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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-08 14:51:122022-06-08 14:51:12Illinois Congressional Candidate Niki Conforti on the Economy
I don’t know what you guys are paying for gasoline…. but here in California we are paying up to $5.75 to $7 per gallon. My line of work is in petroleum for about 31 years now, so here are some tricks to get more of your money’s worth for every gallon:
Here at the Kinder Morgan Pipeline where I work in San Jose , CA we deliver about 4 million gallons in a 24-hour period thru the pipeline. One day is diesel the next day is jet fuel, and gasoline, regular and premium grades. We have 34-storage tanks here with a total capacity of 16,800,000 gallons.
Only buy or fill up your car or truck in the early morning when the ground temperature is still cold. Remember that all service stations have their storage tanks buried below ground. The colder the ground the more dense the gasoline, when it gets warmer gasoline expands, so buying in the afternoon or in the evening….your gallon is not exactly a gallon. In the petroleum business, the specific gravity and the temperature of the gasoline, diesel and jet fuel, ethanol and other petroleum products plays an important role.
A 1-degree rise in temperature is a big deal for this business. But the service stations do not have temperature compensation at the pumps.
When you’re filling up do not squeeze the trigger of the nozzle to a fast mode If you look you will see that the trigger has three (3) stages: low, middle, and high. You should be pumping on low mode, thereby minimizing the vapors that are created while you are pumping. All hoses at the pump have a vapor return. If you are pumping on the fast rate, some of the liquid that goes to your tank becomes vapor. Those vapors are being sucked up and back into the underground storage tank so you’re getting less worth for your money.
One of the most important tips is to fill up when your gas tank is HALF FULL. The reason for this is the more gas you have in your tank the less air occupying its empty space. Gasoline evaporates faster than you can imagine. Gasoline storage tanks have an internal floating roof. This roof serves as zero clearance between the gas and the atmosphere, so it minimizes the evaporation. Unlike service stations, here where I work, every truck that we load is temperature compensated so that every gallon is actually the exact amount.
Another reminder, if there is a gasoline truck pumping into the storage tanks when you stop to buy gas, DO NOT fill up; most likely the gasoline is being stirred up as the gas is being delivered, and you might pick up some of the dirt that normally settles on the bottom.
Note: If the pump repeatedly shuts off early, it could be a sign of a problem with the vapor recovery system, such as a clogged carbon canister.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-08 14:51:112022-06-08 14:51:11Tips on Pumping Gas that Will Save You $$$!
Push a sympathetic message. Drum up a bunch of misguided support. And then aim for a ridiculous tax increase. That was the strategy from Red4ED after it launched a little over four years ago.
In that spring of 2018, the color red was popping up all over the place—from Facebook profile pictures to protests at the state Capitol. And it was supposedly all about increasing teacher salaries and funding for K-12 education. It was a movement that had great momentum, a sycophant media, and a political class that was terrified to stand up to them. Yet they figured out how to, in four short years, go from a political juggernaut to one of the largest and most expensive failures in Arizona political history.
Of course, defeating this multiyear assault on Arizona by Invest in Ed was a huge win for taxpayers, job creators, and the future prosperity of our state. And it would not have been possible without a combination of political miscalculations and blunders by the Red4ED decision makers and a consistent, sustained opposition from key organizations and elected officials willing to stand up to the bullies behind the movement
A Massive Legal Blunder
While the story of Red4ED began with a protest at the Capitol and demands for higher teacher pay, the movement was quickly hijacked by the teachers’ unions and other out-of-state special interest groups. It didn’t take long for the mission to morph from one about helping teachers into a singular quest to double the state income tax through a ballot initiative.
Soon after the first protests, a consortium of liberal organizations launched Invest in Ed version one, a poorly drafted initiative that proposed to double Arizona’s income tax. After receiving over $2 million from the National Teachers Union, Red4ED was successful in submitting enough signatures for their tax increase initiative to qualify for the 2018 ballot. But there was a problem. The organization’s 100-word summary of its ballot measure was grossly misleading. The Arizona Chamber of Commerce sued, and the Arizona Supreme Courtruledagainst it, saying that the description “did not accurately represent the increased tax burden on the affected classes of taxpayers.”
Whether it was an intentional effort to mislead the public or just a complete drafting blunder on their part, Red4ED’s tax increase initiative was removed from the ballot. And a $2 million lesson was learned. Or was it?
Their Litigation Woes Continue
Red4ED regrouped after its embarrassing court loss and put all its effort—along with more than $23 million—toward passing Invest in Ed version 2.0, also known as Prop 208. After an ugly campaign that involved deceiving voters once again, the initiative barely passed with 51% of the vote.
Yet just like the first initiative, Prop 208 was taken back to court, this time by the Arizona Free Enterprise Club and Goldwater Institute. And once again, the measure wasstruck downby the Arizona Supreme Court.
The court determined that the initiative violated the constitutional expenditure limitation. Here is the craziest part of the story—the drafters of the initiative knew that it violated the constitutional expenditure limitation. That’s right, the people that put Prop 208 on the ballot were fully aware that their measure had a constitutional defect. Yet their lawyers thought they could address the problem by including language that would “exempt” their statutory measure from the constitutional spending cap. As you would expect, this didn’t work, and the court struck down the measure in its entirety. But instead of cutting their losses and figuring out how to stop burning money that they said teachers desperately needed, Red4ED found a new way to target Arizona taxpayers.
A Futile Effort
In the midst of a brutal year for many, the Arizona legislature delivered historic tax cuts in June 2021. You would think this would be a cause for celebration for everyone, but Red4ED refused to join the party. Instead, the group spent over $5 millionto hire an army of paid circulators to put a referendum on the ballot to block the tax cuts from going into effect.
They thought they finally scored a big win, but it turns out the only thing they scored was more legal headaches. Immediately after the referendum was submitted, the Arizona Free Enterprise Club filed a lawsuit, challenging the constitutionality of ballot referral. It was our belief that the measure did not comply with the “support and maintenance” clause in the constitution, and therefore the tax cuts were not referrable.
Nine months after our lawsuit was filed, the Arizona Supreme Court agreed with our position andruled against the referendum, issuing a big win for taxpayers throughout the state.
If you’re doing the math, that’s more than $30 million spent in just over four years, and what does Red4ED have to show for it? Two legally flawed initiatives and a legally flawed referendum that all failed miserably. Plus, they took a movement that had sympathetic support for increased teacher salaries and turned it into a radical left/teacher union effort that destroyed any credibility they had with voters.
Adding insult to injury, they also had to endure watching the Arizona legislature and Governor Ducey implement the anti-Red4ED plan by slashing income tax rates in half to a flat 2.5%. In other words, a plan hatched by Invest in ED seeking to double the state income tax resulted in income tax rates that were slashed in half. What a disaster for them! But maybe they can at least celebrate the possibility that Red4ED may be the largest, most expensive failure in Arizona political history.
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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-08 04:05:002022-06-08 04:05:00Red4ED Is One of the Most Expensive Failures in Arizona Political History
The Federal Reserve is finally taking a tougher stance on inflation. The Federal Open Market Committee (FOMC) raised its federal funds rate target by 50 basis points in May. It will likely raise its targetby another 50 basis points when it meets in June—and then again in July.Fed Chair Jerome Powell has acknowledged there “could be some pain involved in restoring price stability,” but nonetheless concludes that “it’s something we have to do.”
To some, the Fed’s recent tightening appears to be too little, too late. The personal consumption expenditures price index (PCEPI), which is the Fed’s preferred measure, has been elevated for more than a year and began accelerating last October. But the Fed left its target rate unchanged until March and did not significantly change course until May. Even then, its move looked modest compared to the prevailing inflation. Bond markets continued to price in more than 2 percent inflation per year over the next ten years.
Why did the Fed wait so long to address the inflation problem? One might argue that Fed officials just didn’t realize inflation was much of a problem until it was far too late. However, this view appears to be inconsistent with most FOMC members’ projections of inflation, which exceeded 2 percent in March 2021 and have been ratcheted up each quarter thereafter. It also appears to be inconsistent with FOMC statements, which suggest Fed officials understood there was an inflation problem by mid-December 2021.
FOMC Statements
The FOMC releases a statement after each meeting to summarize its assessment of the economy and indicate how it will adjust monetary policy, if at all. These statements are carefully worded and do not change much from meeting to meeting. When changes occur, therefore, it provides some indication as to how the thinking of Fed officials has changed. In what follows, we identify significant changes in FOMC statements over the last fourteen months.
March 17, 2021 : “… Inflation continues to run below 2 percent. …”
At the onset of the pandemic, the price level fell below the growth path consistent with the Fed’s 2 percent inflation target. It did not return to that growth path until March 2021. Of course, it takes time to collect and report data. When the FOMC met on March 17, it had PCEPI data for January (released on February 28) and Consumer Price Index (CPI) data for February (released on March 10). Given the available data, it was reasonable to conclude that inflation remained below target—and that’s what the Fed did.
April 28, 2021: “… Inflation has risen, largely reflecting transitory factors. …”
When the FOMC met in late April 2021, it had PCEPI data for February (released March 26) and CPI data for March (released April 13). Based on this new information, the Fed changed its assessment. It acknowledged that inflation had risen, but attributed this to transitory factors. It did not expect inflation to remain elevated.
June 16, 2021: “… Inflation has risen, largely reflecting transitory factors. …”
July 28, 2021: “… Inflation has risen, largely reflecting transitory factors. …”
September 22, 2021: “… Inflation is elevated, largely reflecting transitory factors. …”
The FOMC continued to attribute the high inflation to transitory factors through September 2021. When it met in September, it had PCEPI data for July (released August 27) and CPI data for August (released September 14). Prices were clearly elevated. The July PCEPI data showed prices were 1.4 percentage points higher than the 2-percent growth path projected from January 2020. But the primary cause of higher prices was less clear.
If prices were elevated due to pandemic-related supply constraints, they could be expected to come back down when those constraints eased up. If, instead, they were elevated due to a surge in nominal spending, the Fed would need to take action to bring prices back down (or, see them remain elevated permanently). Fed officials apparently accepted the supply constraint view, maintaining that inflation was largely transitory.
November 3, 2021: “… Inflation is elevated, largely reflecting factors that are expected to be transitory. …”
The FOMC began changing its tune in early November 2021. Whereas it had previously attributed high inflation to “transitory factors,” it now attributed it to “factors that are expected to be transitory.” It was a small admission of doubt from a hitherto confident Fed.
Doubt about the transitory nature of inflation was certainly in order by early November. The FOMC had PCEPI and CPI data for September (released October 29 and 13, respectively), at the time. It knew prices had outpaced FOMC member projections (which had been revised up in both June and September) and were now 2.3 percentage points higher than the 2-percent growth path, despite relaxing supply constraints and strong growth in real output and employment.
