AIER’s Everyday Price Index Rises a Record 12.8 Percent Over the Last 12 Months thumbnail

AIER’s Everyday Price Index Rises a Record 12.8 Percent Over the Last 12 Months

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By Robert Hughes

Editors’ Note: There are different ways to calculate inflation. Unfortunately, the government tends to dominate the field with its CPI or Consumer Price Index. But the government is often not an unbiased observer. For one thing, the government changes its methodology from time to time, making historic comparisons challenging. Government historically causes inflation in most cases through excessive monetary creation to fund its chronic inability to control spending. As a consequence, they have a vested interest in downplaying the blowback they get from an angry public. In the realm of a conflict of interest,  Social Security benefit adjustments are indexed to their numbers, hence they have a financial interest in understating inflation. So critics think they tinker with the data, especially using hedonic accounting. This is an attempt to correct for quality changes that occur over time. They also can manipulate the weighting of the index. They also use rental equivalence as opposed to the outright cost of real estate. AIER some years ago developed its own proprietary index and it has been quite good at assessing inflation closer to reality.  Right now, they suggest prices are up over 12% while the government suggests they are up about 8.5%.  That is a whopping difference of almost 50%. If you choose to accept government numbers that is your privilege. The CPI still shows a very serious inflationary problem.  However, private indices show the problem is much worse, and that is a real concern. If AIER is correct, we are now in a rare double-digit inflation crisis. These levels can create social chaos as inflation is like a compound interest curve in reverse. A 10%  inflation rate, would mean our money would lose half of its purchasing power in just a little over seven years. That can wipe out the savings of the middle class and lead to social revolution. It is a tremendous burden on the elderly on a fixed income who live mostly on savings. With the Biden Administration, like so many issues, a good case can be made that either it is the result of stupidity or it is intentional to create the environment for radical change. Either way, it is irresponsibility of the highest order.

AIER’s Everyday Price surged 2.1 percent in May after a 0.5 percent increase in April, a 3.0 percent jump in March, and a 1.3 percent gain in February. Over the first five months of 2022, the EPI is up at an annualized rate of 20.6 percent. From a year ago, the Everyday Price Index is up 12.8 percent, the fastest on record dating back to 1987.

Price increases continue to be generally broad-based with 19 components showing gains versus four showing declines, and one unchanged in May. Motor fuel prices, which are often a significant driver of the monthly changes in the Everyday Price index because of the large weighting in the index and the volatility of the underlying commodity, led the gainers with a 7.8 percent rice rise for the month (on a not-seasonally adjusted basis), contributing 108 basis points to the monthly increase.

Household fuels and utilities were the second-largest contributors in May, adding 43 basis points, followed by a 34-basis-point contribution from food at home, and an 11-basis-point contribution from food away from home (restaurants). The remaining contributions were four basis points or less.

The Everyday Price Index including apparel, a broader measure that includes clothing and shoes, rose 2.0 percent in May after gaining 0.4 percent in April, 2.8 percent in March, and 1.4 percent in February, contributing to an annualized rate of rise of 20.0 percent for the first five months of 2022. Over the past year, the Everyday Price Index including apparel is up 12.2 percent, also a record high back to 1987.

Apparel prices fell 0.1 percent on a not-seasonally-adjusted basis in May. Apparel prices tend to be volatile on a month-to-month basis. From a year ago, apparel prices are up 5.0 percent.

The Consumer Price Index, which includes everyday purchases as well as infrequently purchased, big-ticket items and contractually fixed items, rose 1.1 percent on a not-seasonally-adjusted basis in May. Over the past year, the Consumer Price Index is up 8.6 percent, the fastest pace since December 1981.

The Consumer Price Index excluding food and energy rose 0.6 percent for the month (not seasonally adjusted) while the 12-month change came in at 6.0 percent. The 12-month change in the core CPI was just 1.3 percent in February 2021 and 2.3 percent in January 2020, before the pandemic.

After seasonal adjustment, the CPI rose 1.0 percent in May while the core increased 0.6 percent for the month. Within the core, core goods prices were up 0.7 percent in May and are up 8.5 percent from a year ago. Significant increases for the month were seen in used cars and trucks (1.8 percent), pet food (1.6 percent), motor vehicle parts and equipment (1.5 percent), new cars (1.1 percent), new trucks (1.0 percent), and sporting goods (0.9 percent).

Core services prices were up 0.6 percent for the month and are up 5.2 percent from a year ago. Among core services, gainers include airfares (up 12.6 percent for the month and 37.8 percent from a year ago), health insurance (up 2.0 percent and 13.8 percent from a year ago), cable and satellite television services (1.3 percent and 5.8 percent from a year ago), other lodging away from home including hotels (up 0.9 percent for the month and 19.3 percent from a year ago), car and truck rentals (up 0.8 percent and 10.4 percent from a year ago), and owners’ equivalent rent (which accounts for 23.8 percent of the CPI, rose 0.6 percent for the month and 5.1 percent from a year ago).

Price pressures for many goods and services in the economy remain elevated due to shortages of supplies and materials, logistical and supply chain issues, and labor shortages and turnover. Sustained elevated price increases are likely distorting economic activity by influencing consumer and business decisions. Furthermore, price pressures have resulted in a new Fed tightening cycle, raising the risk of a policy mistake. In addition, turmoil surrounding the Russian invasion of Ukraine and renewed lockdowns in China are sustaining a high level of uncertainty for the economic outlook. Caution is warranted.

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Backup Battery Cost Fantasies Abound

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By Committee For A Constructive Tomorrow

The only technologically feasible way to make renewables reliable at in the foreseeable future is with massive amounts of grid scale batteries. Whether this is even remotely feasible depends on the cost and here things get truly strange.

On the one hand we have real utility reports of the capital cost of these big battery arrays. Battery systems that have actually been built. On the other hand we have projected capital costs, which are being used to defend the growth of unreliable renewables.

The real costs and the projected costs are wildly different. So different that the projected costs have the aspect of fantasy.

Let’s start with the reality. The EIA collected annual utility data on the cost of grid scale battery arrays. Their most recent report is “Battery Storage in the United States: An Update on Market Trends — August 2021”.

From 2013 to 2018 the average reported cost was around $1,500,000 per MWh. The range was pretty large, from under $500,000 to around $3,000,000 per MWh.

It is worth noting that in 2020 EIA excitedly reported a big drop in cost. This was from an average of $2,100,000 in 2015 way down to a low of $600,000 in 2019. I am rather skeptical that this 70% cost drop was real. There was no technological breakthrough to cause it. I suspect it was either a case of price cutting or of utilities manipulating their cost reports. Tesla has been bidding very low, at around $500,000 for some time. These are likely loss leader bids.

It is certainly the case that the cost must be going way up these days, not down, given the huge price spike in lithium and other essential constituent materials, as well as in the energy needed for making these monster battery arrays.

So it seems fair to say that the cost is at least $600,000 a MWh, quite possibly a lot more. A million dollars a MWh is not an unreasonable estimate. Keep in mind that a MWh is what an average American home uses in just a month, so it is not a lot of juice storage for a lot of money.

Now comes the fantasy. There are several recent mainstream estimates of the future capital cost of grid scale battery arrays. These estimates are often used in assessments of the economic feasibility of a transition from coal and gas fired generation to wind and solar. The battery cost estimates are crucial because it will take an enormous amount of batteries to try to make intermittent wind and solar reliable.

For example, DOE’s National Renewable Energy Laboratory has published battery cost projections through 2050 in their report “Cost Projections for Utility Scale Battery Storage: 2021 Update”. NREL is gung ho on renewables, so also on the batteries needed to try to make wind and solar reliable.

Each NREL projection is for a narrow range of costs. The low end of that range is a mere $143,000 per MWh in 2030 and $87,000 in 2050. That is right, just $87,000 for something that today costs $600,000 to $1,000,000, with costs going up.

Clearly this protection is extremely rosy, to the point of fantasy.

In a recent report — “The Future of Energy Storage” — MIT goes even lower. Their 2050 battery cost estimate is a tiny $70,000 per MWh! For something that costs upwards of a million dollars today. Surely this is pure fantasy.

Mind you given the Biden goal of zero electric power emissions by 2035, the 2050 fantasy figure may be irrelevant. But even NREL’s 2030 estimate of $143,000 is unbelievable. Given the way prices are rising, $1,000,000 is a better bet. Plus Biden’s goal is itself pure fantasy.

In short, energy policy needs to be based on sound engineering estimates, not wishful fantasies.

Author

David Wojick

David Wojick, Ph.D. is an independent analyst working at the intersection of science, technology and policy. For origins see http://www.stemed.info/engineer_tackles_confusion.html For over 100 prior articles for CFACT see http://www.cfact.org/author/david-wojick-ph-d/. Available for confidential research and consulting.

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

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List of 95 U.S.-Based Food Manufacturing Plants Destroyed Under Biden Administration

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By The Geller Report

More bombshell news the media censors ….Food shortages planned …. so sinister.

Here is the Updated List of US-Based Food Manufacturing Plants Destroyed Under Biden Administration

By Jim Hoft The Gateway Pundit, June 11, 2022:

Joe Biden’s ‘Build Back Better’ is not working as planned, or is it?

Gas prices are at record highs, stock markets are down, parents are having difficulty finding a baby formula, and the cost of everything is way up.

According to the U.S. Department of Agriculture (USDA), there are currently no nationwide food shortages in the country.

“There are currently no nationwide shortages of food, although in some cases the inventory of certain foods at your grocery store might be temporarily low before stores can restock,” the agency said on their website. “Food production and manufacturing are widely dispersed throughout the U.S. and there are currently no wide-spread disruptions reported in the supply chain.”

As the Gateway Pundit previously reported, at least 18 major fires have erupted at food industry facilities and plants over the past six months. All of the fires have been officially listed as accidental or inconclusive.

Now this… A Gateway Pundit reader sent us an updated list of US-based food manufacturing plants that were damaged from 2021 to 2022 under the Biden administration. These data were first published at Think Americana.

Below is the list of America’s 95 plants that have been destroyed, damaged or impacted by “accidental fires,” disease, or general causes.

