on August 1. Hudong Zhonghua is one of the major shipbuilding units belonging to state-owned CSSC.

With a carrying capacity of 24,116 twenty-foot equivalent units (TEU), MSC Tessa will surpass Evergreen’s Ever Alot by 112 TEU to take the title of the world’s largest containership.

Ever Alot, the world’s first 24,000 TEU containership, was also built by Hudong Zhonghua Shipbuilding and was only recently delivered in June to a subsidiary of Taiwanese shipping company Evergreen Marine Corporation.

MSC Tessa measures in at 399.99 meters long with a beam of 61.5 meters. It is one of four ultra-large containerships on order at Hudong Zhonghua for Mediterranean Shipping Company, the world’s largest container shipping operator. Delivery is planned for later this year.

CSSC said in addition to the float out, MSC’s No. 4 newbuilding has now entered the building dock, joining No. 2 and No. 3, “forming a spectacular scene of batch construction.”

CSSC, which is a major shipbuilder for China’s PLA Navy, said MSC Tessa and the three other newbuilds, which will be classed by DNV, are designed independently by MSC and it holds no intellectual property rights to the design.

The shipbuilding conglomerate did however share the following design highlights:

  • Hybrid scrubber desulfurization unit
  • Small bulbous bow, large diameter propellers and energy-saving ducts
  • A new bubble drag reduction system which reduces total energy consumption corresponding total carbon emissions by 3%-4%
  • A new shaft generator system which can effectively reduce fuel consumption, optimize EEDI energy efficiency indicators, and reduce GHG emissions.
  • Optimized superstructure, radar mast, and other design features that maximize TEU capacity compared to similarly-sized ships (by dimensions)

QUESTION: Why isn’t America building the world’s largest container ships?

©Dr. Rich Swier. All rights reserved.

How Airline Regulations Hurt Passengers thumbnail

How Airline Regulations Hurt Passengers

By Foundation for Economic Education (FEE)

To help passengers, airline regulations should be scrapped, not increased.


If you’ve been anywhere near an airport in the last two years, you’ve probably gathered that things in the airline industry have changed. Delays and cancelations are causing more headaches than ever, baggage mishandling is up, unruly passenger cases are up…it’s really a mess. Unsurprisingly, flight complaints remain significantly higher than pre-pandemic levels.

The most common complaint category is refunds. Many passengers feel that airlines have been bad about issuing refunds for missed flights, and some have been calling on the government to do something about this problem.

On Wednesday, the Department of Transportation responded to these calls with new proposed regulations that would create stricter rules for airlines regarding refunds.

According to current regulations, airlines are required to give refunds if a flight is canceled, or if a flight experiences a “significant delay” or change and the passenger chooses not to travel. However, under the current rules, the airline gets to decide what constitutes a “significant delay.” Unsurprisingly, passengers don’t always agree with the decisions airlines make.

“In practice, the circumstances in which airlines are required to make refunds have often been subject to interpretation,” writes Alison Sider in the Wall Street Journal. “The government doesn’t define significant change or delay in current rules, leaving it up to airlines to determine that.”

The new rules being proposed by the DOT are designed to eliminate the ambiguity in the current rules. Under the proposed rules, refunds would be mandatory for passengers who choose not to fly if the departure or arrival time changes by more than 3 hours for a domestic flight or 6 hours for an international flight. The new rules would also require refunds for missed flights if there is a change in the departure or arrival airport, an added connection, or a change of aircraft that constitutes a “significant downgrade” in the traveler’s experience.

Aside from clarifying (and, in practice, expanding) when refunds are mandatory, the proposed rules would also require airlines to issue non-expiring vouchers for passengers who don’t want to fly because of public health concerns or who can’t fly due to public health regulations such as stay-at-home orders or border closures.

“When Americans buy an airline ticket, they should get to their destination safely, reliably and affordably,” Transportation Secretary Pete Buttigieg said in a press release. “This new proposed rule would protect the rights of travelers and help ensure they get the timely refunds they deserve from the airlines.”

At first glance, it’s easy to think that these regulations would be a pure win for consumers. After all, doesn’t it help to have more refunds and vouchers?

Yes, on the surface. But everything comes with a cost, and airline regulations are no exception. In a world of scarcity, you can’t get something for nothing. There’s no such thing as a free refund.

So where is the cost? Here, as in many cases, the cost is hidden, and it requires some digging in order to find it.

A good place to start is to look at this policy from the airline’s perspective. Now, this isn’t to say that airlines and their profit margins are the only thing that matters. Far from it. What I’m saying is, in order to help consumers, it’s important to understand how airlines make decisions and what incentives they face.

When an airline gets hit with a regulation, whether it be about safety or staffing or refund policies, the airline is essentially forced to take on additional costs. When they have to pay out more for refunds, for instance, their average cost per flight goes up. The result is a leftward shift in the supply curve and a higher price.