December 15, 2021: “… Supply and demand imbalances related to the pandemic and the reopening of the economy have continued to contribute to elevated levels of inflation. …”
The FOMC statement changed significantly in December 2021. The “transitory” term had been dropped entirely, in line with Chair Powell’s comments on November 30. The statement also acknowledged demand-side factors were contributing to inflation, which implied that prices would not return to normal unless the Fed took action to bring prices back down.
Somewhat surprisingly, given the clear change in the FOMC statement, the Fed did not take action to bring prices back down. It left its federal funds rate target unchanged in December and January. It made a modest 25-basis-point hike in March and then left its target there until May. In April, The Economist magazine asked whether the Fed could pull off an ”immaculate disinflation.” The Fed recognized prices were too high. But it was not doing anything to bring prices back down beyond hoping they would decline on their own.
January 26, 2022: “… Supply and demand imbalances related to the pandemic and the reopening of the economy have continued to contribute to elevated levels of inflation. …”
March 16, 2022: “… Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher energy prices, and broader price pressures. …”
May 4, 2022: “… Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher energy prices, and broader price pressures …”
In the January, March, and May 2022 statements, the FOMC continued to acknowledge that demand-side factors were contributing to inflation. It added “energy prices” and “broader price pressures” as contributors in March, reflecting the Russian invasion of Ukraine (and corresponding supply disturbances). But, otherwise, its statement was largely unchanged.
Conclusion
Monetary policy is difficult in real-time. Data is collected and released with a lag. Policy decisions have delayed effects. It is difficult to know what and how much to do in the moment.
The FOMC statements suggest that, by December 15, 2021, Fed officials understood inflation was at least partly the result of demand-side factors and, hence, needed to be brought down to some extent with contractionary monetary policy. And, yet, the Fed largely failed to act until May 2022.
One might excuse Fed officials for being late to recognize the inflation problem. Reasonable people can disagree about when the Fed should have known inflation was too high. But there is no excuse for the considerable delay before acting once the problem had been recognized. Perhaps a December 2021 rate hike would have spooked markets, as the Fed had just revised its view and had not had time to conduct forward guidance. But the Fed had opportunities in January and March. And it could have called a special meeting in February or April. Instead, it waited until May.
The Fed could have—and should have—taken prompt action to bring down inflation. It didn’t. Now inflation is much higher—and much harder to deal with—than it otherwise would have been.
*****
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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-08 04:00:002022-06-08 04:00:00When Did The Fed Change Its Tune?
Efforts to cease the use of crude oil could be the greatest threat to civilization’s eight billion people.
The Stockholm+50 in Stockholm, Sweden, will commemorate the 1972 United Nations Conference on the Human Environment and celebrate 50 years of failed global environmental action. The meetings on June 2nd and 3rd will follow months of consultations and discussions with individuals, communities, organizations, and governments around the world.
The rise of the Green World Order that will be addressed at the Stockholm+50 needs to address the impact on the world’s 8 billion residents in a future world without fossil fuels as efforts to cease the use of crude oil could be the greatest threat to civilization’s eight billion, and may result in billions, not millions, of fatalities from diseases, malnutrition, and weather-related deaths trying to live without the fossil fuels that are benefiting society.
Yes, the climate is changing, as it has been for four billion years, and will continue to change, and yes, there will be fatalities from the coming climate changes. Climate change is expected to cause approximately 250,000 additional deaths per year, between 2030 and 2050, from malnutrition, malaria, diarrhea, and heat stress. However, the irresponsible idea that global warming poses an immediate existential risk for the world, that risk will be small in comparison to a world without fossil fuels, while current governments and corporate leaderships are attempting to revert to its decarbonized status in the early 1800’s and before.
As many world leaders gather in Stockholm the world faces a planetary crisis of pollution and waste, biodiversity loss, and climate changes, as well as other planetary ills that are affecting current and future prosperity and wellbeing. An unhealthy planet threatens human health, prosperity, equality, and peace, but the world also faces the threat of ridding itself of the same fossil fuels that allowed the world to populate from 1 to 8 billion in less than two hundred years.
Life Without Oil is NOT AS SIMPLE AS YOU MAY THINK as renewable energy is only intermittent electricity from breezes and sunshine as NEITHER wind turbines nor solar panels can manufacture anything for society. Climate change may impact humanity but being mandated to live without the products manufactured from oil will necessitate lifestyles being mandated back to the horse and buggy days of the 1800’s and could be the greatest threat to civilization’s eight billion residents.
World leaders make no mention that the entire pharmaceutical industry, chemical industry, materials science, energy, transportation, heating, etc. are dependent on the same fossil fuels that they want to rid the world of. Attempting to attain a decarbonized world like the one that existed in the 1800s and before, could result in Billions of fatalities for the eight billion on earth from disease, malnutrition, and weather-related deaths, versus the projections of millions of fatalities from changes in climate. We cannot continue poisoning the planet in the name of progress just to satisfy our endless electricity demand to fuel the rise of 5G, automated machines, vast data centers, and digitalization.
Surprisingly, the fossil fuels infrastructure may be less invasive than the mining for exotic minerals and metals in developing countries that are directly destroying the planet through environmental degradation and humanity atrocities being inflicted upon those with yellow, brown, and black skin people. The 2022 Pulitzer Prize-nominated book “Clean Energy Exploitations – Helping Citizens Understand the Environmental and Humanity Abuses That Support Clean Energy does an excellent job of discussing the lack of transparency to the world of the green movement’s impact on humanity.
Of the three fossil fuels of coal, natural gas, and crude oil, crude oil is the only one primarily used to manufacture products for society that are the basis of the economy.
Crude oil is virtually useless, unless it’s manufactured (refineries) into oil derivatives that are the basis of more than 6,000 products in our daily lives that did not exist before the 1900’s, and the fuels to move the heavy-weight and long-range needs of more than 50,000 jets and more than 50,000 merchant ships, and the military and space program.
The liquid fuels and products produced from the hydrocarbon processing sector aided the advancement of rocket technology, leading humans to break the boundaries of space and place satellites into geosynchronous orbit, significantly evolving the way the world communicates, navigates, and explores not only Earth but the distant cosmos.
Wind turbines and solar panels may be able to generate intermittent electricity, but they cannot manufacture anything. By-the-way, all the products needed to make the parts for vehicles, wind turbines, solar panels, planes, ships, medical supplies, tires, asphalt, and fertilizer are made with the oil derivatives manufactured from crude oil.
Everything that needs electricity, from lights, vehicles, iPhones, defibrillators, computers, telecommunications, etc., are all made with the oil derivatives manufactured from crude oil. There would be nothing to power in a world without fossil fuels!
The need for electricity will decrease over time without crude oil. With no new things to power, and the deterioration of current things made with oil derivatives over the next few decades and centuries, the existing items that need electricity will not have replacement parts and will ultimately become obsolete in the future and the need for electricity will diminish accordingly.
World leaders need to identify an alternative path that focuses on the reduction of certain demands, or identify the replacement or clone for crude oil, to keep today’s societies and economies running, before jumping out of the airplane without a parachute! Concurrently, the world needs to stop building pointless infrastructure and goods for the sake of producing them and refocus on meaningful and appropriate products and technology to support society and economies. Imagine if each human planted one tree, picked up one piece of trash, or simply pulled the plug on one human degrading electrical device.
With today’s technology to work and educate remotely via virtual connectivity, we should reallocate resources to get people back out of the cities into the rural areas as well as focus on adaptation, conservation, and resource efficiency. Systems need to be rebalanced back onto natural ones where humans are symbiotic and not parasitic, and we need to subordinate technology back to being our slave and not our master. Oil is a magic substance when used correctly and burned cleanly, but it can be the death of us all if used badly. The world needs to REDUCE not ELIMINATE crude oil and reduce its footprint as much as practical and possible, as that may truly be the only plan that will work to save most of the world’s eight billion residents.
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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-08 03:58:002022-06-08 03:58:00Stockholm+50 Attendees Need[ed] to Address the Impact on the World Without Fossil Fuels
A number of articles have appeared recently raising really good questions the climate police can’t or won’t answer. Here are just some of them:
How much battery storage will be required to handle a worst-case scenario of a solid week when the wind doesn’t blow and the sun doesn’t shine after we ‘transition’ to green energy and everybody is supposed heat their homes and run their cars with electric power? Who has made that calculation and what does it show about how realistic Biden’s green energy ‘transition’ is?
How realistic is it to expect people to eat bugs and seaweed, as the climate police would have us do, just to save the planet? ‘In the future, you will eat bugs and be happy’ isn’t going to cut it. By the way, the climate police weren’t kidding. They’re already feeding bugs to schoolkids in Britain.
How can we trust computer climate models when they all assume different temperature inputs, are wrong about stratospheric cooling, are bad at predicting rainfall, and can’t even model regional climate accurately? And you’re telling me these models know with certainty what the climate will be a hundred years from now for the entire planet? Who are you kidding?
Why is Arctic ice at 30-year high when the planet is supposedly burning up and Al Gore repeated scientists’ claims there wouldn’t be any Arctic ice at all by 2013?
How can scientists say sea level rise is getting worse when tide gauges show no rise in rates where the land is not sinking, and sinking land accounts for the supposed rise in in the Tidewater area of Virginia and the Mississippi Delta region? I will make a prediction. The climate industry will soon fake the data from tide gauges like they did with satellite surface temperature data. Satellite data weren’t showing a warming earth, so they were changed to fit the narrative, changed from actual temperatures to what they should have been as predicted by bogus computer models. You can expect these same dishonest liars to attempt to pass off modeled tide gauge data as actual data in the near future.
While we’re talking about data, why has global warming paused for the last 20 years when carbon emissions are ‘worse than ever’? Why can’t the climate police explain the pause?
How come nobody talks about how electric cars can explode, cause fires that can’t be put out, and can electrocute you? Isn’t this the same Left that sued the tobacco industry for hiding all the bad news about smoking causing lung cancer not so long ago? I guess hiding the bad news is OK when ‘we do it, because we’re good people’. The ends justify the greens.
Why do the greenies keep pushing plastics recycling when making new plastic is cheaper, and recycling plastic produces 55 times more carbon emissions than sticking it in a landfill?
Why isn’t anybody talking about the World Bank study which concluded one hundred percent solar, wind, and electric battery energy would be “just as destructive to the planet as fossil fuels”? Such a transition would require unfathomable amounts of copper, lead, zinc, aluminum and iron – not to mention unsustainable quantities of rare earth minerals – all of which would end up as toxic landfill. This transition would also require impossible amounts of land for wind and solar power – the size of five South Dakotas, by one estimate. How is any of this green? The only green I see are the dollars bills the climate swindlers are counting while laughing all the way to the bank.