  1. 1/11/21 A fire that destroyed 75,000-square-foot processing plant in Fayetteville
  2. 4/30/21 A fire ignited inside the Smithfield Foods pork processing plant in Monmouth, IL
  3. 7/25/21 Three-alarm fire at Kellogg plant in Memphis, 170 emergency personnel responded to the call
  4. 7/30/21 Firefighters on Friday battled a large fire at Tyson’s River Valley Ingredients plant in Hanceville, Alabama
  5. 8/23/21 Fire crews were called to the Patak Meat Production company on Ewing Road in Austell
  6. 9/13/21 A fire at the JBS beef plant in Grand Island, Neb., on Sunday night forced a halt to slaughter and fabrication lines
  7.  10/13/21 A five-alarm fire ripped through the Darigold butter production plant in Caldwell, ID
  8. 11/15/21  A woman is in custody following a fire at the Garrard County Food Pantry
  9. 11/29/21  A fire broke out around 5:30 p.m. at the Maid-Rite Steak Company meat processing plant
  10. 12/13/21 West Side food processing plant in San Antonio left with smoke damage after a fire
  11. 1/7/22 Damage to a poultry processing plant on Hamilton’s Mountain following an overnight fire
  12. 1/13/22 Firefighters worked for 12 hours to put a fire out at the Cargill-Nutrena plant in Lecompte, LA
  13. 1/31/22 a fertilizer plant with 600 tons of ammonium nitrate inside caught on fire on Cherry Street in Winston-Salem
  14. 2/3/22 A massive fire swept through Wisconsin River Meats in Mauston
  15. 2/3/22 At least 130 cows were killed in a fire at Percy Farm in Stowe
  16. 2/15/22 Bonanza Meat Company goes up in flames in El Paso, Texas
  17. 2/15/22 Nearly a week after the fire destroyed most of the Shearer’s Foods plant in Hermiston
  18. 2/16/22 A fire had broken at US largest soybean processing and biodiesel plant in Claypool, Indiana
  19. 2/18/22 An early morning fire tore through the milk parlor at Bess View Farm
  20. 2/19/22 Three people were injured, and one was hospitalized, after an ammonia leak at Lincoln Premium Poultry in Fremont
  21. 2/22/22 The Shearer’s Foods plant in Hermiston caught fire after a propane boiler exploded
  22. 2/28/22 A smoldering pile of sulfur quickly became a raging chemical fire at Nutrien Ag Solutions
  23. 2/28/22 A man was hurt after a fire broke out at the Shadow Brook Farm and Dutch Girl Creamery
  24. 3/4/22 294,800 chickens destroyed at farm in Stoddard, Missouri
  25. 3/4/22 644,000 chickens destroyed at egg farm in Cecil, Maryland
  26. 3/8/22 243,900 chickens destroyed at egg farm in New Castle, Delaware
  27. 3/10/22 663,400 chickens destroyed at egg farm in Cecil, MD
  28. 3/10/22 915,900 chickens destroyed at egg farm in Taylor, IA
  29. 3/14/22 The blaze at 244 Meadow Drive was discovered shortly after 5 p.m. by farm owner Wayne Hoover
  30. 3/14/22 2,750,700 chickens destroyed at egg farm in Jefferson, Wisconsin
  31. 3/16/22 A fire at a Walmart warehouse distribution center has cast a large plume of smoke visible throughout Indianapolis.
  32. 3/16/22 Nestle Food Plant extensively damaged in fire and new production destroyed Jonesboro, Arkansas
  33. 3/17/22 5,347,500 chickens destroyed at egg farm in Buena Vista, Iowa
  34. 3/17/22 147,600 chickens destroyed at farm in Kent, Delaware
  35. 3/18/22 315,400 chickens destroyed at egg farm in Cecil, Maryland
  36. 3/22/22 172,000 Turkeys destroyed on farms in South Dakota
  37. 3/22/22 570,000 chickens destroyed at farm in Butler, Nebraska
  38. 3/24/22 Fire fighters from numerous towns are battling a major fire at the McCrum potato processing facility in Belfast.
  39. 3/24/22 418,500 chickens destroyed at farm in Butler, Nebraska
  40. 3/25/22 250,300 chickens destroyed at egg farm in Franklin, Iowa
  41. 3/26/22 311,000 Turkeys destroyed in Minnesota
  42. 3/27/22 126,300 Turkeys destroyed in South Dakota
  43. 3/28/22 1,460,000 chickens destroyed at egg farm in Guthrie, Iowa
  44. 3/29/22 A massive fire burned 40,000 pounds of food meant to feed people in a food desert near Maricopa
  45. 3/31/22 A structure fire caused significant damage to a large portion of key fresh onion packing facilities in south Texas
  46. 3/31/22 76,400 Turkeys destroyed in Osceola, Iowa
  47. 3/31/22 5,011,700 chickens destroyed at egg farm in Osceola, Iowa
  48. 4/6/22 281,600 chickens destroyed at farm in Wayne, North Carolina
  49. 4/9/22 76,400 Turkeys destroyed in Minnesota
  50. 4/9/22 208,900 Turkeys destroyed in Minnesota
  51. 4/12/22 89,700 chickens destroyed at farm in Wayne, North Carolina
  52. 4/12/22 1,746,900 chickens destroyed at egg farm in Dixon, Nebraska
  53. 4/12/22 259,000 chickens destroyed at farm in Minnesota
  54. 4/13/22 Fire destroys East Conway Beef & Pork Meat Market in Conway, New Hampshire
  55. 4/13/22 Plane crashes into Gem State Processing, Idaho potato and food processing plant
  56. 4/13/22 77,000 Turkeys destroyed in Minnesota
  57. 4/14/22 Taylor Farms Food Processing plant burns down Salinas, California.
  58. 4/14/22 99,600 Turkeys destroyed in Minnesota
  59. 4/15/22 1,380,500 chickens destroyed at egg farm in Lancaster, Minnesota
  60. 4/19/22 Azure Standard nation’s premier independent distributor of organic and healthy food, was destroyed by fire in Dufur, Oregon
  61. 4/19/22 339,000 Turkeys destroyed in Minnesota
  62. 4/19/22 58,000 chickens destroyed at farm in Montrose, Color
  63. 4/20/22 2,000,000 chickens destroyed at egg farm in Minnesota
  64. 4/21/22 A small plane crashed in the lot of a General Mills plant in Georgia
  65. 4/22/22 197,000 Turkeys destroyed in Minnesota
  66. 4/23/22 200,000 Turkeys destroyed in Minnesota
  67. 4/25/22 1,501,200 chickens destroyed at egg farm Cache, Utah
  68. 4/26/22 307,400 chickens destroyed at farm Lancaster Pennsylvania
  69. 4/27/22 2,118,000 chickens destroyed at farm Knox, Nebraska
  70. 4/28/22 Egg-laying facility in Iowa kills 5.3 million chickens, fires 200-plus workers
  71. 4/28/22 Allen Harim Foods processing plant killed nearly 2M chickens in Delaware
  72. 4/2822 110,700 Turkeys destroyed Barron Wisconsin
  73. 4/29/22 1,366,200 chickens destroyed at farm Weld Colorado
  74. 4/30/22 13,800 chickens destroyed at farm Sequoia Oklahoma
  75. 5/3/22 58,000 Turkeys destroyed Barron Wisconsin
  76. 5/3/22 118,900 Turkeys destroyed Beadle S Dakota
  77. 5/3/22 114,000 ducks destroyed at Duck farm Berks Pennsylvania
  78. 5/3/22 118,900 Turkeys destroyed Lyon Minnesota
  79. 5/7/22 20,100 Turkeys destroyed Barron Wisconsin
  80. 5/10/22 72,300 chickens destroyed at farm Lancaster Pennsylvania
  81. 5/10/22 61,000 ducks destroyed at Duck farm Berks Pennsylvania
  82. 5/10/22 35,100 Turkeys destroyed Muskegon, Michigan
  83. 5/13/22 10,500 Turkeys destroyed Barron Wisconsin
  84. 5/14/22 83,400 ducks destroyed at Duck farm Berks Pennsylvania
  85. 5/17/22 79,00 chickens destroyed at Duck farm Berks Pennsylvania
  86. 5/18/22 7,200 ducks destroyed at Duck farm Berks Pennsylvania
  87. 5/19/22 Train carrying limestone derailed Jensen Beach FL
  88. 5/21/22 57,000 Turkeys destroyed on farm in Dakota Minnesota
  89. 5/23/22 4,000 ducks destroyed at Duck farm Berks Pennsylvania
  90. 5/29/22 A Saturday night fire destroyed a poultry building at Forsman Farms
  91. 5/31/22 3,000,000 chickens destroyed by fire at Forsman facility in Stockholm Township, Minnesota
  92. 6/2/22 30,000 ducks destroyed at Duck farm Berks Pennsylvania
  93. 6/7/22 A fire occurred Tuesday evening at the JBS meat packing plant in Green Bay.
  94. 6/8/22 Firefighters from Tangipahoa Fire District 1 respond to a fire at the Purina Feed Mill in Arcola
  95. 6/9/22 Irrigation water was canceled in California (the #1 producer of food in the US) and storage water flushed directly out to the delta.

With inflation at 40-year highs, this is devastating news.

AUTHOR

Pamela Geller

RELATED ARTICLE: US Is “Beyond Bankrupt”: Tech Giant Fears “Controlled Demolition” Enabling A “New Dystopian Future”

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

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How “A Bug’s Life” Revealed the Immorality of Socialism

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By Foundation for Economic Education (FEE)

There is no ethical or moral reason why somebody should work tirelessly to support a bunch of bureaucrats, and the 1998 Pixar hit seems to grasp this.

If you haven’t seen A Bug’s Life, I assure you that you have missed one of the best movies ever. Indeed, that animated classic produced by Pixar that saw the light of day in 1998, and that probably doesn’t get the recognition it deserves, is probably one of the most libertarian productions ever seen.

Nowadays it is difficult to find a film that represents good ideals and lays bare the practices of totalitarianism; in recent decades, the major film producers have left aside in good proportion the stories of heroes and role models to focus on the victims and their suffering at the hands of the oppressors, without really offering any positive or hopeful message, other than to enhance the culture of victimhood.

However, in A Bug’s Life this did not happen, although the film also has in Hopper—a grasshopper represented by Kevin Spacey—one of the greatest cartoon villains, it also presents in Flik an innovator who never gives up, who constantly explores new ideas, and who finally decides to confront Hopper’s totalitarianism to free his colony from the exploitation of grasshoppers.

Various media have published articles erroneously claiming that the film presents a criticism of “capitalism,” because according to them, it is about a class struggle of exploited workers. But this has little relation with reality. In capitalist and free market systems, people collaborate mutually without coercion; private property is respected, contrary to what is represented in the film, as the ants are fighting to protect their production (private) from the hands of some grasshoppers (militarists) who through force try to take away (expropriate) the fruit of their labor.

Curiously, Flik, who only thinks of liberating his community from oppression, is constantly repudiated and rejected by other ants due to his lack of obedience and respect for the grasshoppers’ authority; in this, we can find great parallels with today’s societies, increasingly servile before the inclement power of the States on steroids and their refined bureaucrats. However, Flik is convinced that he will be able to save his colony from slavery and he will not rest until he achieves it.

Hopper, the villain of this story, is the closest thing to the collectivist dictators we have known in the last 100 years. Stalin, Castro, Chavez, Mao, Pol Pot, Hitler, anyone could be identified with Hopper, because in his conception of the world the ants are scum that must work to sustain the grasshoppers. It is basically the same logic followed by socialist regimes: the people must work to feed the bureaucrats. The supposed “redistribution of wealth” is nothing more than an excuse to appropriate the production of “the people” so that the bureaucrats can dispose of it, leaving only crumbs for its producers.

In one of his impassioned dialogues Hopper addresses the princess of the colony: “It’s a bug-eat-bug world out there, princess. One of those Circle of Life kind of things. Now let me tell you how things are supposed to work: The sun grows the food, the ants pick the food, the grasshoppers eat the food…”

The ant princess is completely intimidated by Hopper’s threats, and he exerts his control over the little insects through fear of violence and demands absolute obedience, in the purest Castro style.

In another part of the film, the grasshoppers closest to the leader stand up to him when he says they have to go and exert more pressure on the ants to get their food, so Hopper responds with some anger: “You let one ant stand up to us, then they all might stand up! Those puny little ants outnumber us a hundred to one and if they ever figure that out there goes our way of life! It’s not about food, it’s about keeping those ants in line.”

Clearly, Hopper understands that it is necessary to keep the collective fear of the ants at bay, for if they were to think they could be free, the grasshoppers’ lives of privilege and idleness would end immediately, and they would have to work for their food themselves.

Flik, like the rest of the colony, is just a little ant who is not strong enough to take on Hopper and the grasshoppers, but he has big ideas and a lot of courage.

After traveling long distances trying to find help for his colony and recruiting a band of circus bugs, Flik returns to the colony to end Hopper’s plans to keep them enslaved until the last of their days. Unfortunately, Flik’s plan fails; however, his courage remains intact, and that manages to inspire the rest of the ants.

In the last part of the film, as a confrontation approaches, Hopper shouts at Flik:  “You piece of dirt! No, I’m wrong. You’re lower than dirt. You’re an ant! Let this be a lesson to all you ants! Ideas are very dangerous things! You are mindless, soil-shoving losers, put on this Earth to serve us!”

Then Flik replies, “You’re wrong, Hopper. Ants are not made to serve grasshoppers. I’ve seen these ants do great things. And year after year, they somehow manage to pick food for themselves and you. So who is the weaker species? The ants are of no use to the grasshoppers. It is you who need us. We are much stronger than you say we are. And you know that, don’t you?

After Flik’s words the grasshoppers start to get restless, the ants start to advance against their slavers, Hopper stands his ground, but his army starts to disperse. The leader of the grasshoppers gives the order to counterattack, but the ants have already realized that they are more and that they don’t need the grasshoppers. Finally the ants overwhelm their captors, and the princess says to the villain: “You see, Hopper, nature has a certain order. The ants gather the food, the ants keep the food, and the grasshoppers leave!”

In the end, all the ants needed was a little courage to break free from their captors, and Flik gave them the inspiration to defeat the grasshopper army.