Now, some airlines may choose to offset the price increase by cutting back on other perks and services (meals etc.), but consumers ultimately pay somehow for the privilege of having their guaranteed refunds.

To give an analogy, say the DOT decided that, in the name of consumer welfare, every flight needed to have at least 20 flight attendants. Undoubtedly, consumers would have a better experience, but clearly that flight is going to be more expensive than a flight with fewer attendants.

The point is, there’s always a tradeoff between perks and price. Generous refund policies are nice to have, but just like generous staffing and generous safety standards, they come at a premium.

So far we’ve established that, all else equal, the more-consumer-friendly refund policies being proposed by the government will lead to higher prices because they impose higher costs on airlines. The benefit is that more people get refunds. The cost is more-expensive airfare.

So, is this a good tradeoff? Is the benefit to consumers worth the cost? To answer this question, we need to understand how markets deal with tradeoffs. Let’s begin by considering two hypothetical extremes.

Luxury Air is an airline that cares deeply about customer satisfaction. To show this, they have a very generous refund policy, even more generous than what the government requires. They will give anyone a refund for any reason at any time. Naturally, they have to charge a lot more than anyone else to stay in business with that kind of policy, so that’s what they do. Lots of perks. High prices.

Frugal Air is an airline that cares deeply about affordability. To show this, they have the lowest prices in town. They will always match their competitors. Naturally, they can’t afford to be very generous with their refund policies, so they don’t give any refunds for any reason. It’s a bit of a risk, but hey, you get what you pay for.

Now, back to the real world. In the free market, airlines begin by offering a combination of prices and perks somewhere along the spectrum from Frugal Air to Luxury Air. Then, consumers patronize the airlines that best satisfy their wishes. If consumers don’t think it’s worth it to pay for Luxury-Air-style refund policies, the businesses offering those flights will go under. Likewise, if consumers are turned off by “no refunds for any reason,” those kinds of policies will also be weeded out.

What we’re left with is the airlines that offer the optimal tradeoff between perks and price as judged by consumers. Thus, through a process akin to natural selection, consumers “choose” the refund policies and corresponding prices that best suit their wishes. The policies that the market “selects for” are the ones that consumers prefer the most. In other words, the market naturally gravitates toward a sort of goldilocks zone.

Now, consider what happens when a regulator comes in. Essentially, they mandate a specific spot on the Frugal-to-Luxury spectrum and force airlines to be “no less luxurious” than that. A mandate to provide refunds in certain circumstances is a mandate to provide extra perks, which invariably leads to higher prices. But—and this is the key—the “degree of luxury” they mandate is arbitrary, and the fact that they have to force the market up to it indicates that it is not in the goldilocks zone where consumers are happiest.

If consumers really believed those better refund policies were worth the extra expense, they would have favored airlines that offered that tradeoff, and the industry as a whole would have gone in that direction to maximize profits (that is, the goldilocks zone would be at a higher degree of luxury). The fact that the airlines aren’t offering them for the most part is all the evidence we need to conclude that consumers don’t think the benefit of more refunds is worth the cost. Thus, imposing a policy like this is most likely a net harm to consumers.

Again, the analogy to flight attendants is a bit easier to conceptualize. If the market is selecting for 3 attendants per flight and $100 tickets, a government mandate of 5 attendants per flight (which makes for, say, $120 tickets) pushes consumers away from their preferred perk/price combination. Hence, the regulation designed to help consumers ultimately ends up hurting them, because even though they got an extra benefit, it wasn’t worth the extra cost.

Consumers are perfectly capable of regulating airlines through their purchasing decisions—they do it every day. The DOT might think they’re helping, but they’re really not. Airline passengers are far better off when they, not bureaucrats, decide how airlines are run.

This article was adapted from an issue of the FEE Daily email newsletter. Click here to sign up and get free-market news and analysis like this in your inbox every weekday.

AUTHOR

Patrick Carroll

Patrick Carroll has a degree in Chemical Engineering from the University of Waterloo and is an Editorial Fellow at the Foundation for Economic Education.

EDITORS NOTE: This FEE column is republished with permission. ©All rights reserved.

HARVARD-CAPS HARRIS POLL: Biden Approval Remains at Historic Lows thumbnail

HARVARD-CAPS HARRIS POLL: Biden Approval Remains at Historic Lows

By Dr. Rich Swier

Voters overwhelmingly believe we are in or headed for a recession. Inflation and affordability are the top issue across the political spectrum.


NEW YORK, NY /PRNewswire/ — Stagwell (NASDAQ: STGW) today released the results of the July Harvard-CAPS Harris Poll, a monthly collaboration between the Center for American Political Studies at Harvard (CAPS) and the Harris Poll, a Stagwell research and insights firm.