Last question: why is anybody still falling for any of this malarkey? I hope you’re not.
Depending on income, the Biden administration plans to offset higher prices for Americans by providing the essential services and products they need. In essence, Democrat-Socialism with a filter of equity in distribution, i.e. “enhanced dependency.”
Remarkably, Stephanopoulos references one of the most insane New York Times op-ed’s ever written around economics [ARTICLE HERE]. Within the reference, the Democrat legislative proposal is for the government to take over the purchasing of essential products like food, fuel, gasoline and medicine. The government would then distribute those products. The entire premise is based on some academic leftist theory of economics that is just nuts. It looks nothing like capitalism.
Biden, his administration and the media are all into Building Back Bigger Government.
Marc Morano reported on a New York Times article written by Culture & lifestyle journalist Annaliese Griffin writing on June 2, 2022. Griffin wrote,
“Inflation has the potential to drive welcome change for the planetif Americans think differently about the way they eat…We could adjust what we eat to save both our pocketbooks and our planet.”
“Climate change has motivated some to eat less resource-intensive meat and more vegetables, grains and legumes, but this movement has not reached the scale necessary to bring needed change — yet… A 2021 study in Nature found that animal products produce greenhouse gases at twice the rate of foods from plants. We should be paying attention to every ton of carbon dioxide that goes into the atmosphere — the same way shoppers are watching the cost of every addition to their grocery carts.” …
“Inflation resulting from the cost of fuel and feed, coupled with supply chain slowdowns, may make meat substitutes more affordable relative to traditional, factory-farmed meats.
… Historically, cost has been a powerful force that has changed Americans’ diets.”
“The New York Times seems bent on updating Gordon Gekko’s phrase from the 1987 film Wall Street: Chaos, for lack of a better word, is GOOD. Climate activists in academia, the Biden admin. and the media seem to think the more humans suffer, the more the planet will benefit. This is more evidence that economic calamity, debt, inflation, supply chain issues, and skyrocketing meat and energy costs are not the unintended consequences of the climate agenda, but the INTENDED consequences. Chaos conditions the public to accept more centralized control of their lives. Vladimir Lenin reportedly once said, ‘worse is better’ or ‘the worse, the better’ to cheer on chaos and the destruction of the existing order to impose his ideology.”
The Bottom Line
A reader sent us an interesting commentary titled “Price of gas in France” about an art thief who stole a number of masterpieces. Here’s what he sent us:
A thief in Paris planned to steal some paintings from the Louvre. After careful planning, he got past security, stole the paintings, and made it safely to his van. However, he was captured only two blocks away when his van ran out of gas.
When asked how he could mastermind such a crime and then make such an obvious error, he replied, “Monsieur, that is the reason I stole the paintings—.”
Biden’s plan is no better than that of the thief, it is dramatically worse.
Americans are seeing Biden’s policies at the gas station, on store shelves, in the products and services they buy and in their retirement accounts.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-07 12:51:182022-06-07 12:51:18VIDEO: Biden’s Inflation Plan Includes Increased Dependency on the State and Marxist Economics
‘Adjust what we eat to save both our pocketbooks & our planet’
Culture & lifestyle journalist Annaliese Griffin writing on June 2, 2022, in the New York Times: “Inflation has the potential to drive welcome change for the planet if Americans think differently about the way they eat…We could adjust what we eat to save both our pocketbooks and our planet.”
“Climate change has motivated some to eat less resource-intensive meat and more vegetables, grains and legumes, but this movement has not reached the scale necessary to bring needed change — yet… A 2021 study in Nature found that animal products produce greenhouse gases at twice the rate of foods from plants. We should be paying attention to every ton of carbon dioxide that goes into the atmosphere — the same way shoppers are watching the cost of every addition to their grocery carts.” …
“Inflation resulting from the cost of fuel and feed, coupled with supply chain slowdowns, may make meat substitutes more affordable relative to traditional, factory-farmed meats.
… Historically, cost has been a powerful force that has changed Americans’ diets.”
Climate Depot’s Marc Morano: “The New York Times seems bent on updating Gordon Gekko’s phrase from the 1987 film Wall Street: Chaos, for lack of a better word, is GOOD. Climate activists in academia, the Biden admin. and the media seem to think the more humans suffer, the more the planet will benefit. This is more evidence that economic calamity, debt, inflation, supply chain issues, and skyrocketing meat and energy costs are not the unintended consequences of the climate agenda, but the INTENDED consequences. Chaos conditions the public to accept more centralized control of their lives. Vladimir Lenin reportedly once said, ‘worse is better’ or ‘the worse, the better’ to cheer on chaos and the destruction of the existing order to impose his ideology.”
If the current rate of food inflation holds and Americans don’t change their meat consumption habits, they will spend roughly $20 billion more on meat, poultry, fish and eggs over the next year than they did in 2020. … Inflation has the potential to drive welcome change for the planet if Americans think differently about the way they eat. While hunger and food insecurity are a very real problem in the United States and globally, middle- and upper-class Americans still have more choices at the grocery store than perhaps any food shoppers in history. Climate change has motivated some to eat less resource-intensive meat and more vegetables, grains and legumes, but this movement has not reached the scale necessary to bring needed change — yet.
[ … ]
A 2021 study in Nature found that animal products produce greenhouse gases at twice the rate of foods from plants. We should be paying attention to every ton of carbon dioxide that goes into the atmosphere — the same way shoppers are watching the cost of every addition to their grocery carts. …
One recent survey of 3,500 consumers found that while environmental concerns and animal rights would not persuade many shoppers to purchase meat substitutes more often, lower prices could.
Video of Obama seeking to bankrupt coal industry in 2008: – Flashback 2008: President Barack Obama in interview with the San Francisco Chronicle editorial board: “If somebody wants to build a coal-fired power plant, they can. It’s just that it will bankrupt them,” Obama said, responding to a question about his cap-and-trade plan. He later added, “Under my plan … electricity rates would necessarily skyrocket.”
Inflation divide: The wealthy splurge, the poorest pull back – (AP) — Americans at the low end of the income rung are once again struggling to make ends meet. A confluence of factors — the expiration of federal stimulus checks and surging inflation on staples like gas and food — are driving an even bigger wedge between the haves and have-nots. While wealthier shoppers continue to splurge, low-income shoppers have pulled back faster than expected in the past two months. They’re focusing on necessities while turning to cheaper items or less expensive stores. And they’re buying only a little at a time. It’s a reversal from a year or so ago when low-income shoppers, flush with money from the government and buoyed by wage increases, were able to spend more freely.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-06 23:51:172022-06-06 23:51:17NYT praises inflation as way ‘to drive welcome change for the planet’ + Prince Charles backs face masks for cows!
The shadow inventory emerges with perfect timing, just as holy-moly mortgage rates and sky-high prices keep buyers away.
“Inventory” in housing means homes listed for sale. Then there’s the shadow inventory – vacant homes that owners want to sell eventually because they have already moved into a new place but want to ride up the surge in home prices all the way, and then at the tippy-top, they’ll sell it to maximize their profits.
We have seen this during the past 18 months when home prices spiked: people bought a home and moved in, and they moved out of their other home but didn’t sell it, expecting a 10% or 20% or 30% gain in price on a leveraged bet with a much bigger gain on equity. The math makes sense, though it doesn’t always work out, and now it’s starting to be time to put those vacant homes on the market, and here they come, just as home sales are dropping because layers and layers of buyers have been removed from the market by the rising mortgage rates and sky-high prices.
Active listings jumped. In May, the inventory of homes actively listed for sale jumped by 26% from April and is suddenly up by 8% from a year ago, the first year-over-year increase since June 2019, according to the National Association of Realtors today. There were about 38,000 more homes listed for sale in May than a year ago (data via realtor.com):
The strategy of not putting the old home on the market after moving out has had the effect of creating record low inventories for sale, and inventories remain low, but that is now changing, and very suddenly so.
Active listings jumped for two reasons:
One, falling sales, as potential buyers left the market due to sky-high home prices and holy-moly mortgage rates. The NAR’s metric of “pending listings” for May, which tracks listings that are in various stages of the sales process, but before the deal closes, dropped by 12.6% year-over-year in May, after the 8.7% drop in April, the ninth month in a row of year-over-year declines:
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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That’s according to a recent study from researchers at Florida Atlantic University and Florida International University.
The research found that homes in various metro areas are substantially overvalued with a low supply of houses on the market. It found that four U.S. housing markets are overvalued by more than 60%. Meanwhile, homes in another 11 markets are overvalued by 50% or more.
The research says that the Phoenix metro area ranks sixth nationally in terms of overvalued housing markets at 57.94%.
It says that at the end of April, the average home price in Phoenix was $466,170. This was much higher than the expected home price, which was under $300,000 ($295,164.60).
Home prices have increased rapidly in the Phoenix metro area. The average home price as of April 30, 2021, was $356,078. That means the average home price increased by more than $110,000 in a one-year span; it was a 30.9% increase in home values. Meanwhile, the expected home price only increased by about $10,000 in that stretch.
The economists who conducted the study don’t think this trend will continue.
“Near-record-low mortgage rates helped fuel demand for housing, especially during the pandemic, and the competition for homes pushed prices higher. But now the Federal Reserve is raising rates to curtail inflation, and already that’s cooling demand,” Ken H. Johnson, an economist in FAU’s College of Business, said in a press release.
“If we’re not at the peak of the current housing cycle, we’re awfully close,” he added. “Recent buyers in many of these cities may have to endure stagnant or falling home values while the market settles – and that’s not what they want to hear if they had planned to resell anytime soon.”
The top-10 metro areas included in this study ranked by how overvalued homes were: Boise City, Idaho (72.64%); Austin, Texas (67.70%); Ogden, Utah (64.73%); Las Vegas, Nevada (61.48%); Atlanta, Georgia (58.01%); Phoenix, Arizona (57.94%); Provo, Utah (57.02%); Fort Myers, Florida (56.26%); Spokane, Washington (56.25%); and Salt Lake City, Utah (55.75%).
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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-06 04:00:002022-06-06 04:00:00Phoenix Metro Area Homes Among Nation’s Most Overvalued, Study Finds
In a famous lecture, economist Ludwig von Mises showed how government intervention begets more intervention.
Over the last month, president Biden invoked the Defense Production Act in an attempt to fix the formula shortage. In a statement, the White House highlighted that,
“The President is requiring suppliers to direct needed resources to infant formula manufacturers before any other customer who may have ordered that good. Directing firms to prioritize and allocate the production of key infant formula inputs will help increase production and speed up in supply chains.”