The message that A Bug’s Life leaves us with is quite hopeful, and we should all follow the example of Flik and his colony; there is no ethical or moral reason why somebody should work tirelessly to support a bunch of bureaucrats.

The wealth created should belong to its creators, not to those who dictate the laws of unjust societies and intimidate citizens with the use of force.

This El American article was republished with permission.

AUTHOR

Emmanuel Rincón

Emmanuel Rincón is a lawyer, writer, novelist and essayist. He has won several international literary awards. He is Editor-at-large at El American

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

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Could Chile Turn Its Back on Freedom?

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By Ken Veit

Editors’ Note: Chile is a beautiful country, as is the United States of America. This article is clearly about America as much as it is about the potential loss of liberty and a far leftist takeover in Chile. The parallels are stunning with actors like Elizabeth Warren, Bernie Sanders and the radical progressives (Obama inspired) driving the out-of-control Biden presidential bus. It is an important read and an important message for freedom loving, hard working, and law abiding American citizens who believe in the foundational principles of individual sovereignty and the rule of constitutional law that has guided the greatest experiment in governing by consent of ‘We the People’.

Most people outside of South America do not follow trends there very closely. You may not be aware that democracy and freedom are being threatened in the most successful country in Latin America: Chile. That development threatens us here as well.

A quick history lesson. In 1970, Chile became the first country to freely elect what became a Communist government under Salvador Allende. The Chilenos did not want Communism. Allende was elected with only a little more than a third of the total votes when the other two candidates split the Conservative vote. Allende quickly became a puppet of the extreme left, and the country spiraled into chaos, pushed along by Henry Kissinger and the CIA. Things got so bad in terms of inflation, unemployment, etc. that on August 22, 1973, Congress by a large majority asked the armed forces to put an end to multiple violations of the Constitution.  General Augusto Pinochet staged a coup d’etat on September 11, 1973, ousting Allende who shot himself in the Presidential palace.

Pinochet became dictator until 1989 when he freely relinquished office after honest elections. He gets a bad press in the U.S. because of the brutal methods he used to suppress the Communists, who were not about to give up power easily. It was during the Pinochet era that I was traveling regularly to Chile. The reality on the ground was quite different from what we NorteAmericanos were told by our media.

Anyone could walk around the cities and talk freely about politics and the government, as long as you did not promote insurrection. If you did, you might find that the Police would come down on you with una mano dura (an iron fist). But for the most part, there was no censorship. Restaurants were full. Most people led normal lives and were comfortable speaking their minds.

Most people liked Pinochet. He quickly restored order from chaos. I asked friends how they felt about the allegations of brutality, which were true. None approved of it, but generally, I was told, “You weren’t here. Anything is better than how it was under Allende.” What was so bad about him? It was largely the fact that he promised everything to everyone for free, all at Government expense. Naturally, this was popular with the poor and the uneducated, but it was totally unsustainable. The economy collapsed.

Pinochet hired a group of economists from the University of Chicago, disciples of Milton Friedman, to come down and tell him how to straighten things out. Among other things, they revamped their Social Security System which was bankrupt. Taxes were still collected, but instead of turning the money over to the politicians to spend, a group of companies was allowed to compete to be managers of the pension funds that were seen to belong to the individual citizens. This was how I became involved, as my company became one of those investment managers.

The program was wildly successful. Chile became one of the few countries anywhere that had a public pension system that was not built on smoke and mirrors. Among other things we established a system where individuals could go to a public kiosk, punch in their Social Security ID, and learn exactly how much they had accumulated on their behalf.

Not everyone was happy, however. The Pinochet reforms primarily benefited those who worked. Chilenos are serious people. If you work, you benefit. If you don’t, you can’t look to the Government to take care of you. This is anathema to people who see society as a global village where everyone is responsible for everyone. Politics is usually about the division of the spoils, and inevitably the pendulum of power swings back and forth between those who are content with the way things are and those who would like things to be more favorable to their interests.

After Pinochet, Chile tried Governments of the Left and of the Right over the next 30 years, but generally, they did not stray too far from the precepts of Milton Friedman. People always speak of Chile as a model for South American governments, which historically have tended to be either corrupt or inept.

In the last few years, however, the gap between the Haves and the Have-nots has widened dangerously. This is a global phenomenon that threatens to topple Governments. With the Internet, social media, and cell phones ubiquitous, public opinion and public action can be mobilized rapidly.

In Chile, the Have-nots are rising. Not surprisingly, they resent the fact that those who have been contributing and saving for retirement are in better financial condition than they are. Chile’s social safety net is not satisfactory. With rising power, those on the political Left have forced a Constitutional rewriting. Recently, a 600-page draft was released which, if adopted, would put the country back on the path they abandoned when Allende fell.

Among other things, the draft calls for a more socially just allocation of retirement assets. Put bluntly, that would mean giving the Government the power to seize all the accumulated retirement assets of individuals and spread the money around to the less fortunate. Another name for confiscation is “theft”, but to the apostles of social justice, this is dismissed as just an excuse for keeping poor people down.

In today’s world, to be poor is seen as being a victim of elites in an unjust society, which is translated into having rights denied. As more and more people come to see themselves as victims, they are increasingly using the political system for a redress of grievances over rights denied.

“Rights” are things to which one has a proper claim. Some, like freedom of religion, if enshrined in law, are ours to enjoy without regard to anyone else. But many rights also place obligations on others to facilitate or pay for those benefits or alter their behavior. The so-called right to health care, or the right to security in old age, involve costs that have to be paid for somehow by someone. In other words, many rights are affected by the political process that determines obligations associated with those rights.

Increasingly, politicians and judges have invented rights like the right to privacy, the right to an abortion, etc. It is not so much a matter of appropriateness as it is a matter of funding. This largely depends on political power. This is what is playing out in Chile. The proposed new Constitution is full of rights, but vague on how they will be financed. Chilenos will vote in September. Most likely, few will have actually read the entire document, relying instead on political slogans.

What has this to do with the United States? Politicians like Bernie Sanders and Elizabeth Warren are at the forefront of politicians proclaiming the existence of many rights on the grounds of morality. Their answer to the question of who pays is the greedy rich and greedy corporations. Chilean politicians make similar arguments. Isn’t it immoral for some to have so much more than they could ever need when so many are currently in desperate need? The BLM movement argues that many of the great corporations and great fortunes were built on the backs of slaves, and therefore reparations are in order to right old wrongs. Proposed “wealth taxes” are merely confiscation by another name.

These are powerful arguments that swing voters, ignorant of the fatal flaws inherent in what is essentially a Communist core belief. (“To each according to his needs from each according to his ability.”)

There are no easy answers. However, I was disturbed by a recent article in the Wall Street Journal that highlights the potential fragility of Capitalism in our time. Jamie Dimon, the popular CEO of JPMorgan-Chase Bank was awarded a $52.6 million dollar “special” bonus on top of his regular compensation of $32 million. That doubled his pay from the previous year. Now Dimon had not invented a cure for cancer or “saved” JPM in a time of great financial peril. He had simply done a good job, as he usually does.

Shareholders overwhelmingly refused to approve the special bonus. However, the Journal calmly reported that it is doubtful he will give it back. Jamie is not like a baseball pitcher who argues he should get a bonus because when he pitches the attendance always goes up. Dimon manages a large bank and does it well. It is unquestionably a challenging task. But $80+ million dollars?

I don’t believe that Chilean corporations pay their CEOs as lavishly. But the Dimon incident gives ammunition to those who find the “wealth gap” intolerable. As political power shifts back and forth, those of us who believe in Capitalism would be well advised to minimize examples of excesses that fan the flames of resentment. The mob always has the power of numbers.

Watch the Chilean referendum on the new Constitution carefully. The vote will be on September 4. The betting is that it will not be approved because it goes too far to the Left. But you never know. The winds of change will still be blowing even if it is defeated.

TAKE ACTION

The highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

Housing Bubble Getting Ready to Pop: Mortgage Applications to Purchase a Home Drop to Lockdown Lows, “Bad Time to Buy” Hits Record amid Sky-High Prices, Spiking Mortgage Rates thumbnail

Housing Bubble Getting Ready to Pop: Mortgage Applications to Purchase a Home Drop to Lockdown Lows, “Bad Time to Buy” Hits Record amid Sky-High Prices, Spiking Mortgage Rates

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By Wolf Richter

Refinance mortgage applications collapsed to the lowest since the year 2000

This just keeps getting worse: Applications for mortgages to purchase a home dropped 7% for the week, and were down 21% from a year ago, the Mortgage Bankers Association reported today. An indicator of future home sales: Potential homebuyers try to get pre-approved for a mortgage, lock in a mortgage rate, and then start house-hunting.

Mortgage rates have soared this year, and home prices have soared for years to ridiculous levels, causing layers and layers of potential buyers to abandon the market, amid “worsening affordability challenges,” as the MBA called it. And these applications to purchase a home hit the lowest point since the depth of the lockdown in April 2020 (data via Investing.com):

The MBA’s Purchase Mortgage Applications Index has now dropped below the lows of late 2018. By November 2018, the Fed had been hiking rates for years (slowly), its QT was in full swing, and mortgage rates had edged above 5%, which was enough to begin shaking up the housing market. Home sales volume slowed, prices began to come down in some markets, and stocks were selling off. But with inflation below the Fed’s target, and with Trump, who’d taken ownership of the Dow, constantly throwing darts at Powell, the Fed signaled in December 2018 that it would cave, and instantly mortgage rates began to fall, and volume and prices took off again.

Today, raging inflation is the #1 economic issue, and the Fed is chasing after it, with backing from the White House, so this issue in the housing market is just going to have to play out.

Holy-Moly Mortgage Rates

The average 30-year fixed mortgage rate with conforming balances and 20% down rose to 5.40% this week, according to the MBA today, having been in this 5.4% range, plus or minus a little, since the end of April, the highest since 2009.

I call them holy-moly mortgage rates because that’s the reaction you get when you apply this rate to figure a mortgage payment for a home at current prices and then accidentally look at the resulting mortgage payment (data via Investing.com):

“Bad time to buy a home.”

Turns out, sky-high home prices to be financed with holy-moly mortgage rates, plus uncertainty about the economy, dropping stock prices, and inflation eating everyone’s lunch make a toxic mix for homebuyers.

The percentage of people who said that now is a “bad time to buy” a home jumped to 79%, another record-worst in the data going back to 2010, according to Fannie Mae’s National Housing Survey for May. Sentiment has been deteriorating since February 2021.

*****

Continue reading this article at Wolf Street.

TAKE ACTION

The highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

Housing Bubble Ready to Pop thumbnail

Housing Bubble Ready to Pop

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By Wolf Richter

Mortgage applications to purchase a home drop to lockdown lows. “Bad Time to Buy” hits record amid sky-high prices, spiking mortgage rates. refinance mortgage applications collapsed to the lowest since the year 2000.

This just keeps getting worse: Applications for mortgages to purchase a home dropped 7% for the week, and were down 21% from a year ago, the Mortgage Bankers Association reported today. An indicator of future home sales: Potential homebuyers try to get pre-approved for a mortgage, lock in a mortgage rate, and then start house-hunting.

Mortgage rates have soared this year, and home prices have soared for years to ridiculous levels, causing layers and layers of potential buyers to abandon the market, amid “worsening affordability challenges,” as the MBA called it. And these applications to purchase a home hit the lowest point since the depth of the lockdown in April 2020 (data via Investing.com):

The MBA’s Purchase Mortgage Applications Index has now dropped below the lows of late 2018. By November 2018, the Fed had been hiking rates for years (slowly), its QT was in full swing, and mortgage rates had edged above 5%, which was enough to begin shaking up the housing market. Home sales volume slowed, prices began to come down in some markets, and stocks were selling off. But with inflation below the Fed’s target, and with Trump, who’d taken ownership of the Dow, constantly throwing darts at Powell, the Fed signaled in December 2018 that it would cave, and instantly mortgage rates began to fall, and volume and prices took off again.

Today, raging inflation is the #1 economic issue, and the Fed is chasing after it, with backing from the White House, so this issue in the housing market is just going to have to play out.

Holy-Moly Mortgage Rates

The average 30-year fixed mortgage rate with conforming balances and 20% down rose to 5.40% this week, according to the MBA today, having been in this 5.4% range, plus or minus a little, since the end of April, the highest since 2009.