Four in ten voters report feeling pessimistic about their lives over the next year in the face of historic inflation levels and data suggest we are looking at another hyper-partisan election cycle. The topics surveyed in this month’s poll include the political impact of Roe vs. Wade, voter views on the Biden administration energy policy, the January 6 hearings, and the 2024 presidential election. Download key results here.

“Democrats can still hold onto hope ahead of the midterms, with the race a dead heat despite President Biden’s approval rating being at a historic low and nearly half of Americans believing the country is currently in a recession,” said Mark Penn, Co-Director of the Harvard-CAPS Harris Poll. “Looking to 2024, most voters are still open to a moderate independent candidate, but among Republicans, Florida Governor Ron DeSantis is solidifying his status as the second choice. In these divided times, voters themselves seem to be holding contradictory opinions on issues such as energy policy and Trump’s legal culpability in the January 6 riots.”

GOP ON THE RISE AS ECONOMY STRUGGLES 

  • Biden’s approval remains at a historic low of 38%.
  • 84% think the economy is either in recession or will be within the next year.
  • Perceptions on inflation seem to have peaked slightly: 33% of voters, up from 28% last month, think the U.S. economy is strong today, and inflation – while still the number one issue facing the country – fell 6 points.
  • Approval rating of the Republican Party neared 50 percent for the first time since February 2022 in our poll – now 5 points higher than the Democratic party approval rating.

2022 MIDTERMS ARE IN DEAD HEAT, WITH INFLATION AND ROE VS. WADE AS THE DRIVING CONCERNS

  • The generic Congressional ballot is split 50-50, with Democrats and Republicans voting along party lines; Independents lean with Republicans 54-46
  • Inflation and affordability is overwhelmingly the biggest concerns for both Democrats and Republicans, followed by Abortion Rights for Democrats and Immigration for Republicans
  • Democrats have made little progress mobilizing on abortion so far: 39% of voters, up from 36% in June, say the Supreme Court’s decision has made them more likely to vote for a Democrat in the midterms

VOTERS SEEKING FRESH CHOICES ON THE BALLOT IN 2024

  • Voters are tired of hyper-partisanship: Strong majorities of over 6 in 10 voters don’t want either Joe Biden on Donald Trump to run in 2024
  • A majority open to considering a “moderate independent candidate” in case the choice is between Trump or Biden.

ENERGY POLICIES – VOTERS BLAME BIDEN, ARE SKEPTICAL ABOUT CLIMATE ‘EMERGENCY’ 

  • 59% of voters oppose the Biden administration’s energy and gas policies, and 63% think they are responsible for most of the increase in gas prices
  • 45% think climate change is an immediate threat, including 66% of Democrats and 41% of independents. Voters want the administration to emphasize lower prices and energy independence over climate change.
  • Climate change is an immediate threat to 45% of voters, including 66% of Democrats and 41% of independents
  • Voters are wary of the climate issue being politicized: Only four in ten say that an emergency climate declaration by the Biden administration would be legitimate

JAN 6. HEARINGS & ELECTORAL COUNT – VOTERS SPLIT ON DETAILS BUT WANT COUNTRY TO MOVE ON

  • Voters are split on how and whether Trump should be held responsible: 53% of voters think Trump should face criminal indictment for his actions on January 6, but 54% think he should be allowed to run for president again.
  • Nevertheless, 69% think it is time to unite the country and heal.
  • Voters are split 50-50 on whether Congress should be involved in certifying presidential elections instead of the courts. Still, clear majorities believe the role of the Vice President and state governors should be purely ceremonial.

THE U.S. ON A GLOBAL STAGE – TAIWAN 

  • 48% of voters think Taiwan is neutral towards the U.S., 36% think it is an ally, and 16% think it is an enemy
  • 52% of voters support senior U.S. government officials visiting Taiwan even if China has signaled it might act military to prevent them from doing so—surprisingly, 59% of Democrats support it, over 10 points higher than Republicans and Independents.

The July Harvard-CAPS Harris Poll survey was conducted online within the United States from July 27-28, 2022, among 1,885 registered voters by The Harris Poll and HarrisX. Follow the Harvard CAPS Harris Poll podcast at https://www.markpennpolls.com/ or on iHeart Radio, Apple Podcasts, Spotify, and other podcast platforms.

About The Harris Poll

The Harris Poll is a global consulting and market research firm that strives to reveal the authentic values of modern society to inspire leaders to create a better tomorrow. It works with clients in three primary areas: building twenty-first-century corporate reputation, crafting brand strategy and performance tracking, and earning organic media through public relations research. One of the longest-running surveys in the U.S., The Harris Poll has tracked public opinion, motivations, and social sentiment since 1963, and is now part of Stagwell, the challenger holding company built to transform marketing.