In other words, the government is now engaging in what economist Don Lavoie referred to as non-comprehensive economic planning. It’s imposing rules requiring businesses to operate in a way that bureaucrats believe will quickly resolve this crisis. But the planning seems to have failed. Since Biden invoked the DPA, the number of stores out of stock has increase to 70% according to ABC news.
While some may be surprised that the US government can so quickly command industry, it should be no surprise at all. In fact, some basic understanding of government intervention shows that this sort of result is seemingly inevitable.
A Web of Intervention
There have been several good articles explaining the source of this infant formula shortage. FEE’s own Jon Miltimore produced a great story on the topic. But, to keep it short, Abbott, one of the country’s largest formula producers, had a plant shut down by the FDA due to safety concerns.
But how could shutting down one plant in the whole country cause this? Well, formula production is one of the most tightly regulated industries in the US. Because of this, it’s very difficult to enter the market, so there are a few firms that dominate the industry. So, when one has problems, the national supply is severely impacted.
One of the most harmful regulations are related to WIC and SNAP programs aimed at providing taxpayer subsidized formula to low-income consumers.
As reported in Time, Congress, in a supposed attempt to limit the cost of this program, made each state select one company to have formula which can be bought with WIC and SNAP in 1989. Since up to two thirds of formula is purchased with WIC and SNAP, the winners of these bids are able to crush competition.
Furthermore, until recently, the FDA banned importation of formula that listed ingredients in an order not prescribed by US bureaucrats. This limit on imports further restricts competition on a basis unrelated to health.
Meanwhile Fortune highlights research that shows despite European brands meeting safety regulations by and large, the FDA still restricts these imports due to the instructions being confusing.
Economist Alex Tabarrok highlights how price controls may be playing a role in the shortage as well.
Policy analyst Gabriella Beaumont-Smith examines the trade restrictions on baby formula, which includes tariffs of up to 17.5 percent.
In short, the industry is tangled in a web of intervention which is killing competition.
It’s this abundance of regulation that makes Biden’s use of the Defense Production Act so unsurprising.
In 1950, economist Ludwig von Mises gave a lecture titled “The middle of the road policy leads to socialism.” In this lecture, Mises expounded upon a theory now known by many as “the dynamics of interventionism.”
Mises uses an example of the dairy industry to show how intervention unfolds dynamically. Imagine the government decides that the price of milk is too high for poor people to afford it. In order to remedy the problem, the government passes a price control. For example, “milk cannot cost more than $2/gallon.”
But another problem arises. At this lower price, dairy farmers can no longer sell their milk at a high enough price to make a profit. Instead, they would be better off exiting the industry. But if dairy farmers exit, there will be less milk to buy. If the government wants to continue to make milk affordable and accessible, they’ll have to bail out the dairy industry. One way they could do this is by setting a price control on feed for cows.
But then producers of cattle feed will make losses. So, the interventions must occur again.
Intervention begets intervention.
This dynamic is exactly what is occurring in the formula industry. FDA regulations have made it impossible in the current industry for sufficient competition to arise.
This lack of competition combined with FDA shutdowns exacerbates the possibility of shortages like this. The shortages lead to the executive branch using the Defense Production Act to control the industries which provide imports to the formula industry.
Again, intervention begets intervention.
Market Solutions
Some may accept the argument but argue that now that we have a crisis, we need to use things like the Defense Production Act to end it.
I disagree.
Government bureaucrats have insufficient knowledge and incentives to craft regulations which actually help. The Defense Production Act won’t help, because the government does not effectively plan the economy.
Need proof? The Abbot formula plant was shut down in February. The politicians and bureaucrats in Washington had from February to May to create and carry out a plan which would prevent this crisis. They failed.
Rather than solve the problem by using the same means that created it, central planners would be wise to lay down their Excel spreadsheets and let the market solve problems.
Allowing consumers to give their money and provide profits to companies which best solve their needs is how babies get fed.
Peter Jacobsen is an Assistant Professor of Economics at Ottawa University and the Gwartney Professor of Economic Education and Research at the Gwartney Institute. He received his PhD in economics from George Mason University, and obtained his BS from Southeast Missouri State University. His research interest is at the intersection of political economy, development economics, and population economics. His website can be found here.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-05 22:51:292022-06-05 22:51:29The Economic Theory That Explains Biden’s Response to the Baby Formula Shortage
While some are certain of the inevitability of the impending demise of the internal combustion engine (ICE), others are far less certain. Cristian Agapie points to market pressures due to increased demand for electric vehicles have raised prices and operating costs as well. Another writer calls out electric vehicles, even Tesla’s, as just boring to drive. One thing for certain: hardly anyone will be able to enjoy the camaraderie and thrill of working on these vehicles.
Meanwhile, even General Motors, which like most other automobile manufacturers, has pledged to end its production of ICE vehicles, has also patented what it calls “multilink cranktrains with combined eccentric shaft and camshaft drive system for internal combustion engines.” This innovative design is likely similar to Nissan’s variable compression engine already available in its luxury Infiniti QX50 SUV.
The GM system, invented by Michigan-based senior engineer Andrew G. Balding, is designed to provide variable compression ratios that provide high power output when needed and high efficiency otherwise. Balding, who was just promoted, had been working at GM for the past six years on advanced powertrain designs but a lot longer in the field.
The patent describes a system that incorporates a multipoint linkage that engages the piston to the crankshaft and rotates on a secondary axis that is offset from the first axis between the crankshaft and the engine block. This enables a variable volume above the piston head at top dead center in the stroke and switching on the fly to produce more power under heavy load or greater efficiency while cruising. The result is greater fuel efficiency without sacrificing power.
The system is compatible with GM’s overhead-valve (pushrod) engines that drive the automaker’s pickups and SUVs. Widespread adoption of variable compression ratio engine technologies could ensure that ICE engines remain competitive and available to especially rural and business drivers. That is unless irrational mandated or even voluntary deadlines for abandoning the engine that transformed the world can be enforced against an unwilling public.
Rural and freedom-loving Americans are quite aware that globalist policies are deadly to outdoor lifestyles, but the majority of America’s urban youth have been brainwashed to believe that the ICE vehicle is a murderous killer of humanity and the environment. Activist-fearing “Detroit” (an archaic term, to be sure) is already at work dismantling ICE assembly lines in favor of vehicles that ordinary people will never be able to tinker with.
The electric vehicle is, in this writer’s opinion, a death machine. Not because a few EVs have spontaneously caught on fire, sometimes locking a driver in the vehicle. Not even because EV batteries can pose problems for those responding to a vehicle crash. Nor need we discuss other foibles–like the year-long backlogs for new EVs largely due to supply chain issues for semiconductors and the short supply of lithium for batteries, both of which could be short-lived.
No. The era of the mandatory electric vehicle marks the end of human freedom on the American highway, truly the end of human freedom – PERIOD. And not just the EV, but the EV culture, which is part of the “virtual” revolution in which people can act out roles online that do not translate easily to the physical world. For example, most “driving” done by pre-teens through twenty-somethings is done via video gaming. These virtual unreality games often focus on killing, almost never on, say, gardening, ranching, farming, forest management, electrical line work, water and sewer system construction, or other physical world jobs.
This massive disconnect with the physical world is what enables the green fantasies to gain traction with the naïve who only know what the censors approve–unless they have family or friends who do live in the “real” world and invite them to share in those experiences.
All too often today’s “education” consists of sloganeering and rote instruction that discourages real investigation and demonizes physical work. [Two plus two only equals five in a virtual unreality.] The massive shortfalls in trade industries are at least anecdotal evidence of the near-complete condemnation of those who work in the physical world as evil or worthless or something to be done by “others.”
The elites brazenly fly to meetings where they openly plan the demise of the middle class, even all private property not already under their own control. They have invested seemingly trillions in convincing people to give up their freedoms to serve “the common interest,” otherwise known as the interests of the elites. But people should realize that mandated “renewable” energy is a Trojan horse inexorably linked to ending private ownership of transportation, housing, and just about everything else.
Under plans designed by World Economic Forum (WEF) types, once the “transition” is complete, drivers will no longer be able to choose from among dozens of independent or corporate gasoline providers. Instead, they will buy their electricity from monopoly governments or their crony-controlled franchises. That means that politics, not the market, will determine the price of a recharge. And governments always seem to find ways to give us less for more.
More to the point, energy shortfalls imply electricity rationing (which already exists in China and elsewhere). In the coming age of scarcity, it is quite conceivable (given the thrill that China’s social credit policy gives the WEF crowd) that only “good Panem-ers” will be allowed to charge their vehicles. Dissidents (we see this already in today’s political rhetoric) will be denied even essential services.
Even what is deemed “essential” (as it was during the COVID lockdowns) will be determined by governments–and today’s governments only reward their friends. Rest assured, in every power outage “emergency,” government vehicles–and those of favored elites–will be first in line for recharging. The rest of us will be left high and dry–and, in summer, sweaty.
Rural drivers know full well they will pay more and have fewer options, just as they do for cable and broadband. They see this in the glee that President Biden and his cabinet members express as gasoline and diesel prices escalate (according to plan). And every time there is a power outage–and with no natural gas, coal, or even oil to burn, these will happen frequently (they already are in some places)–they will be unable to deliver produce and other goods to urban markets.
City folk will be the secondary victims–and they have no clue this is even a possibility–because dissent is verboten.
Meanwhile,there are reports that electric grid operators are warning that California and some midwestern states face energy shortages again this summer. Hot, dry weather, and careless smokers lead to wildfires that soak up water supplies and force blackouts that can last for days. EV drivers cannot recharge without electricity and may even be trapped because of power failures. Who knows? Maybe the perpetrators of this fraud will find they overplayed their hands.
There may be still time to stop the theft of freedom posed by the EV culture, but only if people awaken to realize that “wokism” is designed to put you to sleep. And then act accordingly.
*****
This article was published by CFACT, Committee for A Constructive Tomorrow 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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-05 04:00:002022-06-05 04:00:00The Electric Vehicle Bad Dream
The Bank of Canada on Wednesday increased its policy interest rate (known as the overnight target rate) from 1.0 percent to 1.5 percent. This was the second fifty–basis point increase since April and is the third target rate increase since March of this year. Canada’s target rate had been flat at 0.25 percent for twenty-three months following the bank’s slashing of the target rate beginning in March 2020.
As in the United States and in Europe, price inflation rates in Canada are at multidecade highs, and political pressure on the central bank to be seen as “doing something about inflation” is mounting.
The bank is following much the same playbook as the Federal Reserve when it comes to allowing the target rate to inch upward in response to price inflation. The bank’s official position is that it could resort to very aggressive rate increases in the future in order to hit the 2 percent inflation target.