I call them holy-moly mortgage rates because that’s the reaction you get when you apply this rate to figure a mortgage payment for a home at current prices and then accidentally look at the resulting mortgage payment (data via Investing.com):

“Bad time to buy a home.”

Turns out, sky-high home prices to be financed with holy-moly mortgage rates, plus uncertainty about the economy, dropping stock prices, and inflation eating everyone’s lunch make a toxic mix for homebuyers.

The percentage of people who said that now is a “bad time to buy” a home jumped to 79%, another record-worst in the data going back to 2010, according to Fannie Mae’s National Housing Survey for May. Sentiment has been deteriorating since February 2021.

*****

Continue reading this article at Wolf Street.

TAKE ACTION

The highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

World Bank Sees Stagflation for Several Years thumbnail

World Bank Sees Stagflation for Several Years

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By Neland Nobel

After both the Federal Reserve and the Biden Administration suggested that inflation, was “transitory”, inflation has gotten much worse and is now embedded in much of the price structure.

The Biden Administration denies any role in causing inflation by spending hugely, gunning the money supply, and restricting energy output. Instead, it tends to blame Putin and the Russian invasion of Ukraine.

The Biden Administration also mistakes the economic comeback from “lockdown” as somehow a validation of their policy rather than the natural rebound one would expect after the government used its police powers to shut down the economy, supposed to save us from the virus.

This claim is tantamount to taking credit for the victim starting to breathe again after you decide to take your boot off his neck. 

It would seem the public is not buying their lame excuses and is becoming increasingly worried about both inflation and the economy. A recent Gallup Poll suggests that the public sees their economic status declining. Confidence readings are now lower than they were in 2009, at the end of the last financial crisis.

The World Bank has joined in with a newly issued report suggesting stagflation, not seen since the 1970s, will persist for a number of years. They have significantly downgraded their estimate of economic growth going forward.  

It is beginning to feel like Jimmy Carter is back in the White House.

This report seems to reinforce what the public is feeling. Things will be getting worse.

This is not what the Biden Administration wants you to hear, as it runs counter to their narrative that they have handled things well, the economy is booming and inflation is all the fault of Russia.

A quick summary from the forward from their report:

“Just over two years after COVID-19 caused the deepest global recession since World War II, the world economy is again in danger. This time it is facing high inflation and slow growth at the same time. Even if a global recession is averted, the pain of stagflation could persist for several years— unless major supply increases are set in motion. Amid the war in Ukraine, surging inflation, and rising interest rates, global economic growth is expected to slump in 2022. Several years of above-average inflation and below-average growth are now likely, with potentially destabilizing consequences for low- and middle-income economies. It’s a phenomenon—stagflation—that the world has not seen since the 1970s. Our forecasts reflect a sizable downgrade to the outlook: global growth is expected to slow sharply from 5.7 percent in 2021 to 2.9 percent this year. This also reflects a nearly one-third cut to our January 2022 forecast for this year of 4.1 percent. The surge in energy and food prices, along with the supply and trade disruptions triggered by the war in Ukraine and the necessary interest rate normalization now underway, account for most of the downgrade.”

Notice the passage “unless major supply increases are set in motion.”

That is very important because the Biden Administration and its ESG allies are busy cutting supplies and deliberately driving up energy costs to force the adoption of the Green New Deal. The resultant spike in natural gas has caused fertilizer to spike, inhibiting the production of food. Biden then adds greater injury by pushing ethanol, which basically has us burn our remaining food to make fuel. All this is the reverse of increasing supplies of key commodities.

They add:

“The danger of stagflation is considerable today. Between 2021 and 2024, global growth is projected to have slowed by 2.7 percentage points—more than twice the deceleration between 1976 and 1979. Subdued growth will likely persist throughout the decade because of weak investment in most of the world. With inflation now running at multidecade highs in many countries and supply expected to grow slowly, there is a risk that inflation will remain higher for longer than currently anticipated.”

Note the blame attributed to Covid.

It is not the virus per se that caused widespread disruption, it rather was the way governments chose to deal with Covid. This is not mindless quibbling. There is a difference between the damage the virus did and what damage government policy did. Never before in history was “lockdown” used, which instead of isolating the sick, shut in the healthy instead. So, we part company with the bank on causation. If the government had left the economy alone, and instead simply aided hospitals, the global slowdown would not have been as severe as that caused by the lockdown.

Many scientists at the time, argued against lockdown on both economic and health grounds, particularly the Great Barrington Declaration.  It has been subsequently supported by studies that show little in the way of reduction in mortality was achieved at great cost to the economy, and to the detriment of health in a variety of other ways. But that was buried by Dr. Fauci and the Federal medical establishment. To paraphrase Colin Powell, if you break it, you own it.  The Biden Administration and even the World Bank, simply won’t own up to the catastrophic series of mistakes made by government officials.

Compounding the economic trauma, worried about a drop in demand, governments and their central banks then flooded the system with money, boosting demand. But lockdown policies shut down supply as well, creating more demand than supply, a sure recipe for inflation.

Later on, the World Bank continues:

“The current juncture resembles the early 1970s in three key respects: supply shocks and elevated global inflation in the near-term, preceded by a protracted period of highly accommodative monetary policy in major economies, together with recent marked fiscal expansion; prospects for weakening growth over the longer term, which echo the unforeseen slowdown in potential growth of the 1970s; and vulnerabilities in EMDEs to the monetary policy tightening by advanced economies that will be needed to rein in inflation.”

It is good they acknowledge the “highly accommodative monetary policy” and fiscal expansion of the 1970s, but deficit spending has been far worse recently than in the 1970s, private debt growth far worse, and the QE policies and zero interest rates did not even exist during the 1970s. 

In short, the excesses of the recent period are far worse than the 1970s and it was all a policy choice.

Many asset classes and economic growth have been distorted by years of easy money and negative real interest rates, even before lockdown. As inflation has worsened, it has required that monetary policy be thrown in reverse with sales of central bank assets (Quantitative Tightening) and rising interest rates. Worldwide markets have shuddered as the easy money support for assets is being removed. We have had a sharp decline in stocks, bonds, cryptocurrencies, SPACs, NFTs, and other asset classes favored by easy money. Real estate is also beginning to show signs of weakness as interest rates rise, increasing the cost of monthly payments for housing.

It remains to be seen whether the damage to markets will rival that of the 1970s. The stock crash of 1973-74 was the worst since the Great Depression and brought the major stock indices down 50%.

While the World Bank’s description of the causation of stagflation is in our view too narrow, their estimate of the impact on growth looks pretty solid. In short, we agree with many of their conclusions even though their explanations are far too kind to governments.

But we agree with their overall economic conclusions. Stagflation seems likely for some time.

Just remember whom to blame for this. It is almost all the fault of bad policy decisions by government health officials, central bankers, diplomats, and politicians.

As a final thought, while not a subject of the World Bank Report, many comparisons are being made with the era of Jimmy Carter, an ineffectual President in many ways, but in others, he was a decent man who did not use his office to enrich himself. The occasional drunken gaffe from his beer-swilling brother Billy seems almost quaint compared to the constitutional shaking scandals of the Biden Family business ties to foreign powers, the pornographic rage of son Hunter, the clear path of mental decline by the President, the raw abuse of power by the FBI and the CIA, the Russian collusion hoax, and the electoral shenanigans of the Biden years.

Carter was a devout Southern Christian, a Navy veteran of the nuclear submarine fleet.  Biden has embraced and promoted truly radical social revolutionary movements ranging from Black Lives Matter, the 1619 Project, and the transgender extremists. He calls those that disagree with him, domestic terrorists and white supremacists. He either believes this crap or he is too addled to oppose those who want to exploit his creeping dementia.

The combination of social disintegration, stagflation, and a loss of confidence in government create an environment far worse than what existed under Carter. Biden in a sense has pulled off the impossible. He has made Jimmy Carter look like a great President.

TAKE ACTION

The highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

What are ESG Scores? thumbnail

What are ESG Scores?

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By Neland Nobel

And why are so many advocates of liberty deeply concerned about them?

Klaus Schwab and a growing list of powerful global economic and political elites, including BlackRock CEO Larry Fink and President Joe Biden, have recently committed to a global “reset” of the prevailing school of economic thought. They seek to supplant the entrenched “shareholder doctrine” of capitalism, which—as Milton Friedman famously espoused over 50 years ago—holds that the only purpose of a corporate executive is to maximize profits on behalf of company shareholders.

To replace shareholder capitalism, Schwab, Fink, Biden, and a legion of their peers have promulgated a nouveau “stakeholder doctrine,” commonly referred to as “stakeholder capitalism.” This approach, which aims to harness the growing clamor for more socially conscious corporate decision-making, authorizes, incentivizes, and even coerces corporate executives and directors to work on behalf of social objectives deemed by elites to be desirable for all corporate stakeholders—including communities, workers, executives, and suppliers.

Environmental, social, and governance (ESG) scores—a social credit framework for sustainability reporting—are being used as the primary mechanism to achieve the shift to a stakeholder model. They measure both financial and non-financial impacts of investments and companies and serve to formally institutionalize corporate social responsibility in global economic infrastructure.

Environment, social, and governance scores are theoretically supposed to incentivize “responsible investing” by “screening out” companies that do not possess high ESG scores while favorably rating those companies and funds that make positive contributions to ESG’s three overarching categories. A company’s ESG score has become a primary component of its risk profile.

Who Are the agents responsible for this shift, and what have they done to bring it about?

Although there have been many ESG frameworks developed over the past decade, in the past three years alone, three major documents and compacts have been signed by a coalition of corporate governors, political elites, central bank directors, international organization representatives, and other powerful individuals. Together, they have had a substantial impact on the global economy and the shift to ESG.

In August 2019, The Business Roundtable (TBR)—comprised of 181 of the most powerful corporate executives in the United States—officially revised its conception of a corporation’s purpose to “promote an economy that serves all Americans.” The companies these CEOs represent hail from nearly all sectors of the U.S. economy, including major financial institutions, media conglomerates, technology firms, defense contractors, pharmaceutical companies, and myriad others.

Many of these executives are likely unaware that their  ESG ideas come dangerously close to the social credit system run by the Chinese Communist Party. It applies to corporations instead of individuals, but the principles are the same. Nor do they likely recognize that their policies result in starving the fossil fuel industry of capital, thus contributing to soaring energy costs to consumers and rampant inflation. Besides Biden, think of these leaders when you fill up your tank!

For businessmen to betray the principles of private ownership of capital, and free enterprise, and buy into the agenda of a particular political party, marks quite a change in the role of business in society. Heretofore, with the exception of tax-free foundations funded by businesses (think of the Ford Foundation), corporations rarely have been so politically active outside of election activities. This is causing evolutionary tension with our political parties. The Democrat party increasingly has become the party of Big Money and Big corporations, while the Republican party is increasingly less friendly to Big Business and sides more with small business people and consumers.

A case in point is the state of Florida. Previously quite friendly to Walt Disney, state leaders took affront when that giant corporation that had received special favors from the state, decided it would take it upon itself to interfere directly and publicly with legislation that would restrict the teaching of transgender ideology to those in kindergarten through the third grade. The result was the loss to Walt Disney of the Reedy Improvement district, which gave that corporation almost the power of self-government.

You will note in the map provided, that Arizona has down well on this front, largely due to Republicans in the legislature.

If the upcoming elections go badly for Democrats and the Green New Deal, Republicans need to keep in mind that Big Business has not been their friend. The result should be a reexamination of the relations of business to government. Special favors, subsidies, and tax breaks, all need to be eliminated. Republicans should strive to eliminate regulations and barriers that reduce competition.  It is bad enough to have socialism constantly foisted upon us by Democrats. It is quite another to expect that from Big Business. Republicans will have to deal with “Business Roundtable” types within our own ranks.