About the Harvard Center for American Political Studies

The Center for American Political Studies (CAPS) is committed to and fosters the interdisciplinary study of U.S. politics. Governed by a group of political scientists, sociologists, historians, and economists within the Faculty of Arts and Sciences at Harvard University, CAPS drives discussion, research, public outreach, and pedagogy about all aspects of U.S. politics. CAPS encourages cutting-edge research using a variety of methodologies, including historical analysis, social surveys, and formal mathematical modeling, and it often cooperates with other Harvard centers to support research training and encourage cross-national research about the United States in comparative and global contexts. More information at https://caps.gov.harvard.edu/.

About Stagwell

Stagwell is the challenger network built to transform marketing. We deliver scaled creative performance for the world’s most ambitious brands, connecting culture-moving creativity with leading-edge technology to harmonize the art and science of marketing. Led by entrepreneurs, our 12,000+ specialists in 34+ countries are unified under a single purpose: to drive effectiveness and improve business results for their clients. Join us at www.stagwellglobal.com.

©All rights reserved.

The Democrat Economists in Charge of Deciding ‘If’ There’s a Recession thumbnail

The Democrat Economists in Charge of Deciding ‘If’ There’s a Recession

By Jihad Watch

Why the Biden administration wants the “experts” to determine if there’s a recession.


Facebook is now censoring posts and videos about the Biden recession by using partisan fact-checks from left-leaning outlets to wrongly condemn them as “misinformation”.

The fact checks rely on the same argument being propounded by the Biden administration and its media allies that only the National Bureau of Economic Research and, more specifically, its Business Cycle Dating Committee, can officially decide if there’s a recession.

And anyone who isn’t on the Committee talking about a recession is spreading “misinformation”.

That’s an obvious problem because 2 out of 3 American voters, including even 53% of Democrats, believe that there’s a recession. That’s a whole lot of people to censor.

Totalitarian Communist regimes in Russia and China have criminalized discussions about domestic economic problems, and the American Left is trying to deploy its propaganda machine of partisan media outlets, fact checkers and Big Tech monopolies to duplicate their efforts.

It’s bound to fail.

Declaring that only a small group of “experts” is allowed to call it a recession despite the fact that two consecutive quarters of a shrinking economy is the definition of a recession is a gatekeeping fallacy.

And the experts are hardly any more objective than the fact checkers citing them.

Peter Blair Henry, the current vice chair of the National Bureau of Economic Research, was the head of the Obama campaign’s economics advisory team and then served on his transition team. And Henry has promoted Biden’s disastrous inflationary “Build Back Better” plan.

Of the eight economists on the Business Cycle Dating Committee, the team that the White House and the media insist are the only ones who get to decide if it’s a recession, several held posts in the Obama administration, and others were clearly aligned with the Democrats.

Christina and David Romer, a husband and wife team, already an innate conflict of interest, were described as “staunch Obama supporters” in an IMF profile. Romer had provided “briefing memos” to Austan Goolsbee, Obama’s radical economic adviser, during the campaign, and she went on to chair Obama’s Council of Economic Advisers. In that role, she aggressively pushed for an even bigger “stimulus package” than the one that damaged the economy under Obama.

Robert J. Gordon compared Trump to Hitler and declared that he would miss Obama’s “eloquence”. He claims that America’s growth is over and proposes a program of a “progressive tax code”, eliminating deductions, legalizing drugs, and providing a lot more welfare.

Gordon had joined lefty economists in arguing that the era of permanent economic malaise was upon us. During the 2016 election, his “The Rise and Fall of American Growth” was frequently cited as expert evidence that serious GDP growth of the kind Trump was urging was impossible.

The economist, or someone by that name from his university, appears to be a donor to Democrat candidates, the DNC and at least one anti-Republican PAC.

Gordon was also a signatory to an open letter titled, “Economists Oppose Trump’s Re-Election”.

The pro-Biden and anti-Trump letter included the contention that Trump “claimed to have the unique ability to generate growth (in real GDP) of between 4% and 6%, but never surpassed 2.9% in his first three years in office. Furthermore, analysts at Goldman Sachs and Moody’s Analytics have projected that Joe Biden’s economic plans, if implemented, would actually generate faster growth in both employment and real GDP.”

Gordon, along with other lefty academics, was expressing a political preference for Biden over Trump while claiming that this position was backed up by their “expert” opinion.

Biden’s economic plans led to a massive disaster, but there’s no reason to think that Gordon or any of the other economists involved in this letter are ready to admit that they were wrong.

And that Biden has inflicted a recession on America.

Another of the members of the Business Cycle Dating Committee who also signed the anti-Trump and pro-Biden letter is Mark Watson of Princeton. Watson was also the co-author of an infamous argument claiming that the economy performs better under Democrat presidents.

His work was cited by Obama’s Council of Economic Advisers co-authored together with James Stock, a member of the council who serves as another member of the Business Cycle Dating Committee.