As in the US, it’s important for central bankers to sound hawkish, even if their actual policy moves are extremely tame.
The World’s Central Banks Are Still Committed to Monetary Inflation
In spite of their lack of any real action, however, Canada’s central bankers are comparatively hawkish when we look at the world’s major central banks. At a still very low target rate of 1.5 percent, Canada’s central bank has set a higher rate than the central banks in the US, the UK, the eurozone, and Japan. Indeed, in the case of the European Central Bank and the Bank of Japan, rising inflation has still not led to an increase in the target rate above zero.
Federal Reserve: 1.0 percent
European Central Bank: –0.5 percent
Bank of England: 1.0 percent
Bank of Japan: –0.1 percent
Moreover, the ECB and the BOJ haven’t budged on their subzero target rates in many years. Japan’s rate has been negative since 2016, and the EU’s has been negative since 2014.
The Bank of England recently increased its target rate to 1 percent, which is the highest rate for the BOE since 2009.
In the US, the Federal Reserve has increased the target rate to 1 percent, the highest rate since March 2020.
However, it’s clear that none of these central banks are prepared to depart from the policies of the past twelve years or so, during which ultralow interest rate policy and quantitative easing became perennial policy.
The Federal Reserve has talked tough on inflation but has so far only dared to hike the target rate to 1 percent while inflation is near a forty-year high.
The Bank of England apparently suffers from the same problem, as Andrew Sentence of the UK’s The Times pointed out this week:
There is a serious mismatch between inflation and the level of interest rates in Britain. The rate of consumer prices inflation measured by the CPI is now 9 per cent—four-and-a-half times the official target rate of 2 per cent. The Bank of England is forecasting that CPI inflation will reach double-digit levels by the end of the year…. The older measure—the Retail Prices Index (RPI), which is still widely used—is already showing a double-digit inflation rate (over 11 per cent). Yet the official Bank rate has been raised to just 1 per cent, up a mere 0.9 percentage points on the near-zero rate during the pandemic.
This mismatch is not confined to the UK. In the US, where inflation is currently 8.3 per cent, the official Fed Funds rate is also just 1 per cent. And in the eurozone, where inflation is 8.1 per cent, there has been no interest rate rise at all from the European Central Bank.
This mismatch is not confined to the UK. In the US, where inflation is currently 8.3 per cent, the official Fed Funds rate is also just 1 per cent. And in the eurozone, where inflation is 8.1 per cent, there has been no interest rate rise at all from the European Central Bank.
In other words, even with these tiny rate increases, we’re seeing in the US and the UK, the Fed and the BOE aren’t as far behind the curve as the ECB, which in late May suggested it has started to consider reining in its easy-money policies. But in typical central bank speak, this means putting in place some small changes many months down the road. Specifically, ECB president Christine Lagarde stated that “based on the current outlook, we are likely to be in a position to exit negative interest rates by the end of the third quarter.”
Translation: “We might do something in five months.”
Anticipating the obvious response to this lack of action, Lagarde also insisted, “We are in a situation that is vastly different from the United States and we are actually perfectly on time and not behind the curve.”
Meanwhile, the Bank of Japan shows no signs of relenting on its dovish policy. In spite of the yen being in the midst of a historic slide compared to the dollar and the euro, BOJ governor Haruhiko Kuroda has made it clear he has no changes in the works.
A Strong Dollar by Default
This is all good for the dollar, and as we’ve seen in recent weeks, talk of a “strong dollar” has returned as other major central banks make their own fiat currencies look even worse than the dollar. The dollar, of course, is being rapidly devalued—but not as much as the yen or the euro.
Unfortunately, this gives the Fed in the US even more breathing room when it comes to getting away with inflationary monetary policy. Moreover, we have even started to hear complaints about this “strong dollar,” as we often hear from exporters, hack economists, and central bankers who think that a weak dollar helps the economy.
Perhaps the biggest danger here may be the adoption of an updated version of the late 1980s Plaza Accords designed to weaken the dollar. If the weak dollar advocates win that fight, we’ll be looking at a continued downward spiral in dollar purchasing power, all justified by the “problem” of a dollar that is too strong compared to other currencies. Weak dollar advocates are already working on it.
In the short term, however, the dollar is very unlikely to be the first domino to fall if the world is headed toward a sovereign debt or currency crisis. A crisis could actually trigger flight to the dollar and away from competing currencies. Ordinary people, however, will continue to face only bad options: continued high price inflation with only moderate wage increases—meaning declining real wages—or a recession that brings down inflation (both price inflation and monetary inflation) but drives up unemployment. Or there could be stagflation, with both a slowing economy and strong price inflation. None of the likely options are good news.
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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-05 03:55:002022-06-05 03:55:00Don’t Be Fooled: The World’s Central Bankers Still Love Inflation
Taxes on fuel can be pretty hefty, but they’re hard to notice if you’re not looking for them.
A Chevron gas station in Los Angeles was spotted charging over $8.00/gal for gasoline on Tuesday, a stark reminder of just how much fuel prices have risen across the country. Customers were unsurprisingly frustrated by the price, but felt there was little they could do to avoid it.
“In addition to the price of oil, other factors include the competitive conditions in the marketplace, the higher cost to produce gasoline to the specifications required by the California Air Resources Board, costs associated with fuel distribution, local, state and federal taxes, California carbon-compliance costs, recent inflationary pressures, and fixed costs of doing business that are often higher in California relative to other states (e.g., the cost of commercial real estate),” Chevron said.
There’s a lot in there, but one noteworthy piece is taxes. California has some of the highest gas taxes in the country, with total state taxes amounting to 68.15 cents per gallon. Throw in federal taxes on top of that, which total 18.4 cents per gallon, and you can see how it starts to add up.
Other states don’t have it quite as bad, but the taxes are still noticeable. The volume-weighted average of state taxes across the US is 38.69 cents per gallon. Add in the 18.4 cents per gallon from federal taxes, and you’re looking at total taxes of 57.09 cents per gallon on average (for comparison, gas retailers make about 10-15 cents per gallon in profits).
With taxes having such a significant influence on gas prices, some states have recently introduced gas tax “holidays” to help ease the pain at the pump. New York, for instance, is suspending its 16-cent-per-gallon motor fuel and sales tax from June through December. Connecticut suspended its 25-cent gas tax from the beginning of April through to the end of June, and Georgia suspended its 29.1-cent tax from mid-March to the end of May.
Now, it’s easy to think that suspending a 16-cent-per-gallon tax means that gas prices will go down by that amount overnight, but it’s not quite that simple. What the tax suspension actually does is lower the cost of production for gas producers like Chevron and Exxon (causing the supply curve to shift down). Now, this will almost certainly result in prices coming down due to competition, but the amount that prices go down depends on the relative elasticity of supply and demand. Put simply, some of the 16-cent break will go to consumers in the form of lower prices, but some of it will go to producers in the form of higher profits, and that breakdown will vary depending on the specific market factors in each context.
So, cutting gas taxes does bring gas prices down, but it’s highly unlikely that it will be cent-for-cent.
What’s curious about these gas tax cuts is how hard it is to notice them. Many drivers in these states likely had no idea these taxes had been suspended. Some perhaps didn’t even realize these taxes existed in the first place, or at least weren’t aware of how high they were.
The reason, of course, is that gas taxes are hidden in the price of fuel. For the most part, there’s no indication on your receipt about all the taxes that influenced the final price.
In theory, there’s nothing wrong with this. People can look up the taxes if they want. But psychologically, this makes a tremendous difference.
Think about your typical trip to the gas station. You notice the price, the company logo, and that’s about it. Thus, when prices go up and down, you naturally associate that with the gas market and the company. There’s no big sign pointing out the government interference that’s taking place behind the scenes.
Is it any wonder, then, that people are constantly blaming the gas companies for high prices? We hear so much about “corporate greed” and “price gouging” and the need for a “windfall profits tax,” and yet we hear so little about gas taxes. Why? Because you can’t protest what you can’t see. There’s hardly any visibility around these taxes, which is precisely why there’s hardly any pushback.
Consider, for a second, what would happen if every single gas bill pointed out the state and federal gas taxes associated with it. Imagine how people would react. In all likelihood, there would be a significant outcry imploring the government to reduce the taxes.
It makes you wonder if that’s why they made these taxes so invisible in the first place.
Patrick Carroll has a degree in Chemical Engineering from the University of Waterloo and is an Editorial Fellow at the Foundation for Economic Education.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-04 21:52:192022-06-04 21:52:19How Hidden Fuel Taxes Are Increasing Your Gas Bill
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 company we will be focusing on this week is Carter’s, Inc (3.22).
Carter’s is a retail children’s clothing score. The company was founded in Needham, Massachusetts in 1865 by William Carter. By the 1960’s the company was producing goods from seven mills. Today Carter’s has grown to 750 locations and acquired OshKosh B’gosh and Skip Hop Inc. Carter’s has a good track record on basic freedoms due to their donations to several Catholic charities and St. Mary School. The company only gets a partial credit on the life issue due to donating more to Catholic charities than to Susan G. Komen, Which supports planned parenthood. Furthermore, Their education and environment scores get a slight reduction due to support of the YMCA for their common core stance, and Catholic charities support for the Paris Climate Agreement. Despite all this, Carter’s remains the highest scoring children’s clothing company and you should give their shop a once over if you’re in need of clothing for your growing family.
The Children’s Place (2.63) has a uniformly worse performance for conservative issues among the children’s clothing retailers. Founded in 1969, the company exchanged hands several times before ending up with stable ownership and becoming publicly traded in 1997. The Children’s Place owned and operated 335 Disney stores until 2008, when ownership of those stores went back to Disney. The Children’s Place has a reduced score on all issues due to donations of undisclosed amounts to the NAACP, which advocates for liberal policies on all issues save environmentalism. The Children’s place does seem to have a good stance on the environment since their company policy revolves around sustainable sourcing of materials and responsible waste management for the company. If you find yourself shopping for children’s clothes at The Children’s Place, maybe give Carter’s and other brands that donate less to liberal policy advocates a look when shopping for your kid’s outfits.
“Parentpreneurs” are among the cohort of new business owners who are revitalizing the American zest for entrepreneurship and innovation.
The American entrepreneurial spirit has been revived over the past two years after an extended decline. According to the US Census Bureau, new business owners applied for more than 5 million Employer Identification Numbers (EINs) in 2021, the most in at least a decade-and-a-half of record-keeping.
The resurgence of entrepreneurship began in 2020, when widespread economic disruptions caused by the pandemic response led many individuals to strike out on their own. New business starts were up 24 percent in 2020 over the previous year, and up 23 percent in 2021 compared to 2020.
