Category Archives: Economics

Miscellaneous economy stuff

Fascism

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President Joe Biden (D) infamously called half of Americans semi-fascists a few days ago.

Now California is creating a State government board that will dictate the wages that fast food companies in the State must pay.

California’s Legislature passed a bill Monday to create a government panel that would set wages for an estimated half-million fast food workers in the state….
The bill, known as the Fast Act, would establish a panel with members appointed by the governor and legislative leaders composed of workers, union representatives, employers and business advocates. They would set hourly wages of up to $22 for fast food workers starting next year and can increase them annually by the same rate as the consumer-price index, up to a maximum of 3.5%.

This is what true fascism is.

In a real dictionary, viz., American Heritage Dictionary or Merriam-Webster, socialism is a political-economic system in which Government directly owns the means of production—directly owns the businesses operating in an economy. Fascism is a subset of socialism wherein Government is pleased to allow businesses to be privately owned, but Government dictates to those businesses how they will operate: the products they will produce and in what quantity, and/or the prices they will charge for their products, and/or as in the present California case, what wages they will pay their employees—all to serve the State’s ends, not the business owners’ or investors’, who are us Americans. This government control, further, is paired with active, often violent, suppression of opposition to such controls.

In addition to that, Merriam-Webster also notes that in fascism, race often is “exalted” above the individual; American Heritage terms it belligerent racism. Much like the Progressive-Party adherents and supporters do today with their enthusiastic proselytizing of identity politics.

In the Newspeak dictionary of the Progressive-Democratic Party, though, “fascist” and “semi-fascist” are just shibboleths, personal smears, with which Party adherents and supporters insult all of us Americans rude enough to disagree with them. These tools of denigration are trotted out whenever Party adherents and supporters are unable to make coherent, reasoned arguments for their own policies and policy proposals or against anyone else’s policies or policy proposals.

Readers easily can discern which of these definitions are in play by Party adherents and supporters.

Plus Inflationary Effects

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Penn Wharton has updated its estimate of the cost to us average Americans of President Joe Biden’s (D) bailout of student loans, expanding its estimate to more than $1 trillion.

The largest potential cost-driver Penn Wharton identified is the Biden administration’s new income-driven repayment plan, which includes capping monthly student loan payments at 5% of a borrower’s discretionary income and reforming the repayment guidelines to guarantee that no borrower who makes “about the annual equivalent of a $15 minimum wage” will have to make monthly loan payments.

Others are touting the boon to our economy from all that freed-up spending those winners will be able to do, now that they don’t have to worry about paying debts.

In speaking from their Newspeak dictionary, though, the Progressive-Democratic Party politicians and their acolytes on the Left claim that that increased spending won’t add to the already burgeoning inflation our economy is afflicted with from supply disruptions and profligate spending (even for a Party administration) the Biden administration is throwing around.

Ignore what’s behind the curtain: the…intersection…of limited supply and increased spending that is inherently inflationary, especially in today’s economic environment, as anyone who’s had high school economics or who can understand a supply/demand graph knows.

Some on the Left piously intone that the bailed out students will use the opportunity to pay down the rest of their debts. Ignore what’s behind that other curtain, too, that the resulting increase in loanable funds held by financial institutions represents additional debt creation for the purchase of big-ticket items in the near- to intermediate-term supply-limited environment, which is inflationary in tomorrow’s and next week’s economic environment.

Contempt for our Constitution

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President Joe Biden (D) has canceled thousands of dollars of student loan debt with a few swipes of his Executive Order pen. Lay aside the amorality of that, and lay aside, too, the enormous cost of his move.

It’s blatantly illegal.

January 2021…the Department of Education issued a legal memo saying the education secretary “does not have the statutory authority to cancel, compromise, discharge, or forgive, on a blanket or mass basis, principal balances of student loans, and/or to materially modify the repayment amounts or terms thereof.”