Obama had appointed Stock to his Council of Economic Advisers in 2013. Stock was both an Obama and a Hillary donor. He also contributed $2,800, close to the maximum, to Biden.

The political conflict of interest in determining that the economy is in recession is obvious.

Of the remaining Business Cycle Dating Committee members, Robert Hall appears to have donated to a Democrat candidate. James Poterba had vocally praised Obama’s economic council members, calling them  “realists and pragmatists who are looking for what will work to address the particular problems we are facing”.

What that means is that of the eight Business Cycle Dating Committee members, a quarter are former members of Obama’s Council of Economic Advisers, half are public Obama supporters, one is a Biden donor, two have expressed public opposition to Trump and support for Biden.

This group of experts is anything but non-partisan and the lean is anything but conservative.

It’s fair to say that 6 of the 8 Business Cycle Dating Committee are either Democrats or aligned with Democrats. Another is ambiguous and only one has expressed no recent public political preference.

It’s obvious why the Biden administration is betting that a group stocked with its own political allies will be less likely to state the obvious about the state of the economy. Democrats, their media and their tech monopolies are using expert gatekeeping by their own allies to deny that there’s a recession even though the vast majority of Americans know that it’s already here.

It doesn’t take the Business Cycle Dating Committee to state the obvious. All it can do is stonewall what everyone can see around them. Beyond their political allegiances, many members of the Committee have a history of being fundamentally wrong about the economic measures of the Obama and Trump administrations. Many supported the Obama era inflationary spending that deepened our national debt and suppressed our economic potential.

There’s no reason to think they’ve learned to be any more correct or any less biased.

The new technocratic totalitarianism insists that the nature of reality is controlled by small groups of partisan handpicked experts and that ordinary people have no right to disagree, and that furthermore it is the job of the tech monopolies who control the marketplace of ideas to immediately stamp out such dissent as “disinformation” and a “threat to democracy”.

But reality isn’t controlled by experts and the efforts by the Biden administration to build a wall of experts around reality is as doomed to failure as similar measures in totalitarian states.

After first denying the reality of inflation, the Biden administration is trying to deny the recession.

The same experts who tried to deny the disastrous effects of Obama’s economy are trying to tell the same lies for Biden. But no amount of lies will turn a recession into a recovery.

AUTHOR

DANIEL GREENFIELD

Daniel Greenfield, a Shillman Journalism Fellow at the Freedom Center, is an investigative journalist and writer focusing on the radical Left and Islamic terrorism.

EDITORS NOTE: This Jihad Watch column is republished with permission. ©All rights reserved.

The Inflation ‘Reduction’ Act – Really?? Are You Kidding?? Calling Senator Sinema thumbnail

The Inflation ‘Reduction’ Act – Really?? Are You Kidding?? Calling Senator Sinema

By John R. Ammon

The $739 billion Inflation ‘Reduction’ Act of 2022 – really?? Are you kidding?? Joe Manchin, Chuck Schumer and Joe Biden are attempting to rapidly hoist this Senate bill on America before the coming recess to reduce inflation!

Does any sane American (sane = common sense, attached to reality) actually believe this totally partisan and desperate legislation arriving months before the November 8th reckoning will reduce the Biden inflation caused by uncontrolled federal spending and the attack on energy in America?

After appearing as a rare, sane and pro-American Democrat, Manchin now claims his elevation to the world’s oldest profession from the political profession, a close second.

This legislation, to be passed by reconciliation (50 votes plus the Vice-President), will be economically devastating to Americans and make the economic crisis in America much worse as recession deepens and severe inflation goes higher.

The bill includes a higher tax burden on all classes of taxpayers and small businesses (where American jobs are created), hundreds of billions for the Green New Deal, over $250 billion taken from Medicare and a host of other hostile provisions hurting the working folks and producers in the nation. The enviro-left-Democrat base is cheering the Democrat Senators on to ‘save the planet’.

Who is left among the Senate Democrats to stop this assault on economic and energy policy, in effect a crushing of the middle and lower classes? There is one person – the one who previously stood with Joe Manchin against eliminating the Senate filibuster, against packing the Supreme Court, against spending 5 trillion dollars on Build Back Better, etc., etc.

It is Kyrsten Sinema of Arizona. Contact her now and be loud and clear – her political future is at stake and she may be the only Senator who can actually stop this craziness and threat to America’s future.

She is on the ballot in 2024 and has billed herself as an independent, maverick styled politician. Remind her that Arizonans reject this damaging, partisan election year legislative stunt and will reject her if her name is on it.

Let Senator Sinema know that her name is now the only important name – she is the one Senator who can kill this bill at a time of recession and galloping inflation. The state she represents is polling decidedly against the Inflation Reduction Act of 2022 and a vote for it by her will not be forgotten or forgiven.