The Census Bureau data suggest that the upward entrepreneurship trend is continuing in 2022, with new business starts up 1.6 percent in April 2022 compared to March 2022.
These new entrepreneurs are a diverse group. Data from the Kauffman Foundation indicate that more middle-aged “Gen Xers” have recently started businesses than those in other age groups. Latinos also launched more new businesses in 2021 than any other racial or ethnic group, and immigrants out-paced native-born Americans in last year’s entrepreneurial ventures.
My guest on this week’s LiberatED Podcast is one of these new entrepreneurs who launched her business last year. Lorianne Bolotin is an immigrant physician and midwife who grew up in the Dominican Republic. She and her husband Jack, a finance executive, never thought that they would be in the education business, until mandates and lockdowns of 2020 led them to find an alternative for their children’s education.
Last year, they founded Metsada, a private membership association (PMA) that prioritizes family freedom. “Our belief is that families have the freedom of making their own choices in health and education,” said Lorianne.
As a project of Metsada, the couple created Independence Day Academy, a learning center in New Jersey that enables parents to enjoy a homeschooling-style educational experience while supporting children when parents work and tend to other responsibilities.
Lorianne found that many parents were frustrated with their children’s public schooling experience, especially over the past two years of school closures and ongoing school virus policies. Parents wanted something different that nurtured their children academically while also allowing for maximum parental involvement. “The main thing that made people wake up to different learning options was that they didn’t feel heard by the school system,” said Lorianne. “Parents discovered that all the power is in the school system, not the parents.”
Metsada is hoping to create a network of independently run learning centers, and shortly after the opening of Independence Day Academy, the Bolotins welcomed Jenny Markus to the Metsada network.
Jenny is a lifelong New Yorker, parent, and self-directed education advocate. She is the co-founder of Coney Island Clubhouse, a child-led learning center in Brooklyn, New York.
Jenny also joined this week’s podcast conversation to talk about the Metsada network and why she launched her schooling alternative. “I really wanted to show that not only could this be done, it can be done in New York City,” she said.
“Parentpreneurs” like Lorianne and Jenny are among the cohort of new business owners who are revitalizing the American zest for entrepreneurship and innovation. By recognizing deficiencies in the status quo and imagining other possibilities for teaching and learning, these new entrepreneurs are creating more options for families and building the future of education.
Kerry McDonald is a Senior Education Fellow at FEE and host of the weekly LiberatED podcast. She is also the author of Unschooled: Raising Curious, Well-Educated Children Outside the Conventional Classroom (Chicago Review Press, 2019), an adjunct scholar at the Cato Institute, and a regular Forbes contributor. Kerry has a B.A. in economics from Bowdoin College and an M.Ed. in education policy from Harvard University. She lives in Cambridge, Massachusetts with her husband and four children. You can sign up for her weekly newsletter on parenting and education here.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-04 11:51:132022-06-04 11:51:13U.S. Entrepreneurship Is Up, and “Parentpreneurs” Are Among These New Founders
Look what the Democrats have done to us. And you don’t have to be a clairvoyant to see how much worse it’s going to get as the Democrats continue to spend, spend, spend and vow to tax, tax, tax.
Elon Musk told top managers he had a ‘super bad feeling’ about the economy
The Tesla electric carmaker said he needed to cut staff by about 10 per cent
An email with the news about was sent to company executives on Thursday
By Chris Matthews For Mailonline, 3 June 2022
Tesla Chief Executive Elon Musk told top managers he had a ‘super bad feeling’ about the economy and that the electric carmaker needed to cut staff by about 10 per cent, according to an internal email.
The email, titled ‘pause all hiring worldwide’, was sent to Tesla executives Thursday, and underscored an increasingly gloomy economic outlook for the globe, as prices soar and war in Ukraine passes its 100th day.
Musk earlier this week asked Tesla employees to return to the office or leave the company.
Tesla Chief Executive Elon Musk told top managers he had a ‘super bad feeling’ about the economy and that the electric carmaker needed to cut staff by about 10 per cent, according to an internal email
‘Everyone at Tesla is required to spend a minimum of 40 hours in the office per week,’ Musk wrote in another email sent to employees on Tuesday night.
‘If you don’t show up, we will assume you have resigned.’
The message from Musk came shortly after Jamie Dimon, Chairman and Chief Executive of JPMorgan Chase, described the challenges facing the US economy as akin to a ‘hurricane’.
However, although financial experts acknowledged a ‘bad feeling’, many were unsure a global recession is on the cards.
Carsten Brzeski, global head of macroeconomic research at ING, said: ‘Musk’s bad feeling is shared by many people.
‘We’re talking about stagnation and a global economy which has to go through significant structural change, such as decarbonisation, deglobalisation and adjusting to older societies.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-04 10:51:232022-06-04 10:51:23Elon Musk: Tesla to ‘Pause All Hiring Worldwide’ and Cut Staff by 10% has ‘Super Bad Feeling’ About The Economy
We are apparently back in the spend-your-way-to-prosperity mode. Last week Wall Street greeted the “strong” April PCE [Personal Consumption Expenditures] number with a spree of dip-buying, but you have to wonder just how long households can keep reaching into their cookie jars in order to spend what they are not earning.
According to the Commerce Department, the abysmal 4.4% personal savings rate posted for April was the lowest level since August 2008, and we know what happened next!
Its also damn obvious from the chart that the triple whammy of the Covid-Lockdowns, the stimmy bacchanalia and red hot acceleration of global inflation and supply chain breakdowns has sent the standard economic numbers into a tailspin. After all, when the savings rate goes from an out-of-this-world 34% to a rock bottom 4% in just 24 months, you are not dealing with a standard economic cycle.
Instead, what you have is uncharted waters in every sense of the term. So more than ever, it is essential to pick through the statistical noise in order to identify the true fundamentals at work.
Personal Savings As A Percent Of Disposable Personal Income, August 2008-April 2022
For our money, that investigation starts with the obvious truth that when you are drawing-down your savings rate you are spending more than you earn. And since November 2020, that’s exactly what has been happening.
Household wages and salary compensation (purple line) is up by 14.8% in nominal terms but personal consumption expenditures have risen by 21% more. That is, April PCE (brown line) was 17.9% above what was already a Trump “stimmy” bloated level in November 2020.
Wage And Salary Disbursements Versus Personal Consumption Expenditures, November 2020 to April 2022
Moreover, these nominal numbers do not tell even half the story. When you wring out the inflation, what you get is some pretty midget numbers. That is, real PCE has been growing at only a 2.56%annual rate since the February 2020 pre-Covid peak—-$6 trillion of stimmies not withstanding.
The reason is no mystery: Inflation-adjusted wage and salary incomes are are up by only two-thirds that level at a 1.66% per annum rate. So to keep the spending game going, households are breaking into their piggy banks.
Change In Inflation-Adjusted PCE Versus Wage And Salary Income, February 2020-April 2022
So, no, we don’t think there is anything “strong” about household spending.
What is actually strong is the rate at which inflation has been eating into real purchasing power. Thus, what last week’s spending and income report also showed was that the headline PCE deflator continues to rise, posting at 6.27% on a Y/Y basis, the highest gain since January 1982.
That Y/Y gain compares to the 4.44% rate posted last October and the 3.58% Y/Y rate recorded last April. So that’s acceleration with a vengeance.
In fact, the PCE deflator first crossed the Fed’s sacred 2.00% inflation target in March 2021 and has essentially tripled since then.
Y/Y Change In PCE Deflator, 1982-2022
Still, the more revealing trend in the April spending and income report was the continued decline of the government transfer payments rate. After peaking at an otherworldly $8.05 trillion annualized rate owing to the Biden Stimmy in March 2021, transfer payments have come back to earth, posting at well less than half that level, $3.83trillion, in April.
Consequently, further PCE growth will be dependent upon wage and salary income gains, which gains are currently being outrun by inflation.
Moreover, the apparent “normalization” of transfer payments shown in the chart below is not exactly what it appears to be. In December 2019, before the Covid and Stimmy perturbances knocked the numbers into a cocked hat, annualized government transfer payments stood at $3.11 trillion.
The gain during the 29 months since then, therefore, computes to a sizzling 9.31% annualized growth rate. Yet here we are with the consumer digging deep into savings because even $3.83 trillion of free stuff is proving insufficient to fund the household shopping machine.
Annualized Rate Of Government Transfer Payment, March 2021 to April 2022
Of course, the Wall Street stock peddlers espied good news on the inflation front, claiming that the tiny hook on the right-hand margin of the chart below means that the Fed has already won the battle against inflation and that after the next two scheduled 50 basis point rate increases it will be in a position to “pause” its anti-inflation campaign in September.
Talk about lame rationalization. It just so happens that the 4.91% Y/Y increase posted in April for the PCE deflator excluding food and energy is a trivial 39 basis points below the February figure, but that’s not even the real point.
The fact is, there is a virulent food, energy and commodities inflation worldwide and there is no end in sight. So what counts is the total cost of living index, not one that excludes what is now approaching $5 per gallon gasoline and the highest grocery inflation in a generation.
Even then, the February to April postings for the PCE deflator excluding foods and energy were the highest increase since September 1983, which hardly amounts to a victory over inflation.
Y/Y Change in PCE Deflator Excluding Food And Energy, 2012-2022
For want of doubt, consider recent postings for the 16% trimmed mean CPI. As we have often explained, if you want to remove the short-term volatility from the monthly index, do not pretend that food and energy don’t count, but instead take out the highest 8% and lowest 8% of inflation basket items each month.
That results in different exclusions each month on both the high and low extremes, thereby smoothing the index without falsely lowering the index reading when food and energy items are running high.
As shown below, the Y/Y read-out of the 16% trimmed mean CPI continues to accelerate.
Y/Y % Change:
April 2020: 2.16%;
April 2021: 2.45%;
October 2021: 4.12%;
January 2022: 5.42%;
April 2022: 6.16%;
Y/Y Trimmed Mean CPI, January 2019-April 2022
In fact, the April print was the highest reading ever recorded since this version of the CPI was initiated in December 1983!
Indeed, it’s not even a close call. The highest Y/Y rate during the oil price blow-off in mid-2008 was only 3.63% and during the first Gulf War crisis it topped out at 5.09%.
So when it comes to the ballyhooed Fed “pause” in September, fuggedaboutit!
The underlying inflationary momentum as shown by the 16% trimmed mean CPI is higher than it has ever been—including during the runaway inflation of the 1970s.
Y/Y Change In 16% Trimmed Mean CPI, 1983-2022
There are numerous reasons to expect no slowdown in the core inflation trend any time soon, but surely the lagging nature of the BLS’ rental components is a flashing red light.