Vote with your dollars as well and try to avoid doing business with corporations that betray your trust and the economic system that made this country great. More than half the country identifies as conservative so make these companies pay whenever you can. True, it takes some work to find substitutes, but where you can, hit them in the pocketbook. But it is easy in some cases to avoid buying shoes for example from Nike, buying anything from Disney, buying a car from GM, and turning off the NBA is quite easy. Some choices, like the NBA, are not even “necessities” in the normal course of life and can easily be dismissed. Find money managers other than BlackRock, and move your checking account away from Chase and other large banks, to smaller independent banks. It can be difficult finding substitutes on occasion but where you can, avoid doing business and avoid buying the stocks of companies in the Business Roundtable, or at least directors of the Roundtable.You can actually make spending your money a political “lifestyle” choice.  It is fun and you will feel good about doing so.

Corporate leaders will soon get the message.  If you go woke, you will go broke.  Other than the transgender craze, nothing has been more woke than ESG.

*****

This article is adapted from materials published by The Heartland Institute and is reproduced with permission.  However, the opinions are that of the author.

TAKE ACTION

The highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

Company Contrast: Backyard Burgers and Checkers & Rally’s thumbnail

Company Contrast: Backyard Burgers and Checkers & Rally’s

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By 2ndvote .com

Each week 2ndVote takes a look at popular companies that either score well or score poorly  and then try to provide alternatives that either better align with the 2ndVote values or should be avoided to the best of your ability. This series is called The Company Contrast, and the companies we will be focusing on this week are Backyard Burgers (3.00) and Checkers & Rally’s (3.00).

For all the hungry 2ndVote shoppers looking for a good ol’ fashioned burger joint, look no further than Checkers & Rally’s. Still sporting their classic mid-century drive-in style, Checkers and Rally’s have been around since 1986 and 1985, respectively, as separate entities, but merged in 1999 to form the current namesake. Their neutral score of 3.00 means that the food will only taste even better without a bunch of leftist activism soiling the flavor and your wallet. Another neutral option is Backyard Burgers, which, having been named one of America’s favorite brands by Newsweek, fancies itself as a slightly more high-end alternative to many other fast-food burger restaurants. Fortunately for consumers, their neutral score of 3.00 makes for a guilt-free experience for those that want to align their dollars with their values.

Of the many mainstream fast-food eateries, one chain to avoid is Burger King (2.35). With a parent company like Restaurant Brands International, Burger King suffers on the issues of Life, Basic Freedoms, and Environment for their association with organizations that support Planned Parenthood, their high ranking on the HRC Corporate Equality Index, and partnerships with organizations that push alarmist environmental agendas. But that shouldn’t stop you from reaching out to them through the 2ndVote website to communicate your distaste of their liberal-leaning activism!

EDITORS NOTE: This 2ndVote column is republished with permission. ©All rights reserved.

85% of Top Economists Reject Elizabeth Warren’s Latest Foolish Proposal, New Survey Finds thumbnail

85% of Top Economists Reject Elizabeth Warren’s Latest Foolish Proposal, New Survey Finds

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By Foundation for Economic Education (FEE)

Here’s hoping policymakers in Washington heed these warnings.

Senator Elizabeth Warren made a name for herself in 2020 as the progressive Democrat who “has a plan” for everything. But her plans are often not very well thought through, and the Massachusetts Senator’s latest “price-gouging” initiative is a similarly bad idea.

Warren is one of the many progressive politicians who has pushed the bogus narrative that “corporate greed” is to blame for our ongoing surge in inflation. (As I explain here, this isn’t the case). In response, she proposed an anti-“price-gouging” law that would outlaw “unconscionably excessive price increases” at large companies “during all abnormal market disruptions.”

Corporations are bragging about jacking up prices. And they get away with it because our markets lack competition. My Price Gouging Prevention Act would give the @FTC more power to go after price-gougers so we can lower costs for families.https://t.co/b5YHNOj02I

— Elizabeth Warren (@SenWarren) May 15, 2022

What’s an “unconscionable excessive” price increase? What constitutes an “abnormal market disruption?” And how could federal bureaucrats huddled in an office in Washington, DC possibly make these determinations for all the different industries in America and the literal millions of factors that influence market prices?

Warren’s legislation offers no satisfying answers to these simple questions, which may be why an overwhelming majority of prominent economists just rejected a very similar concept out of hand.

IGM Chicago recently surveyed a group of top economists, including many from the Ivy League, and asked them whether “it would serve the US economy well to make it unlawful for companies with revenues over $1 billion to offer goods or services for sale at an ‘unconscionably excessive price’ during an exceptional market shock.”

(Notice the language is very similar to Warren’s proposal).

CLICK HERE TO VIEW THE CHART ON WHAT ECONMISTS THINK

Weighted for confidence, an astounding 84 percent disagreed with the notion that such a plan would be good for the economy. As anyone who has spent time around economists can tell you, they’re a fickle bunch with a wide range of ideological influences, so this kind of consensus on an issue is quite unusual.

The specific feedback individual economists offered was also illuminating.

“This just seems unenforceable at every level,” said MIT economist David Autor. “What is unconscionable? Why only companies above $1 [billion]?”

“Totally impractical!” responded Stanford’s Robert Hall.

In my personal favorite, University of Chicago economist Austan Goolsbee, who previously served under President Obama, simply responded, “How are we back on this again?”

Of course, appealing to expertise alone is not much of an argument. We also need to understand why economists so resoundingly rejected this proposal and why banning “price gouging” runs afoul of basic economic principles.

Well, high prices, even—no, especially—during times of crisis, actually serve several important economic functions.

As I’ve previously explained:

“When resources are scarce and demand is outstripping supply, companies naturally raise prices. This encourages those who don’t truly need the resource or have an easy alternative not to buy it all up, reserving the resources for those who need them the most.

Think of gas prices, for example. When we’re experiencing serious fuel shortages — like we are right now — gas prices might rise as high as $4. With prices that high, people who could bike to work but prefer to drive might still bike to save money. But those who have to drive to work and have no other option will pay the higher price. This is an imperfect mechanism, to be sure, but it’s still one that mostly ensures the scarce fuel ends up with those who need it most.

Yet if ‘anti-price-gouging’ laws keep the price set at $2 because $4 is deemed ‘unconscionably excessive,’ gas stations will quickly run out of it. Who gets it versus who doesn’t will simply be a matter of chance.

What’s more, high prices during periods of high demand for a product are the force that attracts more businesses to come in and provide more of the good or service, which eventually alleviates the shortage and lowers the price again over time. But if the price is kept capped low, there’s no market force naturally bringing in more investment to boost the supply to keep up with increased demand.”

So, it’s not just experts telling us that anti-“price-gouging” laws are such a bad idea—basic economists and common sense alike confirm this reality.

Here’s hoping policymakers in Washington heed these warnings. If they don’t, everyday Americans will suffer the economic consequences.

WATCH:

AUTHOR

Brad Polumbo

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

RELATED ARTICLE: Why Economic Degrowth Is Terrible for Everyone—Especially the Poor

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

Univision Sells 18 Spanish Radio Stations to a Group Partially Financed by Soros thumbnail

Univision Sells 18 Spanish Radio Stations to a Group Partially Financed by Soros

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By SPIDER & THE FLY The False Allure of Communism

Univision recently sold 18 Spanish radio stations, including 10 AMs and eight FMs in the largest Hispanic markets in the nation, to the Latino Media Network, a new company, for a $60 million cash deal. This company was founded by two left-wing Democratic radicals, Stephanie Valencia and Jess Morales Rocketto, with the partial financial assistance of Lakestar Finance that is connected to the Soros Fund Management.

Stephanie Valencia served as Deputy Chief of Staff to Secretary of Commerce Penny Pritzker in October 2013. Prior to joining the Commerce Department, Ms. Valencia served in the Barack Obama White House in the Office of Public Engagement for almost five years. Later, she served as Special Assistant to the President and Principal Deputy Director, and worked on President Obama’s top priorities. Prior to joining the Obama administration, Ms. Valencia served on the Obama-Biden Presidential Transition Team and was the Deputy Latino Vote Director on the 2008 Obama campaign.

Jess Morales Rocketto served as Political Director of the National Domestic Workers Alliance (NDWA) and Executive Director of Care in Action. She has worked in political advocacy campaigns on behalf domestic workers, economic justice, immigration reform, and opposing sexual harassment.

Ms. Morales, who serves as the Chair of Families Belong Together and We Belong Together and with her organization NDWA, has been campaigning for immigration reform to legalize millions of undocumented immigrants. She is an alumna of Hillary for America, the AFL-CIO, Obama for America, the Democratic National Committee, Rebuild the Dream, and the New Organizing Institute.

The reelection campaign of Republican Florida Governor Ron DeSantis denounced the efforts of radical billionaire George Soros to “manipulate” the midterm elections by helping the new left-wing Latino Media Network purchase two Miami radio stations. The DeSantis campaign released the following statement: “Governor Ron DeSantis is taking [on] Soros on his own turf with a Spanish language ad buy on the Soros network, serving as a PSA to Hispanic Floridians to warn of the pro-socialism, radical agenda behind The Latino Media Network.”

The leaders of the Assembly of Cuban Resistance denounced the purchase of the radio stations

On June 8, 2022, I attended a very important meeting in the Library Museum of the Bay of Pigs Veteran Association Assault Brigade 2506. The leader of the Assembly of Cuban Resistance, Orlando Gutierrez Boronat, called the meeting due to the immense concern over the sale of 18 Spanish Radio Stations across America to a group called Latino Media Network with the financial assistance of Lakestar Finance that is connected to the Soros Fund Management.

The President of the Bay of Pigs Veterans Association, Rafael Montalvo Gutierrez, opened the meeting requesting a minute of silence for the many patriots who have died fighting communists. He said that the Bay of Pigs veterans are opposed to the sale of the two stations in Miami. Orlando Gutierrez Boronat explained to the many reporters from television and radio and the participants that the meeting was going be conducted in English and Spanish. Several elected and civic leaders spoke during the meeting. They were businesswoman Irina Vilarino, Lt. Governor of Florida Jeanette Nuñez, Mothers Against Repression of Cuba (Mar por Cuba) President Silvia Iriondo, Florida State Senator of District 37 Iliana García, State Representative District 103 Tom Fabricio, and the Mayor of Hialeah Steve Bovo.

I am with Lt. Governor of Florida Jeanette Nuñez, who spoke very well at the meeting of her great concern, as well as Florida Governor Ron DeSantis, over the sale of two Spanish radio stations in Miami, Radio Mambí and WQBA, to the left-wing Latino Media Network.

The Cuban American Lt. Governor Nuñez said that her father made her listen to these two stations when she was a little girl on the way to school. She said she did the same with her daughter. Thanks to these radio stations she found out what the Cuban regime was doing in the island.

Jeanette M. Nuñez was born and raised in Miami, Florida. She was elected as Florida’s first Hispanic woman Lieutenant Governor of Florida in 2018. She previously served as a State Representative of the Florida House of Representatives from 2010 to 2018 and was named Speaker Pro Tempore from 2016 to 2018.

The 18 stations purchased include 10 AMs and eight FMs in the largest U.S. markets, including eight of the top 10 Latino markets. Markets included are Los Angeles, New York, Miami, Houston, Chicago, Dallas, San Antonio, McAllen, Fresno, and Las Vegas. Collectively, Latino Media Network’s stations reach nearly one third of the Latino population. The Federal Communications Commission must approve the sale.

Stations included in the deal are:

  • Los Angeles – KTNQ-AM 1020
  • New York – WADO-AM 1280
  • Miami – WAQI-AM 710; WQBA-AM 1140
  • Houston – KLAT-AM 1010
  • Chicago – WRTO-AM 1200
  • Dallas – KFLC-AM 1270; KFZO-FM 99.1
  • San Antonio – KXTN-AM 1350
  • McAllen – KGBT-AM 1530; KGBT-FM 98.5; KBTQ-FM 96.1
  • Fresno – KOND-FM 107.5; KRDA-FM 92.1; KLLE-FM 107.9
  • Las Vegas – KLSQ-AM 870; KISF-FM 103.5; KRGT-FM 99.3

The left-wing radical Democratic activists, Jess Morales Rocketto and Stephanie Valencia who, worked in the past with Barack Obama and Hillary Clinton, were given $60 million by Lakestar Finance. Included in the purchase were two anti-communist radio stations in Miami: Radio Mambí WAQI-AM 710 and Radio La Cubanísima WQBA-AM 1140. These two radio stations have been operating for decades and are listened in Cuba, the Caribbean, Florida, and many other states in America.