See the TAKE ACTION link below to contact Senator Sinema and inform her of the consequences of caving to Chuck Schumer and Joe Biden.

Although Senator Mark Kelly is a predictable and loyal shill for Chuck Schumer and does what he is told, he is on the ballot this November and is very vulnerable. Delivering the same message to Kelly is appropriate and might be helpful even if his vote is quite predictable.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

The Biden Administration Says US Not in a Recession, but Federal Statutes Say Otherwise. Who is Right? thumbnail

The Biden Administration Says US Not in a Recession, but Federal Statutes Say Otherwise. Who is Right?

By Jon Miltimore

Is the US economy in recession? The answer is, paradoxically, both easier and more complicated than you might think.

As expected the United States posted negative growth for the second consecutive quarter, according to government data released on Thursday.

“Real gross domestic product (GDP) decreased at an annual rate of 0.9 percent in the second quarter of 2022, following a decrease of 1.6 percent in the first quarter,” the US Bureau of Economic Analysis announced.

The news prompted many outlets, including The Wall Street Journal, to use the R word—recession, which historically has been commonly defined as “economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.”

The White House does not agree, however, and following the release of the data, President Biden said the US economy is “on the right path.” 

The comments come as little surprise. Treasury Secretary Janet Yellen had recently hinted that the White House would contend the economy wasn’t actually in a recession even if Q2 data indicated the economy had contracted for a second consecutive quarter.

“There is an organization called the National Bureau of Economic Research that looks at a broad range of data in deciding whether or not there is a recession,” Yellen said. “And most of the data that they look at right now continues to be strong. I would be amazed if they would declare this period to be a recession, even if it happens to have two-quarters of negative growth.”

“We have a very strong labor market,” she continued. “When you are creating almost 400,000 jobs a month, that is not a recession.”

Yellen is not wrong that NBER, a private nonprofit economic research organization, looks at a much broader swath of data to determine if the economy is in a recession, or that many view NBER’s Business Cycle Dating Committee as the “official recession scorekeeper.”

So White House officials have a point when they say “two negative quarters of GDP growth is not the technical definition of recession,” even though it is a commonly used definition.

On the other hand, it’s worth noting that federal statutes, the Congressional Budget Office, and other governing bodies use the two consecutive quarters of negative growth as an official indication of economic recession.

Phil Magness, an author, and economic historian points out that several “trigger” provisions exist in US laws (and Canadian law) that are designed to go into effect when the economy posts negative growth in consecutive quarters.

“For reference, here is the definition used in the Gramm-Rudman-Hollings Act of 1985,” Magness wrote on Twitter, referencing a clause in the Act. “This particular clause has been subsequently retained and replicated in several trigger clauses for recessionary measures in US federal statutes.”

It’s worth noting that Magness doesn’t contend the two consecutive quarters definition is the best method of determining whether an economy is in a recession, but simply points out that claims that it’s an “informal” definition of recession are untrue.

“It may not be a perfect metric, but it has a very long history of being used to determine policy during recessions,” Magness writes.

Some readers may find it strange that so much heat, ink, and energy is being spent on something as intangible as a word, which is a mere abstraction that has no value. And some policy experts agree.

“Whether [we’re] in a technical recession is less interesting to me than the following 3 questions,” Brian Riedl, an economist at the Manhattan Institute, recently said. “1) Are jobs plentiful? (Yes – good) 2) Are real wages rising? (Falling fast – bad) 3) Is inflation hitting fixed-income fams? (Yes – bad.)”

Others contend that definitions matter, and that by ignoring the legal definition of recession, the Biden White House can continue to argue that the US economy is “historically strong” even as economic growth is negative, inflation is surging, and real wages are crashing.

As Charles Lane recently pointed out in the Washington Post, words have power. He shares a colorful anecdote involving Alfred E. “Fred” Kahn, an economist who served in the Carter Administration who was instructed to never use the words “recession” or “depression” again.

In 1978, Kahn — a Cornell University economist in charge of President Jimmy Carter’s inflation-fighting efforts — said that failure to get soaring prices under control could lead to a “deep, deep depression.” Carter’s aides, perturbed at the possible political fallout, instructed him never to say that word, or “recession,” again.

We don’t know whether this instruction stirred the wrath of Kahn, a verbal stickler notoriously disdainful of cant and euphemism; in a previous government job, he had sent around a memo telling staff not to use words like “herein.”

It did trigger his wit, though: In his next meeting with reporters, Kahn puckishly said the nation was in “danger of having the worst banana in 45 years.”

Lane’s anecdote about Kahn is instructive because it reveals something important about these debates. While they may have a certain amount of importance as far as political spin goes, they are meaningless as far as economic reality is concerned. Substituting the word “banana” for recession did not change economic conditions or the economic outlook one bit, which no doubt was precisely Lane’s point.

My colleague Peter Jacobsen made this point effectively earlier this week.