As shown below, nationwide median rents in the 50 largest markets have risen from $1,475 per month in April 2019 to $1,827 per month in April 2022. That’s a 24% gain, but so far the CPI rental index is up by only 10% during the same period, owing to the extensive lags built into its methodology.
The most authoritative private market rent index is up nearly two-and-one-half times more than the CPI rental component during the last three years.
But eventually the CPI will catch up to market realities, and especially to the fact that the April 2022 Y/Y gain in the realtor.com index was 16.7% compared to the 4.8% Y/Y reading reported by the CPI.
The fact is, 32% of the weight in the CPI consists of direct rental costs and the OER (owner’s equivalent rent) sub-index, which tracks rental market trends. So we have one-third of the CPI heading much higher, regardless of what happens to food and energy.
And when you look at so-called “core” inflation alone, the rental components weight is more than 40% of the CPI and 25% of the PCE deflator excluding food and energy.
In a word, the Fed won’t have any excuse to “pause” its anti-inflation campaign owing to temporary dips in the core index. Even the latter is totally unlikely to happen in a material and sustained manner.
Median Rents, realtor.com, April 2019-April 2022
Another factor to consider is that food inflation is more inflationary than it used to be. What we mean is that the food-way-from-home sub-index has far more weight in the CPI than it did 30-40 years ago. That’s because the share of food purchased at restaurants and other food service establishments has skyrocketed.
As shown in the chart below, during Q1 1992, monthly food expenditures at restaurants amounted to just $17 billion or 61% of the $28 billion monthly spend at grocery stores. By contrast, during Q1 2022 the monthly spend at restaurants was $82 billion or 119% of the $69 billion spend at grocery stores.
Stated differently, during the past 30-years restaurant spending rose at a 5.4% rate per annum—far above the 3.1% annualized gain for grocery stores.
This huge reversal in where the food dollar is spent is important.That’s because under current circumstances restaurant food prices are at the heart of the low-end labor shortage, where hourly wages are now soaring, thereby adding further to the soaring food costs embodied in the restaurant tab.
US Monthly Food Spend: Restaurants Versus Grocery Stores, 1992-2022
As to the labor cost element of restaurant pricing, the chart below leaves little to the imagination. Since February 2020, nominal hourly wage rates in the leisure and hospitality sector are up by 24%.When adjusted for inflation, this wage spike is the highest in history going back to the 1960s.
Inflation-Adjusted Y/Y Change In Hourly Wage Rates for Leisure & Hospitality, 1965-2022
As for the other main ingredient of restaurant costs, the global food price index also tells you all you need to know. At the 160.2 level posted for April, it now stands 58% above it February 2020 level. There is no prior two year period that even comes close to that rate of increase—even during the mid-2008 commodity price blow-off the two-year gain was just 45%.
What this means, of course, is that the food inflation coming down the pipeline of producer and consumer prices still has a huge head of steam. So as the “runaway inflation” issue takes front-and- center in the fall Congressional campaigns, the Fed won’t have any political leeway to pause, either.
Global Food Price Index, 2019-2022
Finally, the inflationary gales coming in from the global commodity markets and manufactured goods supply chains show no signs of abating. Even when you set food and energy aside, the producer price index for finished goods excluding these two items was up by 8.6% in April—meaning that several months from now those globally-sourced finished goods pressures will be showing up in the CPI on top of surging food, energy and shelter costs.
Needless to say, April’s gain for this PPI sub-index was the highest since June 1981, meaning that the Fed is hostage to the inflation fight whether it wants to be or not.
Yes, there is nothing like a Paul Volcker within a country-mile of the Eccles Building today, but that doesn’t matter. The last thing these financial overlords want is to have their vaunted “independence” challenged by hopped-up politicians with a fresh electoral mandate.
Y/Y Change In Producer Price Index For Finished Goods Excluding Food And Energy, 1981-2022
Of course, the Fed’s involuntary anti-inflation policy will soon lead to a recession, but that’s now unavoidable. The die has already be cast.
Of all people, even the single-greatest bubble-rider of our times, Elon Musk, can see it coming. That leaves only the 12 dolts on the FOMC to catch-up to reality along with their shills and megaphones on bubblevision:
(Musk) was queried as to whether or not he thought a recession was on its way and told a Twitter user: “Yes, but this is actually a good thing. It has been raining money on fools for too long.”
“Some bankruptcies need to happen. Also, all the Covid stay-at-home stuff has tricked people into thinking that you don’t actually need to work hard,” he continued.
He said he thought a recession would last 12 to 18 months and, channeling his inner Milton Friedman, said: “Companies that are inherently negative cash flow (ie value destroyers) need to die, so that they stop consuming resources.”
You can call it ironic that Musk’s company would have likely been wiped out in a recession a couple of years ago, but for now the Tesla founder seems to have far more of a clue about economics than those in government and at the Fed.
Compare that clarity to this doozy from the minutes of the last Fed meeting. It’s surely wins the Oscar in the “you don’t say” category
(some participants)…….noted that a restrictive stance of policy may well become appropriate,” the minutes said.
Mr. Powell further signaled resolve to slow price increases by suggesting that the unemployment rate, at 3.6% in April, might need to rise as the Fed slows demand. “There could be some pain involved,” he said last week.
Well, at least he got that right.
Even Pusillanimous Powell now knows that last week’s ballyhooed “pause” doesn’t really stand a chance.
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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When Governor Newsom and New Zealand Prime Minister Jacinda Ardern met to announce a deal between the tiny country and the broken state, it was another example of California illegally enacting its own foreign policy. And a reminder of why California gas prices are so high.
The memorandum had California promising to be “carbon neutral” by 2045 and to promote the “environmental integrity of carbon pricing instruments”. California’s crooked carbon pricing schemes have become notorious for both their worthlessness and their corruption.
And California drivers are paying the price.
A report from Stillwater Associates last year found that California consumers were paying an extra $1.19 a gallon. This year the added costs include a 51 cent state excise tax, an 18 cent sales tax, 20 cents for Fuels Under the Cap, part of the state’s corrupt environmental cap and trade program and 17 cents for the Low Carbon Fuel Standard.
Californians are paying a $1.41 federal and state tax markup on $3 bucks of crude.
Or almost half.
Biden and other Democrats have blamed corporate profits, but the gas stations and suppliers are making a mere 33 cents a gallon or less than a third of the state’s added $1.08 in various taxes. Even the refiners are only making 72 cents. The biggest piece of the pie is coming from the taxes, many of them hidden, imposed by Democrats in the name of saving the planet.
While Newsom and Big Green describe some of these taxes as “allowances” and “credits” as part of a “marketplace”, they are really a corrupt scheme to force consumers to pay money to special interests and politically connected companies under the guise of “saving the planet”.
The Left now attacks Elon Musk, but California’s environmental regulations kept Tesla profitable. For example, in 2020, Tesla reported $428 million in sales from “regulatory credits” amounting to “four times Tesla’s $104 million of net profit for the quarter”. In the first quarter of 2021, Tesla sold $518 million in “credits” and Autoweek noted that it was making “more money selling credits and bitcoin than cars.” Credits are like bitcoins the government forces you to buy.
Regulatory credits are a corrupt environmental scam in which car makers who sell regular cars to ordinary people have to buy “credits” from electric car makers like Tesla, who sell to the rich, and then pass on the high costs on to working class and middle class car buyers.
The dirty truth about California’s electric car market is that it’s subsidized by people who can’t afford them. And the same situation applies to gas prices with their burden of green taxes.
Democrats sold the fuel taxes as penalties on polluters. They claimed that imposing them would “make the polluters pay”. Few Californians seemed to understand that by “polluters”, the Sacramento political establishment meant the single mother picking up her son from school, the supermarket cashier commuting to work, and everyone else who can’t afford a Tesla.
The California average gas price is now over $6 a gallon, compared to $4.60 for the rest of the country, because Democrats are making ordinary drivers, whom they call “polluters”, pay.
Gov. Newsom is touting his new deal with New Zealand, even though most California environmentalists have turned on the corrupt green scam that’s killing the state.
ProPublica, a leftist group, noted that, “California’s oil and gas industry actually rose 3.5% since cap and trade began.” While the idea that there’s anything wrong with carbon is an environmentalist hoax that props up corrupt green special interests, the Brown-Newsom green tax isn’t even coming close to accomplishing the stated goals that is the basis for those taxes.
A Bloomberg article last month began by arguing that, “California’s carbon market was supposed to be a model for the US, harnessing the power of capitalism to fight climate change in the world’s fifth-biggest economy. But nearly 10 years after ‘cap and trade’ began, there’s little proof the system has had much direct impact on curbing planet-warming pollutants.”
Before bitcoin, environmentalists created an imaginary “carbon currency” and a marketplace around it that forced ordinary consumers to fund corporate bribery of top Democrats. Some of the biggest companies in the country boast of going “carbon neutral” by 2030, 2045 or 2980, when what that actually means is that they’re buying “carbon offsets” and changing nothing.
The carbon scam has made the right sorts of people rich and everyone else much poorer.
California began trading “emissions” in the 90s with the Regional Clean Air Incentives Market (RECLAIM).A decade later, Anne Sholtz, an environmental law academic and emissions broker who helped set up the program, had been arrested by the EPA on wire fraud charges.
Sholtz had all but invented the modern electronic pollution marketplace. She met with Al Gore and gave plenty of interviews until she was arrested for trying to trade credits she didn’t have.
But can there be fraud when the whole thing is a scam?
Big Green created a massive industry based on trading indulgences from government environmental mandates. An industry now worth billions, is being touted to investors as having the potential to hit $100 billion or $200 billion or infinity by 2030. It’s an industry that, unlike those it’s using the government and leftist activists to shake down, is worth nothing, produces nothing, and exists purely as a rent-seeking parasite destroying American living standards.
Each company and investor joining the regulatory Ponzi scheme is now motivated to pressure governments, local and national, to impose more taxes and push more companies into the market so that those who got in earlier will steal more from those who come in later. This perverse socialist mockery of capitalism is depicted as “saving the planet” even though it has failed to do anything to move the dial even on the environmental hoax that justifies its existence.
And that is one reason why California’s gas prices are some of the highest in the nation.
But like vegans, legal shoplifting, and shopping bag bans, what starts in California, doesn’t stay there. Biden and Senate Democrats have tried to impose a national carbon tax on Americans.
Had Senator Manchin not rejected last year’s proposed carbon tax, the whole country would have been hit with a tax of at least another 18 cents per gallon. Senator Whitehouse’s proposal would have added about 14 cents a gallon, but would have increased “5 percent above inflation annually.” That kicker, also a part of California’s gas taxes, is what’s really making them rise.
And that’s just for starters.