Latino Media Network is run by two left-wing radical social activists who espouse a radical socialist woke political agenda. Patriotic Hispanics of all nationalities are extremely concerned and alarmed over the cancel culture and the silencing of the two radio stations in Miami that historically stood as voices for freedom in Cuba and other nations against bloody communist regimes like Venezuela and Nicaragua.

On June 10, I attended the Round Table Defending Free Speech held at the Republican National Committee Center in Doral, Florida.

Sitting at the front table were U.S. Florida Republican Senators Marco Rubio and Rick Scott. Both spoke eloquently in denouncing the purchase of 18 Spanish radio stations by Soros and in particular the Radio Mambí WAQI-AM 710 and Radio La Cubanísima WQBA-AM 1140 in Miami.

I am with Florida Republican U.S. Senator Rick Scott who together with U.S. Senator Marco Rubio condemned the purchase of the 18 Spanish radio stations including two in Miami by a new company with Soros funding.

Several elected and civic leaders and civic spoke at the meeting. They were Florida State Senators Ana Maria Rodriguez and Ileana García, State Representative David Borrego, Congressman Carlos Jimenez, Mayor of Hialeah Steve Bovo, and the owner of La Poderosa and Cadena Azul Radio Stations Jorge Rodriguez. The RNC Round Table: Defending Speech was a great success, and it was covered widely by the media.

On June 9, 2022, Florida Senators Rick Scott, Marco Rubio, Tom Cotton (R-AR) as well as Representatives Carlos Giménez (R-FL), María Elvira Salazar (R-FL), and Mario Díaz-Balart (R-FL) wrote a letter to Federal Communications Commission (FCC) Chairwoman Jessica Rosenworcel regarding the sale of 18 Spanish-language radio stations, including Miami’s conservative Radio Mambí, to the Latino Media Network (LMN)

The letter of the members of Congress stated the following: “We are concerned that LMN, as a newly formed front group led by partisan operatives with zero experience in broadcasting, may work to silence political viewpoints with which its funders disagree. If successful, LMN could exercise virtually uncontested influence over nearly one third of all Hispanics across the country. Given the importance of the FCC’s stewardship over the limited AM and FM bandwidth available across the United States, we ask that the commission carry out its due diligence and thoughtfully scrutinize the takeover of these stations by a partisan organization only announced last week.”

“Far from benign, the proposed sale is the latest in a series of moves by elite progressives desperate to claw back support from Hispanic voters, who have rightly turned their backs on Democrats and their socialist priorities. But instead of overhauling their own unpopular policies, we are concerned that far-left ideologues are attempting to consolidate and expand their control over the media, so they can flood the airwaves with propaganda with the hopes of fooling listeners so that they can silence effective conservative voices who challenge their progressive propaganda.”

Hispanics are worried that these new Soros radio stations will impose a radical socialist agenda contrary to our South Florida community’s Judeo-Christian values. South Florida has tens of thousands of citizens who have lived and suffered under communist regimes in Latin America and other countries of the world like China, Russia, and Eastern European nations.

Patriotic and anti-communist Hispanics value freedom of speech, freedom of the press, and all the rights given to Americans by the Bill of Rights of the Constitution of this great nation. America is a nation that Hispanics love immensely and that many Hispanics and their children and grandchildren have defended by serving in the Armed Forces and fighting in many wars.

The Bay of Pigs Veterans Association, the Cuban Patriotic Council, and many organizations of the Cuban Americans, Venezuelan Americans, and Nicaraguan Americans are part of the Assembly of Cuban Resistance. This organization will stand united to defend and uphold the right of Hispanics to discuss the immense damage of done by communist tyrants everywhere in the world.

Hispanics will resist peacefully any attempt to censor their voices. Hispanics will use legal and legitimate means at their disposal, including boycotts, general strikes, and peaceful protests. Patriotic Hispanics will not be censored! Cuban Americans, Venezuelan Americans, and Nicaraguan Americans will not be silenced! And Hispanics will pray to God for His assistance to prevent America becoming a communist totalitarian nation. Hispanics will continue to fight for the freedom of Cuba, Nicaragua, Venezuela, and any other nation that has a bloody and oppressive communist regime.

©Frank de Varona. All rights reserved.

Weekend Read: 5 Reasons America’s Birthrate Is Plummeting

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By Hannah Cox

The simple truth is, that there are fewer people who want to bring kids into the world. Though the reasons are diverse, 44 percent of non-parents between 18 to 49 say it is not at all likely they will procreate.

Elon Musk recently tweeted, “population collapse is the biggest threat to civilization.”

The tweet included a link to an interview Musk gave where he expanded on the subject. “Assuming there’s a benevolent future with AI, I think the biggest problem the world will face in 20 years is population collapse,” Musk wrote. “Collapse. I want to emphasize this….Not explosion, collapse.”

Musk has been known to raise this concern in the past too. Last year he told the Wall Street Journal, “I can’t emphasize this enough, there are not enough people.” He also said that low and rapidly declining birth rates are “one of the biggest risks to civilization.”

That the wealthiest and arguably one of the smartest men on earth spends his days fixating on this issue should be a signal to others that things might be more dire than they think.

According to the US Census, “The US population grew at a slower rate in 2021 than in any other year since the founding of the nation.” And we’re not alone. According to reporting by the BBC, “Researchers at the University of Washington’s Institute for Health Metrics and Evaluation showed the global fertility rate nearly halved to 2.4 in 2017 – and their study, published in the Lancet, projects it will fall below 1.7 by 2100.”

Population replacement rates are important for a society to sustain itself. We need people to be born so that there are workers to fill the various needs of the whole. Old men cannot do the labor young men can do, young adults are needed to care for the dying and aging. Fewer people mean less economic activity, smaller GDPs, less innovation, and less competition.

It also means we have less division of labor. As Adam Smith wrote in The Wealth of Nations, “The division of labor is limited by the extent of the market.“ That means people are less able to specialize and lean into their preferences or areas of expertise in their work.

As a whole, the machine slows and then stagnates when new firewood is not added to the furnace.

But while Elon Musk is absolutely correct about the problem and the potential threat it poses to society, he has not addressed (as far as I’ve seen) the underlying issues creating it or discussed how they might be solved.

So, in an effort to address these issues, here are five reasons people are increasingly choosing not to procreate, along with the free-market responses that could address them.

The simple fact is, that some people don’t want children. And there are legitimate reasons for that choice.

No matter what Sheryl Sandberg wants you to believe, women cannot have it all. “Leaning in” is a practice that has left most women who attempt it barrelled over in pain.

The reality is, while women tend to work outside the home in most partnerships now, the vast majority of childcare and household work continues to be laid at their feet. This is an ongoing issue that causes many women to choose not to have kids or not to have more kids.

In life, just as in economics, there are trade-offs. Most women realize they will likely not be able to be a successful career woman, a dedicated mother, and a jaw-dropping homemaker all at the same time. There are choices to be made here, and some women are simply deciding that motherhood is the role they can let go of.

It’s important to point out that these are choices that used to be harder to make. In generations past, women were shamed for not having kids, ostracized in society, or simply did not have the access to birth control they needed to determine their own pathway. We’re moving away from that kind of culture, and the advancements in women’s healthcare have empowered women to set their own course.

As a woman who has never wanted children, I’ve thought deeply about this topic. And I believe there are many others who are looking at the same factors I am and reaching the same conclusion.

Motherhood is hard, physically, emotionally, and mentally. I personally never wanted to go through the pain of childbirth, nor do I want to give myself the mental and emotional anxiety that comes with taking on this role. But as pointed out above, this wasn’t always a calculation afforded to women.

Furthermore, I love working—always have. And I’ve built a meaningful and impactful career I’d never be willing to give up. While some women choose to work and have kids, that’s not a situation I’d choose for myself. I’d never put my kids in government schools nor would I want them to spend their time with others in daycare. So when faced with the choice of pursuing my work or raising kids, I simply choose the former. It’s where I want to spend my time. I’ve met many others who feel the same way as me.

There are other factors as well. While the world has actually been improving (though you wouldn’t know it based on the media), there are many people (myself included) who look around and still don’t find the world to be one they’d want to bring kids into.

Thanks to birth control and the gains made under feminism, these are choices women now get to make that other generations simply were not afforded. As a whole, this is a choice that should be accepted and even celebrated by society.

Are there free market solutions to these factors? Sure. School choice would make it easier for women to homeschool or find other alternatives. Remote work would allow more people to balance child-rearing with their careers. And improvements in our social climate would likely make people more optimistic about procreating.

Still, the simple truth is, there are fewer people who want to bring kids into the world. Though the reasons are diverse, 44 percent of non-parents between 18 to 49 say it is not to or not at all likely they will procreate. And that’s ok. But for those who do want kids, we should strive to create a world where that option is as feasible as possible.

While some women and men are simply choosing not to have kids, others wish to and cannot find adequate partners.

It’s important to remember that we are still merely a few decades into a new normal: the sexes having equal rights and a fair playing field.

While this is long-overdue progress that should obviously be celebrated, it also means the social fabric of our society is still fraught with landmines. For all of human history, women and men have not been in a situation where they were equal under the law.

That means culturally and biologically women are programmed to look for partners who are stronger and wealthier than they are, because those elements were essential for survival for most of our existence. But in recent decades, women are largely surpassing men economically. They are more likely to obtain degrees, are catching up to men in their earnings, and in 37 percent of US households, women pay the bills.

To this, many will say women should just lower their standards or not be so picky. But it’s not that simple. Again, to do that requires overcoming significant evolutionary impulses on the part of women. And even when they do overcome these factors, it still isn’t working out. In fact, marriages with female breadwinners are 50 percent more likely to end in divorce. This illustrates that the power dynamic shift created between higher-earning women and lower-earning men is one our society has not yet learned to live with.

Furthermore, while men say they are fine with dating women who are smarter than them, psychological studies have revealed otherwise. Men are also biologically inclined to be providers and to be competitive. But for the first time in history, they’re having to compete with women, and outcome-wise, they’re often ending up in second place. It turns out they don’t find this so appealing in practice.

The fact that LDS and evangelical families are still having more children backs all of this up. Since gender norms are changing more slowly in these communities, it would seem their relationships are not suffering the same growing pains and therefore the number of children they are having is falling more slowly.

These are societal problems, not ones suited for public policy. And the harsh reality is that it will probably take decades for us to sort out this new landscape for romantic relationships and for people to evolve past the male provider/female nurturer gender stereotypes. But they are challenges worth examining and overcoming, and at an individual level, we can all look for ways to foster romantic relationships that take these factors into consideration.

Even for people who do want to have kids and manage to find the right partner, there is still a multitude of landmines they must overcome before they can comfortably procreate, and they all trace back to affordability.

A flourishing society would naturally incentivize people to procreate. But that requires a steady currency, a good job market, relatively safe communities, the promise of a good education, and economic factors that make it affordable to have and raise a child.

According to Merrill Lynch, it currently costs $230,000 to raise a kid to age 18. That’s a jaw-dropping amount, especially when one considers record-breaking inflation, wage stagnation, and economic uncertainty created by the reckless printing and spending policies of the US government.

The reasons for these high costs also trace back to the government. Childcare costs have been soaring for decades thanks to extreme government regulations and restrictions on these services. In one survey, 85 percent of parents reported spending 10 percent or more of their household income on child care.

Education is another major financial calculation in these decisions. There’s no way to sugarcoat it, government schools are atrocious and private schooling or alternative options can be expensive or unfeasible. Many parents are also hesitant to place their kids in government schools because of gun-free zones that make them sitting ducks.

And then there’s college. The price of higher education is astronomical, and that is solely due to government subsidies and loans. But while evidence increasingly shows college is not a good investment for most, many parents still desire to give their kids every opportunity they can and thus factor this in.

Additionally, healthcare costs continue to rise in the country thanks to the government increasingly taking over our system. Insurance prices shot up after Obamacare and there is no end in sight for many.

Finally, there are the costs of infertility. A growing number of Americans are having trouble getting pregnant when they want to. Some blame this on problems with our nutrition. Others say it’s because people are having kids later in life. Likely there are multiple reasons. But whatever the cause, fertility assistance is extremely expensive and a cost many cannot afford.