“[You] don’t need a thermometer to feel if it’s hot outside,” he wrote. “Economic issues, especially inflation, top the list of concerns for voters going into the 2022 midterms, and it isn’t particularly close. So officially defined recession or not, it doesn’t really matter.”

Moreover, Jacobsen explains, macroeconomic data like GDP have historically been the tool of politicians and bureaucrats, who use them to justify economic interventions.

“When GDP numbers fall below a certain level, politicians can use that data to try to push income back up. Or perhaps when the economy is ‘running too hot’ politicians can use fiscal and monetary policy to slow down the economy.

All of these metaphors about economies running hot or stalling are based on a central planning view of the economy. In this view, the economy is like a machine which we can adjust to bring about the proper results. Without macroeconomic statistics, central planners have fewer means by which to justify particular interventions. We can’t claim we need stimulus if we can’t point to some data indicating it’s necessary.”

The takeaway here is an important one. We don’t need “bureaucratic weathermen” telling us when the economy is good or bad any more than we need them “managing” the economy with the money supply, which is precisely how we got here in the first place.

So while the debates over the R word are likely to continue, it’s important to remember it doesn’t really matter if you call this economy a recession or a banana. The fundamentals speak for themselves.

*****

This article was published by FEE, Foundation for Economic Education and is reproduced with permission.

TAKE ACTION

The $739 billion Inflation Reduction Act of 2022 being pushed through the U.S. Senate to be passed by reconciliation (50 votes plus the Vice President) before the upcoming August recess is a threat to America’s economy and the well-being of all Americans. The article above makes clear that Senator Kyrsten Sinema is the one Democrat vote that America is looking at. She alone can stop this legislation. Please contact her at her office locations in Washington, D.C. and in Arizona by phone and letter. Click the red TAKE ACTION link below for Senator Sinema’s contact information.

Although Senator Mark Kelly is a do-as -Chuck Schumer- tells-you-to-do partisan shill, contacting him may be helpful given his significant vulnerability in the November general election. His contact information is also found at the TAKE ACTION link below. We suggest that copying him on your letter to Senator Sinema may possibly have some impact on his voting behavior. Calling his office is also important – the staffs do score the relative positions of constituents and this too may influence the voting behavior.

New housing market data reveals a stunning shift as these 21 of the top 50 metro areas show price declines for June thumbnail

New housing market data reveals a stunning shift as these 21 of the top 50 metro areas show price declines for June

By Edward Pinto

In the Fortune article below Shawn Tully interviews Ed Pinto and cites AEI Housing Center data on HPA to discuss the cooling housing market. He also writes about the geography of these changes, as western metros face the most drastic downturns in HPA.


It’s finally happening. After soaring 40% from pre-pandemic levels in the greatest boom in decades, home prices peaked in June, and started falling in July. That’s the stunning, sudden shift revealed in a new set of data just introduced by the American Enterprise Institute’s Housing Center, one of the top sources for in-depth, city-by-city numbers on all things housing, from appreciation to inventories and mortgage originations. “The market just reached a turning point,” says Ed Pinto, the AEI Housing Center’s director. “Prices will keep falling on a national basis for August through December. It’s likely that we’ll see declines in around four out of five metros in some of the months ahead.”

Until now, the AEI had measured prices primarily on a year over year format. And by that yardstick, housing still looked strong in June. That month, the AEI found that the value of the average home had grown by 15% from June of 2021. But its data also showed over the 12-month span, “home price appreciation,” or HPA, was slowing fast, down substantially from a summit of 17.5% in April. The question that pullback posed for America’s homeowners: What’s happening right now, week by week or month by month? Is it possible that in my city, in Atlanta or Phoenix or Raleigh, prices are actually starting to decline?

The AEI’s new data answers that query. The measure displays price changes from one month to the next. Hence, the numbers provide an up-close view of precisely when the patterns turn, by how much, and what the moves foreshadow. They’re a guide to reading the market’s pulse. The AEI’s figures are based on actual closings for the month, as reported in the public records. Pinto deploys a methodology that compares sales of similar quality homes, eliminating distortions from shifts in the sales “mix”––for example, a deceptive boost to average prices as a higher share of pricey homes sell in June than in May.

An astounding number of markets are already posting declines

The AEI calculated the figures for the nation’s 50 most active housing markets. The AEI’s below, “Home Price Appreciation (Month over Month),” shows the changes from one month to the next from the start of 2019 through June of this year. Let’s begin with the national data. The overall market has been on such a relentless rampage, for so long, that only twice in that period have prices retreated, and each time by just 0.1%. As recently as January, America’s monthly HPA was 2.6%, sliding in May to a still robust 1.1%. But in June, appreciation hit a virtual freefall, shrinking to just 0.2%.

View Home Price Appreciation (Month-Over-Month) Chart.