The Obama administration was proposing a carbon tax that would have added over 40 cents per gallon. The EU’s $75 per ton carbon tax applied here would mean over 60 cents more per gallon. A former Carter adviser has proposed a tax that would be closer to 90 cents.
And it would only go up from there.
California is a cautionary tale that when environmentalists, leftists, and other Democrats claim that they want to “make polluters pay”, they mean you.
Driving by a Los Angeles gas station last week, I saw that the price was approaching 7 bucks.
Daniel Greenfield, a Shillman Journalism Fellow at the Freedom Center, is an investigative journalist and writer focusing on the radical Left and Islamic terrorism.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00DrRichSwier.comhttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngDrRichSwier.com2022-06-03 21:51:202022-06-03 21:51:20High Gas Prices are Caused by Governments, Not Companies
On May 18 this year, in Jarkesy v. SEC, a majority of a three-judge panel of the Court of Appeals for the Fifth Circuit—an appellate court just below the Supreme Court—challenged some of the powers commonly used by the Securities and Exchange Commission (SEC) and other administrative agencies when they charge individuals or companies with wrongdoing.
The SEC’s actions were not unusual for an administrative agency—requiring a defendant to make his case before an administrative law judge (ALJ) instead of a jury—but the court found that under the Constitution’s Seventh Amendment, George Jarkesy, Jr. was entitled to a jury trial, that many ALJs used by the SEC and other agencies were unconstitutionally independent of the president’s control, and that the authority that Congress had given the SEC to choose an ALJ instead of a jury was also unconstitutional.
The case received an unusual amount of attention in the media, largely because the SEC is a powerful agency, and the actions of administrative agencies are seldom found to be unconstitutional by courts below the Supreme Court. But another reason may be that the Fifth Circuit’s decision reflects a general concern in the judiciary about the power of administrative agencies—which many call the “administrative state”—and how they fit into our constitutional system.
In Federalist 78, Alexander Hamilton argued that the members of the federal judiciary should have lifetime tenure—even in a republic—because the courts are intended to be the “Guardians of the Constitution.” This role, he said, will require an “uncommon portion of fortitude” when judges’ decisions upholding the Constitution conflict with the views of the more powerful elected branches. “Nothing can contribute so much,” said Hamilton, to the judiciary’s firmness and independence as “permanency in office.”
The protests that we see today in front of the Supreme Court, and even at the homes of the justices themselves, amply demonstrate the difficulties the judiciary faces as it is called upon to interpret how various policies fit within the constitutional structure the Framers wanted them to protect.
Chief Justice John Marshall, established the primacy of the Supreme Court, as Hamilton saw it, with the foundational 1803 decision of Marbury v. Madison. There, he ruled not only that the Court could declare acts of Congress unconstitutional, but also that courts could interpret the laws. These two points, never subsequently challenged, reified Hamilton’s assertion that judges were to be the “Guardians of the Constitution.”
There was little change in the structure of the government, or the respective roles of the president and Congress, until the Progressive Era, from about 1880 to 1920, when Woodrow Wilson and Theodore Roosevelt argued for major changes in the government’s structure and role in the economy. During this period, the Interstate Commerce Commission, the Food and Drug Administration, and the Federal Reserve were established to address specific issues that had arisen as the US economy grew quickly. But aside from a few tariff cases, there was little need for the judiciary to interfere in the structure or operations of the government.
That changed with the Great Depression and the New Deal, when the Supreme Court—whose members included distinguished jurists such as Louis Brandeis and Benjamin Cardozo as well as Chief Justice Charles Evans Hughes—ran head-on into the policies of FDR and the progressive Democratic Congress. This confrontation produced two instances—Panama Refining v. Ryan and Schechter Poultry v. United States—where the 1935 Court determined that acts of Congress were unconstitutional because they delegated too much legislative authority to administrative agencies in violation of the Constitution.
Chevron became the most cited and interpreted case in administrative law, and administrative agencies reached their greatest level of authority, issuing more than 3000 rules and regulations every year after 1989.
These decisions and others caused President Franklin D. Roosevelt, after the huge Democratic Party victory in 1936, to propose a Court-packing plan. Although Court-packing itself failed, it changed the game. Every member of the 1935 Supreme Court resigned between 1936 and 1941, to be replaced by Roosevelt–appointed justices much less willing to take on the elected branches.
From then on, the Court assumed a more accommodating posture, finding authority for the vast number of administrative agencies established in and after the New Deal. The Court’s reticence in this respect probably reached its peak in 1984, with Chevron v. Natural Resources Defense Council. There, a unanimous Court declared that “Sometimes the legislative delegation to an agency is implicit, rather than explicit. In such a case, a court may not substitute its own construction of a statutory provision for a reasonable interpretation” by the agency.
Here, with what became known as “Chevron deference,” the Court was directing lower courts to accept the administrative agency’s interpretation of its statutory authority—if reasonable—and opened the door to the vast expansion of the administrative state that we see today. In short order, Chevron became the most cited and interpreted case in administrative law, and administrative agencies reached their greatest level of authority, issuing more than 3000 rules and regulations every year after 1989.
What might be called a constitutional awakening, or at least a renewal of the Supreme Court’s interest in its role as guardian of the Constitution, may have begun in 2013, with City of Arlingtonv. FCC. There, in a challenge to Chevron deference, Chief Justice Roberts (joined by Justices Kennedy and Alito) wrote that “We do not leave it to the agency to decide when it is in charge.”
Significantly, in the same decision, the Chief Justice reiterated Hamilton’s view in Federalist 78 that the judiciary has a special role as guardian of the Constitution: it “is the obligation of the judiciary not only to confine itself to its proper role, but to ensure that the other branches do so as well.”
This was followed in 2015, by Perez v. Mortgage Bankers Association, where a majority recognized that the Administrative Procedure Act of 1946 (APA) had already required that courts—and not agencies—should be interpreting the statute. The Senate Committee considering the APA in 1946 stated: “Judicial review…is indispensable since its mere existence generally precludes the arbitrary exercise of powers or the assumption of powers not granted.” Chevron deference, accordingly, and its support for agency determination of their own authorities, now seemed to be on the way out.
An even more determined interest in protecting the constitutional structure seems to have emerged at the Supreme Court with the arrival of Justice Gorsuch in 2017. At that point, there were five justices—Chief Justice Roberts and Justices Thomas, Alito, Kennedy, and Gorsuch—with serious interests in constitutional structure, and the Court reached out to take one issue (among four others) in Gundy v. United States, then languishing in the lower courts. This case raised the claim that in enacting a 2006 statute, Congress had unconstitutionally delegated legislative authority to the Executive Branch—a violation of the so-called nondelegation doctrine.
The Supreme Court’s interest in constitutional issues related to the administrative state has not gone unnoticed, either by litigants or by judges.
As it turned out, when Gundy was argued, there were only eight justices on the bench. Justice Kennedy had resigned, and his successor, Justice Kavanaugh, had not yet been sworn in. Because the Court was split on such an important case, Justice Alito decided not to vote to challenge the reigning nondelegation approach, but he and Justice Kavanaugh later stated that they would be willing to hear another nondelegation case in the future. In any event, Justice Gorsuch wrote a powerful dissent, joined by the Chief Justice and Justice Thomas, in support of the view that the statute at issue in Gundy had unconstitutionally delegated legislative authority to the Executive Branch.
The Court’s interest in considering this issue—and in reaching down specifically to take the nondelegation question from another case—demonstrated that at least five justices were then concerned about constitutional structure, particularly the separation of powers. This is a fundamental element of the Constitution that seeks to preserve liberty by separating the entire government into three branches—a Congress to make the laws, a president to enforce or carry out the laws, and a judiciary to interpret the laws.
This raised new questions about the authority accumulated in administrative agencies, which might be called the fourth branch of government that appears nowhere in the Constitution but had been acquiring increasing power since the New Deal. Moreover, many scholars and students of government have noted that Congress has continued to hand power to administrative agencies as a way to avoid making difficult decisions itself. An important reason for restraining the growth of the administrative state would be to force Congress itself to address difficult issues through legislation.
The Supreme Court’s interest in constitutional issues related to the administrative state has not gone unnoticed, either by litigants or by judges. Without the Court’s interest in the nondelegation doctrine in Gundy, and the questions about Chevron expressed in City of Arlington and Perez, Jarkesy and his counsel might not have challenged the SEC in the Fifth Circuit, and the Fifth Circuit judges might not have gone beyond settled law. Other litigants would not have brought cases challenging Chevron and raising nondelegation issues in the current Supreme Court term. If the Court takes SEC’sappeal of the Fifth Circuit’s Jarkesy decision in its next term, we’ll get a clearer picture of how the Court views the administrative state.
The Fifth Circuit’s Jarkesy decision reflects the Supreme Court’s renewed interest in challenging the administrative state.
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.
https://libertyfirst.org/wp-content/uploads/logo_v6_225x110.png00ThePricklyPear.orghttps://libertyfirst.org/wp-content/uploads/logo_v6_225x110.pngThePricklyPear.org2022-06-03 09:12:002022-06-03 09:12:00Bureaucrats in the Dock
Only buy or fill up your car or truck in the early morning when the ground temperature is still cold. Remember that all service stations have their storage tanks buried below ground. The colder the ground the more dense the gasoline, when it gets warmer gasoline expands, so buying in the afternoon or in the evening….your gallon is not exactly a gallon. In the petroleum business, the specific gravity and the temperature of the gasoline, diesel and jet fuel, ethanol and other petroleum products plays an important role.
A 1-degree rise in temperature is a big deal for this business. But the service stations do not have temperature compensation at the pumps.
When you’re filling up do not squeeze the trigger of the nozzle to a fast mode If you look you will see that the trigger has three (3) stages: low, middle, and high. You should be pumping on low mode, thereby minimizing the vapors that are created while you are pumping. All hoses at the pump have a vapor return. If you are pumping on the fast rate, some of the liquid that goes to your tank becomes vapor. Those vapors are being sucked up and back into the underground storage tank so you’re getting less worth for your money.
One of the most important tips is to fill up when your gas tank is HALF FULL. The reason for this is the more gas you have in your tank the less air occupying its empty space. Gasoline evaporates faster than you can imagine. Gasoline storage tanks have an internal floating roof. This roof serves as zero clearance between the gas and the atmosphere, so it minimizes the evaporation. Unlike service stations, here where I work, every truck that we load is temperature compensated so that every gallon is actually the exact amount.
Another reminder, if there is a gasoline truck pumping into the storage tanks when you stop to buy gas, DO NOT fill up; most likely the gasoline is being stirred up as the gas is being delivered, and you might pick up some of the dirt that normally settles on the bottom.
Note: If the pump repeatedly shuts off early, it could be a sign of a problem with the vapor recovery system, such as a clogged carbon canister.