Relatedly, many economists point to the quantity-quality tradeoff theory which implies that a reduction in fertility would lead to more human capital investment per child. Meaning, people would rather invest their love, finances, and attention into a smaller number of children versus spreading it across a large family.

There are many public policy reforms that would bring these costs down. But for the time being it is understandable why for some the math is simply not adding up. People want to know they can give their kids a brighter and better future than they themselves had, and for now, that simply isn’t true for a lot of people.

Finally, many economists point to something called the demographic transition theory to explain the decrease in childbirth. In short, because child mortality rates have dropped so precipitously under capitalism people don’t have to have as many kids.

In generations past, as terrible as it was, parents would have a lot of kids with the assumption that several would die. That is no longer the case. People can plan how many children they want to have with a high level of certainty that those kids will live into adulthood.

Furthermore, as societies have become less male-centric, parents don’t have to keep having kids until they have a boy. For inheritance, property, and societal reasons, this used to be a goal for many people, but it is one that is quickly diminishing.

Many of these are issues we as a society can address through free-market solutions. It’s time we have that conversation.

*****

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

A Balanced Budget Constitutional Amendment May Be Our Only Hope. thumbnail

A Balanced Budget Constitutional Amendment May Be Our Only Hope.

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By Thomas C. Patterson

Over the last few decades, no force on earth has been able to halt the explosive growth of US federal debt.

At the conclusion of WWII, fiscal conservatives were aghast that our national debt had ballooned to $259 billion. By the end of the Vietnam war it stood at $533 billion and, despite urgent warnings, was over $5,674 billion by the end of the century. Today it stands at $30,000 billion ($30 trillion) after the Biden administration’s horrific spending spree conducted under the pretext of limiting the fallout from Covid.

The reason is pretty simple. Spending other peoples’ money is politically popular. Taxes are not and budget-cutting is risky.

We have developed a political culture in which the reelection of incumbents is the highest of all priorities. It is considered perfectly acceptable to just kick the can down the road and let future generations sort out the consequences of our selfishness.

So, for example, when Bush 43 attempted to propose desperately needed reforms for Medicare and Medicare, he was mercilessly demagogued for “pushing granny over the cliff”. His Republican allies deserted him and the effort collapsed.  Nobody has tried any such thing since, although debt reduction is mathematically impossible without entitlement reform.

It doesn’t take a genius to see where this is going. Interest rates are rising, while serious geopolitical threats are forming. We’re backing ourselves into a position of severe internal and external weakness at just the wrong time.

Yet the political class remains unmoved. Some pay lip service to fiscal discipline, but the spending goes on unabated.  Student loans, accommodations for illegal immigrants, and missiles for Ukraine on the condition that no Russians will be harmed by their use are all embraced as if unlimited funds are available.

Fortunately, our forefathers anticipated that the government they created would attempt to exceed its limited constitutional powers. They gave the states a powerful tool to defend themselves – the right to amend the constitution on their own.

Article V of the constitution mandates that Congress “shall” call a constitutional convention when requested to do so by 2/3 of the states and that any amendments proposed when ratified by 3/4 of the states become “Part of this Constitution”.

The founders would be disappointed to know that the states have never exercised this extraordinary privilege. Thomas Jefferson, knowing how these things go, thought a convention of the states would be needed every generation or so to reign in federal government encroachments.

Instead, the states have stood meekly by as the federal government has far surpassed them in power and prestige to the point where calling a convention of the states is seen as an act of rebellion against authority.

But nothing else has worked to restrain federal spending. Millions of dollars have been spent to elect self-described fiscal conservatives, yet it’s beyond obvious that Congress will never reform itself.

Of course, the convention-of-the-states idea has its enemies. Opposition from the spenders on the left is understandable because they don’t want to end their gravy train. But it is the alliance between the left and conservative stalwarts like the Eagle Forum and John Birch Society which have effectively stalled progress.

Their arguments are fear-inspired. Their principle objection is the perceived threat of a “runaway convention“, the fear that in a constitutional convention, there would be nothing to stop special interest groups from pushing their agendas from banning abortion to banning guns.

Hogwash. Even if the state legislatures fail to limit the authority of Convention delegates, 38 states must ratify any proposed amendments. That historically has been very strong protection.

Right-wing opposition seems mostly concerned that the convention could inflict lasting damage to the sanctity of our Constitution. The opposite is the truth.

Nothing could honor and strengthen the constitution more than using its own provisions to enable us to address our most urgent modern threat.  The other option is the Left’s practice of declaring a “living“ constitution that says whatever judges say it does.

It’s time for us to flex our democratic muscles and fulfill our destiny as free, optimistic, and proud Americans.  Our republic may be in the balance.

*****

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 highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

Yes, the Products You’re Buying Are Getting Smaller—Even Though Prices Are Not thumbnail

Yes, the Products You’re Buying Are Getting Smaller—Even Though Prices Are Not

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By Foundation for Economic Education (FEE)

The rise in consumer prices has rightly received a great deal of attention, as inflation hovers around 40-year highs. Everyone can see that virtually everything is getting more expensive, but fewer have noticed that many items are also getting smaller.

On Wednesday the Associated Press ran an article under the headline “No, you’re not imagining it — package sizes are shrinking.”

The AP spoke to one shopper, Alex Aspacher, who does a lot of shopping for his family of four in Ohio. He noticed he was still paying $9.99 for Swiss cheese even though the package had shrunk from a pound to 12 ounces.

“I was prepared for it to a degree, but there hasn’t been a limit to it so far,” Aspacher told the AP. “I hope we find that ceiling pretty soon.”

This phenomenon—known as “shrinkflation”—is nothing new, of course. It’s just more pronounced now than in any time in recent memory because inflation is much higher.

But what exactly is shrinkflation? As economist Peter Jacobsen explained last year, it’s simply a different kind of inflation.

“Shrinkflation is a form of inflation because you’d have to spend more money to get the same quantity or quality as you did in a previous year,” he explained. “The prices have remained the same, but the products are worse.”

The only difference is, instead of raising the price of an item or service, businesses are reducing the quantity or quality of it while keeping the price the same.

Edgar Dworsky, a consumer advocate who has tracked shrinkflation for decades, told the AP shrinkflation is rampant at the moment because of the underlying economic conditions.

“It comes in waves,” said Dworsky. “We happen to be in a tidal wave at the moment because of inflation.”

While there are too many examples of shrinkflation to easily track, here is a list of some examples Dworsky highlighted and others that we found.

  1. Kleenex: A box now has 60 tissues instead of the 65 it had a few months ago.
  2. Yogurt: Chobani Flips have shrunk to 4.5 ounces; they had been 5.3 ounces.
  3. Domino’s Pizza, citing the rise of chicken prices, announced earlier this year it was shrinking its 10-piece chicken wing package to eight pieces. The carryout price remains the same: $7.99.
  4. Toothpaste: Tubes of Crest reportedly have shrunk from 4.1 ounces to 3.8 ounces.
  5. Folgers coffee reduced its 51-ounce container to 43.5 ounces. (Oddly, Folgers still says the container will make up to 400 cups of coffee, citing a new technology that yields lighter-weight beans. Or something.)
  6. Fritos: “Party Size” bags used to be 18 ounces, but most retailers are now advertising 15.5 ounce bags.
  7. Gatorade: PepsiCo, who produces Gatorade as well as Fritos, has begun phasing out 32-ounce bottles and replacing them with 28-ounce ones, which are actually more expensive. (PepsiCo said the change was unrelated to the economic climate and the plan had been in the works for years.)
  8. Cereal: Honey Bunches of Oats reduced its standard cereal box to 12 ounces; it had been 14.5 ounces.
  9. Paper Towels: Bounty reduced its 2-ply sheet roll from 165 to 147 sections.
  10. Oatmeal: Quaker reduced the number of pockets in a box from 10 to 8, reports the Daily Mail.
  11. Ziploc bags: Boxes now come with 50 in a package instead of 54.
  12. Soap: Dial reduced its bottle size from 21 ounces to 16 ounces.

BONUS Item: Airline service: As FEE’s Peter Jacobsen notes, airline complaints are through the roof, the result of reduced customer service.

We could go on, of course. But you get the point.

Some people naturally want to blame companies for shrinking the size of their products while charging the same price (or higher ones), but this is the wrong reaction.

As noted above, shrinkflation is simply a form of inflation, and inflation is a monetary phenomenon above all else.

“Inflation is always and everywhere a monetary phenomenon,” noted Nobel Prize-winning economist Milton Friedman, “in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output.”

It’s no coincidence that America is experiencing the highest inflation in decades after the Federal Reserve “flooded the system with money,” as Fed Chairman Jerome Powell admitted in a 60 Minutes interview.

The mystery of Inflation.

“You flooded the system with money.”

“Yes, we did.” pic.twitter.com/2ClRf97fg7

— Jon Miltimore (@miltimore79) January 17, 2022

This was a perfect recipe for inflation.

“Inflation is caused by too much money chasing after too few goods,” Friedman noted.

You simply can’t drop $5 trillion dollars into an economy without a corresponding expansion of goods and services and not experience inflation. This is why we’re seeing it now, both through higher prices and the reduced quantity and quality of goods and services.

So if you’re upset you’re paying just as much for less cereal, toilet paper, tissue, and countless other products, that’s fine. Just make sure your anger is directed in the proper direction: at the people who “flooded the system with money,” and those who directed them to do so.t be kept.”

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

Jon Miltimore

Jonathan Miltimore is the Managing Editor of FEE.org. His writing/reporting has been the subject of articles in TIME magazine, The Wall Street Journal, CNN, Forbes, Fox News, and the Star Tribune. Bylines: Newsweek, The Washington Times, MSN.com, The Washington Examiner, The Daily Caller, The Federalist, the Epoch Times.

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

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Stock Market TANKS 800 POINTS At The Open As Inflation Hits 40 Year High

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By The Geller Report

That was once considered a bloodbath. Now it’s just another day under the Biden regime.

U.S. INFLATION HIT A NEW FOUR-DECADE HIGH IN MAY

U.S. consumer inflation reached an 8.6% annual rate in May, its highest level in more than four decades as surging energy and food prices pushed prices higher.

The Labor Department on Friday said that the consumer-price index  from the same month a year ago, marking its fastest pace since December 1981. That was also up from April’s CPI reading, which was slightly below the previous 40-year high reached in March. The CPI measures what consumers pay for goods and services.

May’s increase was driven by sharp rises in the prices for energy, which rose 34.6% from a year earlier, and groceries, which jumped 11.9% on the year. Prices for used cars and trucks rose 1.8% in May from April,. Shelter costs, an indicator of broad inflation pressures, accelerated on a monthly basis in May and were up 5.5% compared with a year ago.

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VIDEO: Mortgage Application Index Decreased to Lowest Number in 22 Years

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By The Geller Report

More of what the Democrats ain’t telling you.

Homeownership is the bedrock of individual autonomy, economic security, social stability, personal well-being and wealth creation. It was the attainable American dream. So, too, the Democrats had to destroy it.

Mortgage-Application Index Falls to Lowest Level in 22 Years

A measure of mortgage applications fell to its lowest level in 22 years last week, another sign the U.S. housing market is coming back to Earth after a red-hot, two-year stretch. Applications fell 6.5% in the week ended June 3, the fourth consecutive week of declines, according to the Mortgage Bankers Association. Refinance and purchase activity fell 6% and 7%, respectively. Higher interest rates have been weighing on demand for refinances all year, but now there are signs the slowdown has spread to purchase demand as well. Sales of existing homes in April fell to their slowest pace since before the pandemic. But even with sales slowing, home prices continue to rise thanks to a dearth of homes for sale. That means many would-be buyers are struggling with the twin challenges of double-digit jumps in home prices and higher borrowing costs (Wall Street Journal).

AUTHOR

Pamela Geller

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

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Germany’s Green Energy Fixation Should Teach U.S. a Lesson

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By Larry Bell

Germany’s new Chancellor Olaf Scholz’s government vice chancellor and economic minister Robert Habeck, a leading member of his country’s Green Party, has experienced a rude lesson regarding the disastrous consequences of his years of naïve opposition to fossil fuels.

After tasking his top officials to assess the energy security implications of Germany’s dependence on Russian supplies in the event of a then-looming Ukraine invasion, their conclusions were desperately dispiriting.