Behind that national downshift are astounding reversals in sundry cities that were thriving just months ago. In June of 2021, only four metros showed a fall in prices from May and last year, the only May-to-June loser was Louisville at a tiny -0.1%. In April, not a single one of the fifty metros endured a decline from March. But this June, no fewer than 21 locales suffered drops from their May prices, some of them big. In general, the steepest falls came in the expensive west coast markets, as well as western metros that gained legions of buyers from the exodus from California. Eleven of the hardest-hit addresses fit this category. The biggest loser was San Francisco at -3.8%, followed by San Jose (-3.2%). Among the other western cities logging large declines are Seattle (-1.8%), Los Angeles (-1.5%), Portland (-1.3%), Denver (-0.9%) and Phoenix (-0.6%). Almost all of these metros were rocking as recently as February, with San Francisco up 2.8% over January, San Jose ahead 3.9%, and Seattle gaining 3.5%.

“The clearest trend is the pullback in these west coast cities, and those influenced by the California craziness,” says Pinto. In these places, the giant price increases in the last two years, from already expensive levels, has so diminished affordability that the fast-shrinking ranks of buyers are hammering values in spite of historically low volumes of homes for sale. From the fourth quarter of 2019 to Q1 of this year, prices jumped from $1.2 to $1.6 million in San Jose, $575,000 to $819,000 in Seattle, from $466 to $623,000 in Denver, and from $340,000 to $516,000 in Phoenix. The only out West markets that still showed strength were Las Vegas, a venue that’s cooling but still managed a 0.2% increase over May, and Boise, where prices waxed 1.8%, maintaining a record of consistent, month over month advances. Boise keeps thriving as a favorite destination for work-at-home refugees from California who can sell a home in, say, San Jose, get a much bigger abode at half the cost in their adopted city, and still bank hundreds of thousands of dollars.

In recent months, the hottest markets have clustered in the sunshine state. Cape Coral, which was scoring year over year increases in the mid-30% range, is backpedaling fast (you can read my recent feature on Cape Coral’s market here). Its gain of 2.8% from April to May flip-flopped to a negative 1.0% in June. Tampa, North Port, Orlando, Jacksonville and Miami are all way down from February increases, but still advanced between 0.2% and 1.1%.

By contrast, a number of older metros that didn’t experience big price gains demonstrated remarkable resilience, for a simple reason: Many remain relatively cheap. St. Louis, Nashville, Boston, Providence, Philadelphia, Kansas City, Columbus and New York all ranked in the top ten for May to June gains. Tied for first place with Boise the Big Apple, which garnered a month over month increase of 1.8% and is one of few stalwarts that appear on a rising trajectory.

The downdraft in June radically transforms the outlook for this year and 2023

Pinto also gets a good look at where prices are headed by studying “rate lock” data from Optimal Blue. Those numbers reflect contract prices for sales that will close in around 90 days. For Pinto, the rate lock trend points to falling prices, at the national level, for July through December of 2022. “We expect the national month over month HPA to go negative in July for the first time in years,” he says. “From there, prices should fall 3% to 5% from June levels by year end. Those total increases will accumulate gradually over the seven months from June to December.” By year end, Pinto expects that home prices will still be 4% to 6% above December of 2021, but probably remain on a downward path.

Pinto forecasts that if overall prices slide by around 4% from here to year end, a far larger number of metros than the 21 that were negative in June will be soon posting falling prices from month to month. “I wouldn’t be surprised if some months, we see 40 cities showing declines,” he says.

So where does Pinto see values heading in 2023? It would seem that if prices are falling in December, they’d keep tumbling through most of 2023. But that’s not necessarily the most likely scenario, says Pinto. “We’ve seen a decline in mortgage rates in recent weeks from 6% to around 5.5%,” says Pinto. “If rates rates continue to recede, that would give a boost to appreciation.” He points out that although inventories are growing, stocks remain extremely slim. “We’re still at around one month of supply at the current level of demand,” he says. “To get declining prices, we’d need to see seven ‘months of supply, and that could be a long way off.” For Pinto, it’s highly possible that a combination of stable or falling rates, and limited volumes of homes for sale, could sustain gains of 4% to 6% next year.

Still, Pinto says it’s never been more difficult to predict housing ‘s future. “There are so many factors pushing and pulling in different directions,” he says. “My crystal ball is getting foggier.” The AEI’s new monthly numbers enable homeowners to watch the market’s course, not just over long spans, but as it evolves. Folks are super-anxious about what today’s tumultuous times mean for the future of their biggest asset. They want to see whether the value of their ranch of colonial waxed or waned in the last 30 days. Now they can. The AEI numbers don’t hand homeowners a crystal ball. But following the AEI’s fresh data will keep your thumb flush on the market’s pulse of the market that, for most Americans, counts more than any other by far.

©Edward Pinto. All rights reserved.