House Speaker Nancy Pelosi (D, CA) Biden didn’t have the power to cancel student debt.

That has to be an act of Congress…the president can’t do it. That’s not even a discussion.

Only the Congress can specify the spending—or lack of spending—that the Federal government engages in. No President can do that unilaterally.

It’s also a cancelation of existing contracts, both without consultation with and acceptance by the contracts’ counterparties, it’s done without compensation to those counterparties. These are Federal loans to the students, though, doesn’t that make the Federal government the counterparty? No. It’s We the People, the taxpayers, who floated these loans and who will lose from their unilateral modification. The Federal government only acted in our name.

It’s what we have an elected legislature for, and a legislature that is the sole source of legislation, and the House of Representatives in particular that is the origin of spending bills.

I’m reminded of the remark made by a future philosopher: I am altering the deal. Pray I do not alter it any further.

This is Biden’s Woodrow Wilson-esque contempt for and disregard of our Constitution. That document and statutes that implement it are to be themselves laid aside whenever they’re inconvenient.

States Aim to be Zero-Emissions in their Cars by 2035

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California has decided to ban all ICE car sales in the State by 2035—in the name of only zero-emission cars being allowed to be sold.

Never mind that it’s an impossible task, or that California, Washington, and Massachusetts are deceiving all of us and themselves with their claim of and demand for zero-emissions in cars sold in those States. This is, to use the technical term, a crock. Zero-emission cars are an impossibility, and it will be an impossibility for the foreseeable future of human history.

Mining for the raw materials for the batteries for these cars, and mining for the metals and other minerals that go into making any car, is not zero-emission: it takes energy to do all of that, and that energy comes from burning fuel—coal, oil, natural gas.

Shipping those raw materials to processing plants takes energy, and that energy comes from burning fuel—coal, oil, natural gas.

Processing that raw material into the components—batteries, car parts, wiring for the cars—takes energy, and that energy comes from burning fuel—coal, oil, natural gas.

Shipping those finished components to the final assembly plants takes energy, and that energy comes from burning fuel—coal, oil, natural gas.

Delivering those finished cars to their dealers for sale takes energy, and that energy comes from burning fuel—coal, oil, natural gas.

The energy for charging and recharging the batteries in those “zero-emission” cars takes energy, and that energy comes from burning fuel—coal, oil, natural gas.

Expanding the electric grid and building out a national network—or even just a city-wide network—of charging stations takes energy, and that energy comes from burning fuel—coal, oil, natural gas.

And getting the raw materials, components, assembly, shipping along the way to get the components for the grid build-out and to get those recharging stations—see above.

And that’s just a high-level view of the energy requirements for producing electric cars. Electric cars are not at all zero-emission vehicles.

I Have Questions

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It seems the US and the People’s Republic of China have reached a secret agreement regarding US audits of PRC companies as a prerequisite for those companies being listed on US stock exchanges. This putative agreement allows the Public Company Accounting Oversight Board inspectors to travel to Hong Kong or mainland China for inspections, and it’s officially signed by the PCAOB, the PRC’s Securities Regulatory Commission, and the PRC’s Ministry of Finance.

I also have an observation: inspecting audit papers is not the same as auditing the company.

My questions:

  • In what way will the inspectors know that the audit papers are accurate reflections of the audit that was done?
  • How much advance notice will be required before access to the audit papers is allowed?
  • Will the inspectors be allowed to make notes/copies of the papers and take the notes/copies with them on departure?
  • In what way will the inspectors know that all of the audit papers have been made available?
  • To which audit papers will access be allowed?
  • Via what mechanism will the inspectors know which audit papers to inspect?
  • In what way will the inspectors know that all of the subset of audit papers allowed actually have been made available?

There are more, but these will do for a start.

Secret agreement because:

Officials from the US Public Company Accounting Oversight Board and the US Securities and Exchange Commission said they agreed with their Chinese counterparts to not make the language of the deal public.

No coverup there. Not a bit of one.