Habeck reportedly told an interviewer: “I thought to myself ‘the situation we are in is a catastrophe. I can’t possibly take responsibility for perpetuating this total, terrible helplessness.”

What had Habeck belatedly realized?

A major lesson—and one we might expect would have been obvious very early—is that wind energy which Germany built a lot of is neither reliable nor cheap.

As a matter of fact, Germany—with the highest installed wind power capacity in Europe, also, along with Denmark—has among the highest electricity prices worldwide (around USD 35 cents per kilowatt-hour [cents/kWh] in the second quarter of 2021), ranking 15th as most expensive out of 133 countries.

That ranking doesn’t account for a present surge in German energy prices which are likely to go much higher.

Nevertheless, this was already more than three times what we then paid in America (11.8 cents/kWh), which is projected to increase about 4% this year.

On top of an already high price pain, Germany had a breezily bad wind yield last summer, the weakest in over 20 years, with onshore electricity generation only 87% of that produced in 2020.

This required Berlin to crank up more of Habeck’s Green Party-loathed coal and lignite-fired plants to make up the difference.

What else could they do?

Germany, a dominant EU economic power, relied on Russia for more than half of the natural gas and a third of the oil they burn to power factories, heat homes, and fuel trucks, buses, and cars.

To make matters even worse, roughly half of Germany’s coal imports—which are essential to its steel manufacturing—come from Russia as well.

So it’s not as if Habeck should have any trouble eliminating Russian coal imports. The global supply is plentiful, and Germany itself has vast reserves of it that are easily accessed and transported.

As for natural gas, as recently as 15 years ago, EU member countries produced more gas than Russia exported.

Also paradoxically, although Europe’s gas reserves are smaller than Russia’s, they may have as much technically recoverable shale gas as the US, which their governments won’t allow to be developed.

Regarding oil, Germany has relied on Russian deliveries for about 35% of their supply via dedicated pipelines for decades since their ports have limited capacity to host supertankers from other suppliers. Germany also lacks pipelines for coast-to-coast transport, and the country has allowed most of the containers used to move it by train to be scrapped.

So forget about cheap energy for Germany, especially natural gas which is essential to the country’s economic competitiveness. As projected by The Wall Street Journal, Germany’s gross domestic product could fall by up to 6% if Russian deliveries are stopped.

Meanwhile, Russian giant Gazprom PJSC has acquired Europe’s biggest gas storage facility, and Russian government-controlled oil producer Rosneft has acquired a majority share in one of Europe’s biggest oil refineries—both in Germany.

By the time Putin’s troops invaded Ukraine, Germany was already paying Russia about $208 million for energy daily, curbing their enthusiasm for Western financial sanctions that followed.

All consequential dependence and desperation are entirely self-inflicted, dating back to the Cold War when West Germany supplied the Soviet Union with steel to make pipelines in exchange for cheap natural gas.

Chancellor Angela Merkel’s 16-year reign accelerated this interdependency, backing the construction of two gas pipelines between Germany and Russia—Nord Stream 1 and 2.

The Nord Stream 2 gas pipeline was ready to come online but Germany mothballed it when Russia attacked Ukraine. Germany provided decisive backing over the past 16 years to develop the pipelines, which together cost around $20 billion.

The first of those pipelines were agreed on shortly before former Chancellor Gerhard Schröder was replaced by Merkel in 2005.

Only weeks after leaving office, Schröder, a personal friend of Putin, was awarded a senior Nord Stream position to become an influential lobbyist for gas giants Gazprom and Rosneft, with access to leading politicians, including current Chancellor Olaf Scholz and his senior aides.

By the time Merkel recently stepped down and Scholz stepped in, Germany had come to be the world’s biggest buyer of Russian gas, and one of the EU’s most dependent countries on Russian energy.

Germany’s green-obsessed government has made itself even more reliant on natural gas because of earlier decisions to phase out nuclear and coal-fired power plants.

Vice Chancellor Habeck is on a hunt to buy liquefied natural gas, or LNG, from suppliers such as the U.S. and Qatar. The problem is that LNG travels by ship before being re-gasified at special port facilities that Germany doesn’t currently have.

Although new contracts struck with Norway and Gulf states have somewhat helped Habeck reduce Russian supplies, a key Schwedt refinery in eastern Germany, which supplies most of the region’s car, aircraft, and heating fuel, is controlled by Rosneft which has no interest in refining non-Russian oil.

So much to the angst and incriminations of his former Green Party pals, Habeck is seeking to lease a couple of Greece’s giant floating LNG terminal ships, Transpower and Transgas, which are set to come online early next year.

For comparison, Germany needs around 95 billion cubic meters of gas a year, and while Nord Stream has a capacity of 55 billion cubic meters a year, a single floating terminal can add only about 5 billion cubic meters. Most of the rest would have to come from LNG imports supplied by neighboring countries such as the Netherlands.

With no thanks to President Joe Biden’s war on fossil energy which is causing shortages and record prices in America, we can’t do much to help.

Yes…there is a dire lesson in this for us, too.

*****

This article was published by CFACT, Committee for A Constructive Tomorrow and is reproduced with permission.

TAKE ACTION

The highly choreographed January 6 Select Committee that is being performed on primetime TV over the next several weeks can only be described as political and partisan trash. It is not about truth or acting in the interests of American citizens. It is about the 2024 election – clear as day.

Please click here to inform our elected leaders how you feel about the partisan travesty unfolding in the U.S. House of Representatives.

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How to Alleviate the Looming Global Hunger Crisis

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By Bjorn Lomborg

A global food crisis is looming, so policymakers everywhere need to think hard about how to make food cheaper and more plentiful. That requires making a commitment to producing more fertilizer and better seeds, maximizing the potential offered by genetic modification, and abandoning the rich world’s obsession with organics.

Russia’s brutal war in Ukraine is making less food available because the two nations have been responsible for more than a quarter of global wheat exports and big quantities of barley, corn and vegetable oil. On top of punishing climate policies and the world emerging from the pandemic, prices of fertilizer, energy and transport are soaring, and food prices have climbed 61 percent over the last two years.

The war has exposed some harsh truths. One is that Europe — which portrays itself as a green energy trailblazer — is highly reliant on Russian gas, especially when the sun is not shining or the wind is not blowing. The war has reaffirmed the basic reality that fossil fuels remain crucial for the vast majority of global needs. And the emerging food crisis now reveals another harsh truth: organic farming cannot feed the world and could even worsen future crises.

Long simply a fashionable trend for the world’s 1 percent, environmentalists have increasingly peddled the beguiling idea that organic farming can solve hunger. The European Union is actively pushing for a tripling of organic farming on the continent by 2030, while a majority of Germans actually think organic farming can help feed the world.

However, research conclusively shows that organic farming produces much less food than conventional farming per acre. Moreover, organic farming requires farmers to rotate soil out of production for pasture, fallow or cover crops, reducing its effectiveness. In total, organic approaches produce between a quarter and half less food than conventional, scientific-driven agriculture.

This not only makes organic food more expensive, but it means that organic farmers would need much more land to feed the same number of people as today — possibly almost twice the area. Given that agriculture currently uses 40 percent of Earth’s ice-free land, switching to organics would mean destroying large swathes of nature for less effective production.

The catastrophe unfolding in Sri Lanka provides a sobering lesson. The government last year enforced a full transition to organic farming, appointing organics gurus as agricultural advisers, including some who claimed dubious links between agricultural chemicals and health problems. Despite extravagant claims that organic methods could produce comparable yields to conventional farming, within months the policy produced nothing but misery, with some food prices quintupling.

Sri Lanka had been self-sufficient in rice production for decades, but tragically has now been forced to import $450 million worth of rice. Tea, the nation’s primary export crop and source of foreign exchange, was devastated, with economic losses estimated at $425 million. Before the country spiraled downward toward brutal violence and political resignations, the government was forced to offer $200 million in compensation to farmers and come up with $149 million in subsidies.

Sri Lanka’s organic experiment failed fundamentally because of one simple fact: it does not have enough land to replace synthetic nitrogen fertilizer with animal manure. To shift to organics and keep production, it would need five to seven times more manure than its total manure today.

Synthetic nitrogen fertilizers, mostly made with natural gas, are a modern miracle, crucial for feeding the world. Largely thanks to this fertilizer, agricultural outputs were tripled in the last half-century, as the human population doubled. Artificial fertilizer and modern farming inputs are the reason the number of people working on farms has been slashed in every rich country, freeing people for other productive occupations.

In fact, one dirty secret of organic farming is that, in rich countries, the vast majority of existing organic crops depend on imported nitrogen laundered from animal manure, which ultimately comes from fossil fuel fertilizers used on conventional farms.

Without those inputs, if a country — or the world — were to go entirely organic, nitrogen scarcity quickly becomes disastrous, just as we saw in Sri Lanka. That is why research shows going organic globally can only feed about half the current world population. Organic farming will lead to more expensive, scarcer food for fewer people, while gobbling up more nature.

To sustainably feed the world and withstand future global shocks, we need to produce food better and cheaper. History shows that the best way to achieve that is by improving seeds, including by using genetic modification, along with expanding fertilizer, pesticides, and irrigation. This will allow us to produce more food, curb prices, alleviate hunger, and save nature.

*****

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

TAKE ACTION

Thank you to all The Prickly Pear readers who contacted legislators about the egregious formation of the “Disinformation Governance Board” at the Department of Homeland Security under Secretary Alejandro Mayorkas. Citizens such as yourselves made the Biden administration and DHS back away from this unprecedented Orwellian and tyrannical step of censorship and suppression of free speech in our Republic. There are critical issues to  ‘TAKE ACTION’ on and The Prickly Pear will serve as a rallying point to stop the left’s assaults on We the People and our liberty. God bless America.

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Illinois Congressional Candidate Niki Conforti on the Economy

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By Dr. Rich Swier

WHEATON, Ill./PRNewswire/ — We are on the verge of an economic crisis the likes of which we have not seen since the 1970s.

America in the 1970s was dealing with an oil crisis, and high inflation and interest rates – some nearly 20%. We are already in an energy crisis. Some gas pumps are now being refitted to accommodate double digit gas prices – yes, $10 a gallon and more. This Administration’s war on oil and gas, supported by Casten and Newman, is turning into a war on the American people.

To combat rising inflation, the Fed has raised interest rates by the largest amount in 2 decades. This is just the start of frequent rate hikes that will happen this year. Higher interest rates will increase the burden of debt and reduce the purchase of large assets – like cars and homes, further slowing the economy.

We are getting squeezed.

Americans need to brace for some very difficult times. Our government has forgotten the American people. Many are dealing with the choice of putting gas in their car or food on their table. This, coupled with higher prices for all retail products, is reducing disposable income, which means fewer vacations and dinners out.

As paychecks are spent on necessities, other industries, like travel, hospitality, and entertainment, will suffer. The trickle-down effect will send shockwaves throughout all sectors of the economy. No industry will be safe from setbacks. Jobs will be lost. This is a perfect storm for a devastating economic crisis.

The only way out of this will be to repeal failed policy and institute a return to energy independence while rebuilding American self-sufficiency. Promoting all forms of energy (solar, wind, hydro, coal, and other fossil fuels – and even nuclear) and letting the free market identify the best option rather than the government is a better approach. Returning manufacturing to the U.S. will reduce our dependency on foreign nations and strengthen America.

This Administration’s progressive experiment has failed and is hurting Americans. We need to return to policies that lower the cost of living, support American small businesses, and strengthen our presence on the world stage.

ABOUT NIKE CONFORTI

Niki is a proud mom and a resident of the western suburbs. She is a graduate of the University of Chicago School of Economics with an MBA in Healthcare Administration from George Washington University in Washington, D.C. Simply put, Niki has the strongest bio across candidates and is best positioned to win back voters who have moved away from the GOP over the last two cycles. She has strong ties to the community and a message that resonates with the electorate. In the first midterm election of a presidency, the party holding the White House averages 27 house seats lost. This puts IL-6 at the tip of the spear for a GOP comeback—and puts Niki in a strong position to win.

Click here for more information on the Conforti for Congress Campaign

©Dr. Rich Swier. All rights reserved.

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